FEDERAL COURT OF AUSTRALIA Pitcher Partners Consulting Pty Ltd v Neville's Bus Service Pty Ltd [2019] FCAFC 119 Appeal from: Neville's Bus Service Pty Ltd v Pitcher Partners Consulting Pty Ltd [2018] FCA 2098 File number: VID 66 of 2019 Judges: ALLSOP CJ, YATES AND O'BRYAN JJ Date of judgment: 23 July 2019 Catchwords: TORTS – deceit – where appellants' advice on a tender price contained an amortisation error – tender won – appellants dishonestly concealed error and provided false assurance that contract price included full subvention allowed for by Transport for NSW – onus on respondent to prove damages qualified when deliberate wrong of applicants caused difficulties of proof – no Jones v Dunkel inference drawn – no error in finding on the balance of probabilities that respondent would have successfully renegotiated the contract had the error been known – direct loss calculated as prejudice or disadvantage suffered as a consequence of altering position under fraudulent inducement - appropriate to rely on presumption against wrongdoer – liar held to restore the innocent party to position consistent with lie being true - appeal dismissed with costs CONSUMER LAW – dishonest conduct found to be seriously misleading or deceptive conduct Legislation: Competition and Consumer Act 2010 (Cth) sch 2, ss 18, 236, 237 Trade Practices Act 1974 (Cth), s 87 Cases cited: Abigroup Contractors Pty Ltd v Sydney Catchment Authority (No 3) [2006] NSWCA 282; 67 NSWLR 341 Armory v Delamirie (1722) 1 Stra 505; 93 ER 664 Badenach v Calvert [2016] HCA 18; 257 CLR 440 Blatch v Archer (1774) 1 Cowp 63 at 65; 98 ER 969 Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; 117 FCR 424 Clef Aquitaine SARL v Laporte Materials (Barrow) Ltd [2001] QB 488 Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; 174 CLR 64 Doyle v Olby (Ironmongers) Ltd [1969] 2 QB 158; 2 All ER 119 Environmental Agency v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22 Forrest v Australian Securities and Investments Commission [2012] HCA 39; 246 CLR 486 Fox v Percy [2003] HCA 22; 214 CLR 118 Gould v Vaggelas [1985] HCA 75; 157 CLR 215 Henville v Walker [2001] HCA 52; 206 CLR 459 Holloway v McFeeters [1956] HCA 25; 94 CLR 470 Houghton v Immer (No 155) Pty Ltd [1997] NSWSC 608; 44 NSWLR 46 HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; 217 CLR 640 Jones v Dunkel [1959] HCA 8; 101 CLR 298 Livingstone v Rawyards Coal Co (1880) 5 App Cas 25 LJP Investments Pty Ltd v Howard Chia Investments Pty Ltd (No 2) (1989) 24 NSWLR 499 Mackay v Dick (1881) 6 App Cas 251 Macquarie International Health Clinic Pty Ltd v Sydney South West Area Health Service [2010] NSWCA 268 Malec v J C Hutton Pty Ltd [1990] HCA 20; 169 CLR 638 Manly Council v Byrnes [2004] NSWCA 123 Marks v GIO Australia Holdings Ltd [1998] HCA 69; 196 CLR 494 McCartney v Orica Investments Pty Ltd [2011] NSWCA 337 McConnel v Wright [1903] 1 Ch 546 Murphy v Overton Investments Pty Ltd [2004] HCA 3; 216 CLR 388 Palmer Bruyn and Parker Pty Ltd v Parsons [2001] 14 HCA 69; 208 CLR 388 Payne v Parker [1976] 1 NSWLR 191 Potts v Miller [1940] HCA 43; 64 CLR 282 Precision Plastering Pty Ltd v Demir [1975] HCA 27; 132 CLR 362 Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd [1979] HCA 51; 144 CLR 596 Smith New Court Securities Ltd v Citibank NA [1996] UKHL 3; [1997] AC 254 State Rail Authority (NSW) v Earthline Constructions Pty Ltd (in liq) [1999] HCA 3; 160 ALR 588 Toteff v Antonas [1952] HCA 16; 87 CLR 647 Tyco Australia Pty Ltd v Optus Networks Pty Ltd [2004] NSWCA 333 Wardley Australia Ltd v Western Australia [1992] HCA 55; 175 CLR 514 Westpac Banking Corporation v Jamieson [2015] QCA 50; [2016] 1 Qd R 495 Date of hearing: 13 May 2019 Registry: Victoria Division: General Division National Practice Area: Commercial and Corporations Sub-area: Commercial Contracts, Banking, Finance and Insurance Category: Catchwords Number of paragraphs: 138 Counsel for the Appellants: Mr B Walker SC with Mr J Tomlinson Solicitor for the Appellants: SBA Law Counsel for the Respondent: Mr JT Gleeson SC with Mr ARR Vincent and Mr JK Edwards Solicitor for the Respondent: HWL Ebsworth Lawyers ORDERS VID 66 of 2019 BETWEEN: PITCHER PARTNERS CONSULTING PTY LTD ACN 106 840 493 First Appellant PITCHER PARTNERS Second Appellant IAN STEWART Third Appellant AND: NEVILLE'S BUS SERVICE PTY LTD ACN 000 193 653 Respondent JUDGES: ALLSOP CJ, YATES AND O'BRYAN JJ DATE OF ORDER: 23 JULY 2019 THE COURT ORDERS THAT: 1. The appeal be dismissed with costs. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT THE COURT: Introduction 1 The appellants (Pitchers) are an accounting consulting company (to which, where necessary to be identified separately, we will refer as "Pitcher Consulting") and a partnership of accountants (to which, where necessary to be identified separately, we will refer as "Pitcher Partners"), an executive director and partner of which was Mr Ian Stewart. Mr Stewart was the third respondent at trial. He has not taken part in the appeal. 2 Whilst the facts need to be understood with precision and in full, it is important to appreciate the essential human simplicity of what occurred. For reasons that remain unarticulated, Mr Stewart untruthfully represented to Mr Joe Calabro, a director of the respondent (to which we will refer as NBS), which was his client, the content of a tender for the right to operate buses in a defined area of Sydney to be awarded by a State Government instrumentality Transport for New South Wales (TfNSW) that he, Mr Stewart, had been instrumental in preparing on behalf of NBS. 3 The lie was that the price in the tender (that had been lodged, and accepted by TfNSW as the winning tender) that he and his colleagues had prepared from NBS' documents had accurately and appropriately provided for the anticipated costs (principal and interest) of finance leases of buses to be taken over from the existing incumbent operator (so-called, "transfer-in buses"). The tender had not done so. The tender price included a sum in respect of the costs of the transfer-in buses that was substantially less (some $660,000 per year) than should have been included. Mr Stewart discovered the error; he covered it up; he lied about it; and he later sought to blame others for it, including Mr Calabro. The relevant importance of the lie was that on the faith of it Mr Calabro caused NBS to enter into finance leases to take over the transfer-in buses from the previous operator believing that the contract price payable by TfNSW to NBS under the successful tender each year included a sum of money substantially equivalent to the lease payments. Had he known the truth, he would not have entered into the finance leases. The error in the tender, innocently made, was also the foundation of misleading or deceptive conduct by the appellants which induced NBS into the underlying contract which provided for the (later) taking over of the buses and entry into of the finance leases. 4 The primary judge awarded damages in deceit as direct loss calculated as a capital sum by reference to the shortfall: nine years' shortfall of $660,000 per year. 5 The appellants submit that that approach was legally flawed and that there was insufficient evidence to prove any loss of NBS whatsoever. 6 For the reasons that follow the appeal should be dismissed with costs. The facts 7 After statutory changes in 2004, the Sydney metropolitan region was divided into 15 regions to be serviced by buses. Only four were served by the State Transit Authority. The regions that operated privately were subject to tender. The statutory changes altered the basis of payment by TfNSW for the provision of bus services. At [15] of his reasons, the primary judge described the changes as follows: Those changes also involved changing the way in which TfNSW paid private bus companies for the provision of bus transportation services, from a "fare based" payment to a "per kilometre based" payment. That, in turn, meant that when the time came for private operators to tender for the right to provide bus services in a particular region under the new system, they were required to calculate the profit component of any bid in a way that was fundamentally different to the previous system, and generally to compile tenders differently. 8 In 2013, NBS tendered for two regions: regions 2 and 15. NBS was at the time the operator in region 2; it sought to operate region 15 as well. It was unsuccessful in retaining the right to operate region 2, but it won the tender for region 15. The error in preparation of the tender about which Mr Stewart was untruthful concerned only the region 15 tender. 9 The tender conducted by TfNSW was for the right to enter into a contract, titled Sydney Metropolitan Bus Service Contract, to provide bus services in one of the designated regions. Following its successful tender for region 15, NBS entered into such a contract with TfNSW. The contract had an initial term of 5 years and TfNSW had the right, by giving notice in writing to NBS, to extend the term for a further 3 year period and then for a further 1 year period (clause 3.3). If the options were exercised by TfNSW, the total contract term would be 9 years. Under the contract, NBS undertook to provide the relevant bus services in the area designated as region 15, and the contract regulated various aspects of the bus services to be provided. In consideration for providing the bus services, TfNSW agreed to pay NBS the "Payments" (clause 20.1), defined as the payments set out in the "Payment Schedule" (being schedule 3 to the Contract). The principal payment was the "Annual Contract Price", one twelfth of which was payable monthly. The Annual Contract Price was an amount stipulated for each of the 9 years of the term of the contract, and was calculated as the sum of various costs such as salaries and wages, bus maintenance and repair and fuel and oil. One of the cost items was the principal and interest cost of transfer-in buses. As noted above, the error in NBS' tender related to that item. The Annual Contract Price was fixed for the term of the contract, unless varied in accordance with the Payment Schedule. The Payment Schedule made provision for price adjustments for such matters as variations in the bus services provided and a failure to achieve key performance indicators. It also made provision for price adjustments for inflation in respect of some, but not all, of the cost components making up the Annual Contract Price. No inflation adjustment was to be provided for the cost of the transfer-in buses. 10 It is necessary to understand the contractual arrangements under the Sydney Metropolitan Bus Service Contract in respect of transfer-in buses. At [7] of his reasons, the primary judge described those arrangements as follows: A successful tenderer for a region previously operated by another bus operator is, by the terms of the contract that the new operator enters into with TfNSW, required to take over and fulfil the lease commitments with respect to any buses held by the incumbent bus operator in that region. These buses are known as "transfer-in buses". 11 Under the Bus Service Contract for region 15, NBS was required to perform the bus services using "Contract Buses" (clause 13.1), which were relevantly defined as transfer-in buses, existing buses or new buses. The transfer-in buses were the buses to be taken over from the previous operator in region 15. Existing buses were buses that were already owned or used by NBS in providing bus services in NSW. New buses were buses that might be purchased by NBS during the term of the contract. As discussed in more detail below, during the transitional period between signing the Bus Service Contract and the date on which services were to commence, NBS was required to acquire any transfer-in buses from the previous operator in accordance with the terms of the preceding contract for region 15, as well as to acquire any other contract buses for the purpose of performing the bus services (clause 3.1(b)). At the termination or expiry of the contract, NBS was required to transfer the transfer-in buses (either by sale or novation of the lease) to the new operator for the region (clause 5 of schedule 8) at a price stipulated by the contract, referred to as the "Vehicle Termination Payment" (clause 4.7 of schedule 3). 