King v Ivanovic[2006] QDC 405

DISTRICT COURT OF QUEENSLAND

1. [1]
   Ms King and Mr Pennisi wanted to buy a property for their family home.  They thought Mr and Mrs Ivanovic’s property was in a good location with potential for capital growth.  Through one of the Ivanovic’s real estate agents, Ms Clark, they made a number of offers to purchase the property.  The last offer, for $885,000, was unconditional and was accepted by the Ivanovics on Sunday 2 May 2004.

2. [2]
   Ms King and Mr Pennisi say they made the unconditional offer in reliance on a representation made by Ms Clark that the Ivanovics had received another unconditional offer through a different real estate agent. Ms King says she was told about one month later by the principal of the other real estate agency that their purchasers had not made an unconditional offer at the time Ms King and Mr Pennisi made theirs.  Ms King and Mr Pennisi then sought an extension of time for settlement and tried to establish whether what Ms Clark had told them was true or not. 

3. [3]
   Their request for an extension was refused.  After making enquiries, they were not satisfied that Ms Clark’s representation was true and purported to rescind the contract on the basis of the misrepresentation. 

4. [4]
   Ms King and Mr Pennisi brought action for the return of the deposit against Mr and Mrs Ivanovic (by way of declaration) and against Ms Clark (by way of declaration or the equivalent in damages). They also claim interest on the deposit or damages and costs. 

5. [5]
   Mr and Mrs Ivanovic have not admitted there was a misrepresentation and have counterclaimed damages of $21,234.48^[1], interest and costs. Ms King and Mr Pennisi argue the Ivanovic’s non-admission is ineffective because of the civil procedure rules.  They say the effect of those rules is that the Ivanovics are deemed to have admitted the representation was made and that it was untrue.  If that is so, the only issue between Ms King and Mr Pennisi on the one hand and the Ivanovics on the other is whether Ms King and Mr Pennisi relied on the representation in making the unconditional offer.

6. [6]
   Ms Clark denied she made the representation alleged against her and says that what she did say was true.  She also did not admit that Ms King and Mr Pennisi relied on the representation.

7. [7]
   The issues are:

1. Is Mr and Mrs Ivanovic’s non-admission of the misrepresentation deemed to be an admission of it and, if so, what are the consequences of that?
2. What representation did Ms Clark make?
3. Was that representation untrue?
4. Did Ms King and Mr Pennisi rely on that representation in making an unconditional offer?
5. What orders should be made?

The effect of Mr and Mrs Ivanovic’s non-admission of the misrepresentation

8. [8]
   Ms King and Mr Pennisi argue that the Ivanovic’s non-admission of the representation and its falsity is ineffective because there is no acceptable explanation for their inability to plead whether or not it is true.  A party is only entitled to plead a non-admission if it has made reasonable enquiries and remains uncertain as to the truth or falsity of the allegation (Rule 166(4) UCPR). If a party fails to properly explain the basis for a non-admission, that defendant is taken to have admitted the allegation.

9. [9]
   In paragraphs 7 and 10 of their defence, the Ivanovics pleaded that, notwithstanding reasonable enquiry, they did not know whether the allegations (of the representation and that it was untrue) were true or false. 

10. [10]
    That statement is plainly untenable. Ms Clark denied both allegations and explained her denials by pleading that she made a different representation which she said was true. Ms Clark is, and appears always to have been represented by the same solicitors and counsel as represented the Ivanovics. 

11. [11]
    There appears to be no authority considering what constitutes reasonable enquiries.  There can be little doubt that it would extend to making enquiries of a commonly represented co-defendant.  Presumably, had that been done in this case, the Ivanovics would have pleaded the same positive case as Ms Clark. 

12. [12]
    The purpose of rule 166(4) is to narrow the issues so far as they are able to expedite just resolution of the dispute.  Counsel for the Ivanovics did not seek to explain the inadequate non-admission.  Had there not been a co-defendant, Ms Clark, who had joined issue on all relevant allegations, I would not have allowed evidence to be called on the two issues that the Ivanovics did not admit.  However, because the second claim for relief is damages against Ms Clark, evidence was allowed on all issues. 

