Douglas v Mikhael & Ors

1. [1]

   In these proceedings, the plaintiff claims damages and other relief for breach of an oral contract which he alleges was entered into by him with the first and second defendants in November 1999 and another oral contract which he alleges was entered into with all three defendants in May 2015. The central issue in the case is whether the plaintiff has established that the conversations on which he relies for the oral contracts occurred.

2. [2]

   The plaintiff is Joseph Douglas (Joseph) whose name at birth was Yacoub Karborani. He changed his name twice, firstly to Abraham Jacobs in December 2005 and then in April 2007 to Joseph Douglas.

3. [3]

   The first defendant is Fadi Mikhael (Fadi) and the second defendant is his wife, Mary Karborani (Mary). Joseph and Mary are siblings. The third defendant, FBM Enterprises Pty Ltd, is a company incorporated in New South Wales which is the trustee of a discretionary trust called The Mikhael’s Trust (Trust). As mentioned below, the discretionary objects of the Trust include the first and second defendants, and also the plaintiff by reason of his familial relationship with the second defendant.

4. [4]

   For convenience, and with no disrespect intended, I will refer to the plaintiff and the first and second defendants by their first names.

5. [5]

   Mr Tang of counsel appeared for Joseph having been briefed only a short time before the hearing commenced, and Ms Dinkha of counsel appeared for the defendants.

Course of the hearing

1. [6]

   When the hearing commenced on 5 September 2022, Mr Tang, who had only recently come in to the matter, sought leave to amend the plaintiff’s statement of claim to more clearly plead the plaintiff’s case and the relief sought. I granted leave.

2. [7]

   The matter had originally been set down for a hearing of 3 days. The cross‑examination of the plaintiff’s witnesses finished at the end of the third day. On the fourth day I adjourned the hearing because the first defendant, Fadi, had been admitted to hospital where he was being treated for an acute intracranial bleed and was in intensive care. This illness ultimately required a lengthy period of hospitalisation.

3. [8]

   The hearing was adjourned (part heard) to 13 December 2022. On that day Fadi, Mary and Mr Hatoum were cross-examined. Before Mary was cross‑examined, Ms Dinkha sought leave to rely upon a further affidavit of Mary which had only recently been sworn. This was opposed by Mr Tang. I upheld the objection due to the lateness of the affidavit but allowed the tender of the financial statements for the Trust for the 2015 to 2018 financial years (Ex 6) and a page of a bank statement for an account in the name of Dale & Waters showing a payment of $300 (Ex 7). Ex 6 was in fact responsive to a Notice to Produce which the plaintiff had served on the defendants previously. Ex 7 is a document that I have not taken into account because of its lack of probative value.

4. [9]

   The parties handed up written closing submissions on 14 December 2022 and made oral closing submissions, and at the end of that day judgment was reserved.

5. [10]

   On 8 February 2023 the plaintiff sent an email to my Chambers making submissions about the evidence and seeking to file and serve a further affidavit. I have not taken into account this email or anything referred to in it because it was submitted without leave having been given by the Court and it is clear that once the hearing has concluded the parties have no right to be heard further: Carr v Finance Corporation of Australia Ltd (No 1) (1981) 147 CLR 246 at 258.

The parties pleaded cases.

1. [11]

   Joseph alleges that at a meeting in Sydney on 6 November 1999 he, Fadi and Mary, entered into an oral contract containing the following terms (1999 Agreement):

2. [12]

   Joseph alleges that in or around November 1999 pursuant to the terms of the above agreement, he paid $75,000 to Fadi and Mary.

3. [13]

   Joseph alleges that the Trust was established on or about 8 June 2000 with Fadi as trustee pursuant to the terms of the 1999 Agreement and that, in breach of the 1999 Agreement, the trustee of the Trust does not hold 50% of the business assets of the Trust on trust for Joseph.

4. [14]

   Joseph contends, in the alternative, that in May 2015 the plaintiff and all three defendants entered into an oral contract containing the following terms (2015 Agreement):

5. [15]

   Joseph alleges that in breach of the terms of the 2015 Agreement and the terms of the Trust, he has not received from any of the defendants the sum of $1,450,000, any part of the profits of the Trust’s business assets (whether accrued since May 2015 or at all) or any account or financial records relating to the Trust’s business assets.

6. [16]

   The relief claimed by Joseph comprises:

7. [17]

   The defendants deny the existence of the 1999 Agreement and the 2015 Agreement on the basis that the alleged conversations did not occur.