12 In conducting the tenders for the provision of bus services, TfNSW provided tenderers with a pro forma "Proposal Response" which sought responses in respect of non-price evaluation criteria and the contract price to be offered by the tenderer. The "price" section of the Proposal Response required tenderers to provide a detailed breakdown of the contract price to be offered using the same cost categories that made up the Annual Contract Price. The contract price was required to be calculated for each year of the contract, including the option periods (that is, 9 years in total). Accordingly, it was necessary for tenderers to calculate the principal and interest cost of all transfer-in buses that would be taken over if the tender was won, as well as all other specified cost components of the contract price to be offered, for each of the 9 years of the proposed contract. 13 Pitchers had provided accounting and financial services to NBS since 2003. Mr Stewart was widely experienced in the bus industry in Victoria and New South Wales. At [19] of his reasons, the primary judge described Mr Stewart's experience in the following terms: … Mr Stewart had extensive knowledge of the bus industry, including in New South Wales. He has had over 35 years of experience working with various parties involved in the bus industry in New South Wales and Victoria. His work in this field has included assisting bus operators in tendering and negotiation processes with government, including tender pricing, advising prospective bidders on the acquisition of bus operated businesses, and advising targets of offers to purchase bus businesses. Mr Stewart was, and the Calabro brothers regarded him as, one of the best qualified advisors in the bus industry. 14 Until the employment by NBS of Mr Nishan Joseph later in 2014, throughout 2013 and 2014, NBS had no financial officers or accountants. It relied entirely on Pitchers and Mr Stewart for financial and accounting services, including the preparation of all aspects of the tender and associated documents. 15 On 9 March 2013, NBS and Pitcher Consulting entered into service agreements in respect of the two tenders. The scope of the work contractually undertaken by Pitcher Consulting included the following: • Analyse the Request for Tender and proposed contract form and provide advice on commercial aspects including risk. • Based upon information provided by NBS and a toolkit of costing models that have been developed by PPC, undertake the costing of services including base level costing of bus hour costs, kilometre costs, overheads, and depot and fleet costs. This will include analysis of historic trends, predictive costing analysis for costs such as fuel, maintenance, and bus capital as examples. • Advise you in relation to the likely financial outcomes of a successful bid including forward forecasts of profitability and cash flows utilising analysis tools developed by PPC. This will enable scenario analysis to be conducted at varying levels of margin or variations to other key assumptions. • Apply our industry experience and benchmark information to guide decision making. • Advise in relation to bid strategy. • Advise in relation to the commercial matters to be considered with the proposed contracts. • Assist with preparation of the bid documentation. • Any other related matters as requested by you. (Emphasis added.) 16 At [25] and [26] of his reasons, the primary judge described some of the work in preparing the tender and, in particular, the obtaining of relevant data concerning the operations in the region the subject of the tender: 25 Part of the first respondent's role involved the preparation of financial statements and making a series of different calculations. Among other things, in order to complete the tenders it was necessary to input into the "data gathering tools" referred to in the retainer agreement data and other information regarding the NBS business and the regions for which it was submitting tenders, including bus fleets, fuel costs, wages and other expenses and overheads. 26 NBS provided some data to the first respondent and all the relevant data was contained in an online database, administered by TfNSW, called the "Data Room". That data included region specific information about costs, routes, fleet and patronage, data based on the performance of an operator for a region, as well as copies of documents and agreements relating to the operation of the regions, including copies of the leases for the buses used by each regional operator. NBS and Pitcher Partners were granted access to the data room in March 2013. 17 As explained by Mr Stewart in his evidence, the contractual framework used by TfNSW for the provision of bus services in each region required the incumbent operator, at the expiry of a contract, to "transfer-out" buses used in providing the services and for the new operator to "transfer-in" those buses. For that purpose, the relevant contracts contained a formula for the amount payable for the transfer-in buses, referred to as the Vehicle Termination Payments (VTP). Mr Stewart gave evidence that the key components of the formula used to calculate the VTP were the original purchase price of the bus, the period the bus has been in service (up to a maximum period of 15 years) and an interest rate being the Commonwealth Treasury bond rate plus 3.5%. 18 Pitchers used a number of costing models, referred to as "tool kits", to assist in costing the services to be provided under the Bus Services Contract and thereby to prepare the pricing section of the tender. The costing model relevant to the bus fleet costs was called "Tool 2" and included the expected costs of the transfer-in buses. At [28]–[30] of his reasons, the primary judge described "Tool 2" in the following terms: Tool 2 28 Part of the services offered by the first respondent included a financial "tool" which it had created and developed to assist in putting together tenders for government bus contracts. Known as "Tool 2", it was designed to calculate the capital cost of the transfer-in buses to be included in a bid. The tool did not use or calculate the actual cost of the transfer-in buses by reference to the leases which were to be in place at the time of the commencement of a new contract, because tenderers do not then know: (1) the total monthly lease costs being paid by the incumbent bus operator for each such bus; or (2) the interest rate or term of the incumbent bus operators finance arrangements in respect of those buses. Nor, ordinarily, would a tenderer be sure of what its own terms of finance would be in respect of the buses once transferred from the incumbent operator to it. As a result, when formulating the tender bid for region 15, neither the first respondent nor the applicant knew what the applicant's actual monthly costs would be in respect of the transfer-in buses once the contract commenced. 29 Tool 2 was designed to ensure that, whatever the actual cost of the transfer-in buses might be, the tender bid would be calculated on the basis that NBS would be able to access the maximum amount of TfNSW funding available in respect of each transfer-in bus. 30 Part of the tool involved in-putting a "Vehicle Termination Payment" or "VTP" (also sometimes called a "transfer-in value"). A VTP is the amount that is paid by an incoming bus operator to an outgoing operator in respect of each bus in the fleet. It is a sum calculated by TfNSW as part of the tender process. 19 A simple amortisation error was made in the figures inputted into Tool 2 in relation to the transfer-in buses for NBS' tender for region 15. To achieve the correct calculation, Tool 2 required the original purchase price of the transfer-in bus to be inputted, so that the original price could be amortised over the maximum allowed period of 15 years. In error, the VTP for the transfer-in buses was incorrectly entered into the tool, which resulted in a lower cost allowance for the transfer-in buses in each of the 9 years of the contract. The primary judge expressed the result of the error at [9] of the reasons: Because the error was contained in the tender documents, the tender which TfNSW accepted significantly understated the available funding from the government for the transfer-in buses for the region 15 tender. As a consequence, the costs incurred by NBS in performance of the region 15 contract were, and remain, significantly higher than the costs incorporated in the tender bid and upon which the region 15 contract price was agreed. 20 In short, the result of the amortisation error was that the tender of NBS did not allow for the full cost of the transfer-in buses, based on the formula used by TfNSW for the transfer of buses from one operator to the next. The shortfall was $660,000 per annum for the life of the contract. 21 Shortly prior to NBS submitting the region 15 tender with the error, Pitchers finalised work on the tender and provided the documentation to NBS. Pitchers also prepared and delivered to NBS the tender papers for the region 2 tender (in which there was no amortisation error). At this time, the error remained undiscovered and was thus an "innocent" error. Pitchers Consulting admitted that, in making the amortisation error in the region 15 tender, it breached its retainer agreement, was negligent and engaged in conduct in contravention of section 18 of the Australian Consumer Law (ACL). 22 In early August 2013, NBS was informed by TfNSW that its tender had been successful for region 15 and unsuccessful for region 2. On 24 August 2013, TfNSW sent NBS a revised contract; in the email that enclosed this revised contract, NBS was asked to double check its figures and schedules that related to the transfer-in buses. These figures and schedules were confirmed by Mr Stewart. 23 On 26 August 2013, the region 15 contract was executed for commencement of services on 1 June 2014 for five years with a further 4 years if granted by TfNSW under cl 3.3(a). The region 15 contract provided for NBS to comply with certain "critical transition milestones" including the acceptance of the leases for the transfer-in buses from the incumbent operator. These transition milestones were contained in cl 3.1 of the contract. The contract commenced on the day of execution, but it was in a "Transition Period" until the "Service Commencement Date" (which was 1 June 2014). During this transition period NBS was required by cl 3.1(b) to do various things, being to: (i) comply with and meet the Transition Milestones contained in Schedule 9, by the date specified for their completion; (ii) acquire any Transfer In Contract Bus in accordance with the terms of any Preceding Bus Services Contract; (iii) acquire all other Contract Buses for the purposes of performing the Contract Bus Services; (iv) do all other things necessary to complete any transfer, novation[,] acquisition of or dealing with Contract Buses or potential Contract Buses in connection with the Contract Bus Services; and (v) make offers of employment to employees of any Preceding Operator, in accordance with the terms of any Preceding Bus Services Contract… 24 Clause 3.1(c) of the contract provided for the consequences of a failure by NBS to comply with or meet a relevant milestone: If the Operator fails to comply with or meet a Critical Transition Milestone, TfNSW may terminate this Contract by notice in writing to the Operator with immediate effect and this Contract will be of no further effect. For the avoidance of doubt, if TfNSW terminates the Contract during the Transition Period in accordance with this Clause 3.1(c), the Operator will not be entitled to claim any amount for set-up costs or any other costs incurred during or before the Transition Period. 25 In preparation for meeting these milestones it was necessary for NBS to prepare financial documents to satisfy its lease financier, Westpac, and itself, that it could meet its financial obligations in respect of the transfer-in buses. Pitchers were again retained to prepare these documents which were what was described as a "3-way cash flow model", integrating a cash flow statement, a profit and loss statement and a balance sheet. 26 It was during the preparation of the 3-way model that the amortisation error was discovered. The discovery can be traced to the treatment of various sequential drafts of the 3-way model. On 26 February 2014, one of Mr Stewart's assistants, Mr Pfirter (whom the primary judge found not to be complicit in the dishonesty), sent version 4 of the 3-way model to Mr Calabro indicating to him that Mr Stewart was reviewing it. This version 4 contained the error and calculated the monthly repayments for the transfer-in buses at $161,734. 