13. [13]
    Counsel for Ms King and Mr Pennisi had understandable concerns that the state of the pleadings left open the possibility that the Ivanovics’ case in some way differed from that of Ms Clark but in what way did not appear on the face of the pleadings themselves.  His concern had some basis.  At times it appeared that Counsel for the Ivanovics was seeking to lead evidence to the effect that, if the alleged representation was made, it was true.  Such evidence was objected to. As is evident from the reasons that follow, to the extent that any evidence capable of supporting such a case was admitted, it was received for a limited purpose and was not admitted as probative of whether the representation was true.

What was the representation?

14. [14]
    Ms King and Mr Pennisi allege Ms Clark made three representations to them on the night before they bought the property, only one of which is critical to their case.  That is, that Ms Clark told Mr Pennisi that the Ivanovics had received an unconditional offer to buy the property for $885,000.

15. [15]
    Ms Clark denies she made that statement.  She says that she told Mr Pennisi that the Ivanovics had received an offer through another real estate agent for a price greater than $885,000.

16. [16]
    Ms Clark and Mr Pennisi were the parties to the relevant conversation. I prefer the evidence of Mr Pennisi as to the terms of the representation made by Ms Clark during that conversation, over that of Ms Clark, for a number of reasons.

17. [17]
    Mr Pennisi’s version of what he was told is supported by Ms King’s evidence.  Ms Clark’s and Mr Pennisi’s conversation was conducted by telephone while Mr Pennisi and Ms King were in their car on their way to dinner on a Saturday night.  Ms King sat next to Mr Pennisi who, she said, repeated to her what he was told as he was told it.  She was insistent that Mr Pennisi told her that Mr Ivanovic had received an unconditional offer.  I found Ms King to be a convincing and credible witness.  I accept that Mr Pennisi repeated to Ms King what he was told by Ms Clark.

18. [18]
    Mr Pennisi impressed me as a reliable witness.  He was very concerned to be precise and accurate, and was unshaken in his version of the conversation.  Counsel for the Ivanovics and Ms Clark submitted Mr Pennisi was combatitive, argumentative, aggressive, self-serving and at times uncontradictory. I reject that submission.  Counsel failed to identify any inconsistencies in his evidence. What counsel apparently interpreted as combatitive, argumentative and aggressive was Mr Pennisi’s understandable insistence that counsel was clear in his questions (which were frequently convoluted and difficult to understand) and that he not misstate evidence Mr Pennisi had given earlier. These misstatements, at times, appeared to arise from counsel misunderstanding what Mr Pennisi had earlier said.  In any case, I found Mr Pennisi to be a forthright witness and consistent in his evidence. Further, he has maintained, since he first raised the matter with Ms Clark and the solicitors for the Ivanovics, that Ms Clark made the representation that he pleaded in this case.

19. [19]
    Ms Clark, on the other hand, conceded she did not have a clear recollection of the conversation with Mr Pennisi. Further, she has not maintained a consistent position on what she was told by Mr Ivanovic that night.  This casts doubt on the reliability of her evidence at trial.

20. [20]
    Mr Pennisi’s version is more consistent with Mr Ivanovic’s evidence about his conversation with Ms Clark.  Mr Ivanovic said he told Ms Clark that he had been told by Chantelle Raath^[2], the other real estate agent, that she had an offer at the full asking price which was unconditional.  He also told Ms Clark that he wanted to receive $870,000 after subtracting her commission.  His evidence was unequivocal that having an unconditional offer was important to him and that he told Ms Clark that is what he wanted.  Given the importance Mr Ivanovic placed on the offer being unconditional, it is improbable, if Ms Clark was told Mr Ivanovic had such an offer, that she would not tell this to Mr Pennisi.

21. [21]
    Before trial, Ms Clark admitted in response to a Notice to Admit Facts, that Mr Ivanovic told her the other offer he received was unconditional. During evidence she said she did not know what the other offer was although she thought he said he had a “full price” offer. When Mr Ivanovic gave evidence, he said a full price offer gave him $870,000 in the hand. Ms Clark conceded her memory would have been clearer when she gave instructions to her solicitors in 2004 to respond to Ms King and Mr Pennisi’s Notice to Admit Facts than it was at trial. I consider that admission is more reliable than the evidence she gave at trial.  It is more consistent with the advice that she says she gave Mr Pennisi.  If she did not know that the other offer was unconditional and thought it was “full price” she could be expected to try to increase the price that Mr Pennisi and Ms King offered.

