Co-authored by Olivia Camilleri
A recent judgement delivered by the New South Wales District Court in Puntoriero v Higgins [2025] NSWDC 244 reminds us of the importance of documenting commercial transactions to prevent lengthy and costly litigation.
Summary of Facts
The dispute involved an alleged oral agreement between Francis Puntoriero, Giuseppe Pangallo (‘Plaintiffs’) and Matthew Higgens (‘Defendant’).
The Plaintiffs claimed to have entered into an oral agreement with the Defendant in May 2010 whereby they would loan $340,000 to the Defendant to assist him in purchasing a property.[1] The Plaintiffs alleged that the Defendant would pay interest on the loan at 10% per annum – bringing the total loan sum, inclusive of principal and interest, to $680,000 – and that the loan would be payable 10 years after the advance of the loan.[2]
The Plaintiff’s claimed that the agreement was made during a meeting in June 2010 which was attended by the Plaintiffs, the Defendant, the Second Plaintiff’s son Pat, and the First Plaintiff’s father Fernando.[3] It was alleged that the Plaintiff’s handed $340,000 in cash to the Defendant during that meeting.[4]
No one ever reduced the terms of the alleged oral agreement to writing and, because the monies were paid in cash, there was no money trail to corroborate the transaction.
The Defendant denied that there was an agreement and denied that he received any monies from the Plaintiffs.[5] Rather, the Defendant asserted that he borrowed $280,000 from his friend Trevor Lucantonio to purchase the property.[6]
In reply, the Plaintiffs said they were aware of the Defendant’s loan from Trevor and was of the understanding that their loan to the Defendant would be used to repay Trevor.[7]
Issues for the Court
A unique feature of this case was that the parties put forward two completely different versions of events. His Honour Newlinds SC DCJ, the trial judge, commented that “One side, or the other, or perhaps both, must be deliberately and knowingly telling untruths.”
Ultimately, his Honour did not have to determine whether either party was lying. As the burden of proof lies with the Plaintiffs, it was up to the Judge to decide whether the Plaintiff has discharged that burden.[8]
Outcome
His Honour was not satisfied, on the balance of probabilities, that the Plaintiffs entered into the agreement they alleged, or that they advanced money to the Defendant as alleged. As such, the Plaintiff’s claim was dismissed, and costs were ordered in favour of the Defendant.
In reaching that decision, his Honour had regard to the comments on Hammerschlag J in John Holland Pty Limited v Kellogg Brown & Root Pty Ltd [2015] NSWSC 451 at [94]:
“Where a party seeks to rely upon spoken words as a foundation for a cause of action, including a cause of action based on a contract, the conversation must be proved to the reasonable satisfaction of the court which means that the court must feel an actual persuasion of its occurrence or its existence. Moreover, in the case of contract, the court must be persuaded that any consensus reached was capable of forming a binding contract and was intended by the parties to be legally binding. In the absence of some reliable contemporaneous record or other satisfactory corroboration, a party may face serious difficulties of proof. Such reasonable satisfaction is not a state of mind that is obtained or established independently of the nature and consequences of the fact or facts to be proved. The seriousness of an allegation made, inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question of whether the issue has been proved to the reasonable satisfaction of the court. Reasonable satisfaction should not be produced by inexact proofs, indefinite testimony, or indirect inferences”
His Honour considered that the Plaintiffs evidence about the alleged transaction either did not make sense, or at least seemed implausible, on a number of the key factual issues in dispute.[9]
Key takeaway: The importance of properly documenting transactions
This case shows how important it is to properly document any transaction you are involved in. Whilst documenting a transaction with family or friends might feel like a breach of trust, this case demonstrates the difficulties you will face enforcing an oral agreement if things go wrong. It’s worth taking the time to document your agreement to ensure you do not end up in litigation.
If things do go wrong and you seek to enforce an oral agreement, then the oral agreement must be proved to the “reasonable satisfaction” of the Court, meaning that the Court must feel an “actual persuasion of its occurrence of its existence”.
It’s in the best interest of all parties involved in commercial transactions to seek legal assistance to ensure adequate steps are taken to minimise risks and avoid disputes like these.
For guidance tailored to your situation, contact Coleman Greig Lawyers’ Dispute Resolution team.
[1] Puntoriero v Higgins [2025] NSWDC 244 [2].
[2] Ibid [3].
[3] Ibid [4].
[4] Ibid [4].
[5] Ibid [6].
[6] Ibid [7].
[7] Ibid [9].
[8] Ibid [12]-[13].
[9] Ibid [84].