27 Versions 5 and 6 of the model were different. They did not contain the amortisation error and, using the correct input data (which had not been used in the tender), calculated the monthly lease cost to be $238,681. In March 2014, Mr Stewart discovered the error in his review of versions 4, 5 and 6 of the 3-way model. Instead of informing Mr Calabro and NBS, Mr Stewart (without, apparently, any complicit connivance of Pitchers' staff) set about changing in version 6, irregularly, the treatment of depreciation on transfer-in buses and cash flow. Meanwhile, Mr Pfirter (to Mr Stewart's knowledge) emailed to Mr Calabro the final version (version 12) of the 3-way model with the amortisation error covered up by the irregular depreciation and cash flow entries. 28 After NBS received the modelling in March 2014, and prior to 1 June 2014, NBS entered into the novated leases with Westpac and became fully contractually committed to the contract with TfNSW. From that point NBS became committed to paying the actual financing expenses for the transfer-in buses that would not be fully covered by the contract price. The contract price formed by the acceptance of the tender, was constituted, in part, by an element for the payment of transfer-in buses that was $660,000 per annum lower than it would have been, had it not been for the amortisation error. At this point in time, the amortisation error was no longer "innocent". It had been fraudulently concealed by Mr Stewart, and so, by Pitchers. 29 Not long after the commencement of the contract, the newly-employed accountant at NBS, Mr Joseph, discovered the shortfall between the funds received by NBS from TfNSW to cover the costs of the transfer-in buses and the lease payments. Not surprisingly, Mr Stewart was required by Mr Joseph and Mr Calabro to explain the position. Once again, his response was not honest. There was no frank admission of the error, rather as the primary judge succinctly summarised it at [137] of his reasons: …from the very first time that Mr Joseph raised the capital shortfall question, Mr Stewart, in particular, made attempts to persuade NBS that no real harm was done, or that fault lay with NBS, because: (1) the region 15 contract was still operating at a profit; (2) Pitcher Partners had spent 6 to 8 weeks working on the region [2] bid pricing but only 2 weeks on the region 15 pricing; (3) Pitcher Partners had applied a "buffer" to other projected costs; (4) NBS declined an offer that Pitcher Partners carry out a QA review; and (5) NBS had insisted on aggressively pricing the tender bid. 30 What is as surprising is the position of all the appellants in the conduct of the litigation for which they were (properly) criticised by the primary judge. At [138] of his reasons the primary judge said: Many of these lines of "defence" were echoed in the witness statements filed on behalf of the respondents and, to a lesser extent, in the respondents' defences, although by the time of closing submissions they were not relied on, and I take them to have been abandoned. That is hardly surprising, because the first and second lines of defence were irrelevant. The third, fourth and fifth were simply untrue. 31 The relevance of these unfortunate findings is apparent when one appreciates that the appellants seek to place emphasis in the appeal on the fact that NBS did not approach TfNSW in the latter part of 2014 to seek to have the tender and contract renegotiated when it became aware of the problem. This was put against NBS, even on appeal, as one reason why NBS had not proved any loss of a valuable commercial opportunity. When asked why his company did not go back and try to renegotiate the contract, Mr Calabro said: In your affidavit, you say you chose not to go back and try to renegotiate the contract? ---Yes. You made that deliberate choice? ---Yes, yes. Well, that's right, correct. Why was that? --- Well, we've – it's very difficult for a company to go crying that they need more money when you've got your accountant saying that there was no error. So how can I justify to the government, which is not my word, and as you can see, I'm a brilliant accountant. (Emphasis added.) 32 This cross-examination was directed to evidence that Mr Calabro gave at paras 170 and 171 of his affidavit of 18 April 2018, as follows: 170 Had Stewart or Pitcher Partners admitted to an error in the Region 15 Tender and Contract in August 2014, instead of taking the position they did in the emails I have referred to, Busabout would have immediately requested that Stewart and Pitcher Partners notify TfNSW of that error and join Busabout in seeking a revised contract which remedied the error and adjusted the contract price accordingly, to ensure that Busabout were paid the actual cost of the transfer-in buses. 171 With Stewart and Pitcher Partners denying an error in the calculations of the Region 15 Tender, in my view, had Busabout notified TfNSW of the Error without the support of Pfirter Partners [sic], it would have been problematic, if not damaging to Busabout's reputation with TfNSW. Central findings and evidence 33 Before examining how the primary judge approached the matter, the criticisms made of the approach of the primary judge in the notice of appeal and appellants' submissions, and the refocusing of the case by the notice of contention, it is important to refer to a number of aspects of the evidence and findings. 34 The first matter of significance is the importance of the subvention of the costs of transfer-in buses in the way the whole system of the tendering for regions worked, and the itemised structure of the tender and contract. The second is the body of findings and evidence as to what NBS would have done had the true position been appreciated by it. The third is the body of findings and evidence about NBS' tender position had the relevant item been expressed without the amortisation error. The subvention of the cost of transfer-in buses and the itemised nature of the tender and contract 35 There was no dispute between the parties that a fundamental premise of the tender was that a successful tenderer would be required to take over the buses of the incumbent operator and the lease commitments therefor (the transfer-in buses), and that the contract price would include an amount to cover the finance costs for the transfer-in buses based on a formula used by TfNSW for that purpose. The appellants and the respondent drew different significance from that consideration, to the relevant merits of which we will come. For now, it is appropriate to recognise what this meant and how it was reflected in the tender process. 36 As a line item in the calculation of the Annual Contract Price in the tender documents and the contract there appeared (for a period of nine years) the "proposed capital charges (principal plus interest) for transfer-in contract buses". As explained by Mr Stewart in his evidence, the amount to be included in that line item was intended to replicate the formula used by TfNSW to reimburse the outgoing operator for the transfer-in buses (being the VTP), and which would also be applied by TfNSW at the end of the new contract. By replicating that formula, NBS would expect to receive the full amount that would be allowed by TfNSW for the transfer-in buses. In other words, the calculations were intended to be a full subvention for the operator winning the tender. It is this line item that was understated by $660,000 per annum by the appellants. 37 As noted earlier, the Annual Contract Price that was tendered by NBS in respect of region 15 was the aggregate of specified cost line items, including salaries and wages, bus maintenance and repair and fuel and oil, as well as the principal and interest for transfer-in buses amongst others. NBS added a profit margin to various of the cost line items which, when aggregated, would constitute its overall profit margin on the contract. The tender process was competitive and, in that competitive environment, it was necessary for NBS to determine the margin that it would add to the cost items in its tender that it regarded as commercially acceptable and also competitive. However, no profit margin was added to the line item for the costs of the transfer-in buses, reflecting the nature of that cost and its method of calculation. NBS sought reimbursement of the amount that was known to be allowed by TfNSW for the costs of the transfer-in buses. 38 The documentation provided for the sums constituting the Annual Contract Price to be calculated for a period of nine years. This revealed, at least, the anticipated length of the contractual relationship. If the extensions of four years after the five year initial contractual period (to the contractual provision for which we will come in due course) were not to be granted, the departing operator would receive an appropriate VTP to cover the now departing operator's lease obligations that had been taken on for these four years. 39 In the submissions of the respondent, the true significance of these considerations is that the entire structure of the bidding and the contract is built on the basis that an operator would receive full reimbursement for the financial obligations in respect of transfer-in buses on the way in, and full protection on the way out. So, it was submitted, when one comes, at any point in the legal and factual analysis, to consider what TfNSW would or might have done had the tender not contained the amortisation error or had it been approached by NBS to vary the contract in order to ameliorate or eliminate the financial consequences to NBS of the mistake, this is said to be a powerful consideration to assist the inference that a variation would have been made to avoid the contractor being exposed to an entirely unintended risk. 40 The appellants, on the other hand, submitted that this very underpinning assumption of the contract made it all the more unusual that no attempt was made by NBS at the trial to call anyone from TfNSW to say what would have been done had the mistake been drawn to the attention of TfNSW after the entry into the contract, but before committing itself to the leases for the transfer-in buses. That failure to call evidence from TfNSW was submitted to be fatal to what was submitted to be the only proper and available bases for damages – the lost opportunity to enter a different contract with a tender without the error, or the lost opportunity to renegotiate and vary the contract into which NBS had entered. The findings and evidence about what NBS would have done had the true position been known 41 It is clear from both the evidence and the findings that had NBS, through Mr Calabro, known of the error it would have increased its bid by $660,000 per annum, or sought to ask for a varied contract by that amount (depending on whether Mr Calabro learnt this in 2013 before submitting the tender, or in 2014 before committing to the leases for the transfer-in buses). These findings were made by the primary judge at [236] and [242] of his reasons. They were plainly supported by the evidence of Mr Calabro (which is important also to assess the likely response of TfNSW) that he would have demanded the full $660,000 since it was intended to be a reimbursement item. For NBS to bear the extra $660,000 per annum cut its operating costs profit margin on the contract by about half. Mr Calabro gave evidence that his objective was to submit a tender with an average cost margin over the life of the contract of about 7% and that he would not have been prepared to reduce his average margin below 6%. There was no challenge on appeal to this conclusion. Thus, NBS proved that had it known the true position prior to contract or prior to entering the leases it would have required (either in its tender or in any renegotiation) the full $660,000 per annum. 42 This body of findings and evidence is important to each way the loss of NBS may be conceptualised. First, it may be seen to assist in the conclusion that the liability of NBS for the shortfall was directly related to the misrepresentation, that was later, in 2014, made deceitfully. Secondly, it may be seen to provide the foundation for the conclusion that NBS proved on the balance of probabilities that it lost a (valuable) opportunity to tender differently or to renegotiate the contract. The findings and evidence about NBS' tender position had the item been expressed without error 43 If one assumes (from the findings and evidence just discussed) that NBS would have tendered as they did, but without the underestimation of financing costs for transfer-in buses, some important findings and evidence should be appreciated. First, at [237] of his reasons, the primary judge accepted and adopted the evidence of Mr Calabro that: … an additional $660,000 per year on the transfer-in buses capital costs … would have resulted in an overall price … "definitely a way – a long way under" the incumbent operator's then current contract price. 