Ballantyne v Phillott [1961] HCA 17; (1961) 105 CLR 379 (14 April 1961)

HIGH COURT OF AUSTRALIA

BALLANTYNE v. PHILLOTT [1961] HCA 17; (1961) 105 CLR 379

Contract

High Court of Australia
Dixon C.J.(1), Menzies(2) and Windeyer(3) JJ.

CATCHWORDS

Contract - Accord and satisfaction - Action for money lent and money due upon a promissory note - Previous action commenced upon the same cause of action - Discontinuance of action - Document subsequently signed by both parties stating that action would be discontinued and not again commenced by plaintiff and that he waives all claims against defendant and that defendant has no claim against plaintiff - Consideration - Whether cause of action discharged.

HEARING

Brisbane, 1960, June 22, 24;
Sydney, 1961, April 14. 14:4:1961
APPEAL from the Supreme Court of Queensland.

DECISION

1961, April 14.
The following written judgments were delivered:-
DIXON C.J. This appeal has caused me great difficulty. The point in the case should be held extinguished by accord and satisfaction. A question of accord and satisfaction is seldom easy but the difficulty which I have felt is not traceable to the unsatisfactory nature of the criteria the law provides. It arises rather from an inability clearly to perceive what was happening at the critical time between the parties themselves and between them and the auxiliaries upon whose counsel and assistance they seem to have depended. The story is a long and unedifying one of the financial relations between mistress and man upon which the oral evidence throws but a flickering light and the why and wherefore of which is left unanswered by the documents, though they are clear enough in themselves and certainly decisive of the passing of money. The mistress is the defendant and she appeals against a judgment pronounced against her in favour of the man for 17,157 pounds by Mansfield C.J. after a trial without a jury. The man, who is of course the plaintiff, sued for 24,235 pounds money lent, 7,217 pounds due upon a promissory note and 50 pounds money paid. The defendant's case was that there were no loans, no liability, and that in any case the plaintiff had sued once before and then had withdrawn his claim in circumstances affording her a defence of accord and satisfaction. She did not deny that for the most part she had had the money or that she had signed the promissory note but she denied that she was ever to pay or repay him anything. The plaintiff gave evidence but he was a man of seventy-three or thereabouts who four years earlier had been left by a cardiac illness with an enfeebled memory and his evidence could amount to very little. The defendant also gave evidence but she possessed no such advantage. No great credence was given to her evidence which was not regarded as reliable; moreover it clearly was defective on some matters, particularly as to the details of what happened over the withdrawal of the plaintiff's claim after he took the earlier proceedings. His claim for money lent was in respect of sums paid to the defendant between 3rd December 1951 and 20th August 1954, when it may be assumed that his illness terminated their association; but their relationship went back long before 1951. It was formed about 1941 at Wyandra a small town in Western Queensland where she was or had been housekeeper for McDonough, who apparently never lost touch with her and came to her help when in February 1956 the plaintiff issued his first writ against the defendant. In 1946 the plaintiff Phillott appears to have set up a flat for her in Brisbane. He paid the rent of the flat and gave her a weekly allowance. Other moneys he paid to her as well. For some reason at the beginning of 1950 or thereabouts she married. Her husband was a man named Ballantyne who lived and worked in Western Queensland. But within a year she resumed her relations with the plaintiff. A hotel was bought at Wyandra and for this he advanced 6,250 pounds to her which was secured by mortgage. From her husband a store was bought, in July 1954, and for this the plaintiff advanced 7,217 pounds for which she gave him her promissory note. For much of the time she lived in the flat in Brisbane but, if the evidence is to be believed, she and both her husband and the plaintiff Phillott lived and worked at