Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Glover v Kaji Australia Pty Limited [2020] NSWCA 222 Hearing dates: 14 July 2020 Decision date: 22 September 2020 Before: Bathurst CJ at [1]; Macfarlan JA at [2]; White JA at [62] Decision: (1) Appeal dismissed with costs. (2) Existing stay on execution and issue of a writ of possession discharged. Catchwords: TORTS – fraudulent conspiracy – appellant alleged multiple parties fraudulently conspired to procure him to obtain a short-term loan he was unable to repay – case entirely circumstantial with no direct evidence – matters relied upon fell well short of proving allegations to the relevant Briginshaw standard – findings by primary judge credit-based and not shown to be in error Legislation Cited: Evidence Act 1995 (NSW) Cases Cited: ASIC v Hellicar (2012) 247 CLR 345; [2012] HCA 17 Berry v CCL Secure Pty Ltd [2020] HCA 27; (2020) 94 ALJR 715 Blatch v Archer (1774) 1 Cowp 63; 98 ER 969 Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34 Browne v Dunn (1894) 6 R 67 Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 Queensland v Masson [2020] HCA 28; (2020) 94 ALJR 785 Category: Principal judgment Parties: Johann Benson Glover (Appellant) Kaji Australia Pty Limited (First Respondent) William Bradley Webster (Second Respondent) Mercia Financial Solutions Pty Ltd (Third Respondent) Richard Nicholson (Fourth Respondent) Rodney Shields (Fifth Respondent) Representation: Counsel: Mr R Newell (solicitor) (Appellant) Mr P Folino-Gallo / Mr N Seow (First and Second Respondents) Mr D Lloyd / Mr N Condylis (Third and Fourth Respondents) Self-represented Fifth Respondent Solicitors: L C Muriniti & Associates (Appellant) Shields Lawyers (First and Second Respondents) DLA Piper Australia (Third and Fourth Respondents) Self-represented Fifth Respondent File Number(s): 2020/12483 Decision under appeal Court or tribunal: Supreme Court of NSW Jurisdiction: Common Law Citation: [2019] NSWSC 1779 Date of Decision: 17 December 2019 Before: Davies J File Number(s): 2014/105767 [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Judgment 1. BATHURST CJ: I agree with orders proposed by Macfarlan JA and with his Honour's reasons. 2. MACFARLAN JA: On 21 February 2011 Mr Johann Glover, the appellant, borrowed the sum of $115,000 from Kaji Australia Pty Limited ("Kaji") and its controller, Mr William Webster (the first and second respondents on this appeal). The loan was for a period of two months and was thus repayable on 21 April 2011. Interest was payable at the rate of 5% per month, reducible to 3% per month for prompt payment. Mr Glover did not repay the loan, with the result that as at 17 December 2019 (the date of the primary judgment), not only was the principal amount of $115,000 outstanding but interest of $358,455 had accrued (calculated at 3% per month at the election of Kaji and Mr Webster). The loan was secured over Mr Glover's home. 3. The proceedings at first instance were commenced by Kaji and Mr Webster against Mr Glover for possession of his property and judgment for the amount owing. Mr Glover did not contest the matters outlined in [2] above but he alleged by cross-claim that, first, the loan agreement and mortgage were unjust and/or unconscionable and secondly, that his entry into the loan agreement was caused by a fraudulent conspiracy of Kaji, Mr Webster, Mercia Financial Solutions Pty Limited (the third respondent) ("Mercia"), Mr Richard Nicholson (the fourth respondent, who was described below as Mercia's "alter ego"), and Mr Rodney Shields (the fifth respondent and agent of Kaji and Mr Webster). Mr Glover alleged that the purpose of the conspirators was "to obtain for themselves the opportunity through a mortgagee sale to appropriate the value of [Mr Glover's] home (in whole or substantial part) and to conceal such fraud from Mr Glover". 4. The means by which Mr Glover alleged that they sought to do this was, in essence, by being involved in the procurement of, or at least knowing about, a purported but sham St George Bank loan approval to Mr Glover, and using that, together with a letter which they knew to contain false information purporting to confirm Mr Glover's employment by a company named Boston Traders Pty Ltd, to procure Mr Glover to obtain the short-term loan with Kaji and Mr Webster which he would then be unable to repay. 