44 The documentary evidence revealed that with the error NBS' tender was nearly 6% below the incumbent's price and without the error it was still 3.4% below the incumbent's price: see Ex JC-1, Pt C tab 21 p 854 and calculations drawn from "Current", "Difference" (adjusted for the error in Option D) and the derived "Government Savings %". 45 The findings of the primary judge at [238] of the reasons is not entirely concordant with the above: … adding the extra $660,000 per year would have represented more than a 5% discount on the then incumbent operator's contract price, which Mr Stewart swore was the discount that he had been told by his government sources with the discount required to be competitive. 46 In any event, even with the removal of the error, NBS' tender was more than competitive with the incumbent. 47 At [240] of his reasons the primary judge found (and there was no challenge to the finding) that: …. the extra $660,000 per year represented in the order of about 2.5% of the overall cost of the region 15 contract and should be regarded in the scheme of things as insignificant. 48 The evidence did not disclose the identity or terms of any other bidders or bids, if any. 49 On the other hand, the significance for NBS of the error was a reduction in the forecast profit margin of about half throughout the term of the contract (in the first year of the contract, the reduction is about 60% but in subsequent years of the contract the reduction is about 45%: see Ex JC-1, Pt C tab 21 p 852 and the line "Total Margin". 50 Further, as the primary judge said at [239] of his reasons, the acceptance of the tender of NBS revealed that NBS' bid was otherwise satisfactory to TfNSW. 51 By April and May 2014, NBS had been told that it had won the tender and it had entered the contract; and the incumbent had been told that it had lost the contract. That placed, as the primary judge found at [243] of his reasons, TfNSW in a difficult bargaining position a little over two months before commencement of operation by NBS. Any requested (indeed demanded) renegotiation would have been to correct the effects of an honest mistake in connection with a line item that was always intended to be fully funded by TfNSW, and which, if varied, still led to a significant discount on the incumbent, by this stage the only likely alternative for services to commence at a time two months hence. 52 One further aspect of NBS' contractual positon in 2014 should be noted. Clause 3.1(c) of the contract did not give NBS contractual freedom, at its own wish or choice, not to take up leases for the transfer-in buses. For it to demand unequivocally a $660,000 increase in the Annual Contract Price to cover the true cost of financing the leases, or to refuse to complete the milestone of taking up the leases would, in all likelihood, have been a breach of cl 3.1(b) (see [23] above) or of an implied contractual term to do everything necessary on its part for the carrying out of the contract: Mackay v Dick (1881) 6 App Cas 251 at 263 (Lord Blackburn) and Secured Income Real Estate (Australia) Ltd v St Martins Investments Pty Ltd [1979] HCA 51; 144 CLR 596 at 607 (Mason J). Nevertheless, that was the clear and unequivocal evidence of Mr Calabro of what he would have done in the real world, and the unchallenged finding of the primary judge. The approach of the primary judge 53 The detailed judgment of the primary judge after a 13 day trial was concerned with many issues that were not in contest on appeal, such as the dishonesty of Mr Stewart, the nature of the error, its discovery, the effort by Pitchers to deflect blame on to NBS, and the otherwise profitable nature of the contract, as well as the operation of the Professional Standards Act 2003 (Vic) and the Professional Standards Act 2003 (NSW) and whether, absent fraud, this legislation limited damages recoverable to $1 million. This last issue contributed to the focus in the judgment to the place of Mr Stewart's dishonest conduct in 2014. 54 The primary judge dealt with the four different ways the case was put. First, he accepted the primary claim that NBS was entitled to damages ($5,485,416) for the tort of deceit being what his Honour found to be the direct consequence of the dishonesty of Mr Stewart in 2014. After a discussion on the cause of action of deceit and causation in deceit at [186]–[198] in the reasons, the primary judge concluded as follows at [199]: In my view, the actual damage flowing from the deceit in this case is the $5.485m sum claimed for the reasons submitted by NBS. That is, having won the bid and entered into the region 15 contract in August 2013, NBS was induced by the representations in March 2014 to enter into novated leases with Westpac in respect of the transfer-in buses. It did so in reliance on those representations and, in doing so, altered its position to its detriment because it assumed a financial obligation that it would not have assumed had the respondents told it the simple truth, known to them but not NBS, that the transfer-in buses were underfunded by $660,000 per annum. As a result, NBS did not have funding for, and was therefore liable to meet from its own resources, an additional $660,000 in finance costs in each of the 9 years of the region 15 contract in respect of the transfer-in buses. NBS was, at that point, as Mr Dawson put it, "locked into both the region 15 contract and the Westpac leases with that shortfall. That is [NBS's] loss". In my view, in the circumstances, the loss that flows from being so locked in, flowing as it does directly from the deceit, estimated by Mr Potter in his unchallenged evidence to be $5,485,416, is recoverable in full, subject to a judgment date adjustment. 55 In so finding, the primary judge rejected the arguments of the respondents at the trial that any loss could not be expressed other than through loss of opportunity claims. The primary judge encapsulated his reason for that rejection at [200], as follows: The respondents' contention that the loss claimed by NBS cannot be separated from the lost opportunity claims because entry into the leases cannot be separated from the region 15 contract does not, in my view, address the different measure of damages that applies in cases of deceit. To say, as the respondents do, that entry into the Westpac leases was a "subset integer" of the region 15 contract and that NBS cannot avoid having to prove, and did not prove, on the balance of probabilities that it would have been successful in its increased bid being accepted or in having the region 15 contract successfully renegotiated is not to the point, because the submission does not address the measure of damages applicable in cases, like this one, of deceit. 56 Involved in the award of $5,485,416 was a conclusion that the loss should be calculated for a nine year, not a five year, period, being a conclusion reached for the reasons expressed at [202] and [203] of the reasons: 202 … The unchallenged assumption from the beginning of the relationship between NBS, the first respondent and Mr Stewart was that the contract tendered for was anticipated to run for 9 years. The tender bid was premised on a 9 year term, as was every piece of modelling performed by Mr Stewart and his colleagues. 203 In those circumstances and when: (1) there is no evidence to suggest that the contract which NBS is "locked in" to will not run the term that TfNSW's own tender assumptions anticipate (a 9 year term); (2) no witness called by NBS was asked a single question about the matter in cross-examination; and (3) the loss is the financial consequence of bus lease novations that were premised on a 9 year term, then the calculation of the direct loss must properly relate to a 9 year term, not some other term. … 57 There were three loss of opportunity claims put forward at the trial: the so-called "Invest Elsewhere Opportunity", the "Increased Bid Opportunity", and the "Correction Opportunity". The first was rejected by the primary judge and not re-agitated on appeal. The second and third were upheld by the primary judge, in the alternative to the primary claim for damages in deceit. 58 The primary judge dealt with the "Increased Bid Opportunity" at [230]–[241]. This claim was based (see [236] of the reasons) on the breach of the contract of retainer by Pitcher Consulting. We have already referred to some of the findings and evidence that underpinned this claim. The primary judge found on the balance of probabilities at [236] that not only would NBS have increased its tender bid in the relevant line item by $660,000 per annum (implicitly without otherwise changing the terms of the bid) but also "that such a bid would have succeeded". The primary judge gave four reasons for the latter finding at [237]–[240]. They were the matters already discussed at [43]–[46], [50] and [47] above. Though the primary judge had expressed his views about the bid succeeding "on the balance of probabilities" in [236], his Honour then, since he was dealing with a hypothetical event (Malec v J C Hutton Pty Ltd [1990] HCA 20; 169 CLR 638 at 643), dealt with the question in terms of degree of probability, saying at [241]: Doing the best that I can I would have estimated the probability of the posed hypothetical occurring at 70%. 59 The "Correction Opportunity" was dealt with shortly by the primary judge at [242]–[244] of the reasons. This opportunity was in one sense predicated on the dishonesty, by this time, of Mr Stewart. The primary judge did not indicate whether this was an alternative formulation of damages in deceit or for contravention of s 18 of the ACL or for breach of contract. Again his Honour made findings "on the balance of probabilities" and then estimated the probability of successful negotiation occurring. At [243]–[244], he said: 243 In my view, were it necessary to decide the point, I would find that NBS has established this claim on the balance of probabilities. It does so for the same reasons as the previous claim but, in my view, NBS is correct to say that there was an additional reason why this outcome would have occurred, namely because as at March 2014, NBS was due to commence operating bus services in region 15 in a little over two months. NBS says, and I agree, that would have placed TfNSW in an awkward negotiating position, making it more likely that it would have acceded to the request to accept the revised tender, and conversely most improbable that it would have reverted to the services of the incumbent operator in circumstances where the revised bid was still less than the price at which the incumbent operator currently provided the bus services. 244 I would estimate the probability of that occurring, doing the best that I can, to estimate the chances of the posed hypothetical, at 75%. In my view, that loss of chance would be recoverable in deceit and in contract, at least. The notice of appeal and the notice of contention 60 Before identifying and discussing the grounds of appeal and of the notice of contention a preliminary comment is apt. The pleading was long and somewhat complex. It was based on s 18 of the ACL, deceit, contract and fiduciary duty. The judgment of the primary judge whilst simplifying the arguments broadly dealt with the matter in the way it was put to him. The dishonesty of Mr Stewart and, through the imputation of his wrong, of the appellants, properly grounded the tort of deceit in 2014. But such dishonesty was also misleading or deceptive conduct for s 18 of the ACL; indeed, it is the paradigm form of deception. That dishonesty or any mental element is not required for s 18 does not mean that actual dishonesty is not misleading or deceptive conduct. Of course, fraud is to be specifically pleaded: Forrest v Australian Securities and Investments Commission [2012] HCA 39; 247 CLR 486 at 502–503 [26]–[27]. The focus by the primary judge, no doubt because of the way the matter was argued, deflected proper attention being given to damages under s 236 of the ACL for contravention of s 18 of the ACL by the dishonest conduct that also founded the claim in deceit. That limited focus was corrected at the appeal by the wider focus of the notice of contention, which was not said to lie outside the pleadings. Nevertheless, the appeal can be disposed of along orthodox principles dealing with the tort of deceit. The notice of appeal and the appellants' arguments 61 The five grounds of appeal contained four distinct groups of arguments. Ground 1 62 The first ground was the attack on the acceptance by the primary judge of the primary case of NBS of damages for deceit at [199]–[200] of the reasons (at [54]–[55] above). The essential submission was that what his Honour did was to award damages to make good the March 2014 representations, in a way akin to damages for loss of contractual expectation damages. Important to this complaint was the way the case had been run (as deceit) and, accordingly, the way that it had been decided with the events of March 2014 and following being seen as quite separate from the (innocent) misrepresentations and breach of contract the year before. The deceit claim was that NBS became "locked in" to a contract with the taking on of responsibility for the leases for the transfer-in buses. As the primary judge described the case at [146] of the reasons: NBS was not "locked in" to the contract until the bus leases were novated, and once this occurred "at that point [NBS] altered its position to its detriment, and suffered a loss as a direct consequence…". 