Relevant principles

1. [18]

   Joseph has the onus of establishing on the balance of probabilities that the two agreements for which he contends were entered into. The relevant principles in determining those questions were stated by Hammerschlag J (as his Honour then was) in John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451 as follows:

2. [19]

   Where the existence and terms of an oral contract is in issue, consideration of the surrounding circumstances including the history of the relationship between the parties and their conduct prior to and at the time the alleged contract was entered into is permissible, as well as post-contractual conduct: Colyer Fehr Tallow Pty Ltd v KNZ Australia Pty Ltd [2011] NSWSC 457 at [47]–[50]; Brambles Holdings Ltd v Bathurst City Council (2001) 53 NSWLR 153; [2001] NSWCA 61 at [25].

3. [20]

   When a plaintiff seeks to prove an oral contract relying on conversations occurring many years ago, it is necessary to bear in mind the well known observations of McLelland CJ in Eq regarding the fallibility of human memory in Watson v Foxman (1995) 49 NSWLR 315 at 319:

4. [21]

   It is for this reason that where the events (including conversations) relied upon took place many years ago, it is recognised that “the only safe course is to place primary emphasis on the objective factual surrounding material and the inherent commercial probabilities together with the documentation tendered in evidence”: Effem Foods Pty Ltd v Lake Cumbeline Pty Ltd (1999) 161 ALR 599; [1999] HCA 15 at [15] - [16]; Et-China.com International Holdings Ltd v Cheung (2021) 388 ALR 128; [2021] NSWCA 24 at [25]–[29] (and cases there cited).

5. [22]

   In Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34, Dixon J emphasised that when the law requires the proof of any fact the Court must feel an actual persuasion of its occurrence or existence before it can be found, and “it cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in its reality” (at 361).

6. [23]

   It follows that Joseph must prove to the reasonable satisfaction of the Court (in the sense of an actual persuasion) that the words he alleges were said in the alleged conversations in 1999 and 2015 were actually said, and that the alleged consensus resulting from those conversations was capable of forming a binding agreement and was intended by the parties to be legally binding. In determining whether that actual persuasion is achieved, the Court may have regard to the matters referred to above including the surrounding circumstances and post-contractual conduct of the parties.

Background facts

1. [24]

   Joseph and Mary were born in Amman, Jordan in 1971 and 1974 respectively. They lived with their parents, Ibrahim Karborani (Ibrahim) and Samia Karborani and sister, Meisa, in Jordan until January 1990 when the family migrated to Australia and settled in Perth.

2. [25]

   In or around 1991, Ibrahim and Samia bought an ice cream business which operated in the weekend markets at Subiaco, Perth, for two days a week and later, in around 1993, a hamburger business in the same markets.

3. [26]

   When the family moved in Perth in January 1990, Joseph completed his secondary school education and then attended Curtin University to study for a bachelor’s degree in Management and Finance but did so for one year only in 1992. It appears that after this he helped his parents in the businesses referred to in the previous paragraph and also worked part-time as a taxi driver in Perth from around 1993 to August 1998.

4. [27]

   Mary completed her secondary school education in 1991 and then undertook a bachelor’s degree in Electrical and Electronics Engineering at the University of Western Australia, graduating in 1996. She subsequently graduated with a Masters of Business Administration degree from the University of Western Australia in 2003. She has been employed by a number of companies including Unisys, KPMG Australia, CSBP Fertilisers, and Chevron in the period up to July 2008. From that time she and Fadi have owned and operated a business known as Dale & Waters, an online clothing business.

5. [28]

   Fadi was born in Beirut, Lebanon in 1971 and he and his parents migrated to Australia in 1986. After completing his secondary school education in 1988, Fadi attended the University of New South Wales and graduated with a Bachelor of Science degree in 1993. He initially worked in the transport industry and then in late 1995 he commenced working for CityWide Clothing Alterations Pty Ltd (subsequently called Looksmart Alterations Pty Ltd) (CityWide) in Sydney. This was a company owned and controlled by Mr Abraham Hatoum (Mr Hatoum) which he established in 1994. Fadi and Mr Hatoum had met at the University of New South Wales when they were students and became friends. Fadi was employed with CityWide as Operations Manager from 1995 until mid 2000 and then from mid 2000 to 2017 he established, operated and sold franchised stores under the CityWide (and later Looksmart) branding in Perth. From 2011 to 2019 Fadi also operated an online furniture business known as Bella Furniture until that business ceased to operate, and from 2008 until the present time, he has operated the Dale & Waters business with his wife as noted above.