the hotel at Wyandra. Of the many large sums of money, always in round figures paid to her, there is no very clear or intelligible explanation. In 1954 the association ceased and until the beginning of 1956 the plaintiff and defendant seem not to have been in communication. But on 14th February 1956 a writ was issued against the defendant on his behalf. The statement of claim upon the writ was for the same moneys and specifically pleaded the promissory note in terms which are sufficient unequivocally to indentify it. On 20th February 1956 an appearance in the action was entered on behalf of the defendant and on 21st February 1956 a notice of discontinuance was filed on behalf of the plaintiff endorsed with the consent of the defendant's solicitor. One might expect at this point a precise account of what happened: it is not however forthcoming. In his evidence the plaintiff gave a sketchy account of meeting the defendant accidentally in a city building at this time. She asked him "if he was going on with it". He answered "Yes" and she said she would pay him when she sold the hotel, to which he was agreeable. According to the defendant, she telephoned to the plaintiff after the service of the writ and said what a dreadful thing it was for him to do. He answered that he had to on account of tax and of his family: he would be up for gift duty and he was worried about tax. She arranged to meet him; they met in the city and talked and went from one place to another. At length he telephoned to his solicitor to withdraw the writ. The solicitor refused until there was an apology from a newspaper. This was in reference to a mistake that had been made in the reporting of the issue of the writ. She was described as plaintiff: this or possibly the correction when it was made, was apparently considered by the defendant as reflecting upon her. At all events she told him that she could sue him for libel. Later, almost certainly on or before 2nd March 1956, they waited for McDonough who came to the hotel after some time. Phillott the plaintiff had asked her if she would sign a document which would mean that she would have no action against him and he none against her: she said naturally she would. The story told by McDonough is that he was staying at the hotel in question, that he returned there late one day and found them waiting. Knowing of the writ he asked if they had composed their differences. The answer was that they had done so. Phillott asked him for a loan and McDonough in response said that they should give him something in writing to say that they had composed their differences before he would enter into any discussions. At this point it is necessary to refer to an officer of the Public Curator's office named Boyle who came now to play a part in the story. McDonough said that he had known Boyle and had seen him with Phillott. In evidence the latter said that he did not know Boyle, who however testified that in an hotel bar Phillott asked him if he could have a statement typed out for him: he produced the statement he desired to be typed. It was in handwriting. After some delay Boyle had it typed and handed the copies and the original back to Phillott. Boyle's evidence proceeded "I told him that I would not, myself, sign a thing like that, that if he did owe her any money why say he did, why say or why infer he owed her any money. I said, 'If she owes you any money and you are going to give it away, then somebody could be up for a considerable amount of gift duty.' I said, 'There is also this to consider, Frank, if you ever do make up your mind to have a go in the future to claim the money again you might find this thing in your road'". His evidence makes it plain that the document he had typed was that subsequently dated 6th March 1956. According to his evidence he did not know until later of that dated 2nd March 1956. The document of 6th March was signed by both the plaintiff and the defendant before a Justice of the Peace to whom Boyle took them on the later date. Somehow the document of 2nd March found its way into the defendant's possession. After it was signed it was given to McDonough. At this period McDonough was maintaining the defendant at the flat in Brisbane. In fact he did lend some money to the plaintiff Phillott. (at p387)

