FEDERAL COURT OF AUSTRALIA Roumanus v Orchard Holdings (NSW) Pty Limited (In Liq), In the Matter of Orchard Holdings (NSW) Pty Limited (In Liq) [2012] FCA 775 Citation: Roumanus v Orchard Holdings (NSW) Pty Limited (In Liq) [2012] FCA 775 Parties: RAYMOND ANTHONY ROUMANUS, ARTHUR JOHN ROUMANUS, SANDRA MARY ROUMANUS, SALISBURY PARTNERS (NSW) PTY LIMITED (ACN 120 421 016), MARY MAROON, WARATAR PTY LTD (ACN 068 651 570) ATF THE ROUMANUS SUPERANNUATION TRUST AND ROSEMAREE MAROON AS TRUSTEE FOR MAROON FAMILY TRUST v ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283); IN THE MATTER OF ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283) File number: NSD 1618 of 2010 Judge: FOSTER J Date of judgment: 20 July 2012 Catchwords: CORPORATIONS –Whether the defendant corporation in liquidation should be held liable as the primary contravenor or, alternatively, as an accessory, in respect of misleading and deceptive conduct constituted by representations made by persons who occupied office as directors of the corporation in connection with the sale by one of those persons to others of shares in the corporation – whether causes of action out-of-time in any event – whether causes of action could be maintained pursuant to ss 52, 75B and 82 of the Trade Practices Act 1974 (Cth) Legislation: Australian Securities and Investments Act 2001 (Cth), ss 12BAB(1)(b), 12BAB(7), 12DA(1), 12GB, 12GF Corporations Act 2001 (Cth), ss 9, 79, 471B, 553, 553A, 563A, 1041H, 1041I Corporations Amendment (Sons of Gwalia) Act 2010 (Cth) (No 150 of 2010), s 3, Sch 1, par 4(1) Trade Practices Act 1974 (Cth), ss 4, 51AF, 52, 82 and 87 Cases cited: De Bortoli Wines Pty Ltd v HIH Insurance Ltd (in liq) (2011) 200 FCR 253 cited Re Application of NRMA Ltd (No 2) (2000) 156 FLR 412 cited Sons of Gwalia Ltd (Administrators Appointed) v Margaretic (2007) 231 CLR 160 applied State of Western Australia v Wardley Australia Limited (1991) 30 FCR 245 cited Walker v Wimborne (1976) 137 CLR 1 cited Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 cited Yorke v Lucas (1985) 158 CLR 661 applied Date of hearing: 9 July 2012 Date of last submissions: 11 July 2012 Place: Sydney Division: GENERAL DIVISION Category: Catchwords Number of paragraphs: 183 Solicitor for the Plaintiffs: Mr P Fordyce of Pmf Legal Limited Solicitor for the Defendant: The liquidator of the defendant submitted save as to costs IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1618 of 2010 IN THE MATTER OF ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283) BETWEEN: RAYMOND ANTHONY ROUMANUS, ARTHUR JOHN ROUMANUS, SANDRA MARY ROUMANUS, SALISBURY PARTNERS (NSW) PTY LIMITED (ACN 120 421 016), MARY MAROON, WARATAR PTY LTD (ACN 068 651 570) ATF THE ROUMANUS SUPERANNUATION TRUST AND ROSEMAREE MAROON AS TRUSTEE FOR MAROON FAMILY TRUST Plaintiffs AND: ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283) Defendant JUDGE: FOSTER J DATE OF ORDER: 20 JULY 2012 WHERE MADE: SYDNEY THE COURT ORDERS THAT: 1. The plaintiffs have leave to amend their Originating Process in accordance with the proposed Further Further Amended Originating Process dated 11 July 2012 lodged with the Associate to Foster J on 11 July 2012. 2. The said Further Further Amended Originating Process be filed in Chambers. 3. Service of the said Further Further Amended Originating Process be dispensed with. 4. To the extent that it may be necessary, pursuant to s 471B of the Corporations Act 2001 (Cth), the plaintiffs have leave to proceed against the defendant in respect of the claims made by them in the Further Further Amended Originating Process. 5. The Further Further Amended Originating Process be wholly dismissed. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. IN THE FEDERAL COURT OF AUSTRALIA NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 1618 of 2010 IN THE MATTER OF ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283) BETWEEN: RAYMOND ANTHONY ROUMANUS, ARTHUR JOHN ROUMANUS, SANDRA MARY ROUMANUS, SALISBURY PARTNERS (NSW) PTY LIMITED (ACN 120 421 016), MARY MAROON, WARATAR PTY LTD (ACN 068 651 570) ATF THE ROUMANUS SUPERANNUATION TRUST AND ROSEMAREE MAROON AS TRUSTEE FOR MAROON FAMILY TRUST Plaintiffs AND: ORCHARD HOLDINGS (NSW) PTY LIMITED (IN LIQUIDATION) (ACN 097 062 283) Defendant JUDGE: FOSTER J DATE: 20 JULY 2012 PLACE: SYDNEY REASONS FOR JUDGMENT 1 The first to third and fifth to seventh plaintiffs (the investors) were investors in the defendant, Orchard Holdings (NSW) Pty Limited (In Liquidation) (Orchard). Orchard was placed into provisional liquidation on 19 December 2007 and was wound up on 11 February 2008 by order of the Supreme Court of New South Wales. Orchard appears to have been insolvent when wound up. 2 The fourth plaintiff (Salisbury Partners (NSW) Pty Limited) (Salisbury) conducts a finance broking business. It is controlled by the first plaintiff (Ray Roumanus). It made some payments to or for the benefit of Orchard which are at the heart of one of the claims made by the fifth plaintiff (Waratar Pty Ltd) (Waratar). Waratar claims that the payments made to Orchard by Salisbury in late 2002 and in early 2003 were made on its behalf. 3 In the period from early October 2001 to May 2004, the investors made payments to Orchard and to persons and entities associated with Orchard and procured others to make payments to such persons and entities on their behalf. The investors argue that most of those payments were made to or for the benefit of Orchard. There is a suggestion in the evidence tendered before me that Orchard did not have a bank account during the relevant period and that monies were paid to other corporations on its behalf purely as a matter of convenience. Some payments were made to the vendor of certain shares in Orchard and thus not paid to Orchard either directly or indirectly. 4 All of the investors claim that they were induced to make all of the payments which they made or which were made on their behalf by misleading and deceptive conduct on the part of Orchard or, alternatively, on the part of its two directors, Mona Kady and Steven Joseph Sarkis (Sarkis). In the event that Mona Kady and Sarkis are found by the Court to have been the primary contravenors, the plaintiffs seek to make Orchard liable as an accessory to the contravening conduct in which its directors are said to have engaged. 5 The investors testified before me that both Mona Kady and Sarkis orally represented to them before the relevant payments were made that the monies which Mona Kady and Sarkis procured from the investors from time to time would be used to enable Orchard to lodge and (later) progress to completion a Development Application (DA) with Penrith City Council the main purpose of which was to enable Orchard to import and use as landfill at its property at 123–179 Patons Lane, Orchard Hills (the property), building and construction waste (also called "non-VENM" waste). The investors claim that, influenced by these and other representations made by Mona Kady and Sarkis, they formed the view that, if a development consent permitting such activities at the property were granted and if the property were rehabilitated, the property could then be subdivided into a large number of residential building blocks. For these reasons, it was thought that, once the development consent was obtained, the value of the property would increase significantly because of its more assured potential for development. The investors contend that it was these blandishments tantalisingly placed in front of them by Mona Kady and Sarkis that induced them to make or cause to be made the relevant payments. 6 Unfortunately, no DA was ever lodged with Penrith City Council either by or on behalf of Orchard. The monies paid by the investors were apparently used by Mona Kady and Sarkis to prop up and fund other corporations and businesses in which they, and perhaps the investors also, were interested. 7 Mona Kady and Sarkis were both subsequently made bankrupt on their own petition—Mona Kady on 27 July 2009 and Sarkis on 28 September 2006. The current position in their bankruptcies was not addressed in the evidence. I infer, however, that the investors have concluded that, even if it were legally possible for to them to sue Mona Kady and Sarkis, there would be little point in doing so now. 8 By order made on 25 November 2010, pursuant to s 471B of the Corporations Act 2001 (Cth), Stone J granted leave to the plaintiffs to proceed against Orchard. That leave authorised the plaintiffs to prosecute claims for damages pursuant to s 82 of the now repealed Trade Practices Act 1974 (Cth) (the TPA) flowing from alleged contraventions of s 52 of the TPA. Relief was also claimed pursuant to s 87 of the TPA. Declarations were also sought in respect of the plaintiffs' entitlement to prove in the winding up of Orchard. In support of their application for leave to proceed against Orchard, the investors contended that they had been induced to make the payments which they made to Orchard by false representations made to them by Mona Kady and by Sarkis to the effect outlined at [5] above and that Orchard should be held liable for the losses suffered by them as a result of their relying on those representations. 9 In their Amended Originating Process filed on 25 January 2012, the plaintiffs omitted the claims for damages pursuant to s 82 of the TPA which had been made in the first iteration of that process. Those claims have not subsequently been reintroduced into that process although it is clear from the Written Submissions lodged by the plaintiffs' solicitor on 6 July 2012 and from his subsequent Written Submissions lodged on 11 July 2012 that the plaintiffs' damages claims are, in fact, at least in part advanced pursuant to s 82 of the TPA. I will deal with the plaintiffs' damages claims on the basis that the plaintiffs rely upon s 52 and s 82 of the TPA to the extent that such reliance is available to them. No particular relief was sought pursuant to s 87 of the TPA. 10 At the hearing, the plaintiffs sought and were granted leave to amend their Originating Process in accordance with a proposed Further Amended Originating Process dated 9 July 2012. 11 As a result of my raising certain matters with the plaintiffs' solicitor after the hearing, the plaintiffs have sought leave to amend their Originating Process yet again. I propose to grant leave to the plaintiffs to amend their Originating Process in accordance with the draft Further Further Amended Originating Process dated 11 July 2012 sent to my Associate on that day. I note that the liquidator has consented to that leave being granted. I will dispense with service of that Further Further Amended Originating Process. To the extent that it may be necessary, I will also grant leave to the plaintiffs to proceed against Orchard in respect of all claims now made in the latest iteration of its Originating Process (including those made pursuant to s 52 and s 82 of the TPA). 12 By their Further Further Amended Originating Process (the current Originating Process), the plaintiffs claim relief pursuant to ss 553, 563A, 1041H and 1041I of the Corporations Act 2001 (Cth) (the Corporations Act) and pursuant to ss 12DA, 12GB and 12GF of the Australian Securities and Investments Commission Act 2001 (Cth) (the ASIC Act). By that process, the plaintiffs claim: 1. An order pursuant to section 471B of the Corporations Act, that the plaintiffs have leave to proceed against the Company in respect of the claims made herein. 2. A declaration that the claims of the plaintiffs made in these proceedings against the defendant and judgments pursuant to it [sic] are debts or claims provable in the winding up of the Company within the meaning of section 553 of the Corporations Act and not debts owed by the Company to them in their capacity as a member of the Company within the meaning of section 563A of the Corporations Act or in addition or in the alternative, a declaration that the claims of the plaintiffs made in these proceedings against the defendant and judgments pursuant to them are loans to the Company less the true value of the shares. 3. A declaration that the defendant has in contravention of section 52 of the Trade Practices Act, 1974 in trade or commerce engaged in misleading or deceptive conduct or conduct which is likely to mislead or deceive in relation to the procurement of payments from the plaintiffs and the retention of the moneys so acquired. 3A. In the alternative to the preceding paragraph, a declaration that the defendant has in contravention of section 1041H of the Corporations Act, 2001 engaged in conduct in relation to a financial product or a financial service that is misleading or deceptive or is likely to mislead or deceive in relation to the procurement of payments from the plaintiffs and the retention of the moneys so acquired; further or in the alternative 3B. A declaration that the defendant has in contravention of section 12DA of the Australian Securities and Investments Commission Act, 2001 in trade or commerce, engaged in conduct in relation to [sic] financial service that is misleading or deceptive or is likely to mislead or deceive in relation to the procurement of payments from the plaintiffs and the retention of the moneys so acquired. 3C. The defendant has, contrary to section 75B of the Trade Practices Act, 1974, engaged in conduct to intentionally aid, abet, counsel or procure the contravention pleaded in prayer 3 or has been in any way directly or indirectly, knowingly concerned in, or a party to, the contravention pleaded in prayer 3. 3D. In the alternative to the preceding paragraph the defendant has, contrary to section 12GB of the Australian Securities and Investments Commission Act, 2001, engaged in conduct to intentionally aid, abet, counsel or procure the contravention pleaded in prayer 3B or has been in any way directly or indirectly, knowingly concerned in, or party to, the contravention pleaded in prayer 3B. 4. Relief pursuant to section 87 of the Trade Practices Act, 1974, or in the alternative section 1041I of the Corporations Act, 2001 and section 12GF of the Australian Securities and Investments Commission Act, 2001. 5. Interest. 6. Costs. 7. Such further or other orders and declarations as the Court shall deem fit. 13 In essence, the plaintiffs claim money judgments against Orchard as damages pursuant to s 82 of the TPA, and/or its analogues, by reason of Orchard's contravention of s 52 of that Act, and/or its analogues, plus interest and costs. In addition, they claim declarations that, once their damages claims have been established and quantified, they will be entitled to prove as creditors in the winding up of Orchard, ranking in an equivalent position with Orchard's external creditors and not being subordinated to those creditors by reason of the operation of s 563A of the Corporations Act, in the form in which it stood at the relevant time (ie as at the date of the winding up order made on 11 February 2008). 