6. [29]

   Fadi and Mary met in early 1995, became engaged in December 1995 and were married in January 1997. In late 1996, they purchased a unit in Rockdale, Sydney for $180,000 which they subsequently sold in early 2000 for $260,000 before moving to Perth.

7. [30]

   From about 1997, when the CityWide business had grown to four stores in Sydney, Mr Hatoum began to explore new sites for the business outside Sydney, including in other States. Mr Hatoum had a vision of growing the business significantly by way of a franchise model that was reasonably priced and could be operated by “mum and dad” owners and migrant tailors. Around this time he attended seminars on franchising and having decided that franchising was the appropriate way to implement the expansion of the business he engaged lawyers with experience in franchising to prepare the necessary documentation. The franchise model was very successful and there are now more than 120 stores across Australia and New Zealand.

8. [31]

   The first two franchised stores in Perth were located at Karinyup and Carousel and were initially established as company-owned stores in 1999. At that time, CityWide had around 13 stores, including stores in Brisbane and Melbourne.

9. [32]

   In late 1997 or early 1998, Fadi had suggested to Mary’s parents that they should consider buying one or two franchised stores to be established by CityWide in Perth. He did so because Ibrahim had previously said to Fadi that he and his wife were considering selling their two stalls in the Subiaco weekend markets as they were only operating two days a week. Ibrahim and his wife were also interested in this as they saw it as providing a possible career path for Joseph.

10. [33]

    From around August 1998 until April 1999, Joseph lived with Fadi and Mary at their Rockdale unit. Fadi’s evidence is that during the first two weeks of this period Fadi tried to teach Joseph the Looksmart business but says that this was unsuccessful because Joseph had little or no administration or computer skills, no business sense or acumen, and no interest in learning the business or developing the limited skill set he possessed. Fadi’s evidence is that as a result, after a few weeks the training ceased and Joseph started working as a courier driver for the CityWide business, delivering clothes from the various stores to the main store in the Gowings Building where the alteration work was performed. This evidence is corroborated by Mr Hatoum. Joseph disputes this and says that throughout the period from August 1998 to April 1999 he was being trained in the CityWide business. However, Joseph’s explanation of his role is contradicted by the evidence of Fadi (the operations manager of the business) and Mr Hatoum (the ultimate owner of the business), and I prefer their evidence to that of Joseph on this aspect.

11. [34]

    From around April 1999 to 2000, Joseph lived at his parents’ home in Parkwood, Perth during which time he mainly worked as a taxi driver. From 2000 to 2003 Joseph lived in Sydney and mainly worked as a taxi driver in his own business. From 2003 to 2005 Joseph lived in the United Arab Emirates. When Joseph returned to Australia in 2005 he and his wife Christine lived for around 6 months with Mary and Fadi in Perth. After Joseph ceased living with Mary and Fadi in Perth in late 2005, Joseph lived and worked in Sydney until 11 August 2015 when he went to prison where he remained until his discharge on 10 May 2019. Fadi’s evidence is that he had no contact with Joseph after 2005 and Mary’s evidence is that she had little or no contact with Joseph after that time. I accept this evidence.

12. [35]

    In early 2000, Fadi and Mary decided to relocate to Perth to live and acquired the first two CityWide franchised businesses at Karrinyup and Carousel from CityWide. Before these acquisitions occurred, Fadi established the Trust on 8 June 2000. He was the initial trustee until he was replaced by the third defendant as trustee by a deed dated 1 November 2009. The Trust was established, on advice from Fadi’s accountant, to be the vehicle to own and operate the 2 franchised stores which he acquired from CityWide. Fadi developed a model whereby he would locate a site, take a lease, fit out the new site and then operate it as a CityWide franchisee until it was ready to be sold to a new franchisee. Over the period from 2000 to 2017, Fadi had established approximately 23 franchised stores in Perth, which had all been sold by 2017 when he exited the Looksmart business. The Trust was used as the vehicle to own and operate these stores.