63 The appellants submitted that there were a number of errors here. First, NBS was already contractually "locked in" by reliance on the 2013 representations. The contract was binding upon NBS. It would have been a breach of contract to withdraw in 2014. In those circumstances, it was submitted, to withdraw would have ended the contract for no claimable loss. Secondly, even on the hypothesis put, NBS could only show loss by giving credit for any benefits received under the contract. The appellants did not submit that damages could only be obtained for entry into a loss-making contract. Rather, it was submitted that it would be an "injustice" to the appellants in allowing NBS to maintain all the benefits of the contract, as well as being indemnified for the expenditure to obtain the benefits. Thirdly, it was submitted that the only other proper assessments of loss were the three loss of opportunity cases that were run. 64 Essential to the complaint was that, underpinning the award of damages was the proposition that TfNSW would have agreed to a variation to fund fully the line item of expense without any other change to the contract; that is, it was necessary for NBS to "prove…that a different and more favourable transaction…would have been entered into but for the fraud". This quoted expression of the matter came from the judgment of Simon Brown LJ in Clef Aquitaine SARL v Laporte Materials (Barrow) Ltd [2001] QB 488 at 500. Support was also sought to be drawn from Marks v GIO Australia Holdings Ltd [1998] HCA 69; 196 CLR 494 at 504–505 [19]–[22]. 65 With the failure of the "Invest Elsewhere Opportunity", there was no available claim that, but for the deceit, there would have been different conduct that would have made more profit than has been made in the contract (other than the claim for the lost opportunity to renegotiate to vary the contract – the so-called "Correction Opportunity"). 66 At this point in the argument, the appellants emphasised the central aspect of the subvention by TfNSW of the cost of transfer-in buses discussed at [35]–[40] above. We set out the appellants' reliance upon this at [40] above. Thus, the appellants submitted that the failure to prove what TfNSW would have done was fatal to showing that NBS would have enjoyed a more profitable contract, but for the fraud. 67 At this point, we interpolate that it was recognised in argument on appeal that the notice of contention (to which we will come) had a significant effect on these arguments by the way it linked the deceit in 2014, to the misleading or deceptive conduct in 2013, the latter preceding and being causative of the entry into the contract. Grounds 2 and 3 68 The second and third grounds concerned asserted errors in the two loss of opportunity claims that were accepted: the "Increased Bid Opportunity" and the "Correction Opportunity". 69 There were a number of specific complaints, but central to the arguments of the appellants (submitted in oral address to be "controlling") was the submission that by failing to call any officer of TfNSW NBS failed to discharge the relevant onus on the balance of probabilities that it would have received a valuable opportunity. Heavy reliance was placed on the expression of the matter by the plurality in Badenach v Calvert [2016] HCA 18; 257 CLR 440 at 455 [41], and by Gordon J at 467 [99]. It was essential, it was submitted, to prove what TfNSW would have done. In oral address it was submitted that NBS had to prove that it would have received the valuable opportunity, namely of having the contract price adjusted to eliminate the bidding error. In all the circumstances (described below) the primary judge erred, it was submitted, in saying (at [234] of the reasons) that calling such evidence was "not necessary" or "unrealistic". 70 A number of related and particular errors were said to help form the circumstances which made calling someone from TfNSW necessary. 71 The primary judge was said to have erroneously assumed (at [157] of the reasons) that the appellants had admitted that an increased tender bid or a renegotiation of the contract to vary the incorrect items would have been accepted by TfNSW. 72 There was no attempt by NBS to call evidence as to the other bidders and their tender prices, or the methodology of TfNSW in choosing the tender bid. The onus, it was submitted, was on NBS to show what TfNSW would have done and thus the failure to call anyone from TfNSW made available an appropriate inference under Jones v Dunkel [1959] HCA 8; 101 CLR 298 that should have been drawn by the primary judge. In this respect, the fact that NBS was not successful in its bid for retaining region 2, in which bid the amortisation error had not been made, was a relevant matter that the primary judge should, it was submitted, have considered. 73 In relation to the "Correction Opportunity", the primary judge failed, it was submitted, to consider that the contract itself contained a clause (cl 3.2 of Schedule 3) that stated "there will be no negotiation of the Annual Contract Price, other than variations in accordance with this Schedule". 74 There was no attempt by NBS to renegotiate the contract after it became aware of the error. This threw in doubt, it was submitted, what would have happened had NBS become aware of the error at an earlier time. 75 There was no attempt by NBS to call evidence about the governmental requirements on a public authority that might restrict its ability to renegotiate a contract such as this. 76 The primary judge erred (at [243] of the reasons – see [59] above) in considering that it was relevant that TfNSW would have felt under time pressure as a feature that increased the likelihood of renegotiation, when it was equally open to consider that the lateness of the request would have led TfNSW to enforce the contract with NBS or go to a competing tenderer. 77 All these considerations, together with the failure to call anyone from TfNSW, meant that the primary judge erred in failing to find that neither opportunity was real and was merely speculative. Ground 4 78 The fourth ground was an alternative to the second and third grounds. If NBS had established that either opportunity (Increased Bid or Correction) were real and not merely speculative, the primary judge erred in not finding that it or they were of nominal value only. The same considerations were relied upon as under grounds 2 and 3. In particular, again, the lack of any evidence from TfNSW was said to be critical, indeed essential, it was submitted, to allow the conclusion to be drawn that TfNSW would, in effect, have sat down and discussed the issues on the basis that they would not take advantage of a genuine and honest mistake. Also, in this context, the appellants emphasised the failure of NBS, and Mr Calabro, to approach TfNSW when they became aware of the error. Ground 5 79 The fifth ground considered the assessment of damages on the basis that the contract would run nine, rather than five, years contained in [203] of the reasons ([56] above). The appellants submitted that the primary judge erred by failing to take into account the contractual clauses dealing with extension of the term in his conclusion at [203(1)], by misunderstanding the relevant onus at [203(2)], in circumstances where NBS did not call anyone from TfNSW as to the likelihood of extension, and where NBS did not call evidence that it would be liable for the Westpac leases in any event, that is whether or not the contract was extended, at [203(3)]. The respondent's arguments The notice of contention, ground 1 of the notice of appeal 80 It is convenient to begin with the notice of contention. It was filed at the commencement of argument on the appeal. There was no objection that it went outside the pleaded case or how the trial was conducted. It had two important features: first, it refocused the primary claim for damages on to ss 18, 236 and 237 of the ACL; and secondly, it viewed the misleading or deceptive conduct in 2013 and 2014 as one series of conduct (at first innocent and later dishonest) that led NBS to enter into the contract on its error-infected bid, and led NBS to enter into the finance leases and to commit fully to the contract on the basis of the dishonest covering up of the discovered error. 81 The respondent put three key submissions: first, the relevant loss and damage involved a comparison between NBS' position (before the deceit) with its resources intact and its position (after the deceit) with its resources fully committed to the contract and to the Westpac novated leases; secondly, in identifying that loss or damage it is unnecessary to postulate a hypothetical different transaction which would have come about had the truth been told by Mr Stewart; and thirdly, in identifying this loss it is appropriate to look at the revenue account in respect of the relevant line item. In formulating its three submissions, the respondent drew heavily from the reasons of the High Court in Murphy v Overton Investments Pty Ltd [2004] HCA 3; 216 CLR 388. 82 As we have already said (at [39]), the respondent relied heavily on the subvention of the cost of the transfer-in buses being at the foundation of the arrangement between contractors and TfNSW. 83 NBS was entitled to compensation for its loss on revenue account in a contract where that particular item could be separately identified. 84 The notice of contention was closely related to the arguments of the respondent on ground 1 of the appeal that focused on the tort of deceit. 85 In answer to the appellants' submission on ground 1, the respondent submitted that the ultimate question was to identify the prejudice suffered in consequence of altering its position under the inducement of fraud. Reference was made to Toteff v Antonas [1952] HCA 16; 87 CLR 647 at 650–651; Wardley Australia Ltd v Western Australia [1992] HCA 55; 175 CLR 514 at 530–533; Doyle v Olby (Ironmongers) Ltd [1969] 2 QB 158; 2 All ER 119 at 122–126; Gould v Vaggelas [1985] HCA 75; 157 CLR 215 at 217; Abigroup Contractors Pty Ltd v Sydney Catchment Authority (No 3) [2006] NSWCA 282; 67 NSWLR 341 at 355 [65] and 363–364 [110]–[116]; Smith New Court Securities Ltd v Citibank NA [1996] UKHL 3; [1997] AC 254 at 264–266 and 279–280; Henville v Walker [2001] HCA 52; 206 CLR 459 at 503–504 [135], 504–505 [138], 505 [139] and 509 [162]; HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; 217 CLR 640 at 666–669 [63]–[68]; Westpac Banking Corporation v Jamieson [2015] QCA 50; [2016] 1 Qd R 495 at 542–546 [142]–[155]; and Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; 174 CLR 64 at 97–98, 114 and 150–153. This was to be looked at here as the commitment to the leases which would not have occurred without the fraud, without any need for hypothetical recreation of the world. Grounds 2 and 3 86 The respondent submitted that Badenach, properly understood, did not require evidence from TfNSW as to whether it would have accepted a new (corrected) bid or renegotiated the contract after the leases had been entered into. Rather, the evidence of Mr Calabro was clear what steps he would have taken: submit a new (corrected) bid and require renegotiation of the contract. That was all, it was submitted, that was necessary for the proof of the existence of a valuable opportunity that NBS had lost: to win the contract on the new (corrected) bid or to have the contract varied. 