14 The liquidator of Orchard has filed an Appearance in the proceeding but has never taken any active role in the matter. At the first Directions Hearing before me, held on 9 May 2012, the legal representative of the liquidator informed me that his client was happy to submit to the orders of the Court, save as to costs. On the same occasion, the liquidator sought, and was granted, permission to be excused from further attendance at Court, including at the hearing. Consistent with that position, the liquidator did not attend at the hearing, was not represented at the hearing, tendered no evidence at the hearing and made no submissions at or before the hearing. The liquidator should be taken as not wishing to put anything in opposition to the plaintiffs' claims (including those claims which have been made for the first time in the current Originating Process) in circumstances where he has been fully apprised of them. In addition, the liquidator informed the Court that he neither consented to nor opposed the plaintiffs' having leave to amend their Originating Process in the manner sought on 11 July 2012. As a result of the attitude adopted by the liquidator, the plaintiffs' evidence was not challenged. The plaintiffs' evidence was given entirely by affidavit. No oral testimony was given by any of the witnesses called on behalf of the plaintiffs. There was no cross-examination of any of those witnesses. There was, therefore, no contradictor to the plaintiffs' case. Notwithstanding these circumstances, the plaintiffs must establish by evidence and argument their entitlement to the relief which they claim. The Context of the Present Case 15 The plaintiffs were the plaintiffs in the proceeding in the Supreme Court of NSW in which the order winding up Orchard was made. By mid 2007, they had become disillusioned with Mona Kady and Sarkis, and their associates, and were fearful that, if they did not take prompt action to put Orchard into liquidation, they would have no prospect of recovering anything from the wreckage that was, by then, Orchard and its related corporations. 16 On 25 October 2008, Arthur John Roumanus (Arthur Roumanus) and Sandra Mary Roumanus (Sandra Roumanus), the second and third plaintiffs, lodged a Formal Proof of Debt or Claim with the liquidator in which they claimed to be creditors of Orchard in the amount of $600,000. They claimed that they had lent $600,000 to Orchard in March 2003. They said that interest was payable on that loan at the rate of 15% pa and that, in addition to that debt, they had a claim for damages against Orchard. 17 The plaintiffs' solicitor suggested in an affidavit sworn by him on 24 November 2010 that all of the other plaintiffs had also lodged Proofs of Debt at around the same time but no other Proofs of Debt were tendered in evidence before me. The plaintiffs' solicitor also submitted in his Written Submissions lodged on 11 July 2012 that all of the relevant payments made by or on behalf of the plaintiffs were loans to Orchard. This general assertion was not supported by the evidence. It is inconsistent with some of the evidence. Nonetheless, it seems clear that, by late 2010, all of the plaintiffs were contending that all of the payments made by them or on their behalf were loans to Orchard. 18 In due course, it will be necessary to scrutinise each payment in order to ascertain the identity of the payer, the identity of the payee and, most importantly of all, the true nature of the transaction. 19 In the period from March to September 2010, the liquidator conducted examinations in relation to the affairs of Orchard pursuant to s 596A and s 596B of the Corporations Act. He examined Mona Kady, Sarkis, the individual plaintiffs and other persons. On the basis of material obtained from those examinations and from other investigations, the liquidator raised with the plaintiffs the question of whether any of them were truly creditors of Orchard and, even if they were, whether their claims should be postponed to those made by the external creditors of Orchard by reason of the operation of s 563A of the Corporations Act. 20 By late October 2010, the plaintiffs and their solicitor became aware that the Federal Parliament was considering passing legislation to overturn the effect of the decision of the High Court in Sons of Gwalia Ltd (Administrators Appointed) v Margaretic (2007) 231 CLR 160. 21 In that context, the plaintiffs' solicitor sent a facsimile to the liquidator dated 27 October 2010 in which he said (omitting formal parts): As you are aware the parties that I represented in the winding up of Orchard Holdings had claims that were asserted as claims in their capacity as debtors. Those claims, at least parts of them, could possibly also be interpreted as being claims in their capacities as shareholders. The claims are the subject of proofs of debt that have been lodged by them in your administrations now. Having regard to legislative changes before the Australian parliament at the moment, which will have the effect of overruling claims in the nature of those permitted to shareholders in the High Court decision in the Sons of Gwalia, and the possibility that you will construe all or some of the debts claimed by my clients as being debts owed to them in their capacity as shareholders, it will be necessary to urgently commence proceedings before the proposed amendments go through. In the circumstances, and without wishing to put you into a difficult spot, my instructions are to commence proceedings next week unless by 4:00 pm on Friday 29 October you confirm that you are treating all of the claims of my clients in the winding up proceedings as being claims of creditors and not shareholders. If you confirm that all of my clients claims are to be treated as claims in their capacity as creditors and not as shareholders I will not have to commence proceedings. However my clients will then rely on such representation to alter their position so as not to commence such proceedings and to forego their entitlements as they exist under the Corporations Act and the common law at the time of this fax. 22 On 2 November 2010, the plaintiffs' solicitor sent a letter in substantially the same terms to the liquidator's solicitor. 23 On 5 November 2010, the plaintiffs' solicitor sent a further facsimile dated that day to the liquidator's solicitor. In that facsimile, the plaintiffs' solicitor said (omitting formal parts): I refer to my previous faxes to you about this matter. I note that I have not yet heard from you in relation to your client's position to the claims of my various clients (as identified in my fax to you of 2 November) against Orchard. I am aware that examinations were undertaken and it would seem that as a result of evidence given in those examinations your client would be inclined to take the view that all or a major part of my clients claims are claims that would fall under s.563A of the Corporations Act. The effect of that provision, as you know, was affected by the High Court judgment in the Sons of Gwalia case. The potentially beneficial results of that judgment are now under threat as a result of the Corporations Amendment (Sons of Gwalia) Bill 2010 (Cth). The form that that legislation will finally take is not yet known as the draft is presently before a Senate sub-committee. For more abundant caution my clients wish to commence proceedings BEFORE the aforementioned legislation is passed. This will avoid any possibility that the amendment would operate to bar their claims. I understand that your client's attitude is that he will abide the order of the Court in regard to this application. In the first instance it will be necessary to have the Originating Process filed in Court before the duty judge for the purposes of obtaining the leave of the Court under s.471B. Your presence would be appreciated on that day to consent to that application, if those are your instructions. I trust I have properly anticipated your client's position on this matter and look forward to hearing from you. 24 On 23 November 2010, the plaintiffs' solicitor sent a further facsimile dated that day in which he said (amongst other things): Please be advised that I anticipate going to Court tomorrow morning on the above matter. The Defendants will be Orchard Holdings (NSW) Pty Ltd ("Company") and Schon Condon. Orders will be sought in relation to leave to bring proceedings against the Company in liquidation (under s.471B) and then for declarations and orders that the various plaintiffs who had the Company wound up, are to be treated as creditors for the purposes of s.555 and not to be treated as claims due to members under s.563A – broadly seeking to have any claims that would fall under s.563A treated as being claims of the kind identified in the Sons of Gwalia Case [2007] HCA 1 I understand that the liquidator's position is that he will abide the order of the Court and not seek to actively challenge my clients' application. It would be of enormous assistance if either a representative of your client could be in attendance at the Court to have the order giving leave under s.471B made by consent or alternatively providing a letter confirming that such consent is given – to avoid the need for you to incur costs. … 25 The liquidator's solicitor replied that same day (23 November 2010). In response to the entreaties of the plaintiffs' solicitor, the liquidator's solicitor said: … the position of the Liquidator in relation to the claims of your clients has not been settled. The Liquidator is currently reviewing the evidence given at the 596A and 596B Examinations, together with other material and will in due course call for formal Proofs of Debt. Once those Proofs of Debt are received the Liquidator will rule on them. The Liquidator's preliminary view, however, from the information that he has to hand, is that part of the claims made by your clients most likely will be rejected as creditor claims, on the basis that the evidence appears to make it clear that, in relation to part of those claims, the monies paid by your clients, was paid in consideration of them obtaining shares in the company. 26 In his letter, the liquidator's solicitor extracted certain questions and answers from the examinations of Ray Roumanus and Sandra Roumanus which he had conducted earlier in 2010. Those extracts established that: (a) Sandra Roumanus had said during her examination that she had acquired three shares in Orchard at a cost of $200,000 per share. (b) Ray Roumanus had said during his examination that he had caused Waratar to acquire two shares in Orchard at a cost of $200,000 each. One share was paid for on 5 October 2001 and the other share was paid for in June 2003 when a cheque for $200,000 was handed to Sarkis at a meeting held in late June 2003 at the Observatory Hotel in Kent Street, Sydney, attended by Sarkis, Ray Roumanus, Morris Maroon and Anthony Maroon (the Observatory Hotel meeting). 27 The liquidator's solicitor observed that, while, as at 23 November 2010, the liquidator had not made a final determination in respect of the plaintiffs' claims, it would seem that: … your clients are most likely not creditors of the company in respect of all the amounts that they claim, given that a substantial amount of the monies paid by them seem to have been paid for the shares that they acquired in the Company. 28 The liquidator's solicitor went on to state that he could not provide the comfort which the plaintiffs' solicitor had sought although he appeared to accept that Ray Roumanus had made loans to Orchard, either directly or indirectly, in addition to acquiring shares in Orchard. In light of the evidence before me, it may be that the entity which actually made these loans was Waratar, not Ray Roumanus personally. 29 Confronted with the possibility that the liquidator might ultimately take the view that most, if not all, of the claims made by the plaintiffs against Orchard were not truly founded upon the relationship of debtor and creditor as at the date of the winding up order but were rather claims for damages which, even if proven, might be subordinated to the claims of Orchard's external creditors if the Federal Parliament acted to overturn by legislation the effect of the High Court's decision in Sons of Gwalia Ltd, the plaintiffs moved the Court on 24 November 2010 for leave to proceed against Orchard. The plaintiffs wanted to make sure that they had done everything possible on their part to keep all of their options open. It must, however, have been apparent to the plaintiffs that, whilst one or two of the claims being made were truly based upon loans made to Orchard, most of the losses suffered by the plaintiffs almost certainly had resulted from their acquisition of shares in Orchard at various times between June 2001 and March 2004. 30 The true nature of the plaintiffs' losses (if any) must be assessed by reference to the evidence tendered before me. Previous attempts on the part of the plaintiffs to characterise all payments made by them or on their behalf as loans to Orchard will count for very little if the preponderance of the evidence points to a different characterisation. Some Preliminary Matters 31 In the Written Submissions lodged on behalf of the plaintiffs before the hearing, the plaintiffs confined their damages claims to claims pursuant to s 82 of the TPA for damages suffered by reason of Orchard's contraventions of s 52 of the TPA or, in the alternative, pursuant to s 75B of that Act, by reason of Orchard's conduct as an accessory to the contraventions of that Act committed by Mona Kady and Sarkis. No reliance was placed upon s 1041H of the Corporations Act or s 12DA(1) of the ASIC Act, which are the equivalents in those two Acts of s 52 of the TPA, nor was any reliance placed upon the relevant provisions in those Acts governing the award of damages as a result of contraventions of those Acts or the relevant provisions in those Acts governing accessorial liability. In his supplementary Written Submissions lodged on 11 July 2012, the plaintiffs' solicitor made clear that he now wished to rely upon these other provisions to the extent that it was necessary or desirable for him to do so in the interests of his clients. The current Originating Process includes claims made pursuant to these other provisions. 32 The claims made by the plaintiffs that they suffered loss by reason of Orchard's misleading and deceptive conduct are anchored in the allegedly false statements made to the plaintiffs and their agents by Mona Kady and Sarkis upon which the plaintiffs assert that they relied in acquiring their shareholdings in Orchard. Contravening conduct of that type is "… conduct in relation to financial services …" within the meaning of s 12DA(1) of the ASIC Act because it is properly characterised as "… [conduct in relation to] the dealing in a financial product …" (viz a share) within the meaning of s 12BAB(1)(b) and s 12BAB(7) of the ASIC Act. At all relevant times, s 52 of the TPA did not apply to "… conduct engaged in in relation to financial services …" as defined in Div 2 of Pt 2 of the ASIC Act (see s 4 and s 51AF(2)(a) of the TPA). This analysis is supported by the reasoning of Santow J (as he then was) in Re Application of NRMA Ltd (No 2) (2000) 156 FLR 412 at [124]–[131] (pp 444–445). 