22. [22]
    In paragraph 19 of the Notice to Admit Facts, Ms King and Mr Pennisi asked Ms Clark to admit that at a meeting on 10 June 2004 she told them that, on 1 May 2004, she had been told by the Ivanovics that they had an unconditional contract for $885,000 submitted by Chantelle Raath. In paragraph 14 of the Response, Ms Clark admitted that fact in so far as she advised them that she verily believed that Chantelle Raath did have a buyer who had made such an offer to the Ivanovics. 

23. [23]
    What is not explicit in that response is whether she admitted that she advised them that on the 1^st of May or on the 10^th of June.  If it is the former, then this is an admission that she made the alleged representation that she has not sought leave to withdraw.  However, the conversation with Mr Pennisi on 1 May 2004 is not referred to in the question.  It is clear to me that Ms Clark was being asked to admit what she told Ms King and Mr Pennisi on 10 June 2004, not what she told Mr Pennisi on 1 May 2004. Accordingly, I do not consider her answer is an admission of the misrepresentation. 

24. [24]
    However, her answer is an admission that Mr Ivanovic told her on 1 May 2004, the night of the critical conversation, that he had an unconditional offer.  Although the purchase price is different, her answer otherwise confirms Mr Ivanovic’s evidence of what he told her.  It bolsters the inference I have drawn from Mr Ivanovic’s evidence that, having been told he had received an unconditional offer, Ms Clark would have relayed that information to Mr Pennisi during the critical conversation.

25. [25]
    Finally, the terms of the correspondence between the parties’ solicitors after Ms King and Mr Pennisi purported to rescind the contract are relevant.  Ms King’s and Mr Pennisi’s solicitors expressly referred to the misrepresentation pleaded in these proceedings.  The responses from the solicitors for Mr and Mrs Ivanovic (who also represented Ms Clark in this matter) proceeded on the basis that Mr Ivanovic believed the representation was true, not that the statement was not made.  In particular, in its letter of 16 June 2004, Ms Inder stated:

“We are instructed that at the time your clients were negotiating to buy the property, our client, Mr Branko Ivanovic, instructed Alma Clark (sic) to advise your clients of the other offer he had received in the form of an unconditional Contract. Our client instructs that at the time the Contract of Sale was being negotiated he simply relayed to Alma Clark (sic) that another agent who also had the listing, being the Professionals Ascot, had advised him they had received an offer in the form of an unconditional Contract.  He verily believed the advice that he had received from his Agent regarding the offer.  He did not, to the best of his knowledge, make a false statement and nor, we are instructed, did Alma Clark (sic) who acted in accordance with the instructions from our client.”

26. [26]
    The impression that the defendants case was that the representation was true was reinforced by a later letter, in which Ms Inder said she had obtained written evidence of the other offer (letter dated 16 July 2004).

27. [27]
    Ms Inder’s instructions when she wrote the letter of 16 June 2004 were that Mr Ivanovic was told there was another offer that was unconditional; that he believed that was true; that he instructed Ms Clark to advise Ms King and Mr Pennisi there was another offer that was unconditional; and that Ms Clark so advised Ms King and Mr Pennisi.  The instructions are, therefore, consistent with Mr Pennisi’s allegation of what he was told.

28. [28]
    Taking all of those matters into account, I am satisfied to the requisite standard that Ms Clark told Mr Pennisi that the Ivanovics had received an unconditional offer to buy the property for $885,000.

Was the representation untrue?

29. [29]
    The only people who could give direct evidence about what offer was made are the buyers and Ms Raath. The buyers have not been identified. Ms Raath’s evidence was entirely unhelpful.  She could not remember whether the offer was conditional or unconditional and did not think she would necessarily remember if it was unconditional. She had looked for but had not located the contract^[3]. Mr Ivanovic, Ms Clark, Ms Inder and Mr Pennisi all gave evidence that they did not see an unconditional written contract. No such contract was disclosed or obtained by pre-trial procedures.

30. [30]
    Ms Watts, the principal of the Professionals Ascot for whom Ms Raath worked, told Ms King on 3 June 2004 that the potential buyers Ms Raath was dealing with were not prepared to go unconditional and that she was sure that they did not do so.  Ms Watts was subpoenaed to give evidence by both parties but did not respond to either.  Neither party requested I take any action to enforce the subpoenas.  Nor did either request an adjournment so she could be located and evidence taken from her. 

