Elderly man sues former son-in-law after losing $250k in property deal

Elderly man sues former son-in-law after losing $250k in property deal


An elderly man who sold his home and moved to Tasmania with the promise of living out his days on a farm is suing his former son-in-law for allegedly reneging on their agreement.

In 2018, Vernon Roy Scott claims he was approached by his then son-in-law, lawyer Shaun Victor Kerrigan, about investing in a property in north-west Tasmania.

Documents filed with the Supreme Court in Hobart allege Mr Kerrigan orally proposed the 77-year-old sell his “only residence” in Barraba in New South Wales and invest $250,000 from the proceeds of that sale into a farm in Sheffield.

Mr Kerrigan denies these claims.

Mr Scott alleges Mr Kerrigan told him to invest because he had a contract to live export Wagyu cattle to South-East Asia and would use the farm to raise and graze the cattle. 

Court documents claim Mr Kerrigan said he and his then wife, Justine, would purchase the Hamptons Road Farm using the $250,000 together with a further $650,000 from tax accountant and agent Salvatore Peter Cassaniti. 

In exchange for the investment, Mr Scott claims he would have been “entitled to live permanently on the property” and could assist Mr and Mrs Kerrigan in setting up and operating the cattle export farm business.

Mr Scott said he agreed to invest because it was his son-in-law, who was a lawyer, proposing it.

In 2018 he sold his NSW property and claims he gave Mr and Mrs Kerrigan a $10,000 cheque for the deposit.

In September 2018 the Hamptons Road Farm was purchased for $900,000.

Vernon Scott says he was promised he could live at the farm for the rest of his life.(

Supplied: realestate.com.au/Roberts Real Estate

)

Court documents allege that Mr Cassaniti and/or Mr Kerrigan then created the company Sheffield (Tas) Pty Ltd, which would own the farm.

In May 2019, Mr Scott transferred the remaining money, $240,000, into the company’s bank account. 

The following month, Mr Scott began living on the Hamptons Road farm.

That same month, court documents allege Mr Kerrigan “and/or” Mr Cassaniti created a “deed of agreement” based on the promises given to Mr Scott.

The deed allegedly stated that Mr Scott’s payment of $250,000 “is for the right to exclusively use and quiet enjoyment [sic] the homestead on the property for life to the exclusion of all other persons”.

It also allegedly stated that the company “must ensure” the homestead on the property “is available and ready to be lived in at any time after the purchase and for the entire life of [Mr Scott]” and in the event that it fails to do so, the sum of $250,000 would immediately become due and payable. 

Both Mr Kerrigan and Mr Cassaniti have both admitted there was a document entitled “deed of agreement, which Mr Kerrigan drafted, but Mr Kerrigan alleges it was signed by his wife. Mr Cassaniti claims it was not entered into by the company, nor was it a deed.

Court documents allege that Mr Cassaniti spoke to Justine Kerrigan over the phone and said words to the effect that “your dad is an old man. Of course we will take care of him”.

Deed of agreement ‘not worth paper it’s written on’

In late June 2019, Mr and Mrs Kerrigan split.

In or about mid-June to July 2019, Mr Cassaniti allegedly met with Mr Scott in person at the farm and asked him to show him the deed of agreement.

After reading it, Mr Cassaniti allegedly told Mr Scott that the “company named as borrower in the deed of agreement did not exist”.

It is alleged that the company that should have been listed on the agreement was Sheffield (Tas) Pty Ltd. Instead it listed Sheffield (Tas) Properties Pty Ltd, “which does not exist”.

According to the statement of claim, Mr Cassaniti alleges this meant the deed was “not worth the paper it’s written on”.

The statement of claim alleges this was a “mutual mistake by all parties”.

In November 2019, Mr Scott allegedly asked Mr Cassaniti to refund the $250,000 he had invested in the property.

Less than a month later, lawyers for Mr Kerrigan are alleged to have informed Justine Kerrigan the company was “eager to sell” the farm and associated equipment.

The lawyers said the farm was apparently “encumbered” by a mortgage and there was very little money remaining.

They also claim Mr Scott was required to pay rent for living on the farm. 

About one year later, Mr Cassaniti allegedly told Mr Scott’s lawyers that company had “contracted to sell the [Hamptons Road Farm] for $975,000”.

The letter is claimed to say Mr Cassaniti and the company recognised Mr Scott as an unsecured creditor — meaning he did not have a security interest, such as a mortgage, over the company’s assets — and was happy to recognise “an obligation to pay [him] interest”. 

However, the letter, sent on December 7, 2020, also allegedly asserted that Mr Scott had no legal right to own or possess the farm and should vacate it by December 13. In his defence, Mr Cassaniti did not admit to these allegations.

Court documents claim the defendants — Mr Cassaniti, Mr Kerrigan, the Sheffield (Tas) company and Mr Cassaniti’s company Reliance Financial Services — caused him to suffer detriment by:

  • Inducing him to sell his only residence;
  • Inducing him to provide $250,000 to the company;
  • Promising to grant him a proprietary life interest — meaning he could live there forever;
  • Failing to ensure the farm remained available and ready to be lived in for his entire life; and,
  • Failing or refusing to refund his sum of $250,000.

It also claims the defendants have breached Australian Consumer Law by acting unconscionably in trade and commerce.

The various claims against the defendants are denied by all the defendants.

Mr Scott is seeking a declaration that he either holds a life interest in the Hamptons Road Farm, meaning he can live there for the rest of his life, or he wants the $250,000 back with interest and legal costs.

Mr Scott initially moved out of Hamptons Road Farm, but says he returned when he realised he would not get his money back. 

He currently lives on the property.

Son-in-law denies he induced man to sell home 

In defence filed with the court, Mr Kerrigan has denied Mr Scott’s claim that he induced Mr Scott to sell his NSW home and invest the $250,000, but did admit he received the money.

He also admitted he did not refund the money but denied Mr Scott was entitled to any relief.

In Mr Cassaniti’s defence, he said he did not know about the oral promises allegedly made to Mr Scott until he read the statement of claim.

He said they were made without his authority and he did not find out Mr Scott was living on the farm until after he had moved in.

He further claims that Mr Kerrigan told him he would be doing him a personal favour by letting Mr Scott live on the property because he did not want his father-in-law living in his house.

Mr Cassaniti claimed Mr Kerrigan said this was because Mr Scott had a “propensity to violence against Mr Kerrigan” and although he was family he was “a nuisance and drank Mr Kerrigan’s alcohol”. 

He alleged the $250,000 was a loan made to Mr and Mrs Kerrigan and it would be on them to repay it. He also claimed they were the wrongdoers.

While he denied Mr Scott was owed a life tenancy on the farm, he alleged that if there was one it had been terminated for a number of reasons:

  • Mr Scott allegedly blocked the most direct access to the farm by a lock;
  • When Mr Kerrigan demanded access he allegedly assaulted him by trying to stab him with a screwdriver;
  • He allegedly disconnected the electric fencing and cattle escaped; and,
  • In preventing the cattle operation from being able to effectively operate, he had breached the implied term of agreement.

He also claimed that moving out of the house and moving back in was a surrender of the lease.

Whilst Mr Cassaniti denied that Mr Scott had suffered loss and damages, he said any such loss arose from his “failure to prudently take care of his own interests”.

Finally, he argued that Mr Scott has said that money was sufficient compensation and the continuation of the lease would cause hardship on the company because it would have a “non-income” producing asset.



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