87 As to the other factors relied upon by the appellants, the respondent submitted that the surrounding circumstances were sufficiently powerful both to support the conclusions of the primary judge, and also to permit a finding that the conclusions reached by the primary judge should not even be discounted for any contingencies. 88 The respondent also submitted that the principal argument based on Badenach must fail without a successful challenge to the primary judge's assessments of the probabilities and contingencies, because his Honour found on the balance of probabilities that NBS would have won the contract with a new (corrected) bid or would have achieved a renegotiation by way of variation to the contract. 89 The principal argument of the appellants was said to be wrong because, if viewed as a loss of opportunity case, what NBS lost was the ability, armed with truthful and accurate evidence, to make and propound its contractual choices with TfNSW on an informed basis – to protect itself from unfunded liabilities. Thus, the correct focus is to see (on the balance of probabilities) what NBS would have done. That was clear: it would have submitted a new bid or would have sought, indeed required, a variation to the contract. 90 The respondent criticised the appellants' calling in aid the rule in Jones v Dunkel. The complaint about the incorrect assumption of the admission was said to be a misreading of the judgment. The various enquiries said by the appellants not to have been addressed in the evidence were said to be unnecessary or speculative: the other competing bids, why NBS lost the bid for region 2 (in which bid the error had not occurred), and the attitude of TfNSW to renegotiation, and generally. The rule in Jones v Dunkel is enlivened where there is an unexpected failure of a party to give evidence or to call a witness. It arises not in drawing an adverse inference, but in inferring the evidence would not have assisted the case of that party, allowing contrary inferences to be drawn more confidently: Holloway v McFeeters [1956] HCA 25; 94 CLR 470 at 480–481; Manly Council v Byrnes [2004] NSWCA 123 at [51]. There is no requirement to draw any inference based on Jones v Dunkel; it is a matter for the fact finder. This is particularly so where the other party (here the respondents) was in a position to call the evidence itself: Payne v Parker [1976] 1 NSWLR 191 at 201–202. Further, the Court should not be astute to draw uncertain inferences in favour of a wrongdoer: McCartney v Orica Investments Pty Ltd [2011] NSWCA 337 at [148]–[160] and [198]–[219]. 91 As to the factual challenge to the assessment of the chances, the respondent proved matters, it was submitted, that made the likelihood of either opportunity high. Ground 4 92 The respondent submitted that the conclusions of the primary judge were evaluative assessments on the evidence before him, not shown to display any error of principle nor being otherwise wholly erroneous: Precision Plastering Pty Ltd v Demir [1975] HCA 27; 132 CLR 362 at 369. Ground 5 93 The respondent submitted that there was ample evidence to conclude that the probabilities were that the contract would be extended. The likelihood of extension depended in significant part upon the satisfactory performance of the operation. The respondent placed significant weight on the lack of any cross-examination of Mr Calabro as to any deficiency in the performance of the first five years. No issue was tendered by the appellants that there were grounds for non-extension. In these circumstances, there was a strong basis, it was submitted, on the authority of Amann Aviation and Gould v Vaggelas for no discount to be made as to the likelihood of renewal. Consideration Ground 1 and damages in deceit 94 In Toteff v Antonas 87 CLR at 650, Dixon J expressed the principle of damages in deceit, as follows: In an action of deceit a plaintiff is entitled to recover as damages a sum representing the prejudice or disadvantage he has suffered in consequence of his altering his position under the inducement of the fraudulent misrepresentations made by the defendant. 95 Sir Owen then proceeded to deal with the application of this to the fraudulent inducement by a vendor of a whole business, the case before the Court. Sir Owen said (at 650) in respect of such a case: if the transaction stands and is not disaffirmed or rescinded, what is recoverable is 'the difference between the real value of the property, and the sum which the plaintiff was induced to give for it" per Abbott LCJ in Pearson v. Wheeler [(1825) Ry. & Mood. 303 at p. 304; [171 E.R. 1028 at p. 1029]]. As Sir James Hannen P. in Peek v. Derry [(1887) 37 Ch. D. 541 at p.594; cf. (1889) 14 App. Cas. 337] pointed out, the question is how much worse off is the plaintiff than if he had not entered into the transaction. 96 As Dixon J then noted: "the point of the application of this doctrine lies in identifying 'the transaction'". The error of the primary judge in that case was to identify the "transaction" as the purchase of the goodwill only (and so to limit damages to goodwill), because the representations (as to takings) concerned goodwill, and not stock or plant and equipment. In fact, the deceit (albeit about takings) had caused the expenditure on the purchase of the whole business and so the plaintiff was entitled to what he had paid diminished by the value of what he got. It was in that context that Dixon J said at 650–651: The measure of damages in an action of deceit consists in the loss or expenditure incurred by the plaintiff in consequence of the inducement on which he relied diminished by the corresponding advantage in money or moneys worth obtained by him on the other side: Potts v. Miller. You look to what he has been induced to part with as the initial step. He is entitled to say that but for the fraud he would never have parted with his money… But he cannot recover the entire price he has paid unless the thing prove wholly worthless. If the thing has any appreciable value the damages must be reduced pro tanto…It must not be forgotten that after all deceit is an action on the case for special damage incurred in consequence of the defendant's fraudulent inducement. (Citations omitted.) 97 Gould v Vaggelas 157 CLR 215 concerned the deceit of vendors of a business to persons who were not the purchaser, but who had formed and controlled the purchaser. The Court discussed, amongst other things, the circumstances in which the plaintiff would be entitled to recover damages beyond the difference between the real value of the property at this time of purchase and what the plaintiff paid for it, as discussed in Potts v Miller [1940] HCA 43; 64 CLR 282 at 289 and 297, and Toteff at 650–651. Gibbs CJ said at 220–221 and 223: The usual rule is, however, only a special application of the general principle that "In an action of deceit a plaintiff is entitled to recover as damages a sum representing the prejudice or disadvantage he has suffered in consequence of his altering his position under the inducement of the fraudulent misrepresentations made by the defendant": Toteff v. Antonas. In other words, the general principle is that the plaintiff is to be put, so far as possible, in the position he would have been in if he had not acted on the fraudulent inducement … … In a case such as the present, where the plaintiffs were not purchasers, the measure of damages is the sum which represents the loss which the plaintiffs have suffered because they altered their positon in reliance on the fraudulent misrepresentation. (Citations omitted.) 98 In Wardley 175 CLR at 530, Mason CJ and Dawson, Gaudron and McHugh JJ referred to what Dixon J had said in Potts v Miller 64 CLR at 297: It will be noticed that, even in such a case, Dixon J. spoke in Potts v. Miller (an action in deceit) of the measure of damages consisting in "the loss or expenditure incurred by the plaintiff in consequence of the inducement upon which he relied, diminished by any corresponding advantage in money or money's worth obtained by him on the other side". It is that amount that, in such a case, represents "the prejudice or disadvantage" the plaintiff "has suffered in consequence of his altering his position under the inducement of the fraudulent misrepresentations made by the defendant", subject to any consequential damage. (Citations omitted.) 99 In Smith New Court Securities Ltd v Citibank NA [1997] AC 254, the House of Lords discussed damages in deceit, and dealt with the judgments of the Court of Appeal in Doyle v Olby (Ironmongers) [1969] 2 QB 158. What is clear from the judgments of Lord Browne-Wilkinson and Lord Steyn (agreed in by Lord Keith of Kinkel and Lord Slynn of Hadley) is that there is no inflexible rule-based approach to the assessment of damages in deceit in English Law. 100 Lord Browne-Wilkinson commenced (at 262) with the well-known statement of Lord Blackburn in Livingstone v Rawyards Coal Co (1880) 5 App Cas 25 at 39 concerning the need for compensatory reparation in damages to award a sum that will as nearly as possible place the party who has been injured in the same position as it would have been had it not sustained the wrong. But there was an important qualification to that very general statement. In cases of malice or international wrong, Lord Blackburn said: There could be no doubt that there you would say that everything would be taken into view that would go most against the wilful wrongdoer—many things which you would properly allow in favour of an innocent mistaken trespasser would be disallowed as against a wilful and intentional trespasser on the ground that he must not qualify his own wrong, and various things of that sort. 101 Lord Browne-Wilkinson then noted the doubts expressed by Lord Atkin in Clark v Urquhart [1930] AC 28 at 67–68 about the line of cases summarised in McConnel v Wright [1903] 1 Ch 546 which were applied by Dixon J in Potts v Miller 64 CLR at 299–300; that application by Dixon J being described by Lord Browne-Wilkinson as "loyal", but Dixon J being "plainly unhappy with it", as reflected in Toteff. 102 Lord Browne-Wilkinson then approved the expression of the matter by Lord Denning MR and Winn LJ in Doyle v Olby (Ironmongers) Ltd at 167 and 168: Lord Denning at 167: The object of damages is to put the plaintiff in as good a position, as far as money can do it, as if the promise had been performed. In fraud, the defendant has been guilty of a deliberate wrong by inducing the plaintiff to act to his detriment. The object of damages is to compensate the plaintiff for all the loss he has suffered, so far, again, as money can do it. In contract, the damages are limited to what may reasonably be supposed to have been in contemplation of the parties. In fraud, they are not so limited. The defendant is bound to make reparation for all the actual damages directly flowing from the fraudulent inducement. The person who has been defrauded is entitled to say: 'I would not have entered into this bargain at all but for your representation. Owing to your fraud, I have not only lost all the money I paid you, but, what is more, I have been put to a large amount of extra expense as well and suffered this or that extra damages.' All such damages can be recovered: and it does not lie in the mouth of the fraudulent person to say that they could not reasonably have been foreseen. For instance, in this very case Mr. Doyle has not only lost the money which he paid for the business, which he would never have done if there had been no fraud: he put all that money in and lost it; but also he has been put to expense and loss in trying to run a business which has turned out to be a disaster for him. He is entitled to damages for all of his loss, subject, of course to giving credit for any benefit that he has received. There is nothing to be taken off in mitigation: for there is nothing more that he could have done to reduce his loss. He did all that he could reasonably be expected to do. Winn LJ at 168: It appears to me that in a case where there has been a breach of warranty of authority, and still more clearly where there has been a tortious wrong consisting of a fraudulent inducement, the proper starting point for any court called upon to consider what damages are recoverable by the defrauded person is to compare his positon before the representation was made to him with his position after it, brought about by that representation… 103 The specific problem being addressed there was the inflexibility of a rule fixed in time (the time of the transaction) and fixed in formula (the difference between what was paid and the value received). The expression of the matter, however, went further: the actual damages directly flowing from the fraudulent inducement. 