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Acknowledgement of Debt, Relationship Property, trust, Trusts

Love lost

When who stopped loving who first is lost to the antiquities of time, for modern lovers there is still the trust to keep them shackled together. And what a shackle, and what expense…

Whittle v Whittle is another tale of love lost but the Trust, if not the trust, remaining.  In this case the pesky issues of gifts and debts arises again (spoiler alert – not sure we’ve seen the last of this particular turnip).

Bare facts:

  • property sold to trust when the settlors liked each other
  • outstanding debt when they didn’t $317,910
  • the debt is relationship property, which is not disputed
  • what is disputed is the terms on which the debt must be re-paid as there are no documents recording the terms of the debt.

Mr Whittle tried unsuccessfully to seek summary judgment of his “half”.  While the Court appeared sympathetic to Mr Whittle’s position, the difficulty it faced was that there was no evidence to show whether the debt was a joint debt or was held as tenants in common.

Hint to lawyers and accountants – think long and hard before drafting Acknowledgments of Debt where the debt is a joint debt – one client might thank you – the other will not.

The end was result was not good – the Court could not find that there was a debt it could issue judgment on for Mr whittle.  However, the judge, rather wisely and sagely threw both parties a bone and suggested that given the core issues and the fact that there was actually a small gulf between the parties – the parties were urged to consider mediation of ADR.





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