A borrower who was the victim of a Nigerian scam failed in her attempt to have loans that supported her investment in the scam set aside …
Ms Wu was an experienced and astute businesswoman who unfortunately fell victim to a Nigerian scam. Between February 2009 and October 2010, Ms Wu borrowed money from Mr Ling on five occasions to advance what she believed was a good investment in Nigeria. Ms Wu made no repayments of interest or principal.
By the time of the fifth loan Mr Ling believed that Ms Wu was being defrauded. He warned her that it was not in her best interest to borrow further money or invest in the Nigerian business. Ms Wu begged Mr Ling to lend her the money. Ultimately, Mr Ling agreed to lend Ms Wu a further $90,000 in October 2010.
Mr Ling sued for recovery of the money he had loaned Ms Wu. Ms Wu defended the claim on the basis that she was a victim of the scam and Mr Ling was aware of this . Mr Ling was successful and Ms Wu appealed. Her appeal was heard in September 2016 and the decision as delivered in December 2016. Ms Wu was again unsuccessful. The Court of Appeal considered when a loan should be set aside because it was unconscionable particularly when the borrower claims to be a victim.
If Mr Ling had taken surreptitious advantage of Ms Wu’s weakness the court may have intervened and relieved her of the obligation to repay the loans. The court went on the say that people do foolish things and knowledge of that foolishness by the lender is not enough to attract the type of relief Ms Wu sought. If Mr Ling were to be deprived of the benefit of his bargain Ms Wu would be required to prove a predatory state of mind. There must be either an active exploitation or a passive acceptance of a benefit in unconscionable circumstances.
On the facts, Mr Ling was aware, at least by the time of the fifth loan that Ms Wu was the victim of a Nigerian scam and was being defrauded. He warned her against taking out the final loan and Ms Wu also had the benefit of legal and accounting advice.
Based on the particular circumstances of this case, the court held that Mr Ling was entitled to judgment for the principal and interest of each of the loans to Ms Wu.
Short case note : A brother and sister argue in court about the ownership of a property in a Sydney suburb.
Livy Szeto claimed that her brother, Liming Situ, held a property at Carlton in his name for both of them in equal shares. Ms Szeto said that before her brother purchased the property they agreed that she would be a co borrower but that the property would be registered in Liming’s name.
Ms Szeto made her claim for an interest in the property on two grounds: the first was that the agreement between them created a common intention trust and the second was that her financial contribution of at least 50% of the purchase price created a resulting trust. Either of these trusts would require Liming to hold the property on trust for both of them
Judge Lindsay did not accept that the agreement claimed by Ms Szeto was made and further that she did not contribute any of her own money to the purchase price.
His Honour found that Ms Szeto had no interest in the Carlton property.