2. It is now convenient to set out the two documents. That dated 2nd March is as follows:-

"2nd March 1956.

That any action or proceeding in any Court heretofore
commenced by the said Frank Pender Phillott against the
said Roberta Ballantyne will be discontinued and that such
action or proceeding shall not again be commenced by or on
behalf of the said Frank Pender Phillott against the said
Roberta Ballantyne and the said Frank Pender Phillott waives
all any any rights or claims whatsoever which he has or may
have had against the said Roberta Ballantyne by virtue of
such action or proceeding or otherwise howsoever.

That the said Roberta Ballantyne has no right or claim
against the said Frank Pender Phillott in respect of or arising
out of any such action or proceeding or otherwise howsoever.

F. Phillott.
Roberta Ballantyne.
Witness
E. J. McDonough." (at p387)

3. This document suggests the clauses drafted in a legal fashion but without operative words to form part of an agreement. Whether Boyle or someone else turned this into a statutory declaration cannot be discovered from the evidence. But the document of 6th March 1956 of which there are two copies as well as an unsigned copy takes that form. It is as follows: -

"Queensland )
to wit )
We, Frank Pender Phillott of
and Roberta Ballantyne of Victory Court
Flats New Farm, Brisbane in the State of Queensland, do
solemnly and sincerely declare as follows:-

1. That any action or proceeding in any Court heretofore
commenced by the said Frank Pender Phillott against the
said Roberta Ballantyne shall be discontinued and that such
action or proceeding shall not again be commenced by or
on behalf of the said Frank Pender Phillott against the said
Roberta Ballantyne

2. That the said Frank Pender Phillott waives all and any
rights or claims whatsoever which he has or may have had
against the said Roberta Ballantyne by virtue of such action
or proceeding or otherwise howsoever

3. That the said Roberta Ballantyne has no right or claim
against the said Frank Pender Phillott in respect of or arising
out of any such action or otherwise howsoever
And we make this solemn declaration conscientiously
believing the same to be true, and by virtue of the provisions
of the 'Oaths Act of 1867'.

Signed and declared )
by the said Frank Pender )
Phillott at Brisbane this ) F. Phillott
Sixth day of March 1956 )
before me - )

C. P. Tavener J. P.
A Justice of the Peace.

Signed and declared )
by the said Roberta )
Ballantyne at Brisbane ) R. Ballantyne
this Sixth day of March )
1956 before me - )

C. P. Tavener J. P.
A Justice of the Peace." (at p388)

4. The foregoing narrative is not full: there are many points of evidence omitted: mostly questionable or dubious. But in substance the narrative sufficiently gives so much of the circumstances as the parties have chosen to unfold affecting the question upon which the appeal depends. That question is whether the plaintiff's prima facie cause of action is met by a plea in bar by way of accord and satisfaction or other discharge. For the appellant did not otherwise attack the findings of liability. It is to be remarked that the plea was not converted into one of accord and satisfaction until an amendment was sought for the purpose on the last day of the trial, which amendment was allowed when judgment was delivered. Until that time it seems to have been an equitable plea. The document relied upon was that of 6th March 1956. The amendment read, without the paragraph for which it is substituted, is hardly intelligible, but although the amended plea refers to no date it has been assumed that the document of 2nd March 1956 is not part of the accord and satisfaction pleaded. However that may be, if the documents, be they both the "agreement" of 2nd March 1956 and the declaration of 6th March 1956 or the latter only, are carefully read in light of the facts it appears to me to be quite clear that the plaintiff intended once for all to renounce for ever his rights against the defendant. It is true that the language speaks of his discontinuing the action as a step yet to be taken but that seems to be of little importance because he waives all or any rights or claims whatsoever which he has or may have had against the defendant. The words "by virtue of such action or proceeding or otherwise howsoever", might be felt difficult because the words "by virtue" strictly are inappropriate. Apparently they are used to convey the idea of the claims being covered by such action. But on the plaintiff's side there is, as I see it, a perfectly plain attempt to renounce all the claims against Roberta Ballantyne which he has made or could make. I see no difficulty in construing the word "waives" as expressing an abandonment or discharge of his rights and claims against the defendant: it is hard to give it any other sense. There appears to me to be only one difficulty and that is to find the consideration on her side which he accepts in discharge of the rights he waives. If he had overcome the prejudice ascribed to him by Boyle against solicitors, doubtless a seal would have been affixed and then no such point could be available to him. But as it is the question is whether he obtained or took any consideration. It is not a question whether an executory promise was proffered as, or formed, the consideration and whether that would suffice. See British Russian Gazette etc. Ltd. v. Associated Newspapers Ltd. (1933) 2 KB 616, at pp 643-645, 650-655 . It is a question whether the statement of the defendant Roberta Ballantyne that she had no right or claim against the plaintiff amounts to a present renunciation of anything of appreciable value or significance and was taken in exchange by the plaintiff. In the course of the cross-examination of the defendant, the emptiness of her claims was put to her. Her answers are what might be expected from a former mistress who though liberally supplied with money had been engaged in ventures with the man who kept her. She said she had told him that if they went into the details he owed her money too. There was a 1,000 pounds of which he took 500 pounds back and often, when at the hotel, he had different things. To a question whether she suggested there was a balance in her favour she said "Really if I had not met him I would be a lot better off today. I would not be sitting here." She would have been in a business. He had got quite a lot back going to the races and helping himself out of the safe (scil. at the hotel). There was no accurate account taken of the moneys. Counsel said "Let us make it clear" and thereby evoked the response "He did owe me money". "For?" "Everything." One may readily say "Of course she had no claim which a judge would enforce." But there remains the question whether the disclaimer or renunciation on her side of all rights against him had no value or import. His was by no means an unprecedented situation. He had mortified a woman with whom he had lived and had put her aside. Many men who have so behaved have failed to escape the natural consequences. Unless they "composed their differences" trouble might be expected. He had moreover been reproached for suing her by the man who now lent her his aid and he wished to borrow money from the latter. But no aid would be forthcoming until there were mutual guarantees of future amity. When McDonough said that he must have a document that they had composed their differences he wished to be sure that the plaintiff's claim was not revived and that on her part she made, and could make, none in the future. Odd as the documents are and slight as, in a legal point of view, might be the assessment given to the consideration she could exchange with his, yet it was something and I think in the circumstances it should be deemed enough. It is a result that accords with their mutual intentions and I think that it is authorized by this peculiar branch of law. (at p390)