13. [36]

    On 29 March 2019, Mr Elias Tabchouri of Macquarie Lawyers sent a letter to Fadi and Mary which included a demand for payment of $1,450,000 plus interest of $306,247.94 and threatened legal proceedings if the payment was not made within 14 days. The letter stated relevantly:

14. [37]

    It is not in dispute that this was the first time any written demand was made to the defendants (T143). This was followed up by a further letter of demand dated 1 May 2019. It may be noted that no reference is made in the letter of 29 March 2019 (or the 1 May 2019 letter) to any agreement made in May 2015 - the focus is entirely on an alleged agreement made on 6 November 1999.

The plaintiff’s evidence

1. [38]

   Joseph gave evidence by 4 affidavits and was cross-examined. In addition, evidence was given in support of his case by Mr Rimon Mansour by 3 affidavits and he was cross-examined. I set out below the relevant parts of their evidence concerning the coming into existence of the 1999 Agreement and the 2015 Agreement.

2. [39]

   In Joseph’s affidavit of 12 October 2020, he said the following regarding the alleged meeting on 6 November 1999 and the events leading up to it:

3. [40]

   Paragraphs 15 – 17 of this affidavit are exactly the same as paragraphs 11 – 13 of Mr Mansour’s affidavit of 19 March 2021 set out at [46] below.

4. [41]

   In Joseph’s affidavit of 12 October 2020 he gives the following evidence regarding the alleged agreement made in May 2015:

5. [42]

   Paragraph 31 of this affidavit refers to two documents which are headed “payment receipt” which are signed by Joseph, one dated 5 June 2015 for $1,500 and another dated 9 June 2015 for $2,000. However, there is no evidence that they were sent to any of the defendants and Fadi and Mary deny having received them.

6. [43]

   Paragraphs 29, 31 and 32 of this affidavit correspond exactly with paragraphs 22 – 24 of Mr Mansour’s affidavit set out at [47] below except that the opening words of paragraph 22 of Mr Mansour’s affidavit refer to Mr Mansour being present while Joseph spoke to Mary with the telephone on loudspeaker, which is a matter not mentioned in Joseph’s account in his affidavit.

7. [44]

   In addition to the correspondence between the key paragraphs mentioned in [40] and [43] above, there is a close correlation between paragraphs 14, 19, 24, 25, 27 and 28 of Joseph’s affidavit of 12 October 2020 and similar paragraphs in Mr Mansour’s affidavit of 19 March 2021.

8. [45]

   Joseph gave evidence in cross-examination that he typed his affidavit of 12 October 2020 himself and then sent it to his solicitor who made some “grammatical modifications” and then sent it back to him for signature (T160, 161 and 163). Joseph said that he did not send his affidavit to Mr Mansour before he prepared his affidavit of 19 March 2021 and had no involvement in the preparation of that affidavit (T161-162). I take this matter up again below.

9. [46]

   Mr Mansour gave the following evidence in his affidavit of 19 March 2021 regarding the alleged meeting on 6 November 1999:

10. [47]

    In his affidavit of 19 March 2021, Mr Mansour gave the following evidence regarding the alleged conversation between Joseph and Mary in May 2015:

11. [48]

    I have noted at [40], [43] and [44] above the correspondence between the key paragraphs of Joseph’s affidavit of 12 October 2020 and Mr Mansour’s affidavit of 19 March 2021.

12. [49]

    Joseph’s affidavit of 12 October 2020 and Mr Mansour’s affidavit of 19 March 2021 were both witnessed by the same solicitor. This was not the same solicitor who represented Joseph during the hearing.

13. [50]

    Mr Mansour said in cross-examination that he typed his affidavit of 19 March 2021 himself based on his own independent recollection of events and then sent it to Joseph’s solicitor who made only minor grammatical spelling corrections to it before Mr Mansour signed it (T200, 209). He also said in cross‑examination that in preparing the draft he had regard to a handwritten note of the meeting on 6 November 1999, which was the first time the existence of such a note had been mentioned (T211). A call was made for the production of the note, but none was produced. Mr Mansour also said that he had kept a record on his mobile phone at the time of the telephone conversation in May 2015 of the numbers referred to in paragraph 22 of his affidavit, but no longer had that mobile phone.

14. [51]

    Mr Mansour said in cross-examination that he did not read Joseph’s affidavit of 12 October 2020 before he made his affidavit of 19 March 2021 and that he had not seen that affidavit before giving evidence at the hearing (T207). However, Mr Mansour could provide no explanation for why there was such a close correspondence between the paragraphs of his affidavit set out above and the corresponding paragraphs of Joseph’s affidavit of 12 October 2020.