5. When Mr Glover obtained the subject loan from Kaji and Mr Webster, the hearing of an application by the Australian Taxation Office ("ATO") for sequestration of his estate on the basis of non-payment of a debt owed to it was imminent. Mr Glover alleged that when he obtained the loan, which was for two months only, he believed that there was a St George Bank loan approval which provided him with an "exit strategy". That belief was not well-founded because the purported St George Bank loan approval was a sham. 6. After an eight day hearing in the Common Law Division, Davies J rejected Mr Glover's cross-claim and found that Kaji and Mr Webster were entitled to possession of the mortgaged property and judgment in debt against Mr Glover ([2019] NSWSC 1779). 7. By his Notice of Appeal filed on 17 March 2020, Mr Glover contended that the primary judge erred in failing to find fraud and conspiracy on the part of Mr Nicholson and Mr Shields (who was also asserted to be "the representative of" Kaji and Mr Webster) arising in particular out of their alleged knowledge that the St George Bank loan approval was a sham. 8. As the primary judge's challenged findings were credit based, to succeed on appeal Mr Glover had to show that the findings were contrary to "incontrovertible facts or uncontested testimony", "glaringly improbable" or "contrary to compelling inferences" (Fox v Percy (2003) 214 CLR 118; [2003] HCA 22 at [28]-[29]; Queensland v Masson [2020] HCA 28; (2020) 94 ALJR 785 at [119]). For the reasons appearing below, I do not consider that he succeeded in doing this. His appeal should therefore be dismissed with costs. THE FACTUAL BACKGROUND AS FOUND BY THE PRIMARY JUDGE 1. On a number of occasions between 2000 and 2004, Mr Glover lent money to a friend, Mr John Lippits Snr. Those loans were repaid. Subsequently he lent amounts totalling more than $1 million to Mr John Lippits Jnr which have not been repaid. 2. In order to lend one particular amount, namely $265,000, to Mr Lippits Jnr (hereafter referred to simply as Mr Lippits), Mr Glover sold listed shares, resulting in him incurring a capital gains tax ("CGT") liability of $56,000. He pressed Mr Lippits to provide him with funds that would enable him to discharge this liability, but they were not forthcoming. As a result, the ATO commenced debt proceedings against Mr Glover, obtained a default judgment, issued a bankruptcy notice and filed a creditor's petition. There were some 10 adjournments of the hearing of the creditor's petition before it was dismissed on 7 March 2011 (following payment to the ATO: see [24] below). On a number of occasions Mr Lippits appeared in the Federal Magistrates Court on Mr Glover's behalf to obtain adjournments. 3. In the meantime, Mr Lippits had suggested to Mr Glover that Mr Glover apply for a loan to enable him to pay the CGT. A number of approaches to financiers were unsuccessful. In about December 2010 Mr Lippits however approached Mr Nicholson, a finance broker, about obtaining a loan for Mr Glover. Mr Lippits then introduced Mr Glover to Mr Nicholson and a meeting occurred between the three of them at which Mr Glover agreed that communications from Mr Nicholson to him could be effected through Mr Lippits. 4. Mr Glover gave evidence that a few days after the meeting he received a telephone call from Mr Lippits who told him that Mr Nicholson had obtained a loan approval from St George Bank. Mr Glover said that a few days after this Mr Lippits rang him to say that St George Bank was not able to "process" the loan quickly enough to prevent the ATO from making Mr Glover bankrupt. Mr Lippits told him "that they were going to have to get [Mr Glover] a short term loan in the interim to get the ATO paid off to prevent him from becoming bankrupt" (Judgment [34]). Mr Glover gave evidence that Mr Lippits said that the short-term loan could then be paid off with the monies from St George. Mr Glover said he agreed with this suggestion. 5. Mr Nicholson's affidavit evidence (as to which see [15] below) was that a conditional approval was issued by the "St George Bank's Home Loan Manager" but that that person subsequently informed him by telephone that the conditional approval "stalled … due to internal bank audit reasons" (Judgment [36]). Mr Nicholson said that he rang Mr Lippits on or about 11 February 2011 and suggested that an approach be made to "a private short term lender who could act quickly and provide the funding within the timeframe required to satisfy the ATO" (Judgment [37]). Mr Lippits asked Mr Nicholson to organise this. As a result, Mr Nicholson approached Mr Shields, a mortgage consultant whom he had known for some years. 