5. One matter arose during the consideration of this case to which unfortunately I did not advert during the argument. The point is that if the promissory note was renounced in writing that might be enough to bar his suit upon it. See Foster v. Dawber [1851] EngR 671; (1851) 6 Ex 839, at p 851 [1851] EngR 671; (155 ER 785, at p 791) . It did not occur to me during the argument that the documents of 2nd March and of 6th March 1956 referred in terms to the action and that the writ identified the promissory note and thus between them you might spell out a written reference to the negotiable instrument in the documents which appear to me to renounce the plaintiff's causes of action. In the view I take of the whole case however this becomes immaterial. (at p391)

6. I would allow the appeal and enter judgment for the defendant. (at p391)

MENZIES J. The appellant was the defendant in an action commenced in the Supreme Court of Queensland in May 1957 in which the respondent claimed 24,235 pounds 7s 0d money lent, 50 pounds money paid and 7,217 pounds money owing upon a dishonoured promissory note given to secure the payment of money lent. The appellant did not deny that she had received large sums of money from the plaintiff during the years 1951 to 1954 inclusive but her version of what had occurred was that everything she received had been given to her by the plaintiff. She had been his mistress for many years prior to her marriage in 1950, and after a break for about a year the relationship had been resumed and it was during this later period that she received from the plaintiff amounts totalling 31,500 pounds, approximately, that in the action he sought to recover as loans. The action was heard by the Chief Justice, who was not able to accept fully the evidence of either the plaintiff or the defendant. He said: "At the time of hearing the plaintiff was aged about seventy-three years and as a result of a serious illness towards the end of 1954 and thereafter, his memory of events was defective. For that reason it is difficult to gather from his evidence any reliable details of his money transactions with the defendant. Also his evidence as to dates is quite unreliable. I am satisfied, however, from the whole of the evidence that during the relevant period he drew cheques on his banking account and made certain payments to the defendant. He has sworn generally that none of the payments so made by him were gifts and that they were loans. The defendant has sworn that the payments made to her by the plaintiff and which are the subject matter of this action were gifts and that at no time did he lend her any money. I do not accept her evidence as reliable. That, however, does not necessarily mean that I accept in full the evidence of the plaintiff." In the result and after an examination of the circumstances in which the various payments were made, his Honour found that of the 31,500 pounds paid by the plaintiff to the defendant, 17,867 pounds was by way of loan, of which 17,157 pounds had not been repaid and judgment was given for that amount. From the finding that the plaintiff had lent the defendant 17,867 pounds there is no appeal. The only ground of appeal is that an alternative defence of accord and satisfaction should have succeeded. (at p392)

2. In 1956 the respondent had sued the appellant upon the same causes of action as those with which we are now concerned. The first writ was issued on 14th February 1956; an appearance was entered on 20th February 1956; and the action was by consent discontinued on 21st February 1956. On 2nd March 1956 a typed document in the following terms was, as the learned Chief Justice found, signed by the parties:-

"2nd March 1956.