15. [52]

    In Macquarie Developments Pty Ltd v Forrester [2005] NSWSC 674 Palmer J said:

16. [53]

    In Macquarie Developments at [87], the correspondence between the evidence of two witnesses had been shown by the evidence of the solicitor of the party who called them to be the result of that solicitor “cutting and pasting” parts of an affidavit of one witness when preparing the affidavit of the other. In those circumstances, the correspondence of the evidence did not suggest collusion or collaboration between the witnesses.

17. [54]

    However, in the present case, while the same solicitor prepared the final version of each affidavit, both Joseph and Mr Mansour were insistent in cross-examination that they each typed their own affidavits and that the solicitor merely revised their drafts to correct grammatical errors.

18. [55]

    I infer from this evidence that there are only two likely alternative explanations for the similarity in the accounts given by Joseph and Mr Mansour of the alleged meeting on 6 November 1999 and the alleged conversation in May 2015. The first is that Joseph sent his 12 October 2020 affidavit to Mr Mansour before he prepared his 19 March 2021 affidavit (in which case both Joseph and Mr Mansour gave untruthful evidence). The second is that Joseph’s solicitor prepared Mr Mansour’s 19 March 2021 affidavit and “copied and pasted” sections of Joseph’s 12 October 2020 affidavit in that process, or sent that affidavit to Mr Mansour and he did so (in which case Mr Mansour but not Joseph gave untruthful evidence). Either way, the correspondence between Mr Mansour’s affidavit and the corresponding parts of Joseph’s affidavit and his unsatisfactory evidence in cross-examination regarding the alleged meeting and conversation, undermines entirely Mr Mansour’s evidence in the proceedings and I reject it.

Defendants’ evidence

1. [56]

   The first and second defendants each gave evidence by one affidavit and were cross-examined. Mr Hatoum also gave evidence by one affidavit and was cross‑examined.

(a) Fadi’s evidence

1. [57]

   Fadi gave evidence in his affidavit that he never had any discussions with Joseph in November 1999 or at any other time about a business arrangement involving CityWide Alterations or Look Smart. He denies that the alleged meeting on 6 November 1999 occurred and denies receiving the amounts of $30,000 or $45,000, as alleged by Joseph in November 1999 or at any other time. He also denies ever meeting Mr Mansour.

2. [58]

   Fadi also gave evidence that at the time Joseph alleges he entered into the 2015 Agreement with Fadi and Mary, Fadi and Mary’s total assets were between $1 million to $1.2 million and so if Mary had agreed to pay the amount of $1,450,000 to Joseph, they would have had to sell their family home as well as borrowing around $400,000 with no collateral to give as security to the lender.

(b) Mary’s evidence

1. [59]

   Mary gave evidence that she never had any conversation with Joseph about going into business with him in franchises to be established by CityWide Alterations in Perth or in any other business. She denied attending a meeting with Joseph on 6 November 1999 in her unit (or at any other time or place) on that topic or receiving $30,000 in cash from him. She also gave evidence that she was not aware of having a cousin or any other family relation named Rimon Mansour and denies ever meeting him.

2. [60]

   In relation to the allegation that Joseph makes about conversations leading to the 2015 Agreement, Mary denied having the conversations with Joseph referred to in paragraphs 29, 31 and 32 of Joseph’s 12 October 2020 affidavit, and gave the following evidence about her dealings with Joseph around this time:

3. [61]

   Mary put into evidence text messages which she received in the period from 8 June 2015 to 6 August 2015 from a telephone number which she understood to be attached to Joseph’s mobile phone (and which she recorded in her mobile as attributable to “Jacob”). Joseph could not recall in cross-examination what his mobile phone number in the period June to August 2015 was (T35). His explanation for this was that when he went to prison on 11 August 2015 he was required to give up his mobile phone and it was not returned to him. However, Joseph’s inability to recall his mobile telephone number from that period is surprising, to say the least, given that he was apparently able to recall the detail of a conversation 20 years ago, and the detail of another conversation (including several numbers) in May 2015. Joseph had been aware that there was an issue as to whether the text messages were sent from his mobile phone since Mary’s affidavit of 27 February 2022 was filed and served. It was within the power of Joseph (and not the defendants) to tender evidence to prove what his mobile phone number was in June to August 2015. That failure is not explained and I infer such evidence would not have assisted his case: Jones v Dunkel (1959) 101 CLR 298 at 320 – 321.