104 Lord Steyn reflected (at 279–280) upon the justification for distinguishing between deceit and negligence: It may be said that logical symmetry and a policy of not punishing intentional wrongdoers by civil remedies favour a uniform rule. On the other hand, it is a rational and defensible strategy to impose wider liability on an intentional wrongdoer. As Hart and Honoré, Causation in the Law, 2nd ed. … observed, an innocent plaintiff may, not without reason, call on a morally reprehensible defendant to pay the whole of the loss he caused. The exclusion of heads of loss in the law of negligence, which reflects considerations of legal policy, does not necessarily avail the intentional wrongdoer. Such a policy of imposing more stringent remedies on an intentional wrongdoer serves two purposes. First it serves a deterrent purpose in discouraging fraud. Counsel for Citibank argued that the sole purpose of the law of tort generally, and the tort of deceit in particular, should be to compensate the victim of civil wrongs. That is far too narrow a view. Professor Glanville Williams identified four possible purposes of an action for damages in tort: appeasement, justice, deterrence and compensation: see "the Aims of the Law of Tort" (1951) 4 C.L.P. 137. He concluded, at p. 172: "Where possible the law seems to like to ride two or three horses at once; but occasionally a situation occurs where one must be selected. The tendency is then to choose the deterrent purpose for tort of intention, the compensatory purpose for other torts." And in the battle against fraud civil remedies can play a useful and beneficial role. Secondly, as between the fraudster and the innocent party, moral considerations militate in favour of requiring the fraudster to bear the risk of misfortunes directly caused by his fraud. I make no apology for referring to moral considerations. The law and morality are inextricably interwoven. To a large extent the law is simply formulated and declared morality. And, as Oliver Wendell Holmes, The Common Law … observed, the very notion of deceit with its overtones of wickedness is drawn from the moral world. (Emphasis added.) 105 It is unnecessary, and perhaps not wise at an intermediate appellate level, to express agreement with all of this passage, beyond noting that Gummow J approved of the emphasised part in Palmer Bruyn and Parker Pty Ltd v Parsons [2001] 14 HCA 69; 208 CLR 388 at 413 [78]. Also, it can be stated, as Lord Blackburn's qualification to the general principle in Livingstone v Rawyards made clear, that the rule of responsibility concerned (a rule against dishonesty, as opposed to a rule against breach of contract or mere carelessness) undoubtedly plays a key part in the approach to assessment of damages and to causation: Environmental Agency v Empress Car Co (Abertillery) Ltd [1999] 2 AC 22 at 29. 106 After discussing a number of authorities, Lord Steyn said at 283: In my view the orthodox and settled rule that the plaintiff is entitled to all losses directly flowing from the transaction caused by the deceit does not require a revision. In other words, it is not necessary in an action for deceit for the judge, after he had ascertained the loss directly flowing from the victim having entered into the transaction, to embark on a hypothetical reconstruction of what the parties would have agreed had the deceit not occurred. 107 This expression of the matter is conformable with the expression of the matter by Dixon J in Toteff at 650 and 651 ([96] above). 108 Other parts of the expression of the matter by Lord Steyn in Smith New Court Securities received support from the Court in HTW Valuers 217 CLR at 666–668 [63]–[66] to the effect that the circumstances of the case, such as the plaintiff being locked into the business or position by reliance on the fraud, may permit compensation for all loss flowing directly from the transaction without further limiting rules. 109 Relevant to these considerations are the proper considerations of proof when fraud is involved. In Houghton v Immer (No 155) Pty Ltd [1997] NSWSC 608; 44 NSWLR 46, at 59, Handley JA (with the agreement of Mason P and Beazley JA) expressed the principle derived from Armory v Delamirie (1722) 1 Stra 505; 93 ER 664, as follows: … the Court should assess the compensation in a robust manner, relying on the presumption against wrongdoers, the onus of proof, and resolving doubtful questions against the party "whose actions have made an accurate determination so problematic". 110 The above expression of the matter drew from the reasons of Hodgson J (as his Honour then was) in LJP Investments Pty Ltd v Howard Chia Investments Pty Ltd (No 2) (1989) 24 NSWLR 499 at 508. As Giles JA said in McCartney v Orica Investments Pty Ltd [2011] NSWCA 337 at [149]–[154] (Macfarlan JA agreeing), it is a principle not limited to a reduction in the need for proof when the relevant evidence was in the control of the other party, as an instance of Lord Mansfield's dictum in Blatch v Archer (1774) 1 Cowp 63 at 65; 98 ER 969 at 970 that "all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted." In LJP Investments the defendant had engaged in a deliberate trespass by putting scaffolding on the plaintiff's land to use in construction work on its own adjacent land. Damages involved understanding what the defendant would have done in order to assess the benefit to it from the deliberate trespass. Hodgson J said in 24 NSWLR 499 at 508: It is impossible to be certain about which course [the defendant] would have taken, if it had refrained from trespassing: [its] own unlawful act in trespassing, plus the absence of any of [its] decision-makers from the witness box, have made such a decision highly problematic… [I]n these circumstances the Court is justified in taking the course taken in Armory v Delamirie…and resolving the question of value against the party whose actions have made an accurate determination so problematic. 111 As Giles JA said in McCartney v Orica at [152], this was not limited to the absence of the defendant's decision-maker; the defendant's "own unlawful act in trespassing" created the need for findings on an uncertain matter. 112 In McCartney v Orica a central issue was whether an entity called Clos (through a Mr Remy Bontoux) had been deliberately enticed away from a subsidiary of Orica in knowing breach of covenant by Mr McCartney. The trial judge (White J, as his Honour then was) said (set out by Giles JA on appeal at [148]): I do not think that I should readily infer that it was likely that Clos would have left Bronson & Jacobs in the absence of the Defendants' conduct when the conduct was directed at achieving that very goal. One might well ask why the Defendants did what they did if they thought that Clos would have changed distributors in any event. Mr Sullivan's answer to that question was to say that their conduct should be seen as an example of abundant caution. But it is clear that they went to considerable lengths to attract Clos away from Bronson & Jacobs. As a consequence of their conduct, it is impossible to know now with any certainty what Clos would have done. That uncertainty should not be allowed to operate in the Defendants' favour. 113 The criticism of the appellant wrongdoer that this was outside Armory v Delamirie because it had nothing to do with evidence being in control of the wrongdoer (and went merely to absence of proof) was rejected by Giles JA. 114 In Tyco Australia Pty Ltd v Optus Networks Pty Ltd [2004] NSWCA 333, Giles JA said at [246]: Tyco was a wrongdoer, and on the questions of fact involved in valuing the benefit to Optus of keeping the equivalent leftover equipment could not insist on an unrealistic level of proof. The presumption against the wrongdoer in Armory v Delamirie (1722) 1 Sta 505; 93 ER 664 goes beyond where the wrong has positively made it difficult for the victim to prove its damages, and extends to where the wrong has thrust the victim into a difficult task of proving a past hypothetical: see generally Waddams, "Damages: Assessment and Uncertainties", (1998) 13 JCL 5L5, and in particular at 58 the dictum of Learned Hand J in L Albert & Son v Armstrong Rubber Co 178 F 2 d 182 (1949) at 189, speaking of proof of what would have been earned had a contract been performed, that 'it is a common expedient, and a just one, in such situations to put the peril of the answer upon that party who by his wrong has made the issue relevant to the rights of the other'. 115 Armory v Delamirie, LJP Investments 24 NSWLR at 508, and Houghton v Immer 44 NSWLR at 59 were expressly approved by the High Court in Murphy v Overton 216 CLR at 416 [74]. 116 These passages reveal that the general proposition that the claimant has the onus to prove its damages is qualified in circumstances where the (deliberate) wrong has caused the position of uncertainty or difficulty of proof. Even in cases of breach of contract where it has become difficult or impossible for the plaintiff to prove it would have recovered its expenses from the performance of the contract, the onus shifts to the defendant to prove that the plaintiff would not have done so, or that the contract was worthless: Amann Aviation 174 CLR at 94–95 (Mason CJ and Dawson) 106–107 (Brennan J) and 128 (Deane J); and Macquarie International Health Clinic Pty Ltd v Sydney South West Area Health Service [2010] NSWCA 268 at [163] per Hodgson JA (Allsop P and Macfarlan JA agreeing); and see Waddams op cit at 58 and HK Lücke "The So-Called Reliance Interest in the High Court" (1994) 6 Corporate and Business Law Journal 117 at 142–147. 117 In a concurring judgment in McCartney v Orica, Young JA identified other sources of authority in Equity and elsewhere for the approach in Armory v Delamirie as understood and expressed by Giles JA. 118 It is against this background of authority that the facts must be examined here. For the moment we will deal with the matter by reference to the approach of the primary judge, and ground 1 of the appeal. 119 By March and April 2014, NBS had entered into the contract, but had not committed itself to the finance leases of the transfer-in buses. By then, Mr Stewart (and, through him, the appellants) had discovered that a significant premise on which NBS had worked, that the Annual Contract Price included an amount for the costs of transfer-in buses that reflected the formula that was applied by TfNSW, was wrong and that NBS had in error (caused by Mr Stewart and Pitchers) underbid by $660,000 per annum. In April 2014, Mr Stewart, knowing that NBS was relying on his calculations of this very matter to enter the Westpac leases, chose to cover up dishonestly his and Pitchers' error and to deceive his own client knowing it would rely upon his communications to enter into the leases. Thus, it can be accepted, as submitted by NBS, that the direct consequence of the deceitful conduct of Mr Stewart and, through him, the appellants was that NBS assumed direct liabilities not covered by the line item represented by TfNSW subvention, to the knowledge of Mr Stewart and the appellants. 120 Whilst it can be accepted that it may have been a breach of contract on the part of NBS not to undertake the responsibility of the leases for the transfer-in buses, the evidence of Mr Calabro was clear. He would not have permitted NBS to undertake the liabilities and almost halve his margin. The hypothesis that is there set up – what would have happened? – was answered by the primary judge (as to which see below). Thus, it may not be correct to say in an unqualified way that the liability was non-existent prior to taking up the leases. It was provisional, recognising that there were difficulties in NBS merely walking away from the contract. Therefore, in that sense, NBS moved from a position of provisional loss to one of certain loss. 121 It was as if Mr Calabro had asked the question: "If we execute these Westpac leases, are we covered by what we will receive from TfNSW by way of indemnification or subvention for the cost of assuming the transfer-in buses?"; and as if Mr Stewart had answered "Yes", knowing the true answer was "No, we made a mistake in the bid; you will be $660,000 per annum short." 