That any action or proceeding in any Court heretofore
commenced by the said Frank Pender Phillott against the
said Roberta Ballantyne will be discontinued and that such
action or proceeding shall not again be commenced by or on
behalf of the said Frank Pender Phillott against the said
Roberta Ballantyne and the said Frank Pender Phillott
waives all and any rights or claims whatsoever which he has
or may have had against the said Roberta Ballantyne by
virtue of such action or proceeding or otherwise howsoever.

That the said Roberta Ballantyne has no right or claim
against the said Frank Pender Phillott in respect of or arising
out of any such action or proceeding or otherwise howsoever.

F. Phillott
Roberta Ballantyne
Witness
E. J. McDonough." (at p392)

3. The evidence relating to the authorship, making, and the production and signing of this document and to its custody thereafter left what actually took place in very considerable doubt. It came into existence after the action had been discontinued. The plaintiff could recollect nothing of it. The defendant gave evidence to the effect that she had seen the plaintiff and told him that he had done a dreadful thing in issuing the writ. She asserted that she could sue him for libel arising from a published newspaper correction of an earlier mistaken statement that she was the plaintiff: she also asserted that he owed her money. With these assertions she said he agreed and asked for her forgiveness. Later she said she and the plaintiff met McDonough, a ubiquitous mutual friend, at the Bellevue Hotel when McDonough said that the plaintiff had done a ridiculous and horrible thing in suing her; then the document was produced by someone - she thinks it was probably the plaintiff - and was then and there signed by the parties and witnessed by McDonough. McDonough's evidence was that he saw the plaintiff and defendant after he learnt the writ had been issued and asked them whether they had composed their differences. When they said they had, he asked them for something in writing for his benefit before he would discuss the plaintiff's request to him for a loan of 700 pounds or 800 pounds. At a later date, he said, the three of them met again and the plaintiff produced the document which was then signed and given to him. The evidence of what happened to the document is particularly scanty. McDonough said it was given to him and that in about July 1956 he gave the plaintiff a copy. The document was itself produced in Court by the defendant and not by the plaintiff, as his Honour mistakenly thought. Although his Honour referred to the evidence which I have outlined, he made no findings upon it except in these words: "Exhibit 42 is a typed carbon copy and is dated 2 March 1956. It is signed by the plaintiff and the defendant and witnessed by McDonough. It came from the possession of the plaintiff's solicitors". The reason no doubt why the learned Chief Justice found it unnecessary to make any more particular findings about the document of 2nd March is that it is not the document that was relied upon as constituting accord and satisfaction. After it was signed and taken away by somebody, a Mr. H. E. Boyle enters the picture. He was a clerk in the Conveyancing Branch of the Office of the Public Curator, Brisbane. He was a friend of McDonough and he said that he was more or less a friend of the plaintiff. Boyle's evidence was that early in March 1956 the plaintiff asked him if he could have a statement typed for him and gave him a piece of letter pad, handwritten, to be typed out. When Boyle read it, he asked the plaintiff why he would want to sign such a document and asked who his solicitors were. After further discussion, Boyle said he took the document to his office and had two copies typed as originals in the form of a statutory declaration. He then met the plaintiff with the defendant in the lounge of the Gresham Hotel, gave him the two documents and took him along to a justice of the peace before whom they were signed and declared and by whom they were witnessed. The plaintiff and the defendant each had a copy and the plaintiff then handed his to the defendant and said "You had better look after this" and she put it in her handbag. This occurred on 6th March 1956. This document which was relied upon as an accord and satisfaction is as follows:-

" (QUEENSLAND )
(ADHESIVE ) 21/10/56.
(DUTY 2/6d. )
Queensland )
to wit )

We, Frank Pender Phillott of
and Roberta Ballantyne of Victory Court
Flats New Farm, Brisbane in the State of Queensland, do
solemnly and sincerely declare as follows:-

1. That any action or proceeding in any Court heretofore
commenced by the said Frank Pender Phillott against the
said Roberta Ballantyne shall be discontinued and that such
action or proceeding shall not again be commenced by or on
behalf of the said Frank Pender Phillott against the said
Roberta Ballantyne.