4. [62]

   The text messages referred to requests for money to assist with the payment of rent and other expenses of Joseph and his wife which correlate to the dates when payments were actually made to Joseph or a company he controlled called YIK Support Services Pty Ltd. These text message provide an explanation for the payments made to him by Mary or the Trust in the period around the time of the alleged conversation in May 2015 occurred and provide no support for the existence of an agreement of the kind alleged by Joseph.

5. [63]

   Mr Hatoum gave evidence regarding the establishment and operation of the CityWide business which I have summarised above. In addition, he gave evidence that Joseph worked in the CityWide business in Sydney as a courier driver for about 6 to 9 months in the period 1998 to 1999, during which time he received numerous complaints about Joseph being late, taking too long to perform deliveries, and sometimes not showing up at all. He said that had it not been for his relationship with Fadi, he would not have permitted Joseph’s employment in the business in that period to continue without improved performance. He denies any discussion between him and Joseph regarding Joseph taking any interest in any CityWide franchised stores in Western Australia or elsewhere or any discussion with Fadi about an agreement for the plaintiff to have any involvement in any capacity in the franchised stores in Perth located at Karinyup and Carousel which were acquired by Fadi (through the Trust) in 2000.

The Trust

1. [64]

   The Trust was established by a deed dated 8 June 2000 between Ibrahim as settlor and Fadi as trustee (trust deed). It takes the form of a relatively standard family discretionary trust.

2. [65]

   Clause 3.1 of the trust deed confers on the trustee the power to pay or apply all or any part of the net income of the Trust for any one or more of the “General Beneficiaries”. The expression “General Beneficiaries” is defined in clause 1 of the trust deed relevantly as follows:

3. [66]

   The expression “Specified Beneficiary” is defined to mean the persons named in the schedule to the trust deed, which are the children of Fadi and Mary.

4. [67]

   In the schedule to the trust deed, there are additional persons identified as being members of the class of General Beneficiaries which include Fadi and Mary.

5. [68]

   There is no specific mention of Joseph in the trust deed although he is a General Beneficiary by reason of clause 1.9.2. Nor is there any mention of CityWide or its franchised stores.

Consideration

1. [69]

   The resolution of this case turns on whether the Court should accept the evidence of Joseph and Mr Mansour as to the conversations said to have to have occurred on 6 November 1999 and in May 2015. For the reasons given above I have rejected Mr Mansour’s evidence. For the reasons which follow, I do not accept Joseph’s evidence regarding those matters.

2. [70]

   I do not have an actual persuasion, on the evidence before the Court, that the alleged meeting of 6 November 1999 occurred, or that if it did occur the words attributed to Joseph, Fadi and Mary in paragraph 15 of Joseph’s 12 October 2020 affidavit were said. The reasons for this are as follows.

3. [71]

   First, there is no contemporaneous record of the meeting or what was said at the meeting. In cross-examination, each of Joseph and Mr Mansour said, for the first time, that Mr Mansour had kept a note (T176 and T210 – 211), but a copy of the note was never produced. In the absence of a contemporaneous record I regard it as implausible that Joseph would recall in such detail the conversation which he records in paragraph 15 of his affidavit which occurred over 20 years before he made his affidavit.

4. [72]

   Second, Joseph gave an implausible explanation for why Mr Mansour came to the meeting. He said in his affidavit that he told Mary he would bring Mr Mansour to the meeting so that he could be a witness (paragraph 14). However, he also said that he did not arrange for lawyers to document the transaction discussed at the meeting because he trusted Mary and Fadi (paragraph 18). Joseph provided no adequate explanation in cross-examination for why, if he trusted Mary and Fadi, he needed to bring a witness to the meeting.

5. [73]

   Third, Joseph could not explain how he remembered that the date of the meeting was 6 November 1999, beyond saying it was the date he borrowed $30,000 in cash from Mr Mansour which is not a credible explanation. Joseph’s evidence in cross-examination on this topic was as follows (T105 - 106):

6. [74]

   There is no evidence beyond mere assertion that Mr Mansour had $30,000 in cash in November 1999 to provide to Joseph or that Joseph borrowed $30,000 in cash from Mr Mansour in November 1999 or paid $30,000 in cash to Fadi and Mary in November 1999 or at any other time. There is no evidence to substantiate any repayments by Joseph to Mr Mansour of a borrowing of $30,000.