33 For these reasons, the damages claims which the plaintiffs make against Orchard as the primary contravenor and, in the alternative, as an accessory, must be made pursuant to s 1041H and s 1041I(1) of the Corporations Act and s 12DA(1) and s 12GF(1) of the ASIC Act. Section 52 of the TPA does not apply to those claims. 34 The substance of the plaintiffs' damages cases is the same, whether those cases are considered under s 52 of the TPA or under s 1041H of the Corporations Act or under s 12DA(1) of the ASIC Act. 35 For reasons which I have explained, in the circumstances of the present case, I propose to treat the plaintiffs' claims as being founded upon s 1041H and s 1041I(1) of the Corporations Act and s 12DA(1) and s 12GF(1) of the ASIC Act. In my view, however, the result would not be different if those claims were considered under s 52 and s 82 of the TPA. 36 The jurisprudence developed by this Court and other courts as to the principles which govern the interpretation and application of s 52 and s 82 of the TPA is relevant to the interpretation and application of s 1041H and s 1041I(1) of the Corporations Act and s 12DA(1) and s 12GF(1) of the ASIC Act. In particular, in a case where the misleading and deceptive conduct alleged against the contravenor is constituted by misrepresentations which are said to have caused the claimant to enter into a contract or a transaction, as in the present case, the claimant would normally seek to prove the requisite causal connection between the contravening conduct and the loss claimed by him by proving that he relied upon the misrepresentations when entering into the contract or transaction. In the present case, the plaintiffs must demonstrate that, in making those payments to Orchard which constituted subscription monies for shares in Orchard (if any) and in making those payments to others which constituted the purchase price for existing shares in Orchard, they relied upon the misrepresentations allegedly made by Mona Kady and Sarkis. They must also prove that it was Orchard which should be found to have made those misrepresentations or which should be held liable as an accessory in respect of the contravening conduct engaged in by Mona Kady and Sarkis constituted by the making of those misrepresentations. 37 The question of what loss (if any) was suffered by a claimant who relies upon s 52 and s 82 of the TPA and their analogues is a question of fact to be determined in all of the circumstances of the case. Here, the plaintiffs claim the full amount of the investments made by them. It seems to me that they do so upon the basis that, in reliance upon the misleading and deceptive conduct of Orchard or of Mona Kady and Sarkis, they subscribed for and purchased shares in Orchard which were worthless at each of the times when those shares were acquired. It is for this reason that each of them claims the entire amount which they invested in Orchard. The plaintiffs' solicitor did not put his clients' case this way. He said that the plaintiff did not suffer any loss until Orchard was wound up. In the end, it may not be necessary finally to determine when the claimed loss was first suffered. It may, however, be necessary to determine what loss was suffered by each of the plaintiffs. 38 According to the plaintiffs, the relevant payments for shares in Orchard acquired by them were made at various times between 5 October 2001 and February or March 2004. The payment made by Waratar in May 2004 appears to have been a loan. The last of the other payments was made in February or March 2004. The relevant payments were all made more than six (6) years prior to the commencement of this proceeding (ie more than six (6) years prior to 25 November 2010). As I have already mentioned, it seems to be the plaintiffs' case that they all suffered loss immediately upon making the relevant payments. Prima facie, therefore, by reason of the application of s 1041I(2) of the Corporations Act and s 12GF(2) of the ASIC Act, in the circumstances of this case, the plaintiffs' claims were not brought within the time limited by those statutory provisions. The Court has no discretion to extend the time specified in these sections. 39 However, the liquidator, as the only available potential contradictor and as the person controlling the fortunes of Orchard at the present time, has chosen not to enter the fray and has chosen not to rely upon the relevant statutory provisions which limit the time within which the present proceeding might have been brought. He should be taken to have made a conscious decision in this regard. Furthermore, he may have very good reasons for making that decision. It is not for the Court to second-guess the liquidator on this point. 40 At 259–260 in State of Western Australia v Wardley Australia Limited (1991) 30 FCR 245, the Full Court said: In a general sense, the effect of s 82(2) may be described as the prescription of a time limitation: see Sent v Jet Corp of Australia Pty Ltd (1986) 160 CLR 540 at 542. But there is a distinction between the operation of a statute of limitation, properly so called, which prevents the enforcement of rights of action independently existing, and a time limitation imposing a condition which is the essence of a new right: see Crown v McNeil (1922) 31 CLR 76 at 96, 100-101. It is for a defendant to plead a statute of limitation against an independent right but when a limitation is annexed by a particular statute to the right which it creates it is for the plaintiff to allege that the action was brought within time: cf Elna Australia Pty Ltd v International Computers (Aust) Pty Ltd (No 2) (1987) 16 FCR 410 at 415. If the jurisdiction of a court to entertain proceedings is conditioned in this way on commencement of proceedings within a specified time, the defendant cannot by a purported waiver confer jurisdiction on the court: see Commonwealth v Verwayen (1990) 170 CLR 394 at 425, per Brennan J. However, it is necessary when dealing with s 82 to bear in mind its double operation, to which we have referred above, as dealing both with right and remedy. In our view, in stating that an action under subs (1) may be commenced at any time within the three year time limit specified in s 82(2), that latter provision is to be regarded as having a procedural character. That is to say, s 82(2) is a condition of the remedy rather than an element in the right and a prerequisite to jurisdiction which cannot be waived. It follows that it is for a defendant to assert non-compliance, rather than for a plaintiff to assert compliance with s 82(2) as an element of the cause of action. The need for compliance with s 82(2) may be waived by the defendant and an estoppel may prevent the defendant denying such a waiver. If the defendant fails to plead the limitation, this may be taken as a waiver of the need for compliance with s 82(2). The authorities bearing upon the general principles involved are discussed by Windeyer J in Australian Iron & Steel Ltd v Hoogland (1962) 108 CLR 471 at 488-489 and in Pedersen v Young (1964) 110 CLR 162 at 169. The first of these passages was adopted by Brennan J and McHugh J in Commonwealth v Verwayen (supra) (at 425-426, 497-499); see also the remarks of Gaudron J (at 486-487). The cause of action referred to in s 82(2) is constituted by every fact it would be necessary for the plaintiff to prove in order to support its right to recover the amount of its loss or damage and the relevant question is at what time did all those facts exist: cf Van Win Pty Ltd v Eleventh Mirontron Pty Ltd [1986] VR 484 at 488. Where the conduct complained of contravened s 52, the cause of action under s 82 will accrue upon the occurrence of the misleading or deceptive conduct and the suffering by the injured party of loss or damage "by" that conduct. The remedy then is given to recover "the amount" of that loss or damage from the person whose conduct contravened s 52, or from any person involved in that contravention. 41 That case went on appeal to the High Court. The appeal was dismissed. The High Court did not comment unfavourably on the observations made by the Full Court which I have extracted at [40] above (see Wardley Australia Ltd v Western Australia (1992) 175 CLR 514). Those observations are apt to be applied in respect of the claims made by the plaintiffs in the present case pursuant to s 1041H(1) of the Corporations Act and s 12DA(1) of the ASIC Act as well as to the claims made pursuant to s 52 and s 82 of the TPA. 42 The liquidator has not advanced any contention to the effect that the plaintiffs' claims are time-barred. In circumstances where he is fully apprised of the plaintiffs' claims, the evidence to be tendered in support of those claims and the Written Submissions lodged in support of those claims but has taken no steps to oppose the plaintiffs' claims and, in particular, has not raised any suggestions that the claims are out-of-time, notwithstanding that he has had ample opportunity to do so, the liquidator should be taken as having waived the need for compliance with the time constraints imposed by s 1041I(2) of the Corporations Act and by s 12GF(2) of the ASIC Act and I so find. For this reason, I do not need to resolve the question of when the causes of action relied upon by the plaintiffs arose in each case nor do I need to address at the moment the submissions made by the plaintiffs' solicitor to the effect that the relevant loss was not suffered until Orchard was wound up. 43 The plaintiffs' solicitor devoted some time and effort in his submissions to the interesting corporations law problem which was resolved by the High Court in Sons of Gwalia Ltd. In that case, the High Court held that a claimant who acquires all of his shares in a corporation by purchasing those shares from an existing member of that corporation could maintain a claim for damages for misleading and deceptive conduct against the corporation based on the corporation's failure to comply with its continuous disclosure obligations under the Corporations Act and then prove for the amount thereof in the subsequent liquidation of that corporation pursuant to s 553 or s 553A of the Corporations Act without being postponed under s 563A of the Corporations Act. The contravening conduct on the part of Sons of Gwalia Ltd was its failure to comply with the relevant continuous disclosure requirements laid down in the Corporations Act and the ASX Listing Rules. It was the corporation itself that directly engaged in the contravening conduct. The High Court concluded that such a claim would not be founded upon any rights which the investor had obtained or obligations which he had incurred by virtue of his membership of Sons of Gwalia Ltd but would rather be founded on the conduct of the corporation which gave rise to the liability under the statutes relied upon. 44 The same reasoning would apply to a claim based upon positive misrepresentations provided that the corporation is found to have made the relevant misrepresentations or is relevantly held liable as an accessory in respect of the conduct of others. 45 In Sons of Gwalia Ltd, the High Court held that the claimant in that case had a claim for damages representing the difference between what he outlaid in buying the shares and the true value of what he bought as determined by a properly informed market. In that case, the High Court held that the shares in question would have been judged as worthless by such a market at the time when the claimant purchased them. 46 The effect of the High Court's decision in Sons of Gwalia Ltd is that it does not matter whether the claim in respect of a particular payment is in relation to the acquisition of shares by allotment or the acquisition of shares by purchase and transfer. The result is the same. Once the quantum of the payer's claim is established, he may prove in the liquidation of the corporation and rank equally with the corporation's external creditors irrespective of whether his acquisition of shares was by subscription or transfer. 47 In the present case, therefore, if I were to uphold the plaintiffs' damages claims against Orchard based upon misleading and deceptive conduct, I would grant to them the substance of the relief which they seek. 48 The effect of the High Court's decision in Sons of Gwalia Ltd was overturned by the Parliament when it enacted the Corporations Amendment (Sons of Gwalia) Act 2010 (Cth) (No 150 of 2010). That Act came into force on 18 December 2010. It applies to claims which arise after that date (see s 3, Sch 1, par 4(1)). If loss was suffered by the plaintiffs immediately upon making the investments which they made in Orchard, all of the claims in the present case arose by no later than March 2004. In that event, they would not be affected by that Act. Even if the plaintiffs' losses were suffered later, in 2008, when Orchard was wound up, their damages claims would not be affected by that Act. 49 In the end, notwithstanding that there may have appeared to be some real threshold obstacles in the way of the relief claimed by the plaintiffs, for the reasons explained at [31]–[48] above, the disposition of the plaintiffs' claims for damages made in the present proceeding will depend upon my being satisfied that: (a) The alleged representations, or statements substantially to the effect of those alleged representations, were, in fact, made; (b) Those representations were made to the plaintiffs, directly or indirectly, by Orchard, as representor, or, alternatively, by Mona Kady and Sarkis, as representors, in the latter case, in circumstances where Orchard should be held liable as an accessory; (c) The statements made were false or, at least, misleading and deceptive at the time when they were made and were not subsequently corrected; (d) The plaintiffs who made the relevant payments relied upon those misrepresentations in making those payments; and (e) The individual plaintiffs suffered the loss which each of them has claimed as a result of the misleading and deceptive conduct referred to. The Directors of Orchard 50 Orchard was registered as an Australian corporation on 7 June 2001. The directors of Orchard as at that date were Mona Kady and Sarkis. Those two persons remained the only directors of Orchard until 8 February 2006. On that date, they were both removed as directors of Orchard, effectively with their agreement. On the same day, Mark Kady, Robert Kady and Paul Kady, who are three of Mona Kady's brothers, were appointed as directors of Orchard. Subsequently, on 20 July 2007, Arthur Roumanus, Sandra Roumanus, Ray Roumanus, Waratar, Rosemaree Maroon (Rose Maroon) and Mary Maroon were appointed as additional directors of Orchard. 51 Thus, throughout period from June 2001 until May 2004, which is the critical period for present purposes, the only directors of Orchard were Mona Kady and Sarkis. 