Property developers don't beat around the bush. So when John Cappello phoned John Scrivener to ask for his share of the joint venture profits, Scrivener told him “You’ve got nothing in writing … Good luck if you want to try and get anything in court”.
The property development was the amalgamation of three 5 acre parcels of land at Rouse Hills, Sydney, for a medium density subdivision (see image). Put & Call Options were obtained, a Development Consent was granted, and the site was sold at a large profit.
But while the property development was a great success, the relationship between the partners was not. This was because after securing the site, and contributing to an option fee, John Cappello had taken a backseat role as a silent partner, allowing John Scrivener to pursue the development project in his name. This led to John Scrivener thinking it was all his project.
The property joint venture made a $9 million profit. So it was well worth John Cappello taking his claim to the NSW Supreme Court, in a trial which lasted 7 days and cost hundreds a thousands of dollars in legal fees.
John Cappello's weakness was that there was no joint venture agreement in writing. There was no Joint Venture Agreement, no Joint Venture Company, not even a Heads of Agreement to document the joint venture.
The evidence was an unsatisfactory mixture of emails and recollections of conversations at meetings, in phone calls, at a cafe and over lunch, many years before.
The good news for John Cappello is that the NSW Supreme Court awarded him a one half share of the joint venture profit treating his relationship with John Scrivener as a partnership.
For my case note click