7. [75]

   There is no evidence at all that Joseph paid the remaining $45,000 referred to in paragraph 15 of his 12 October 2020 affidavit. Nor are there any contemporaneous records to support the assertion that Joseph had earned $45,000 from driving taxis which he had “deposited” with his parents by November 1999. Joseph did not call either of his parents to give evidence regarding the $45,000 “deposited” with them and their absence was not explained. I draw the inference that their evidence would not have assisted Joseph’s case: Jones v Dunkel.

8. [76]

   Having observed Joseph closely during his lengthy cross-examination, I consider Joseph’s evidence as to the date of the alleged meeting, what was said in the meeting if it occurred and the “loan” of $30,000 to be unreliable and I reject it.

9. [77]

   Fourth, it is permissible to have regard to post-contractual conduct to determine whether a contract was entered into. There is no evidence of any subsequent conduct by Joseph or the defendants which supports the conclusion that a contract came into existence on 6 November 1999 regarding the acquisition of franchised stores in Perth by the defendants, pursuant to an arrangement of the kind set out in paragraph 15 of Joseph’s 12 October 2020 affidavit. Nor is there any evidence, beyond his bare assertion, that Joseph did anything to establish the two franchised stores at Karingyup and Carousel in late 1999. In particular, there is no evidence, beyond Joseph’s bare assertion, that he made any demand on the defendants that asserted the existence of a contract in the terms alleged until 2019, some 20 years later when his then solicitor sent the letter referred to at [36] above.

10. [78]

    Fifth, the alleged contract is inherently implausible. Fadi had by 6 November 1999 been the operations manager of the City Wide/Looksmart business for four years and was clearly successful and experienced in managing the operations of the business and highly regarded by Mr Hatoum. In contrast, there is no evidence (beyond Joseph’s uncorroborated assertion) that Joseph had any real experience in the conduct of the City Wide/Looksmart business, or any other business apart from taxi driving. Why would Fadi agree to an arrangement whereby he would do all the work in conducting the new business enterprise and bear all the expenses but only share in 50% of the profits? No rational answer to this question was provided by Joseph in cross-examination.

11. [79]

    Sixth, both Fadi and Mary denied that the meeting on 6 November 1999 occurred or any discussions of a business venture of that kind ever took place. Mr Hatoum also denied any discussions with Joseph of the kind asserted by Joseph in his various affidavits in support of his assertion that such an agreement was entered into. I had the benefit of observing each of Fadi, Mary and Mr Hatoum in cross-examination and formed the view that each of them was an honest witness who did their best to give truthful and accurate evidence regarding their interactions with Joseph at the relevant times, including his limited involvement with CityWide in the period leading up to the establishment of its franchised stores in Perth in 1999 and 2000. I accept their evidence as accurate and reliable.

Alleged conversation in May 2015

1. [80]

   I do not have an actual persuasion that the alleged conversation in May 2015 referred to in paragraph 29 of Joseph’s 12 October 2020 affidavit, or the other conversations referred to in paragraphs 31 and 32 of that affidavit, occurred.

2. [81]

   First, the alleged conversations are denied by Mary who I have accepted as a truthful witness. I accept her evidence as accurate and reliable.

3. [82]

   Second, the alleged conversations are implausible. I have referred at [58] above to the evidence of the financial position of the defendants in May 2015. I consider it highly unlikely that Mary would have agreed so readily to pay $1.45m to Joseph in May 2015 given the financial position of Mary and Fadi at that time. Also, the alleged conversations are predicated on there being a business arrangement of the kind which Joseph alleges was made in the alleged meeting on 6 November 1999, which I have rejected.

4. [83]

   Third, the alleged conversation in May 2015 is not corroborated by any contemporary record. Nor is it mentioned in the first written demand Joseph made to Fadi and Mary in the letter dated 29 March 2019 as noted above, and that is a significant matter against the existence of any such agreement. Joseph sought to support the alleged agreement by reference to the evidence of Mr Mansour that he overhead the conversation. I have rejected that evidence. It is significant that Mr Mansour’s presence at the time of the telephone conversation was not raised by Joseph in his 12 October 2020 affidavit. The failure to note such a significant matter in his own account of the conversation is a further matter which casts significant doubt on the accuracy of evidence of the conversation.

Conclusion

1. [84]

   For the above reasons, Joseph has not established that either the 1999 Agreement or the 2015 Agreement was entered into. Accordingly, the plaintiff’s claim should be dismissed with costs.