52 The corporate Constitution of Orchard was not tendered in evidence before me. There was no evidence of any express limitations on or specifications as to the capacity or authority of Mona Kady and Sarkis to bind Orchard, whether acting individually or jointly. The Relevant Relationships 53 Ray Roumanus is the principal of Waratar. Waratar is the trustee of the Roumanus Superannuation Trust and acted in that capacity in all of its dealings with Mona Kady and Sarkis. It was represented in those dealings by Ray Roumanus. Waratar acquired its shares in Orchard in its capacity as trustee of the Roumanus Superannuation Trust. Ray Roumanus is a former bank manager who is now involved in finance broking through Salisbury, a corporation controlled by him. He is the younger brother of Arthur Roumanus and the brother-in-law of Sandra Roumanus. He is a first cousin of Morris Maroon, who is the husband of Rose Maroon. He is also a first cousin of Anthony John Maroon (Anthony Maroon) who is the older brother of Morris Maroon. Anthony Maroon is the husband of Mary Maroon. 54 As noted at [53] above, Morris Maroon and Anthony Maroon are brothers. They are married to Rose Maroon and Mary Maroon respectively. Morris Maroon is an accountant. He is a partner in Ernst & Young. Anthony Maroon is a businessman. 55 Rose Maroon has known Mona Kady since kindergarten. They went to the same primary and high schools. Mona Kady was one year below Rose Maroon at school. Rose Maroon was in the same class as Mona Kady's older sister. Rose Maroon knew Mona Kady and her family well. 56 Rose Maroon is the trustee of the Maroon Family Trust. She acted in that capacity in all of her dealings in relation to Orchard. She acquired her shares in Orchard in that capacity. A Summary of the Relevant Transactions The Investments made by Waratar 57 The Register of Members maintained by Orchard was not always kept up-to-date. Nonetheless, there is no suggestion that those entries which were made in that register were not genuine and did not accurately reflect the substance of the transactions recorded therein. 58 Waratar claims that, on 27 June 2001, one ordinary fully paid share in Orchard was registered in its name in the Register of Members maintained by Orchard. 59 A Share Certificate in respect of that share was issued by Orchard to Waratar on 27 June 2001. 60 It is not clear from the evidence tendered before me whether that share was acquired by Waratar by way of allotment or by way of purchase although the tenor of the evidence of Ray Roumanus was that the share was subscribed for by Waratar and allotted by Orchard. According to Ray Roumanus, notwithstanding some evidence which suggests otherwise, the cost of acquisition of this one share in Orchard was $200,000. 61 Ray Roumanus testified that the cost of acquisition of that share was not paid immediately. He said that the full $200,000 was paid on 5 October 2001 by a cheque dated that day drawn by Waratar in favour of an entity described as "Advanced Earthworks". Ray Roumanus said that that cheque was drawn in this manner at the request of Mona Kady. His evidence was that he committed to acquire that share on behalf of Waratar at a meeting which he had had with Mona Kady and Sarkis in early April 2001 at the home of Mona Kady's parents. 62 I see no reason not to accept the evidence of Ray Roumanus which I have summarised at [60]–[61] above and I do so. However, I am not prepared to find that the first share acquired by Waratar in Orchard was acquired by subscription. The evidence does not justify such a finding. The share may have been purchased rather than subscribed for. 63 Waratar also contended before me that it acquired one additional fully paid ordinary share in Orchard in early 2003. In the evidence, the suggestion was that the acquisition took place in February 2003. However, in the submissions made by the plaintiffs' solicitor at the hearing, it was submitted that the acquisition took place in April 2003. I prefer to proceed upon the basis that the date proven in the evidence is the correct date. 64 The evidence before me suggested that the Register of Members of Orchard did not initially record the ownership of this second share in Orchard by Waratar. However, a search of the records maintained by ASIC in respect of Orchard, carried out on 16 July 2007 (the 16 July 2007 ASIC search), demonstrated that, by no later than that date, Waratar was, according to those records, registered as the owner of two fully paid ordinary shares in Orchard and that it held both of those shares in a trustee capacity. Ray Roumanus testified that, between 16 December 2002 and 7 January 2003, the following cheques were drawn in favour of Orchard (described as "Orchid Holdings" on the cheques) and handed to Mona Kady: (a) Cheque for $20,000 dated 16 December 2002 drawn by RA and CA Roumanus; (b) Cheque for $115,000 dated 16 December 2002 drawn by Salisbury; (c) Cheque for $50,000 dated 16 December 2002 drawn by Harry Michael; and (d) Cheque for $15,000 dated 7 January 2003 drawn by Salisbury. 65 A copy of each of the cheques referred to in subpars (a), (b) and (d) of [64] above was tendered in evidence. A copy of the relevant bank statements showing the debits effected by the drawing and delivery of those cheques was also tendered. No documentary evidence relating to the cheque referred to in subpar (c) of [64] was tendered in evidence. 66 CA Roumanus is Ray Roumanus' former wife, Cecilia. Harry Michael is Cecilia Roumanus' father. It was the evidence of Ray Roumanus that the total amount paid to Orchard by means of the four cheques to which I have referred at [64] above was initially made as a loan by Waratar to Orchard. He said that all of the payments had been made on behalf of Waratar. 67 Ray Roumanus also testified that, in February 2003, he was told by Mona Kady and Sarkis that Orchard could not repay the debt which had been created by the advances made by Waratar between 16 December 2002 and 7 January 2003 which I have described at [64]–[66] above. He said that, for this reason, in February 2003, Monica Kady and Sarkis suggested to him that the debt should be converted into equity in Orchard. On behalf of Waratar, Ray Roumanus agreed to this proposal. He said that, as a result of this agreement, one additional fully paid ordinary share in Orchard was acquired by Waratar in February 2003. He said that this second share was purchased from Sarkis. Other evidence established that Sarkis held all of the shares in Orchard which were registered in his name as the sole trustee of "the Sarkis Family Trust". 68 There was no contemporaneous documentary evidence tendered before me which supported the evidence of Ray Roumanus to the effect that an additional share in Orchard had been acquired by Waratar in February 2003 in the circumstances outlined by him. It is difficult to see how a transfer of a share owned by Sarkis without more could result in the balance of the loan account between Waratar and Orchard ($200,000) being converted into shares in Orchard in the name of Waratar. Other transactions would have had to have been carried out in order to bring about that state of affairs. No evidence of any other transactions relevant to this alleged conversion of debt to equity was tendered before me. 69 In a Form 484 (Change to Company Details) document dated 12 July 2006 and lodged by Orchard with ASIC on 20 July 2006 (the 20 July 2006 Form 484), the lodging party asserted that Waratar had acquired an additional share in Orchard on 29 June 2006 at a cost of $1.00. That form was signed by Robert Kady as a director of Orchard. In that form, it was also asserted that Waratar had purchased that share from Sarkis. 70 Whilst the above evidence is somewhat unsatisfactory, it is clear from the ASIC records that, according to those records, by no later than 12 July 2006, Waratar held two shares in Orchard. 71 I see no reason not to accept the evidence of Ray Roumanus as to the circumstances in which this one additional share in Orchard was acquired by Waratar. I therefore accept the evidence which I have summarised at [63]–[67] above and, in light of that evidence and in light of the matters referred to in [68]–[70] above, I find that Waratar acquired one fully paid ordinary share in Orchard in February 2003 by purchasing same from Sarkis at a cost of $200,000. 72 The plaintiffs' solicitor submitted on behalf of Waratar that one view of the facts concerning Waratar's acquisition of a second share in Orchard is that only $1.00 was paid as consideration for the acquisition of the share and that the balance of the total of the payments made in December 2002 and January 2003 (viz $199,999) should be regarded as a loan by Waratar to Orchard. That submission ignores the evidence of Ray Roumanus as to his discussions in February 2003 with Mona Kady and Sarkis when he agreed to convert Waratar's loan of $200,000 to Orchard into equity. For that reason, notwithstanding the observations which I have made at [68]–[70] above, I reject that submission. 73 Waratar also contended that it lent an amount of $200,000 to Orchard on 13 May 2004. That loan is evidenced by an Acknowledgement of Debt signed by Mona Kady and Sarkis dated 13 May 2004. That Acknowledgement provided that the loan principal of $200,000 together with interest thereon of $10,000 was to be repaid by Orchard to Waratar on 13 August 2004. The principal sum specified in the Acknowledgement was not repaid. No interest thereon was ever paid. On 24 August 2006, Waratar obtained judgment by default against Orchard, Mona Kady and Sarkis, in the District Court of New South Wales for $210,000 plus costs. Presumably, the judgment against Orchard is for the principal amount of the loan to which I have referred of $200,000 together with interest thereon of $10,000. 74 The evidence of Ray Roumanus was that the $200,000 which Waratar lent to Orchard in May 2004 was raised by him by procuring $140,000 from Rose Maroon (presumably as a loan to Waratar) and aggregating that amount with $60,000 from Waratar's own funds. This is not entirely consistent with Rose Maroon's evidence. She suggested that she herself had lent $140,000 to Orchard directly, not via Waratar. 75 It was not suggested by Ray Roumanus or any other witness that the loan made by Waratar to Orchard in May 2004 had not actually been made. Nor was it suggested by anyone in the proceeding before me that the true nature of the transaction was not one of loan. 76 It is not for me in the present proceeding to determine whether, in addition to its damages claims, Waratar was, in any event, as at the date when Orchard was wound up, a creditor of Orchard and, if so, in what amount. These are matters for the liquidator to determine in the first instance. 77 For this reason, Waratar's case for damages against Orchard as the primary actor or, alternatively, as an accessory, in the misrepresentation case which it seeks to litigate in the present proceeding must be confined to the two share acquisition transactions which I have described. That is, the impact of any alleged misleading and deceptive conduct must, therefore, be judged as at 27 June 2001 and (possibly) 5 October 2001 in respect of the first share acquisition and as at February 2003 (and possibly also as at December 2002 and January 2003) in respect of the second share acquisition. The Investments made by Rose Maroon 78 The Register of Members maintained by Orchard shows that five fully paid ordinary shares were registered in the name of Rose Maroon on 27 June 2001. The Register of Members also shows that she acquired those shares by purchasing them from an existing shareholder rather than by subscribing for them. The 16 July 2007 ASIC search confirmed that, as at 16 July 2007, Rose Maroon held five fully paid ordinary shares in Orchard. As was the case with Waratar, the evidence was that Rose Maroon did not pay for these five shares in June 2001. Rose Maroon said that the arrangement in respect of her acquisition of these shares had been negotiated by her husband, Morris Maroon, with Mona Kady and Sarkis in June 2001. The arrangement initially was that Rose Maroon would pay $1 million for five shares in Orchard with $200,000 up front and the balance to be paid when the DA was approved. That arrangement was subsequently varied. The final arrangement was that $750,000 would be paid for the five shares, rather than $1 million. $200,000 was still to be paid up front with the balance of $550,000 payable at the later point in time. 79 Rose Maroon said that, on 11 October 2001, she drew a cheque for $226,000 dated that day in favour of "Advanced Earthworks Pty Ltd" and that, of that amount, $200,000 was the initial payment required in respect of her purchase of the five shares in Orchard acquired on 27 June 2001 and $26,000 was a loan made by her to Orchard in order to cover various expenses to be incurred by Orchard. A copy of that cheque was tendered in evidence before me. 80 The 16 July 2007 ASIC search showed Rose Maroon as the holder of five fully paid ordinary shares in Orchard. Later searches of ASIC records show the same thing. 81 These matters were corroborated by Rose Maroon's husband, Morris Maroon. 82 I accept the evidence of Rose Maroon and Morris Maroon which I have summarised at [78]–[81] above. 83 Rose Maroon also asserted that she made a loan of $140,000 to Orchard in May 2004. She said that she made that loan by means of a cheque for $140,000 dated 13 May 2004 which she drew in favour of "Erskine Park Quarry". She said that she understood that those monies were ultimately to be paid to Orchard and were for the benefit of Orchard. She gave that cheque to Ray Roumanus and asked him to pass it on to Mona Kady or to Sarkis. 84 I do not doubt that Rose Maroon genuinely believes that the $140,000 which she paid to Erskine Park Quarry on 13 May 2004 was a loan to Orchard, as she said. However, it is quite likely that Ray Roumanus, who appears to be more used to dealing with matters of finance than is Rose Maroon, was correct when he said that, in May 2004, Rose Maroon provided $140,000 to Waratar to enable Waratar to make the loan of $200,000 to Orchard to which I have referred at [73]–[75] above. If Ray Roumanus is to be accepted on this point, it would not matter that the cheque which Rose Maroon actually drew was drawn in favour of Erskine Park Quarry. 85 I think that it is unlikely that, in May 2004, Rose Maroon advanced two separate amounts to Orchard, each of $140,000. It is likely that the transactions proceeded in the way that Ray Roumanus described. 86 However, it is not for me in the present proceeding to resolve the question of whether Rose Maroon is truly a creditor of Orchard as a lender to it and, if so, to determine the quantum of the debt due to her. That will be a matter for the liquidator of Orchard in due course if, and when, Rose Maroon lodges a proof of debt with him. 87 In the present proceeding, it is only the original acquisition of five fully paid ordinary shares by Rose Maroon in June 2001 which is the basis of her claim for damages for misleading and deceptive conduct. The critical dates in respect of that claim are June 2001 and (possibly) 11 October 2001. The Investments made by Arthur and Sandra Roumanus 88 On 1 July 2003, one fully paid ordinary share in Orchard was purchased by Arthur Roumanus from Sarkis, as the sole trustee of the Sarkis Family Trust. The purchase price is shown on the relevant Share Transfer as $199,998. 