31. [31]
    What Ms Watts told Ms King was received by way of Ms King’s evidence about their conversation and a file note that Ms King said she made shortly afterwards.  In his submissions, counsel for the Ivanovics and Ms Clark complained that he had not been able to cross-examine Ms Watts about that conversation.  It is the duty of counsel who opposes the reception of evidence to object to it at once (Woods v Rogers ex parte Woods at 217). Not only did counsel not object to this evidence being led, it was he who tendered the file note as an exhibit after cross-examining Ms King about it.  Once a hearsay statement is admitted without objection, the fact that it is a hearsay statement is relevant only on the question of weight.  The statement is evidence for all purposes (Jones v Sutherland Shire Council).

32. [32]
    Other hearsay evidence was admitted without objection when Mr Pennisi was asked about his conversations with Ms Watts.  These conversations were taped. The tapes were tendered as exhibits and counsel for the Ivanovics and Ms Clark requested I listen to them in full.  I did. Again, no objection was made to their reception or submission made as to the purpose for which they admitted.

33. [33]
    The conversations were lengthy. Much of the conversations were devoted to discussions about whether Ms Raath’s buyers were still interested in the property.  Ms Watts was unable to say what the final form of the contract was when negotiations ceased, but on a number of occasions she said she did not think they had made an unconditional offer. Importantly, she told Mr Pennisi that she spoke with Ms Raath on the morning of Sunday 2 May after church and that, at that time, Ms Raath wanted Ms Watts to intervene with her buyers to convince them to go unconditional on their offer. Ms Watts said she would not do so.  She was concerned Ms Raath had found herself in a “dutch auction” and suggested, instead, that the length of the finance and inspection periods should be shortened. If I accept that evidence, then, there could not have been an unconditional offer to Mr Ivanovic from Ms Raath’s buyers on the night of Saturday 1 May when Ms Clark spoke to Mr Pennisi.

34. [34]
    Ms King and Mr Pennisi have the difficult task of proving the non-existence of the offer. I am entitled, in assessing the evidence, to weigh the evidence on that issue in light of the power of the party to produce it (Crombie v Council of the Shire of Livingstone & Anor).  The solicitors for Ms King and Mr Pennisi went to some lengths, as did Mr Pennisi himself, to verify what Ms Watts had told Ms King.  Once the evidence of Ms Watts’ conversations with Ms King and Mr Pennisi were admitted, there was something that the Ivanovics and Ms Clark needed to explain, in the sense that the evidential burden shifted to them. That is, once Ms Watts’s statement that there was not an unconditional offer was admitted into evidence for all purposes, it fell to the Defendants to answer that statement.

35. [35]
    Counsel for both parties have asked me to apply the rule in Jones v Dunkel in relation to their respective failures to call Ms Watts to give evidence.  They both invite me to draw the inference that her evidence would not have been favourable to the other. The unexplained failure to call a witness may, not must, lead to such an inference in appropriate circumstances. This can operate against the party who does not bear the onus of proof on an issue (Ho v Powell). 

36. [36]
    However it cannot apply to the failure to call a non-party witness unless it would be expected that one party rather than the other would call him (Glass JA Payne v Parker at 201-2).  The foundation of the inference is that the party or his advisers are presumed to know the content of the absent witness’s evidence. Otherwise the witness is not a person that a party might reasonably be expected to call (Brandi v Mingot at 560).  Ms Watts was not a witness of either party, although it appears from the correspondence from the solicitors for the Ivanovics and Ms Clark that there were ongoing dealings between them and Ms Watts, after the event. To the extent that Ms King and Mr Pennisi could be presumed to know what evidence Ms Watts would give, that evidence was already received without objection and without the need for Ms Watts to give evidence in person.  I do not think it appropriate in those circumstances to draw an adverse inference against Ms King and Mr Pennisi for their failure to secure Ms Watts’ attendance.

37. [37]
    If I am wrong in that decision, at its strongest for the defence, there are competing inferences that may be drawn.  In such a case it falls to the court to consider the evidence which is before it, in the light of such inferences (Brandi v Mingot).

38. [38]
    The rule in Jones v Dunkel does not prevent an inference favourable to the party who has failed to call a witness from being drawn, if there is other evidence which justifies drawing the inference. In this case, the inference I am asked to draw is that, based both on Ms Watts statements to Ms King and Mr Pennisi and on the absence of a written unconditional offer, no such offer was made. I am satisfied that such an inference is reasonably open on that evidence.