2. That the said Frank Pender Phillott waives all and any
rights or claims whatsoever which he has or may have had
against the said Roberta Ballantyne by virtue of such action
or proceeding or otherwise howsoever

3. That the said Roberta Ballantyne has no right or claim
against the said Frank Pender Phillott in respect of or arising
out of any such action or otherwise howsoever
and we make this solemn declaration conscientiously
believing
the same to be true, and by virtue of the provisions of the
'Oaths Act of 1867'.

Signed and declared )
by the said Frank )
Pender )
Phillott at Brisbane ) F. Phillott.
this )
Sixth day of March )
1956 )

before me - )

C. P. Tavener J. P.
A Justice of the Peace

Signed and declared )
by the said Roberta )
Ballantyne at ) R. Ballantyne.
Brisbane )
this Sixth day of )
March )
1956 before me - )

C. P. Tavener J.P.
A Justice of the Peace." (at p394)

4. It will be noticed that apart from the change from "will" to "shall" in the first clause, the operative part of the declaration is in the same terms as the document of 2nd March 1956. Boyle also said that he returned to the plaintiff the manuscript from which the declaration was prepared. Boyle's evidence relating to typing the document as a declaration was as follows: "Did you tell Mr. Phillott that you intended to have it in the form of a statutory declaration? - When I saw the paper like that, I said, 'Is it a declaration you want?' What did he say? - It did not seem to matter much to him, whether it was a declaration or not, as long as it was typed. I did it in the form of a declaration." The plaintiff said he had no recollection of the events surrounding the making of the declaration and he denied that he knew Boyle. His Honour's finding was as follows: "I accept Boyle's evidence as being substantially correct. I assume that it is owing to the plaintiff's bad state of health that he has no recollection of those events". The defendant's evidence was that on the day she made the declaration she met the plaintiff at the Gresham and was introduced by him to Boyle. After some drinks they went round to the bank building where the documents were signed. She said that McDonough was also at the Gresham on that day. (at p395)

5. The learned Chief Justice found as follows: "The only accord and satisfaction which is pleaded is the alleged written agreement of 6th March 1956. The document which has been pleaded is not in the form of a contract and there is no evidence of any agreement between the parties, other than the evidence of McDonough that the plaintiff said they had composed their differences. According to the terms of the document, there is no promise by the defendant to waive any right or claim against the plaintiff, there is merely the statement that the defendant 'has no right or claim against' the plaintiff. If in fact she has no such right or claim, there could be no consideration moving from her, there being no liability of the plaintiff to her from which she could release him. If, on the other hand, she had in fact a right or claim against him, there is no agreement by her to release him from it. In my view the contract as pleaded lacks consideration and therefore there has been no accord and satisfaction". (at p395)

6. The one thing that emerges clearly from the evidence is that it does not tell the whole story. The plaintiff was old, in bad health and, as his Honour stated, he had been foolishly infatuated. His memory could not be relied upon. The appellant's evidence was sketchy and unreliable. She had obviously traded for years upon the respondent's foolish infatuation for her and was continuing to do so in February and March 1956. McDonough's role of an honest broker between mutual friends who had fallen out was hardly convincing; and although his Honour accepted the substance of Boyle's evidence there was no satisfactory explanation why he did the things he did. In these circumstances, it is not surprising that for the most part his Honour was content to recapitulate the evidence and to leave it at that without making findings upon collateral matters. (at p396)