89 On the same day, one fully paid ordinary share in Orchard was also purchased by Sandra Roumanus from Sarkis, as the sole trustee of the Sarkis Family Trust. The purchase price shown on the relevant transfer was $199,998. 90 It appears that, in late June 2003 or on 1 July 2003, at the same time as they paid for the shares in Orchard which they purchased from Sarkis, each of Arthur Roumanus and Sandra Roumanus paid an additional $2 to Sarkis in respect of the acquisition by each of them of shares in other companies which were associated with Mona Kady and Sarkis. 91 There was evidence before me that cheques totalling $400,000 were handed over to Sarkis at the Observatory Hotel meeting by way of payment for the one share transferred by him to Arthur Roumanus and the one share transferred by him to Sandra Roumanus on 1 July 2003. The relevant Share Transfers were also tendered in evidence as was the 20 July 2006 Form 484. The latter form corroborated the fact that Arthur Roumanus and Sandra Roumanus had each acquired one fully paid ordinary share in Orchard on 1 July 2003 at a cost of $199,998 per share. 92 Arthur Roumanus and Sandra Roumanus also contended before me that, in February 2004, they jointly acquired one additional fully paid ordinary share in Orchard. 93 The 20 July 2006 Form 484 suggested that this additional share was acquired on 25 March 2004 by way of transfer for a purchase price of $199,998. The 16 July 2007 ASIC search shows Arthur Roumanus and Sandra Roumanus as jointly owning one fully paid ordinary share in Orchard by no later than that date. For present purposes, I do not need finally to determine whether it was in February or in March 2004 when this share was acquired. 94 No banking records proving these payments totalling $600,000 were tendered in evidence before me. 95 However, I see no reason not to accept the evidence given by Ray Roumanus, Arthur Roumanus and Sandra Roumanus which I have summarised at [88]–[93] above. Accordingly, I accept that evidence. 96 The critical dates for the claims which Arthur Roumanus and Sandra Roumanus wish to litigate in the present proceeding are June 2003 (in respect of the one share owned by each of them individually) and February or March 2004 (in respect of the jointly owned share). The Investments made by Mary Maroon 97 Mary Maroon and her husband, Anthony John Maroon, testified that Mary Maroon purchased three fully paid ordinary shares in Orchard from Sarkis, as the sole trustee of the Sarkis Family Trust, on 1 July 2003 for a total consideration of $599,994. $600,000 was paid to Sarkis in June 2003 at the Observatory Hotel meeting on account of that purchase. The difference between $600,000 and $599,994 (viz $6) was used to purchase shares in other companies which were associated with Mona Kady and Sarkis. 98 There was tendered in evidence before me the relevant Share Transfer dated 1 July 2003. In addition, the 20 July 2006 Form 484 records the purchase by Mary Maroon of three fully paid ordinary shares in Orchard on 1 July 2003 for a total consideration of $599,994. The 16 July 2007 ASIC search also shows Mary Maroon as the holder of three fully paid ordinary shares in Orchard as at 16 July 2007. The evidence of Ray Roumanus and Anthony Maroon established that cheques totalling $600,000 on account of the acquisitions to which I have referred were handed across to Sarkis at the Observatory Hotel meeting. 99 No banking records proving these payments totalling $600,000 were tendered in evidence. 100 However, I see no reason not to accept the evidence which I have summarised at [97]–[98] above. Accordingly, I accept that evidence. 101 The critical date in respect of Mary Maroon's case for damages for misleading and deceptive conduct in the present proceeding, therefore, in respect of the acquisition of her three shares in Orchard is 1 July 2003 (or possibly late June 2003). The Claims Arising 102 In summary, the relevant plaintiffs make the following claims for damages against Orchard based upon misrepresentations made to them by Mona Kady and Sarkis for which they contend Orchard should be held liable: (a) By Waratar, $400,000 in respect of its acquisition of two fully paid ordinary shares in Orchard, one in June 2001 (paid for on 5 October 2001) and one in February 2003. It is not clear whether the first acquisition was by way of subscription or by purchase and transfer. The second was by transfer of an existing share. It was probably purchased from Sarkis. (b) By Rose Maroon, $200,000 in respect of her purchase of five fully paid ordinary shares in Orchard in June 2001 (partly paid for on 11 October 2001). (c) By Arthur Roumanus, $199,998 in respect of his purchase from Sarkis of one fully paid ordinary share in Orchard on 1 July 2003. (d) By Sandra Roumanus, $199,998 in respect of her purchase from Sarkis of one fully paid ordinary share in Orchard on 1 July 2003. (e) By Arthur Roumanus and Sandra Roumanus jointly, $199,998 in respect of their joint purchase from Sarkis of one fully paid ordinary share in Orchard in February or March 2004. (f) By Mary Maroon, $599,994 in respect of her purchase from Sarkis of three fully paid ordinary shares in Orchard on 1 July 2003. 103 All of the plaintiffs also claim interest on these amounts and costs. 104 Waratar also claims to be a creditor of Orchard in the amount of $210,000 plus interest and costs arising out of the loan which it says it made to Orchard on 13 May 2004. Rose Maroon also claims to be a creditor of Orchard in the amount of $26,000 and possibly the further amount of $140,000. I will not address these creditor claims in these Reasons for Judgment. They must be dealt with by the liquidator in the first instance if, and when, proofs of debt are lodged with him by Waratar and by Rose Maroon. However, it is clear that none of these amounts are claimed in the present proceeding by those plaintiffs as damages against Orchard for misleading and deceptive conduct. The Current Shareholders in Orchard 105 According to an ASIC search in respect of Orchard, obtained on 22 November 2010, the current shareholders in Orchard are: Shareholder's Name Number of Shares Mona Kady 52 ordinary shares Rose Maroon 5 ordinary shares David Kady 10 ordinary shares David Bourchdan 5 ordinary shares Bretant Pty Limited 10 ordinary shares Arthur Roumanus 1 ordinary share Sandra Roumanus 1 ordinary share Arthur Roumanus and Sandra Roumanus jointly 1 ordinary share Mary Maroon 3 ordinary shares Waratar 2 ordinary shares Lucky Investment Group Pty Limited 10 ordinary shares 106 The total issued capital according to that search is 100 fully paid ordinary shares. 107 The shareholdings of the plaintiffs shown in the Table at [105] above accords with the evidence of the individual plaintiffs tendered before me. Together, the investors hold 13 shares in Orchard. 108 With one exception, I am satisfied, on the basis of that evidence, that the ASIC record to which I have referred at [105] above accurately reflects the current shareholdings in Orchard. I so find. The exception to that conclusion is the recording in respect of the shares held by Rose Maroon. Notwithstanding that she is shown as holding five ordinary shares in Orchard which are fully paid, the evidence demonstrates that the true position is that those shares were only partly paid. It would appear that the final agreed acquisition price for those five shares was $750,000 and that only $200,000 of that amount has actually been paid. The Alleged Misrepresentations General 109 The evidence which I will endeavour to summarise in this section of these Reasons for Judgment is extracted from the unchallenged affidavits read on behalf of the plaintiffs (a list of which was marked "MFI-1" at the hearing) and from the documents tendered on behalf of the plaintiffs as annexures or exhibits to those affidavits. The summary which follows is intended to record matters of significance for the plaintiffs' claims in the present proceeding. It is not intended to be nor is it a comprehensive summary of all of the evidence tendered on behalf of the plaintiffs. 110 Because, to a large extent, the circumstances in which each plaintiff came to invest in Orchard are relevant to a consideration of the circumstances in which all of the other plaintiffs came to invest in Orchard, I propose to treat all of the evidence tendered on behalf of the plaintiffs as admitted in each case advanced by each plaintiff and as relevant to each of those cases. The plaintiffs did not suggest that I should do otherwise. It must be remembered that, although, as a matter of convenience, all of the plaintiffs have brought their claims in the one proceeding, nonetheless each of the plaintiffs has a separate and distinct case which must be determined by reference to the evidence and argument relevant to that particular case. 111 Although there is no active contradictor to the plaintiffs' claims, each plaintiff bears the onus of proving the requisite elements of his, her or its case (as the case may be) on the balance of probabilities. When analysing the evidence, I felt some disquiet at times. The plaintiffs have a great deal at stake in the present proceeding and it would only be natural for then to be tempted to overreach in their evidence in order to secure the result which they seek. Some matters of concern were: (a) The evidence shows that the plaintiffs initially attempted to put their status vis-a-vis Orchard as creditors arising from loans made to Orchard in circumstances where they must have known that the bulk of their investments in Orchard were as shareholders. It seems to me that, by putting their claims in this way, they demonstrated a propensity for embellishment when their financial interests are at stake. (b) By the time the present proceeding was commenced, I think that the plaintiffs appreciated that they had to accept that, for the most part, their investments in Orchard had been as shareholders. When regard is had to the terms of the correspondence in late October and early November 2010, which passed between the plaintiffs' solicitor, on the one hand, and the liquidator and the liquidator's solicitor, on the other hand, it is highly likely that each of the plaintiffs and the relevant officers of the plaintiffs well appreciated by then that, given that Mona Kady and Sarkis had been made bankrupt and almost certainly had no assets, the most productive pathway to recoupment of their losses was through claims based upon the broad proposition that they had been misled by Mona Kady and Sarkis, as officers of Orchard, into making the investments in Orchard which they say they made so as to bring themselves within the principles explained by the High Court in Sons of Gwalia Ltd. (c) There are some inconsistencies in the evidence given by the witnesses called on behalf of the plaintiffs. 112 The observations which I have recorded at [111] above are not intended to convey undue scepticism on my part about the plaintiffs' witnesses and the evidence which they gave. I am mindful, as I must be, that their evidence was given on oath or by affirmation, as required, and was not challenged in any respect. By the remarks which I have made, I merely intend to make clear that I have examined the plaintiffs' evidence with a critical eye. In the end, however, I am persuaded that the substance of the plaintiffs' evidence concerning the assurances and inducements that they received from Mona Kady and Sarkis should be accepted and I do so. 113 In the paragraphs which follow in this section, I have endeavoured to summarise the salient points in the plaintiffs' evidence. The Evidence of Ray Roumanus 114 In about December 2000, Mona Kady approached Ray Roumanus seeking to refinance the funeral parlour with which she was involved at that time and also to finance the purchase of a new home which her family had purchased at 71 Foxall Road, Kellyville, NSW. 115 Not long after, in early 2001, Ray Roumanus met with Mona Kady, her parents, her brothers (Ray, Mark, Paul and Robert) and Sarkis in order to see whether Ray Roumanus would be able to procure a finance package for Mona Kady, Sarkis and three of her brothers in order to enable them to purchase the property. 116 The property had been used as a quarry for many years. Quarrying activity had ceased some time before the end of 2000. By early 2001, there was a large hole in the ground at the property as a result of the excavation which had occurred over those years. The Kady and Sarkis interests believed that the hole could be used as a site for dumping unwanted building materials. They thought that, when filled, the land could be rezoned, subdivided and sold as residential building blocks. 117 In early to mid 2001, Ray Roumanus attempted to obtain funding for the group's acquisition of the property but was unable to do so. 118 In the course of attempting to procure funding through BankWest, Ray Roumanus was introduced to Don Reed of Don Reed Associates at Neutral Bay who was the valuer appointed by BankWest to assess the value of the property for that bank. At a meeting held at the offices of BankWest at Level 7, Grosvenor Place, Sydney, which was attended by Mona Kady, Sarkis, Ray Roumanus and Don Reed, Don Reed told those present that he was expert in relation to quarrying and the dumping of waste materials. He said that, in his opinion, with a development consent authorising the property to be used as a quarry and for dumping non-VENM material, the property could be worth in excess of $30 million. At the time when Don Reed made these remarks, the only dumping that was authorised to occur at the property was the dumping of VENM. VENM is an acronym for "virgin excavated natural material". The dumping of VENM did not require a licence from the NSW Environmental Protection Authority (EPA) but the dumping of building and construction waste did require such a licence. Don Reed informed those who attended this meeting that, if Orchard had an appropriate development consent and an EPA licence which allowed it to dump building material at the property then, once the existing hole was completely filled, the property could be subdivided and then used for the construction of residential homes or industrial or light industrial buildings. 119 Orchard was then acquired as the vehicle through which the property was to be acquired. Morris Maroon organised the acquisition of Orchard. Other corporations were also acquired by Sarkis and the Kadys at the same time, with the assistance of Morris Maroon. 120 Orchard contracted to purchase the property on or about 27 July 2001 for the purchase price of $3,850,000. Settlement of that purchase took place on or about 8 or 9 November 2001. 121 In about April 2001, prior to the acquisition of the property, Ray Roumanus was approached by Morris Maroon who asked Ray Roumanus whether he might be interested in investing in a venture with Sarkis and the Kadys at the property along the lines of that described by Don Reed. Morris Maroon told Ray Roumanus that his (Morris') wife, Rose Maroon, had already invested $200,000 in Orchard in order to assist it to outlay the deposit on the acquisition of the property. He also informed Ray Roumanus that he had agreed to invest a total of $1 million in Orchard for a 5% shareholding. He said that Rose Maroon had already paid $200,000 towards the deposit and would pay the balance when the rezoning for the dumping of non-VENM material had been approved. Other evidence showed that Rose Maroon did not pay this deposit until 11 October 2001. 