39. [39]
    I have already canvassed the evidence of Ms Watts’s statements.  As to the absence of the written unconditional offer, the solicitor for the Ivanovics and Ms Clark, Ms Inder, stated in her letter of 16 July 2004 that she had obtained written evidence of the other offer to purchase the property. There is no reasonable interpretation that can be placed on that statement than the “other offer” was the one which lay at the heart of the dispute, the offer from Ms Raath’s buyers that was said to be unconditional. In that light, the failure to produce that written evidence gives rise to an obvious adverse inference.

40. [40]
    At trial Ms Inder said the “written evidence” she had obtained consisted of an e-mail exchange between Mr Ivanovic and Ms Raath that he forwarded to her.  In that e-mail Mr Ivanovic asked Ms Raath to e-mail him “all the details” (what they relate to is not clear), or any new offers, whether from the “same people” or “new people”.  Ms Raath’s reply was that she was preparing two new contracts by the “same people” to send down to him.  This tends to support Ms Inder’s statement in her letter that she had confirmation from the Professionals that there were two contracts presented to the Ivanovics at the time Ms King and Mr Pennisi made their offer, although the e-mails themselves do not go that far.  They certainly do not explain the statement that she had obtained written evidence of an unconditional offer. Mr Ivanovic did not ask Ms Raath to provide that, nor did she do so. 

41. [41]
    Further, they certainly are not evidence that anything Ms Raath said in the e-mail is true as their admission on that basis was objected to and they were received only for the limited purpose of Ms Inder explaining what she was referring to in her letter.  A file note of a conversation between Ms Inder and Ms Watts was also admitted for that same limited purpose.  In it, Ms Watts said there were 2 contracts at the time the Ivanovics sold to Ms King and Mr Pennisi. Again, there is no suggestion that either of those contracts are an unconditional offer and do not explain her reference to written evidence of the other offer.

42. [42]
    The tenor of the correspondence from the solicitor for the Ivanovics and Ms Clark throughout the pre-settlement period gave rise to the impression that there was a written unconditional offer, that she was in possession of it, or had access to it and that her clients declined to produce it. It is reasonable, in those circumstances, to draw an inference adverse to the Ivanovics and Ms Clark from the failure to produce any such written evidence.

43. [43]
    Taking into account what Ms Watts told Ms King and Mr Pennisi, Ms Raath’s evidence, the correspondence from Ms Inder and the absence of a written unconditional offer, I am satisfied that it is more probable than not that Mr Ivanovic did not have an offer in the form described by Ms Clark to Mr Pennisi at the time she spoke with Mr Pennisi on the night of 1 May 2004.

Did Ms King and Mr Pennisi rely on the representation?

44. [44]
    Counsel for the Ivanovics and Ms Clark submitted I should draw an inference adverse to Mr Pennisi when assessing the credibility of his evidence about relying on Ms Clark’s misrepresentation.  He submitted the adverse inference arose from Mr Pennisi’s conduct after he first became aware Ms Clark’s representation was not true.  Mr Pennisi agreed that he sought an extension of the contract and when that was not granted he rescinded the contract on the ground of the misrepresentation. In the meantime, however, he took steps to try to verify what his wife had been told. I do not consider Mr Pennisi’s conduct reflects adversely on his credibility^[4].

45. [45]
    Mr Pennisi did not pretend that his inability to sell their house at auction created difficulties for them, although Ms King referred to the possibility of obtaining bridging finance as one option still open to them. However, if Ms King and Mr Pennisi had the right to rescind they were entitled to exercise that right, even if they also had an entirely subjective motive which was unconnected to the misrepresentation (Denny v Hancock at 10–11; JAD International v International Trucks).

46. [46]
    Mr Pennisi said he spoke to Ms Clark twice about the nature of the other offer, once when she called him in the evening some time before 7pm and then again later in the evening when he rang to check that she shared his view of what an unconditional offer meant. Ms Clark did not remember this conversation.   The second conversation is of particular importance in relation to the issue of reliance. That Mr Pennisi wanted to ensure that he and Ms Clark had the same understanding of the term “unconditional” demonstrates the significance he placed on the nature of the other offer.  He well understood the value of such an offer to a vendor.