122 Thus the difficulty of knowing everything that would have happened thereafter begins with the deceit itself and its consequences. It is then compounded when NBS begins to appreciate the problem in the months afterwards. Mr Stewart (and so Pitchers) refuses to admit error, and, amongst other things, seeks to lay blame on NBS. As Mr Calabro perfectly reasonably said in cross-examination, he could not go to TfNSW for a renegotiation in circumstances where his accountant was either denying a mistake or saying it was his (NBS') responsibility for undercutting the bid. This further lack of openness and honesty, so closely related to the actionable deceit, made it even more difficult to ascertain and prove what would have happened contemporaneously had the deceit and associated dishonourable or dishonest conduct of Mr Stewart and the appellants not taken place. In the light of the fundamental matters of the importance of the subvention to the whole process ([35]–[40] above), the clear attitude of Mr Calabro as to what he would have done ([41]–[42] above) and the evidence as to the likelihood of probabilities drawn from the considerations set out at [43]–[52] above there was ample basis to conclude that the liability of an additional $660,000 per annum was the loss directly caused by the deceit. 123 It can be accepted that implicit in the conclusion of this loss is the alternative of an identical contract with a different line item for subvention by TfNSW. The question is whether NBS proved enough to conclude that that alternative, if not proven by the evidence on the balance of probabilities, was a sufficiently real possibility that, even if uncertain, should be taken as something to be dealt with robustly against the appellants, as deceitful wrongdoers, who made an accurate determination problematic, by their wrongs. 124 The fact that no officer from TfNSW was called by NBS does not undermine this conclusion. TfNSW had no contemporaneous knowledge of the issue, a fact brought about by the covering up of the error by the appellants, even after the deceit had been acted on and then discovered, or so NBS (correctly) thought. The appellants, through their wrong, caused the difficulties of proof. A witness from TfNSW was equally available to the appellants to call to throw light on what TfNSW would or might have done if asked to renegotiate the contract (or earlier to permit a varied bid). Looking at the matter robustly in the way discussed in Houghton v Immer, it was open to the primary judge to conclude that the direct loss flowing from the deceit was the capital value of the $660,000 per annum as the prejudice or disadvantage suffered as a consequence of NBS altering its position under the fraudulent inducement. If the question of what TfNSW would have done was uncertain, that uncertainty was brought about, not insignificantly, by the conduct of the appellants as wrongdoers and by them (as much as NBS) in not calling third parties, years after the event to speculate on entirely hypothetical questions on matters that would not have materially concerned them. In such circumstances, it was appropriate to rely on the presumption against the wrongdoer, the onus of proof and resolving doubtful questions against the appellants whose actions have made an accurate determination problematic. 125 But, in any event, the primary judge made a finding (at [243] of the reasons) that NBS would have successfully renegotiated the contract. In our view, it was not necessary for that finding to be made, but its making concludes the matter. The appellants did not set out to prove and did not prove that NBS would have been unsuccessful. For the reasons given by the primary judge and the reasons discussed below, there was sufficient likelihood of that occurring as to permit the Court, using the robust approach referred to above because of the contribution of the wrongdoer to the difficulties of proof, to conclude that the loss flowing from the deceit was the capital value of the annual revenue shortfall of $660,000. 126 Nevertheless, was the finding on the balance of probabilities in [243] made in error? In our view, no. The absence of evidence from someone from TfNSW was as much an apparent choice of the appellants as NBS. No inference of a Jones v Dunkel kind should be drawn. There was no false assumption of an admission by the primary judge at [157] of his reasons. The acceptance of the appellants at trial was said to be what NBS would have done: put in an increased bid or seek a variation to the contract. The evidence of Mr Calabro comfortably proved those matters. The other bids and bidders could have been proven by either side. In the context where it could be shown that the bid of NBS, even with the correction, comfortably beat the incumbent ([237] of the reasons and [43]–[44] above), Mr Stewart's evidence referred to by the primary judge at [238], the scale of the changes to the overall tender and to NBS' margin ([47], [49] above, respectively) and a robust approach to the fact finding for the reasons already discussed, we would draw the same conclusion as the primary judge. In addition, the primary judge's conclusion should be given significant respect by the recognition of the advantage he had in hearing all the evidence unfold and in assessing the evidence of Mr Calabro and Mr Stewart referred to at [237] and [238] of the reasons (see [43], [45] above): State Rail Authority (NSW) v Earthline Constructions Pty Ltd (in liq) [1999] HCA 3; 160 ALR 588 at 619–620 [89]–[91] per Kirby J, adopted by Gleeson CJ, Gummow and Kirby JJ in Fox v Percy [2003] HCA 22; 214 CLR 118 at 125–126 [23] and 129–130 [33]; and see also Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; 117 FCR 424 at 435–436 [24]. 127 The appellants have shown no error in the primary judge's finding at [243] of his reasons that had NBS been told of the error before executing the leases it would have successfully renegotiated a variation to the contract. The Notice of Contention 128 On the above basis it is unnecessary to go to the notice of contention. It is appropriate, however, to do so, not least because the reasons for the case in deceit as it was run are reinforced if one recognises the matters put in the notice of contention. 129 The dishonest conduct in 2014 was plainly serious misleading or deceptive conduct. It can be viewed as part of a body of misleading or deceptive conduct that commenced in 2013. That 2013 misleading or deceptive conduct induced NBS to bid for, and accept an offer to enter into, a contract on the basis of the amortisation error. The primary judge found at [236] of his reasons that, on the balance of probabilities, NBS would have won the contract with the correction if another bid had been put in. For the reasons that we have already expressed as to the associated finding in [243] (see [125]–[126] above), there has been no error demonstrated in that finding. Thus the misleading or deceptive conduct induced NBS to enter into the contract. The later (2014) dishonest misleading or deceptive conduct drew NBS into a position of complete commitment both to the contract and the external financier. That commitment was on the (dishonestly false) assurance that the Annual Contract Price included the full subvention for the transfer-in buses allowed by TfNSW. 130 The conclusion from this is that when one considers the high public policy of the ACL; the relationship between ss 236 and 237 of the ACL and the width and flexible content that is to be given to "loss and damage because of the conduct of another person" in s 236, in particular by recognising the specific orders that can be made under s 237 upon the same circumstances; the clear injunction of the High Court not to constrain or limit the remedial power of sections such as ss 236 and 237 by paradigms drawn from the common law; the entitlement to look to damages by reference not just to capital account but also to revenue account and to a particular itemised part of an overall contract; the clear proof that NBS had undertaken obligations which were (to the wrongdoer's knowledge) larger than the (innocent and then dishonest) misleading or deceptive conduct led it to believe; and the robust approach to the award of damages against the dishonest person, there is a clear and principled basis to require the appellants to pay the sum awarded by the trial judge as the loss and damage suffered under s 236 of the Act. 131 This approach is supported by the reasons of the Court in Murphy v Overton 216 CLR especially at 406 [41], 407 [44]–[45], 408 [47]–[49], 411–412 [57]–[59], 413–414 [66]–[67], 415 [73], and 415–416 [74]; Marks v GIO 196 CLR at 505 [24] (per Gaudron J) and 536 [118]–[119] (per Gummow J); and Abigroup Contractors v Sydney Catchment Authority 67 NSWLR at 355 [65] and 363–364 [110]–[116]. 132 It can be accepted that the place of s 87 of the Trade Practices Act 1974 (Cth) (the equivalent of s 237 of the ACL) discussed in Murphy v Overton took particular significance in that case because the wrongdoer was a party to the transaction. Here, that feature was not present, but the conduct was far worse – it was, in its second manifestation, dishonest by a trusted adviser of the innocent party. Just as the party to the contract in Murphy v Overton had damages under s 82 framed as the measure of the obligation that the applicants took on that was larger than they had been led to believe (see Murphy v Overton 216 CLR at 413 [66] and 415–416 [74]), here the dishonest advisers, by their misleading or deceptive conduct, led the client into a contract and then dishonestly induced it to commit to a financial liability larger than the dishonest conduct led it to believe. In this way, here, the liar (like the non-fraudulent respondent in Murphy v Overton) is held, by the relief, to restore the innocent party to the positon consistent with the lie being true, that is non-operative. Grounds 2, 3 and 4 133 These grounds can be dealt with shortly. The central argument that Badenach required NBS to prove that TfNSW would have been willing to renegotiate the contract as requested should be rejected. The essence of the uncertainty which led the Court in Badenach to conclude that the plaintiff had failed to prove the existence of a valuable commercial opportunity that had been lost was that one did not know on the evidence what course the testator would have taken. The existence of the opportunity was taken to be speculative. 134 Here it was clear that NBS would have put in a revised bid or sought a variation of the contract. These plain opportunities lost were the commercial circumstances within the control of NBS that the primary judge found had a value. 135 Indeed his Honour found that both would have been successful on the balance of probabilities (see [236] and [243] of the reasons). Thus, even if the submission of principle of the appellants based on Badenach were correct, the submission goes nowhere because of these findings that we have already concluded were made without error. 136 That leaves the assessments of 70% and 75%. We have already concluded that there was no error in the primary judge concluding these matters on the balance of probabilities. His Honour made two evaluative conclusions that have not been shown to be wrong. For all the reasons we have already given, there was available material to support an evaluative conclusion well in excess of 50%. Given the principle of robust fact finding resolving doubtful questions against the wrongdoer and the proper approach to the question as set out in Precision Plastering v Demir 132 CLR at 369, we see no error in these percentages. Ground 5 137 For the reasons given by the primary judge, and the submissions of the respondent, there was a reasonable basis for assessing damages past five years, to nine years. The extension was at the election of TfNSW. No case was sought to be made by the appellants that the contract would not in all likelihood be extended. In particular, given the proper approach to the assessment of damage against the wrongdoer, we see no error in the reasons of the primary judge at [201]–[204] of the reasons. Orders 138 The appeal should be dismissed with costs. I certify that the preceding one hundred and thirty-eight (138) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice Allsop and Justices Yates and O'Bryan. Associate: Dated: 23 July 2019