122 Subsequently, in early April 2001, Ray Roumanus met with Mona Kady and Sarkis at the home of Mona Kady's parents. Ray Roumanus told them that Morris Maroon had explained the venture to him and that the trustee of his superannuation fund, Waratar, would also be interested in investing in the venture. At this meeting, Mona Kady and Sarkis told Ray Roumanus that the venture needed approximately $3.5 million to obtain the necessary development consent and to build the required infrastructure which comprised roadworks, a weighbridge, offices and fences, in order to realise the full potential of the property. They said that they could use the vendor's road for access over the vendor's property until they received development consent at which time they expected to be able to use Patons Lane for access. They told Ray Roumanus that, once the DA for dumping non-VENM material and for quarrying was obtained, the property would be worth in excess of $30 million. 123 On the strength of those representations, Ray Roumanus agreed, on behalf of Waratar, that, for $200,000, Waratar would take one share in the corporation which would be used to acquire the property. That share was acquired on 27 June 2001. Ray Roumanus said that Waratar paid $200,000 for one share in Orchard on 5 October 2001. He said that, on 5 October 2001, he handed to Mona Kady and Sarkis the cheque for $200,000 which I have described in more detail at [61] above. 124 Subsequently, in mid December 2002, Mona Kady and Sarkis sought a short term loan of $200,000 from Waratar. They told Ray Roumanus that these funds were required so that Don Reed, who, they said, was by then acting as a consultant to Orchard, could be paid. In order to secure that loan from Waratar, Mona Kady and Sarkis told Ray Roumanus that the approval of the DA was close and that Orchard had to do some work on the property in order to meet the requirements of the DA process. The evidence before me disclosed that, in the period from mid December 2002 to early January 2003, Ray Roumanus organised for the four payments totalling $200,000 to be paid to Orchard which I have described in more detail at [64]–[65] above. His evidence was that all of these payments, although not necessarily made by Waratar, were paid on behalf of Waratar. 125 Soon after Waratar had made the payments totalling $200,000 referred to at [64], [65] and [124] above, it became apparent that Orchard could not repay the loan. At a meeting held in February 2003, attended by Mona Kady, Sarkis and Ray Roumanus, it was agreed that the $200,000 which Waratar had lent to Orchard in the period from mid December 2002 to early January 2003, would be utilised as the acquisition cost of a further share in Orchard to be acquired by Waratar. In this way, Waratar would acquire one additional fully paid ordinary share in Waratar. According to the evidence of Ray Roumanus, in order to induce him to agree to that conversion, Mona Kady and Sarkis told him that the DA was "looking good" but that Orchard needed more money to pay Don Reed and to progress the DA. They told Ray Roumanus that Sarkis was willing to sell some of his shares and that the proceeds would be reinvested by Sarkis in Orchard in order to assist in defraying the costs of procuring the development consent. Relying upon these assurances, Ray Roumanus caused Waratar to acquire its second share in Orchard. It purchased this share from Sarkis as trustee of the Sarkis Family Trust for $200,000. Waratar purchased this second share upon the basis of the assurances given to Ray Roumanus in February 2003 and upon the basis of the previous assurances which he had received from Mona Kady and Sarkis in relation to the DA. It is not clear how the debt from Orchard to Waratar was "converted" into equity in Orchard. 126 Shortly after the conversations which Ray Roumanus had with Mona Kady and Sarkis in February 2003, he passed on to Anthony Maroon and to Arthur Roumanus the substance of what he had been told by Mona Kady and Sarkis at that time. He suggested that they too might be interested in investing in Orchard. Ray Roumanus told them that Mona Kady and Sarkis had told him that they needed more money to get the DA approved. I have recorded the substance of that conversation at [125] above. Ray Roumanus told Anthony Maroon and Arthur Roumanus: "All of the money that you pay for the shares will be used for the DA application". This, of course, was what he had been told by Mona Kady and Sarkis. 127 In June 2003, the Observatory Hotel meeting took place. At that meeting, cheques totalling $1 million were handed to Sarkis as the purchase price for five fully paid ordinary shares in Orchard. Three shares were to be taken up by Mary Maroon, one share was to be taken up by Arthur Roumanus and one share was to be taken up by Sandra Roumanus. At this meeting, Sarkis repeated his assurance that the money handed over on this occasion would be made available to Orchard and would be used for obtaining the DA. The shares agreed to be purchased which were paid for on this occasion were all transferred as agreed on 1 July 2003. These five shares were all acquired by way of purchase from Sarkis, in his capacity as trustee of the Sarkis Family Trust. 128 As far as the Roumanuses and the Maroons were concerned, little information was conveyed to them between July 2003 and February 2004 as to the progress with the DA or as to the activities at the property. Ray Roumanus said that, in the period 2001–2004, he had no understanding of what it would cost to secure a development consent of the kind described to him by Mona Kady and Sarkis. He said that he believed and relied upon what he was told by Mona Kady and Sarkis in this period. 129 In February 2004, a meeting took place at the property which was attended by all of the investors (except Rose Maroon and Mary Maroon) and several others. At this meeting, Sarkis said to those present: Orchard Hills has struck gold. The Geotech report shows that most of the land has good quality clay which the brick companies want to purchase. The airspace in the hole on the property is worth a lot of money. The brick companies can't get enough of our clay. They will pay to take away the clay which will increase the airspace in the hole. The hole will take 15 years to fill and the generated income from the sale of the clay and the filling of the land will be in excess of $300 million. 130 These statements were confirmed by Anthony Khouri, an associate of Sarkis, at the same meeting. 131 On or about 13 May 2004, Waratar advanced a further amount of $200,000 to Orchard. Once again, these funds were requested by Mona Kady and Sarkis in order to pay Don Reed and other experts as well as to progress the DA. The details of this loan are described at [73]–[75] above. 132 By late November 2005, Orchard was in financial difficulty. At a meeting held at about that time, it was revealed that one of the reasons that Orchard was in that difficulty was that Orchard's monies had been used to fund other businesses operated by Mona Kady and Sarkis. Thereafter, attempts were made to introduce additional investors into Orchard in order to keep it afloat. All of those attempts failed. 133 Ray Roumanus gave evidence before me that the only reason that he had caused Waratar to invest in Orchard was to provide the funding needed for Orchard to obtain the oft-discussed development consent that would allow the dumping of non-VENM building and construction waste at the property and for its use as a quarry to exploit to the full the resources that had been found on the property. 134 On 20 July 2007, the plaintiffs commenced proceedings in the Supreme Court of New South Wales to wind up Orchard. 135 Ray Roumanus also testified that, at no time since Waratar had become a shareholder in Orchard, did he, in his capacity as a director of Waratar, or in any other capacity: (a) Receive any financial accounts for Orchard; (b) Be given any notice of any general meeting of Orchard; and (c) Be kept informed in any detail as to the progress of the DA for the property. The Evidence of Morris Maroon 136 Morris Maroon said that he was introduced to Mona Kady and Sarkis by Ray Roumanus. He said that he first met them at the home of Mona Kady's parents on 14 May 2001. He had been asked by Ray Roumanus to consider acting as the tax adviser to the Kady family. 137 Morris Maroon advised Mona Kady and Sarkis to establish various corporate vehicles through which to exploit the property. 138 He testified that his wife, Rose Maroon, was one of the original shareholders in Orchard. His evidence was that, at some stage around the middle of 2001, Sarkis had told him that he had already had discussions with representatives of Penrith City Council and that he was confident of securing the necessary rezoning of the property. 139 Morris Maroon said that, around the middle of 2003, Sarkis told him that he wished to sell down his equity interest in all of the companies in the group of which Orchard was part for $200,000 per share. He said that Sarkis assured him at that time that all of the funds which he (Sarkis) would obtain from such sales would be put into Orchard in order to secure a development consent that would permit further quarrying at the property and the dumping of non-VENM waste there. 140 Morris Maroon also gave evidence that, before he arranged with his wife, Rose Maroon, to pay the amount of $200,000 which was paid by her on 11 October 2001 to Advanced Earthworks Pty Limited, Mona Kady and Sarkis had told him that they were very confident that the DA would be approved and that, once the DA was approved, the property would be worth hundreds of millions of dollars so that Morris Maroon and Rose Maroon would receive dividend streams in perpetuity. Morris Maroon gave evidence that his wife lent additional sums totalling $166,000 to Orchard. He said that $26,000 had been paid to Orchard on 11 October 2001 as part of the cheque for $226,000 described at [79] above and that $140,000 was paid to Orchard in May 2004. He said that all of the monies paid out by Rose Maroon were supposed to be utilised by Orchard in order to secure the relevant development consent for the property. The Evidence of Rose Maroon 141 Rose Maroon said that she first learnt of the proposed venture involving the property from her husband, Morris Maroon. In early 2001, Morris Maroon told Rose Maroon that he had become aware of an opportunity to invest in the development at Orchard Hills which he had previously mentioned to her. He said that the company which owned the development needed funds in order to obtain a development consent for the dumping of commercial waste. He said that, once the development consent was obtained, the property would be worth a lot more money. Morris said that the money which he and Rose would put in would initially be a loan but would later be converted to shares. 142 Rose Maroon testified that, after the conversation with Morris referred to at [141] above, she, Morris and Sarkis visited the property. She said that, on this occasion, Sarkis told them: This is just the beginning. We'll be building a lot more. At the moment we need money for DA approval. The DA approval will come through in a matter of months. The money lent will be used towards the DA process. Initially, the money will be a loan, converted to equity when the DA is approved. We're confident that we'll get DA approval within 6 months. The land will be worth between $70 and $80 million after the DA approval. It will be a great investment for the children. 143 Shortly after this site visit, Rose Maroon agreed to invest in Orchard. She said she left all the details of that investment in the hands of Morris Maroon. 144 According to Rose Maroon, in late 2001, she drew the cheque for $226,000 which I have described at [79] above. She said that she drew that cheque at the request of Morris who told her: The company wants $1,000,000 for the DA but we'll pay them $200,000 upfront and the balance when the DA's approved. We'll get 5% equity in the company. The additional $26,000 is to cover other expenses required by the company. 145 She said that she handed the cheque to Morris who passed it on to Sarkis. 146 Rose Maroon also testified that she thought that the cheque she drew in May 2004 in favour of "Erskine Park Quarry" for $140,000 constituted a loan by her to Orchard. 147 Rose Maroon said she trusted Mona Kady and Sarkis. She had known Mona Kady since kindergarten. The Evidence of Arthur Roumanus 148 Arthur Roumanus gave evidence that he and his wife Sandra invested in Orchard on 1 July 2003 for essentially the same reasons as I have summarised in respect of the other investors who are plaintiffs. His sources for the information he received were Ray Roumanus and Morris Maroon. He said that he passed this information on to his wife, Sandra, and told her that the monies which they would pay to Sarkis would be for the purchase of two shares in Orchard held by Sarkis, as the trustee of the Sarkis Family Trust. The price was $200,000 per share. He said that he thought that the money which he and his wife paid to Sarkis would be "put into" Orchard in order to enable it to get development consent which would allow the dumping of non-VENM waste at the property. 149 Arthur Roumanus gave evidence that Sarkis requested further funding for Orchard in February 2004 in order to progress the DA. He said that the DA was "on track". Sarkis told Arthur Roumanus at this time that the advance which he had requested would be a loan. Ultimately, this additional investment took the form of a share purchase from Sarkis, in his capacity as trustee of the Sarkis Family Trust. 