7. In contesting the Chief Justice's conclusion that there was no consideration for the respondent's promise, Mr. Bowen sought in the first place to establish that the appellant had in fact some genuine claim against the respondent which on 6th March 1956 she could give up. His Honour did not find that she had any genuine claim and an examination of the evidence does not satisfy me that she had. At most it reveals that if the respondent's evidence were to be accepted, she did on one occasion assert to the appellant that she had an action against him for libel and that he owed her some money. I have already referred to her assertion that the appellant had libelled her. There was, of course, no foundation for any such proceedings. All that had happened was that a newspaper had mistakenly stated that she had sued him and then had correctly stated that he had sued her. Even had the appellant obtained the correction, he had not libelled her. It was then said that not only had the respondent received money from the appellant, but over the years he had received moneys from her by way of loan, but the only evidence to support this was that in making his claim against her he had allowed her certain credits and that in the course of his evidence he recalled that on one occasion in 1952 when she had received certain insurance moneys he may have received 400 pounds or some such sum. His claim, however, was only for the net amount. There was also her evidence that she had paid some laundry bills and other trivial accounts for him and had not been reimbursed. Finally it was said that at any rate she had a claim against him for costs arising out of the discontinuance of the action, but the action was discontinued in circumstances that were really inconsistent with the defendant's being entitled to costs. Not only is there no satisfactory evidence that the appellant had any rights against the respondent, but the evidence that she had asserted to him that she had such rights leaves even that uncertain. I am not ready to make a finding favourable to the appellant that the learned trial judge was not ready to make. It is against this background that the document relied upon as an accord and satisfaction has to be interpreted. (at p396)

8. It is not in the form of an agreement, and according to its terms the appellant made no promise to the respondent. What she did was admit that she had no right or claim against him. If, however, it were a proper inference that the parties were "composing their differences" - to use the phrase that crops up in the evidence - by each promising to give up claims against the other, it would not matter that the language used is not promissory. In McDermott v. Black [1940] HCA 4; (1940) 63 CLR 161 , it was decided that a statement in a letter withdrawing earlier allegations of misrepresentations amounted to a promise not to sue in respect of the misrepresentations or to a release of any cause of action in respect of them, and because the withdrawal had been conditional upon the grant of an extension of time to complete a contract, it constituted a complete defence to an action for deceit based upon the misrepresentations. The opinion of Latham C.J., who dissented, was: ". . . the agreement to withdraw the allegations and the actual withdrawal of the allegations did not amount to or imply any promise . . . never to rely upon the allegations as a cause of action" (1940) 63 CLR, at p 172 . The other members of the Court, however, decided that the withdrawal amounted to a promise not to bring an action: see per Starke J. (1940) 63 CLR, at pp 175, 176 and per Dixon J. (1940) 63 CLR, at pp 183-186 . Dixon J. said: "The difficulty is to be sure of an intention on the part of the plaintiff to discharge the defendant from any liability, that is, an intention to take the agreement to extend the time in replacement or satisfaction of any existing right or claim put in suit by the defendant or, at all events, of the right or claim put in suit by the present action. The 'withdrawal of all allegations imputing anything improper to' the defendant conditionally upon the latter's agreeing to three-weeks' further time for payment of the balance of purchase money clearly amounts to an election to affirm the contract. It does, I think, imply a promise not to revive the allegations. . . . The untechnical and inexact expression, 'withdraw allegations', no doubt causes some difficulty. But it must be borne in mind that the purpose was to settle or compromise a very definite dispute . . . The withdrawal of the allegations of improper conduct meant, in my opinion, that he would make no claim based upon misrepresentation but would accept the promise of further time instead . . . But I think that, consistently with principle, the agreement to withdraw in consideration of a grant of time can be regarded as an accord and satisfaction" (1940) 63 CLR, at pp 185, 186 . What I have quoted is sufficient to show how different is this case from that. There, a definite dispute existed about representations which could give rise to liability unless withdrawn; here, the appellant failed to obtain a finding that she had a genuine claim against the respondent or had even made a claim. There, there was a withdrawal and the question was whether from that a promise could be implied; here, there was nothing beyond an acknowledgment that no right or claim existed. Although, therefore, McDermott v. Black [1940] HCA 4; (1940) 63 CLR 161 shows that a promise can be implied even where non-promissory language is used, it assists the appellant no further and a comparison between the two cases lends no support towards reaching a conclusion here that the appellant was making any promise. (at p398)

