Gopaul & Anor v Naidoo & Anor

A claimant seeking to enforce a written agreement bears the burden of proving, on the balance of probabilities, that the document is authentic and represents the agreement relied upon. Where the evidence concerning the document’s preparation, execution, alteration and custody is inconsistent, the court may find that burden undischarged. The claim then fails without it being necessary to determine the full financial account between the parties. A proposed personal undertaking to repay a debt owed by a company also requires consideration if it is to be enforceable.

The claim arose from a redevelopment venture involving two companies controlled by the parties. The claimants alleged that the defendants had signed a personal loan agreement acknowledging receipt of £400,000 and undertaking repayment, profit-sharing and security obligations.

The defendants accepted signing the relevant signature page but disputed the authenticity and contents of the document relied upon. They contended that the genuine agreement concerned repayment of profits and the transfer of shares, rather than a personal loan. The central issues were whether the alleged agreement was authentic and, if so, whether the defendants’ obligations were enforceable for want of consideration.

1. The claim was dismissed. The claimants had to establish, on the balance of probabilities, that the alleged agreement was what it purported to be and that the signature page had not been taken from another document.
2. The evidence did not satisfy that burden. There were substantial inconsistencies in the accounts given by the witnesses, unexplained discrepancies in the documents, uncertainty about the identity of the lender and borrower, and evidence of repeated dismantling and restapling of the document. Those features meant that the court could not be confident that the signature page had always been associated with the other pages.
3. The court attached particular weight to the evidence of Mr Clarke, whose account was preferred where it conflicted with the other witnesses. The evidence of the principal claimant and another supporting witness was rejected on contested matters, while the defendants’ evidence was also treated with considerable caution.
4. The statutory declarations made for the Land Registry applications identified Gopaul Investments Ltd as lender and Rosebeech Investments Ltd as borrower. They therefore provided context inconsistent with the alleged personal loan agreement relied upon at trial, although the court’s decision ultimately rested on the claimants’ failure to prove the document’s authenticity.
5. Had the alleged agreement been proved genuine, the judge would have held it unenforceable for want of consideration. That conclusion was alternative and did not determine the outcome.