150 Arthur Roumanus said that the only reason that he had decided to invest in Orchard was his belief that the property would have had a substantial value once the development consent was obtained. The Evidence of Sandra Roumanus 151 Sandra Roumanus also gave evidence. She said that she had had very little involvement with the investment made in Orchard by her husband and herself. She said that her husband, Arthur, Ray Roumanus and Morris Maroon had all told her that her initial payment was a loan to Orchard which would be used to fund the DA and get the property to the next stage. She met with Mona Kady and Sarkis in February 2004 when, according to her evidence, they informed her that the DA was going through Penrith Council and that, once the hole at the property was filled up, the land would be sold off as residential real estate. They said that she should imagine the hole filled with hundred dollar bills. They told her that the additional funds which they were seeking at that time would be used to push the DA through. This meeting took place after she had acquired the one share in Orchard in her own name but before she acquired the second share jointly held by her husband, Arthur Roumanus, and her in February 2004. The Evidence of Anthony Maroon and Mary Maroon 152 Mary Maroon testified that she went along with the acquisition of three shares in Orchard in July 2003 at the behest of her husband, Anthony Maroon. She said that she relied entirely upon him. 153 Anthony Maroon testified that, in about mid 2002, he had been told by his older brother Morris Maroon and his cousin, Ray Roumanus, that they had invested in Orchard and that, once the DA had been approved, the value of the property would be substantially increased. They told Anthony Maroon that they expected that the value would be in excess of $70 million once the DA had been approved. Anthony Maroon said that Ray Roumanus and Morris Maroon told him that there were shares available in Orchard which Sarkis wanted to sell. The price was $200,000 per share. They said that Orchard needed the funds to progress the DA so that the property could be used for the dumping of commercial fill. Anthony Maroon said that he relied upon Ray Roumanus and Morris Maroon for information about Orchard. He said that he told his wife Mary of his discussions with Ray Roumanus and Morris Maroon. He said that Mary left the decision to him. He said that he decided to acquire shares in Orchard and to do so in Mary's name for tax purposes. 154 Anthony Maroon said that he had understood from his discussions with Ray Roumanus, Morris Maroon and Sarkis that Sarkis' reason for selling some of his shares was to raise finance for Orchard to secure the oft-discussed development consent for the dumping of commercial fill on the property. He said that he had understood from those discussions that the purchase price which Mary Maroon had paid Sarkis for three fully paid ordinary shares in Orchard would be used to pay for costs associated with obtaining the development consent. His belief was that, once the development consent was obtained, the value of the property would increase. 155 Anthony Maroon also gave evidence about the Observatory Hotel meeting. He said that, at that meeting, Sarkis told him directly that the money that he and his wife were investing in Orchard would be used to get the DA approved. The Evidence of Don Reed 156 At the hearing before me, the plaintiffs also relied upon an affidavit sworn by Don Reed in support of their application to wind up Orchard. In that affidavit, Mr Reed said that he assisted Orchard to import specified quantities of clean fill or VENM onto the property. He said that approval to dump VENM at the property was obtained by correspondence as no formal DA for that activity was required. He also said that he had informed Mona Kady and Sarkis that Orchard should prepare and lodge a DA to rehabilitate the site using construction and demolition waste as backfill. He said that gate receipts for construction and demolition waste would be of the order of $45–$50 per tonne, compared with $6–$8 per tonne for VENM. He informed both Mona Kady and Sarkis that it would be necessary for Orchard to obtain a development consent for the importation of construction and demolition waste to the property. He gave them details of the organisation which had originally been involved in the preparation and submission of DAs in respect of the quarry at the property. Mr Reed said that he estimated that the cost of obtaining a development consent to expand the quarry and to import construction and demolition waste as backfill could be expected to be no more than $200,000 as long as approval was forthcoming without legal challenge. He said that the total amount paid to him for work done for Orchard in the period from April 2001 to July 2005 was approximately $150,000. He said that he had undertaken minimal work in respect of a DA for the importation of construction and demolition waste as backfill for quarry rehabilitation. The Plaintiffs' Submissions 157 In his Written Submissions dated 6 July 2012, the plaintiffs' solicitor submitted that: (a) The plaintiffs' damages claims for misleading and deceptive conduct are provable in the liquidation of Orchard pursuant to s 553 of the Corporations Act and are not to be postponed to those of Orchard's external creditors by reason of s 563A of that Act. This outcome is the result of the application of the reasoning of the High Court in Sons of Gwalia Ltd to the facts in the present case. The effect of that reasoning was not negated by the 2010 amendment to the Corporations Act to which I have referred at [48] above. (b) The loss allegedly suffered by each of the plaintiffs was caused by the misleading and deceptive conduct of Mona Kady and Sarkis for which Orchard should be held liable as the primary contravenor or, alternatively, as an accessory. The plaintiffs' solicitor relied upon the judgment of Stone J in De Bortoli Wines Pty Ltd v HIH Insurance Ltd (in liq) (2011) 200 FCR 253 as containing a clear and accurate exposition of the relevant principles governing causation in this context. (c) In the present case, each plaintiff relied upon the statements made to them directly by Mona Kady and Sarkis, or relayed to them by others based upon information given to those others by Mona Kady and Sarkis, to the effect that: (i) A DA would be or had been lodged with Penrith City Council seeking consent to the dumping of non-VENM building material at the property; (ii) The DA process was "close" or "progressing well" or words to that effect; (iii) Monies invested by the plaintiffs in Orchard would be used to secure development consent to dump non-VENM material at the property; and (iv) Once development consent was obtained, the value of the property would increase significantly, in making the investments in Orchard which each of them made. (d) In making the statements described in subpar (c) above, Mona Kady and Sarkis did so as agent for or otherwise on behalf of Orchard. (e) The payments made by the investors, or on their behalf, from time to time, were paid to Orchard or to others on behalf of Orchard. (f) On each occasion that the statements described in subpar (c) above were made, the statements were false. No DA seeking approval for the dumping of non-VENM waste was ever lodged by or on behalf of Orchard at any time. (g) The plaintiffs lost all of the funds which they invested in Orchard on the strength of the statements made to them by Mona Kady and Sarkis. As a result, they are entitled to damages quantified at the amount which they invested plus interest. 158 In his Supplementary Written Submissions dated 11 July 2012, the plaintiffs' solicitor argued (relevantly) that: (a) All of the payments made by the investors to Orchard were loans. However, in the event that the Court should find that some payments were made as subscription monies for the allotment of shares in Orchard or as the purchase price for shares in Orchard sold to the plaintiffs by Sarkis, the consideration paid should be determined as loss suffered by the plaintiff as the result of Orchard's misleading and deceptive conduct and damages awarded accordingly. In the case of monies paid to Sarkis as the purchase price for shares sold by him to one or more of the plaintiffs, Orchard's liability is said to be as an accessory to the liability of Mona Kady and Sarkis as primary contravenors. (b) The plaintiffs wish to rely upon s 52 and s 82 of the TPA; s 1041H(1) and s 1041I of the Corporations Act; and s 12DA(1) and s 12GF(1) of the ASIC Act. (c) All of the plaintiffs' claims have been brought within the time limited by the relevant statutory provisions viz within six years after the day on which the cause of action that relates to the conduct accrued or within six years after the day on which the cause of action arose. In each case, the cause of action arose or accrued on 11 February 2008 when Orchard was wound up and recoupment of the plaintiffs' investments became impossible. Decision 159 The evidence established and I find the following facts: (a) In early April 2001, at a meeting held at the home of Mona Kady's parents at which Ray Roumanus, Mona Kady and Sarkis were present, one or other or both of Mona Kady and Sarkis told Ray Roumanus that the venture which they had in mind to exploit the property needed $3.5 million to obtain the necessary development consent and to build the required infrastructure. They said that, once these steps had been completed, the property would be worth $30 million. (b) At that meeting, and relying upon those statements, Ray Roumanus agreed to cause Waratar to take one share in the corporation that would be acquired or incorporated for the purpose of carrying out the venture at a cost of $200,000. As at the date of that meeting, Orchard had not been incorporated. (c) One fully paid ordinary share in Orchard was acquired by Waratar on 27 June 2001. (d) Waratar paid $200,000 to Advanced Earthworks Pty Ltd on 5 October 2001 as the acquisition cost of that share. (e) Between 16 December 2002 and 7 January 2003, Ray Roumanus procured various persons and entities to pay a total of $200,000 to Orchard. At the time that these monies were paid to Orchard, they constituted loans to Orchard made by Waratar as lender. (f) In February 2003, Ray Roumanus agreed to "convert" the debt which Orchard then owed to Waratar into equity in Orchard. To this end, Waratar purchased an additional share in Orchard. The vendor was Sarkis. The purchase price was $200,000. (g) In acting as he did in February 2003, Ray Roumanus relied upon statements from Sarkis made to him directly at that time to the effect that the DA was "looking good" and that the purchase price which Waratar paid to Sarkis for this additional share would be put back into Orchard in order to assist with payment of the costs and expenses incurred and to be incurred by Orchard in obtaining the requisite development consent. (h) Shortly after February 2003, Ray Roumanus passed on to Arthur Roumanus and Anthony Maroon the information which he had been given by Mona Kady and Sarkis in February 2003 about Orchard's need for further funds and the use to which the proceeds of any sale of shares in Orchard would be put by Sarkis. (i) In mid 2003, Sarkis told Morris Maroon that he wished to sell down his shares in Orchard at $200,000 per share. He also said that all of the proceeds of such sales would be put into Orchard in order to assist it to secure the requisite development consent. (j) Arthur Roumanus persuaded his wife Sandra to invest in Orchard. Anthony Maroon persuaded his wife Mary to invest in Orchard. This led to the Observatory Hotel meeting. (k) Before any cheques were handed to Sarkis at the Observatory Hotel meeting, Sarkis told Ray Roumanus, Arthur Roumanus, Anthony Maroon and Morris Maroon at that meeting that the proceeds of the sale of five shares in Orchard then held by him, which were to be sold to Arthur Roumanus, Sandra Roumanus and Mary Maroon at that time, would be used to defray Orchard's costs of obtaining the requisite development consent. The inference was that Sarkis would lend these proceeds to Orchard. (l) In acting as they did at the Observatory Hotel meeting, those persons who handed over cheques (Arthur Roumanus and Anthony Maroon) relied upon the statements made to them by Ray Roumanus which I have recorded at subpar (h) above and also relied upon statements to the same effect made by Sarkis at the meeting itself. (m) Prior to June 2001, Morris Maroon arranged with his wife, Rose Maroon, to purchase one share in Orchard for $200,000 for which she paid on 11 October 2001. She purchased that share relying upon statements made to her by her husband to the effect that Orchard needed funds to finance the obtaining of a development consent to permit the dumping of non-VENM material at the property and, when that consent was obtained, the property would be very valuable. She also relied upon the statements made by Sarkis at the site inspection held in 2001 which I have extracted at [142] above. (n) Mary Maroon relied entirely on her husband, Anthony Maroon. Anthony Maroon was told of the venture by Ray Roumanus and Morris Maroon. Anthony Maroon was also told by Sarkis that Orchard had applied for the requisite development consent; that Orchard needed funds to progress its DA; that the proceeds of sale received by Sarkis for the sale of his shares in Orchard to Mary Maroon would be used to assist Orchard to fund its DA; and that, once the development consent was obtained, the value of the property would increase substantially. (o) Anthony Maroon relied upon these statements in handing over cheques totalling $600,000 to Sarkis at the Observatory Hotel meeting. (p) In February 2004, Sarkis told Arthur Roumanus that further funds were required in order to progress the DA which was, according to him, "on track". Sandra Roumanus gave evidence to similar effect. Arthur and Sandra Roumanus relied upon these statements when they purchased one additional fully paid ordinary share from Sarkis in February 2004. (q) No DA was ever lodged by or on behalf of Orchard. 160 I am satisfied that the representations attributed to Mona Kady and Sarkis in the evidence of the plaintiffs which I have summarised at [109]–[159] above were made substantially in the terms alleged and at the times alleged. Insofar as some of the information was conveyed by a direct representee (such as Ray Roumanus) to one or more of the other investors, I am satisfied that it was conveyed accurately. 161 There is no doubt that the statements made by Mona Kady and Sarkis directly to the investors from time to time which suggested that a DA would be lodged or had been lodged and was "progressing well", was "close", was "on track", or the like, were false and thus misleading and deceptive. 162 I also find that each of the investors relied upon these false statements when each of them made the investments which they made in Orchard. Some investors gave specific evidence that they relied on the misrepresentations made by Mona Kady and Sarkis. In other cases, reliance is to be inferred. 163 Each of the investors lost his, her or its entire investment. The shares acquired by the investors were probably worthless when acquired and were certainly worthless by early 2003 when Orchard was unable to repay its loan to Waratar. 164 The last issue to be determined, therefore, is whether Mona Kady and Sarkis acted as agents of Orchard on each occasion that they made the statements which I have found they made with the consequence that Orchard is liable as principal for those statements or whether, in making those statements, Mona Kady and Sarkis were the corporation, Orchard, in the sense that they constituted the relevant manifestation of the corporation for the purpose of making those statements. 