In brief

Time and time again, we see people entering into informal agreements without proper documentation. As the recent case of Neve v Kent [2020] VCC 22 demonstrates, even if you trust the other party, it is important to properly set out the agreement to ensure all parties are clear as to what has been agreed.

The facts

  • Neve is a fitter and turner and had known Kent for 15 years.
  • Neve was due to come into some funds following a redundancy and divorce settlement. Not knowing much about finance he approached Kent for assistance.
  • Neve provided $300,525.85 to Kent to invest on his behalf.
  • Kent drew up documentation including an Agreement and mortgages. Kent claimed that mortgages were signed but not registered in order to protect Neve's interests if Kent were to die (rather than enforceable immediately).
  • Kent said that this amount was not paid to him but were advances to third parties (who were related parties to Kent) and therefore Kent was not personally liable to repay the sums.

The Court

  • The Court found Kent to be an unpersuasive witness.
  • The Court found that Kent personally owed the money to Neve.


Although the Court ultimately found in favour of Neve, it costs approximately $250,000 in legal fees to get to this result.

The lesson is to pay the money to document the agreement initially to save significant costs down the track if a dispute arises.


Never sign any document that has been prepared by the other party without independent legal advice.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Madgwicks is a member of Meritas, one of the world's largest law firm alliances.