9. If, therefore, a promise is to be implied, it must be from something either in the context of the document or in the surrounding circumstances. The context, however, is against it. The promise of the respondent to give up his rights against the appellant is clear and definite and the contrast between the language relating to his claim and the language relating to her claim is strongly against an inference that different language was intended to mean the same thing. Nor have I been able to find anything in the surrounding circumstances that suggests that the language of denial is to be construed as the language of promise. Mr. Bowen emphasized that unless it were so construed the respondent would not be protected in the event of the appellant's suing him because there would have been nothing more than an admission that she had no right or claim against him. This is true but, as I think, unimportant. The parties to the document do seem to me to have in mind that the respondent had rights or claims against the appellant which he was promising to waive, but that she had, as she acknowledged, no rights or claims against him. To my mind, the language used not only imports no promise but is really inconsistent with the implication of a promise. It is the denial, not a withdrawal, of any claim and does not in the known circumstances amount to consideration. (at p398)

10. It has already been observed that included in the money that the action was brought to recover was 7,217 pounds owing upon a dishonoured promissory note. Since the hearing of the appeal the Chief Justice has drawn attention to ss. 67 and 95 of the Bills of Exchange Act 1909-1958 and to the possibility of regarding the document of 2nd March 1956 as amounting to an absolute and unconditional renunciation in writing after maturity of the respondent's rights as holder against the appellant as drawer of the promissory note. This point was not, however, pleaded nor was it taken at the trial or upon appeal. It is not, I think, one that we should consider. (at p398)

11. I have therefore come to the conclusion that the judgment appealed from is correct and the appeal should be dismissed. (at p399)

WINDEYER J. The statutory declaration pleaded as evidencing an accord and satisfaction reproduces in substance the document dated 2nd March 1956. That was signed by the parties, perhaps on the date it bears, and probably at the Bellevue Hotel. Who composed it, and where, when and by whom it was typed we do not know. According to the evidence it was not from it but from a manuscript document that Boyle framed the statutory declaration. The respondent remembered nothing of this; but acknowledged that the documents bear his signature. The stories of McDonough and of the defendant vary in regard to the sequence of events that led to the document of 2nd March being signed. Her evidence is inconsistent. It is not at all surprising that his Honour thought her an unreliable witness. (at p399)

2. Quite apart from the uncertainties surrounding its origin, the document of 2nd March is a puzzling composition. Each of its two paragraphs commences with the word "That"; and what prefatory clause or clauses it was intended should introduce these paragraphs can only be guessed at. A document worded as it is could, no doubt, be construed as evidencing mutual releases, and thus be a bar to any claim by either party contrary to its assertions and promises. I am not satisfied, however, that that is so here. The plaintiff in bringing his action went back upon his written promise. But the law does not prevent him doing so, unless the defendant had given him some consideration for that promise. This, I think, she failed to establish. There are several difficulties in her way. First, I doubt whether at the relevant time she had, or could have thought that she had, any claim against Phillott that she, on her part, was giving up - although I do not doubt that, in the course of recriminations, she had on occasions asserted that she had various claims (legal or moral, or immoral) based apparently upon past associations. Secondly, the document does not purport to be a renunciation by her of any claims. Having regard to the existing circumstances and the state of the relation between herself, Phillott and McDonough, it may, it seems to me, mean no more than that she acknowledges that she, who had in the past received fairly regular sums from Phillott, had no unsatisfied claims upon him, arising as a result of their recent dispute or otherwise. The mere giving of such an acknowledgment could, of course, be the price of his promise. But I do not think that is shown to have been so here. It seems to me not unlikely - and this is the third matter that prevents me being satisfied that the document evidences an accord and satisfaction - that it really records undertakings that the plaintiff and the defendant had severally given to McDonough. They were then pressing McDonough for pecuniary assistance. They sought it because in the past they had, in different ways, enjoyed his friendship. He was not prepared to provide any money without receiving assurances, from the plaintiff that he would abandon his claim, from the defendant that she in fact had no claim. The document of 2nd May thus came into existence. I am not persuaded that it evidences a binding contract between the plaintiff and the defendant. I would therefore dismiss the appeal. (at p400)

ORDER

Appeal dismissed with costs.