165 It was submitted on behalf of the plaintiffs, in the alternative, that, if I should find that the representors were Mona Kady and Sarkis, and not Orchard, I should nonetheless hold Orchard liable as an accessory to the contravening conduct of Mona Kady and Sarkis pursuant to s 75B of the TPA and its analogues in the Corporations Act and in the ASIC Act. 166 The share transactions which the investors undertook, with the possible exception of the first acquisition by Waratar, were all purchases from Sarkis or, perhaps in one case, from another vendor. Whilst it is true that, in order to persuade the investors to part with their money and to buy shares in Orchard which Sarkis wanted to sell, Sarkis assured the investors that, by some means or another, he would put the proceeds which he personally received from the sale of those shares into Orchard in order to assist Orchard to progress and ultimately secure the development consent of which he often spoke, the sale of shares in Orchard by an existing member to another member or an outside investor, without more, would have produced no money for Orchard. It is the sweetener constituted by the promise to put the proceeds into Orchard which might have resulted in a potential benefit to Orchard. But that sweetener was offered by Sarkis in order to secure the sale of his shares in Orchard. It was not offered by Orchard but by Sarkis. It was not a necessary or ordinary incident of the share purchase transactions undertaken by the investors. 167 In my judgment, the share sale transactions undertaken by the investors were intended to be for the benefit of the vendor and the purchasers of the shares. The sweetener was directed at locking in the transaction. These transactions were not part of Orchard's business. It was not a party to any of them. It had no role to play in any of them. 168 There is no doubt that the actual representors were Mona Kady and Sarkis. The issue is: In what capacity did they make the representations? In the case of Sarkis, was it purely to advance his own cause or was it on behalf of Orchard? In the case of Mona Kady, was it to assist Sarkis, or was it on behalf of Orchard? 169 There is no evidence that either or both of Mona Kady or Sarkis had the express authority of Orchard to make the statements which they made. 170 Furthermore, although from 7 June 2001 until 8 February 2006, Mona Kady and Sarkis were the only directors of Orchard, the mere fact that they were the only persons who occupied that position would not be a sufficient basis for finding that they had some implied or ostensible authority to make the statements which they made on behalf of Orchard or that it was an ordinary incident of the office of director of Orchard to make representations to potential purchasers of shares already issued in Orchard in order to assist the vendor of those shares to secure a sale of those shares. The simple fact is that it was no part of Orchard's business to encourage someone to buy shares from one of its existing members and no part of the directors' duties to do so on its behalf. 171 The reasoning in Sons of Gwalia Ltd does not assist the investors. In Sons of Gwalia Ltd, it was the conduct of the corporation itself which had been relied upon by the investor. The observations which the High Court made in that case were put forward upon the assumption that it was the conduct of the corporation itself which constituted the actionable contravention. In that case, the conduct relied upon was a failure to comply with the relevant non-disclosure requirements found in the Corporations Act and in the ASX Listing Rules. In that case, the result would have been the same if the corporation itself had made an untrue public announcement that it had found gold in a specific location and if, on the strength of that account, the claimant had purchased shares and lost money. If, on the other hand, in order to induce a sale of his shares in the corporation, one of the directors of the corporation, even in the presence of all of the other directors, had misrepresented to a potential investor that the corporation had made a gold discovery, when it had not, this would not be conduct for which the corporation could be held liable unless liability can be sheeted home to it by reason of ordinary agency principles. 172 Orchard was not registered until 7 June 2001. None of the statements made by Mona Kady and Sarkis prior to that date could conceivably have been made by Orchard. Those early statements were probably not as significant as the representations which were made later, in any event. 173 For all of the above reasons, I have come to the conclusion that the representations made after 7 June 2001 were not made by Orchard, as representor. Orchard was not, therefore, the primary contravenor. 174 I will now consider whether it can be held liable as an accessory. 175 Under s 1041I(1) of the Corporations Act and s 12GF(1) of the ASIC Act, a claimant may recover his loss or damage by action against the primary contravenor of (by action against) "… any person involved in the contravention …". 176 The phrase "… involved in the contravention …" in those provisions denotes accessorial liability. In s 9 (Dictionary) of the Corporations Act, the phrase is defined by reference to s 79 of the Corporations Act. Section 79 provides: 79 Involvement in contraventions A person is involved in a contravention if, and only if, the person: (a) has aided, abetted, counselled or procured the contravention; or (b) has induced, whether by threats or promises or otherwise, the contravention; or (c) has been in any way, by act or omission, directly or indirectly, knowingly concerned in, or party to, the contravention; or (d) has conspired with others to effect the contravention. 177 By dint of the operation of s 5(2) of the ASIC Act, the phrase "… involved in the contravention …" has the same meaning in the ASIC Act as it has in the Corporations Act. 178 That section is relevantly identical to s 75B(1) of the TPA. The jurisprudence developed by the courts in respect of s 75B is apposite. In Yorke v Lucas (1985) 158 CLR 661 at 667, the plurality (Mason ACJ, Wilson, Deane and Dawson JJ) said that, for the purposes of subpar (a) of s 75B(1), the alleged accessory must have intentionally participated in the contravention by the primary contravenor. The plurality held that, to form the requisite intent, the accessory must have knowledge of the essential matters which go to make up the contravention. At 668, their Honours observed that subpar (c) of s 75B imported into the TPA an existing concept from the criminal law. At 669, the plurality said of s 75B generally that it operates as an adjunct to the imposition of civil liability and that its derivation is to be found in the criminal law. At 669–670, their Honours said: So far we have dealt only with par.(a) of s.75B which refers to involvement of persons who are accessories. The appellants also rely upon par.(c) of the same section which extends the definition of a person involved to a person who has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention. There can be no question that a person cannot be knowingly concerned in a contravention unless he has knowledge of the essential facts constituting the contravention. It cannot, therefore, be suggested that Lucas falls within the first limb of par.(c). It might be thought possible to construe the express requirement of knowledge as extending not only to being "concerned in" but also to being "party to" a contravention. However, there are two reasons, in our view, why it is inappropriate to do so. First, the natural construction of par.(c) is to regard the word "knowingly" as qualifying only the words "concerned in" which immediately follow it. The punctuation strongly suggests such a construction. Secondly, the word "knowingly" would be an unnecessary qualification of the words "party to". In the context of the paragraph, a person could only properly be said to be "party to" a "contravention" if his participation was in the context of knowledge of the essential facts constituting the particular contravention in question. Whilst it is not a contradiction in terms to speak of a person being "party to" something of which he is unaware, some indication is needed to convey such a meaning. There is nothing in the paragraph itself which would point to any conclusion other than that the words "party to" are used to refer to a participant in the nature of an accessory. Moreover, the wider context of the whole section leads to the same conclusion. We have already indicated why par.(a) requires knowledge. Paragraph (b), which speaks of inducing a contravention by threats, promises or otherwise, and par.(d), which speaks of conspiring with others to effect a contravention, both clearly require intent based upon knowledge and there is force, we think, in the observation made in the judgment of the Full Court below [(1983) 80 FLR at p.152; 49 ALR 672, at p.682] that there is— ... no reason why Parliament would have intended that a section which renders natural persons liable for a contravention by a corporation should require some mental element or absence of innocence in every case to which it refers except one which itself requires in its first limb that the person was "knowingly" concerned in the contravention. In our view, the proper construction of par.(c) requires a party to a contravention to be an intentional participant, the necessary intent being based upon knowledge of the essential elements of the contravention. 179 At 673–674, Brennan J, as he then was, said: Section 75B governs civil liability but it is couched in the language of the criminal law: cf. Crimes Act 1914 (Cth), ss.5, 7A and 86. Its terms are substantially repeated in s.76(1)(c) to (f). Section 76(1) defines the persons who are liable to pay a pecuniary penalty for contravention of Pt IV. The terms of s.75B are also substantially repeated in s.78(c) to (f). Section 78 precludes the bringing of criminal proceedings for contraventions of Pt IV. As substantially the same terms are used in ss.75B, 76(1) and 78, the meaning of the corresponding terms in the three sections is substantially the same. Clearly the meaning ordinarily attributed to those terms by the criminal law should be attributed to them in ss.76(1) and 78, and that meaning should be attributed to those terms in s.75B. The provisions of s.75B should therefore be construed as though they were defining the persons criminally liable for contraventions of the provisions of Pt IV and s.52 and for offences created by the other provisions of Pt V. Such a construction effects a substantial symmetry between the classes of persons criminally liable for offences created by Pt V (other than s.52) and the classes of persons who may be civilly liable for contraventions of Pt V, though there may be some disconformity between those whose criminal liability arises only from s.7A of the Crimes Act and those who fall only within s.75B(c). Construing s.75B in that way, civil liability is imposed only on those who, if the particular contravention in Pt IV or Pt V were an offence, would be held criminally liable for it. Civil liability is thus imposed only on those who engage in the conduct prescribed by s.75B with the state of mind which the criminal law calls mens rea. In the criminal law, provisions which extend liability for statutory offences to such persons as are defined by s.75B are not understood as creating separate offences, but as making persons falling within the provision liable for the principal offence once it is committed: per Isaacs J. in Walsh v. Sainsbury [(1925) 335 CLR 464 at p.477]. A person whose act or omission brings him within the literal terms of the provision is not held liable, however, unless he engaged in the conduct therein specified (aiding, abetting, etc.) with a state of mind that amounts to mens rea. The appellants sought to make Mr. Lucas liable either as one who "aided, abetted, counselled or procured the contravention" under par. (a) of s.75B or as a "party to the contravention" under par. (c). In Giorgianni v. The Queen [(1985) 156 CLR 473], this Court decided that a person cannot be held liable for aiding, abetting, counselling or procuring the commission of an offence, even a statutory offence involving strict liability, without intent based upon knowledge of the essential facts which constitute the offence [(1985) 156 CLR, at pp.488, 495, 505–508]. 180 At 677, his Honour said: In determining who is civilly liable for a s.52 contravention under s.75B(a) no question arises as to whether the person upon whom liability is sought to be imposed knew that another person would or might be misled or deceived by the contravening conduct. But s.75B(a) does require knowledge of the acts constituting the contravention and of the circumstances which give those acts the character which s.52 defines, namely, "misleading or deceptive or ... likely to mislead or deceive". As the net of civil liability for a contravention does not catch those who would not be caught if s.52 created an offence, honest ignorance of the circumstances which give a representation a misleading or deceptive character or the character of a representation which is likely to mislead or deceive is inconsistent with civil liability under s.75B(a). The operation of s.75B(a) in conjunction with s.52 may be incongruous, for s.52 throws a strict liability on a corporation, but s.75B(a) does not extend liability for a s.52 contravention to a person who procures the corporation to engage in contravening conduct if that person is honestly ignorant of the circumstances that give that conduct a contravening character. Nor, in my opinion, does par. (c) of s.75B impose a stricter liability. The juxtaposition of "knowingly concerned in" and "party to" in a statute defining criminal liability (e.g., s.5 of the Crimes Act) would deny to the latter term a construction equivalent to "unknowingly concerned in". A "party to" an offence is one who, by the principles of the common law, would be held to be criminally liable for the offence. The term adds little to the more specific terms to be found in s. 5 of the Crimes Act, but it ensures that none is omitted from the net of criminal liability whom the common law would include. As s.75B transports the criteria of the criminal law into the definition of the parties who are civilly liable for contraventions of Pts IV and V, the criminal law definition of parties to an offence furnishes the definition of those who are civilly liable as a party to a contravention under s.75B(c). The requirement of knowledge under par.(a) is no less stringent under par.(c). 181 In the present case, Orchard played no role in the making of the statements which were made by Mona Kady and Sarkis and played no role in the share acquisition transactions until it came time to register the relevant transfer. There is no conduct on the part of Orchard which facilitated or procured the contraventions which I have found were committed by Mona Kady and Sarkis. There is nothing to which the principles articulated by the High Court in Yorke v Lucas can attach. Conclusions 182 Orchard did not make the offending representations and should not be held accountable for those representations as an accessory to the contraventions committed by Mona Kady and Sarkis. 183 For that reason, the plaintiffs' claims fail. There is no need to make any order as to costs. I certify that the preceding one hundred and eighty-three (183) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Foster. Associate: Dated: 20 July 2012