47. [47]
    There were other conversations also of significance in relation to Ms King’s and Mr Pennisi’s reliance on her misrepresentation that she did not remember. Mr Pennisi said that he had spoken to her about making an offer to the Ivanovics at $890,000 but still conditional upon finance and pest and building inspection. She initially did not recall having two phone calls with Mr Pennisi, later that night and in quick succession (8.30pm and 8.41pm).  After being shown Mr Pennisi’s telephone records she conceded that they had taken place. These appear to be the conversations in which Mr Pennisi said they discussed his request that she make a conditional offer at the higher price.

48. [48]
    It is fair to say that Ms Clark’s memory of the events of that night were not at all clear. This is perhaps not surprising as the events occurred over 2 years ago, Ms Clark was at the Gold Coast on her way to a family function, and she was distracted and not as focussed as Mr Pennisi was. For this reason, I prefer Mr Pennisi’s evidence over that of Ms Clark in relation to all conversations that night.

49. [49]
    Much time was spent during Mr Pennisi’s cross-examination exploring scenarios in an apparent effort to demonstrate that Ms King and Mr Pennisi would have made an unconditional offer at $885,000 in any case, because they were so keen to buy it.  Just because they were keen to buy the property does not mean Ms King and Mr Pennisi were not induced to make an unconditional offer because of Ms Clark’s misrepresentation.

50. [50]
    Mr Pennisi did not shy away from their eagerness to buy the property.  However, he was adamant that he would not have made an unconditional offer if he did not think that there was another unconditional offer before the vendors. It goes without saying that it is hard to reconstruct the course negotiations might have taken if that one piece of information had not been given to Mr Pennisi.  However, I accept the evidence of both Ms King and Mr Pennisi that they had never entered into an unconditional contract before, and that they were wary of doing so in this case as their house had not yet gone to auction.

51. [51]
    Their actions on the night of 1 May are consistent with them not wanting to make an unconditional offer if that could be avoided.  Ms King was the one to suggest to her husband that they make a conditional offer at the higher price.  I accept that Mr Pennisi did request Ms Clark to make that offer.

52. [52]
    Ms King and Mr Pennisi also tried to locate an earlier version of the contract, it appears in the hope that they had the Ivanovics’ signatures on a conditional offer at $885,000.  This was the figure that was counter offered by the Ivanovics in response to the first offer from Ms King and Mr Pennisi. I accept Mr Pennisi’s evidence that this was the contract he was looking for when he asked Ms Clark to arrange for someone to open up her office that night. Although she initially said that Mr Pennisi wanted the office opened so he could sign an unconditional offer that night, she later confirmed that he was looking for the earlier version of the contract.  That is also consistent with Mr Pennisi asking to take the contract away overnight. There is no dispute that a written unconditional offer was not given by Ms King and Mr Pennisi to Ms Clark’s assistant until the following morning, the 2^nd of May.

53. [53]
    Had they not been told that the Ivanovics had another unconditional offer before them, I am satisfied that Ms King and Mr Pennisi would have waited it out to see if the Ivanovics would change their mind on the conditional offer at a higher price and, if necessary, would have considered other options to make their offer more attractive.  It was because they believed they had to “match” an offer then before the Ivanovics that they made the offer that was accepted.

54. [54]
    To be actionable, the misrepresentation must have produced a misunderstanding and that misunderstanding must be one of the reasons that induced Ms King and Mr Pennisi to enter the contract (Australian Steel & Mining Corporation Pty Ltd v Corben & Ors at 207 Hutley J.A.) I am satisfied to the requisite standard that Ms Clark’s misrepresentation induced Ms King and Mr Pennisi to make the unconditional offer.

Orders

55. [55]
    I am satisfied that Ms Clark made the representation alleged, that it was untrue, that Ms King and Mr Pennisi relied on it in making their unconditional offer and that they were entitled to rescind the contract for that misrepresentation. As the counterclaim by the First and Second Defendants is based on a breach of contract for wrongful termination, it must fail.

56. [56]
    My orders are:

1. I declare the Plaintiffs were entitled to rescind the contract to purchase the property at 168 Crosby Road, Ascot dated 2 May 2004 and to the return of the deposit paid pursuant to that contract.
2. I order the Third Defendant to repay that deposit to the Plaintiffs.
3. I order the Defendants pay the Plaintiff interest at the rate of 10% per annum from 15 June 2004 to the date of this judgment.
4. The counterclaim is dismissed.

57. [57]
    I will hear submissions from the parties as to costs.