6. Mr Shields said in evidence that he received a telephone call from Mr Nicholson on about 15 February 2011 concerning a short-term loan for Mr Glover. Mr Nicholson said that he had been told that St George Bank had approved a loan but that it could not process it in time for Mr Glover to avoid bankruptcy and that the bank would not in any event "directly pay a debt of the Taxation Department" (Judgment [39]). 7. Mr Nicholson did not give oral evidence at the hearing but Mr Glover read a number of paragraphs from three affidavits which Mr Nicholson swore for the purpose of the proceedings, in one of which Mr Nicholson referred to the above conversation but did not dispute the presently relevant parts of it as recounted by Mr Shields. 8. Mr Shields then said that he told Mr Nicholson that "there had to be a formal valuation to ensure that the security stacked up" and that Mr Shields "wanted to sight the approval letter from St George and the application made to St George, and [also] needed proof of the borrower's income so that if there was a delay with the St George loan he could be sure that the borrower could support the loan for a few months until it was paid out" (Judgment [41]). 9. Later that same day Mr Nicholson sent an email to Mr Shields which attached the St George Bank application (Judgment [43]). The application consisted of a completed standard form document addressed to the bank. Under the heading of "Information" on the first page the form listed a number of items that "You may require". Three of the boxes were ticked, including that relating to: "Proof of income, e.g. PAYG slips, rental statements optional for low doc loans." 1. As completed, the application was stated to be for a 15 year loan of $160,000. In relation to "Employment", the box marked "Full-time" was ticked and Mr Glover's occupation was described as "Consultant Trader", with his current employer said to be Boston Traders and the length of his employment to be two years and one month. His "base income" was said to be $70,000 (Judgment [48]). 2. The last two pages of the application had on them what were found to be forged purported signatures of Mr Glover (Judgment [142]). 3. The purported St George Bank letter of approval was dated 1 February 2011 and bore the name of a Mr Hany Hanna whom the primary judge found was "dismissed by St George for wrongdoing, although whether that conduct related to the presented matter is not known" (Judgment [54]). The letter stated that a loan of $100,000 had been approved in principle and that the approval was subject to a number of matters including a satisfactory valuation of Mr Glover's home. The letter appears to have been used on 1 February 2011 in the Federal Magistrate's Court to obtain an adjournment from that day until 22 February 2011 of the ATO's creditor's petition against Mr Glover. 4. Also on 1 February, Mr Hanna sent an email to Mr Nicholson confirming that the St George loan had been conditionally approved and stating that the "valuation was returned today coming in at $316,000" (Judgment [56]). Mr Nicholson forwarded the email to Mr Lippits later that day. St George Bank's response to subpoenas issued to it many years later in the course of the current proceedings was that it was unable to locate any documents relating to any such loan application, loan approval or valuation. 5. In mid February 2011 Mr Nicholson sent to Mr Shields copies of the St George Bank application and a page containing photocopies of a rates notice for Mr Glover, his driver's licence and medicare card, as well as a copy of the ATO's creditor's petition and the letter on the letterhead of Boston Traders Pty Ltd ("the employment letter"). The employment letter stated that Mr Glover had been employed by Boston Traders since December 2008 on a full-time basis in the capacity of consultant, on a salary of $70,000 per year plus superannuation. It was signed by Mr Lippits who was described in the letter as Boston Traders' CEO. The statements in the letter were false and Mr Glover eventually admitted at the hearing before the primary judge that he and Mr Lippits used the letter to mislead Mr Shields, as well therefore as Kaji and Mr Webster. 6. On 20 February 2011 Mr Glover and Mr Lippits attended a meeting with Mr Shields at the offices of Kaji's and Mr Webster's solicitors. Mr Shields gave evidence that at the meeting, Mr Lippits described himself as a family friend and employer of Mr Glover. Mr Glover told Mr Shields, falsely, that he was employed by Boston Traders on an annual income of $70,000. 7. Mr Shields approved the loan on behalf of Kaji and Mr Webster but ensured that Mr Glover obtained independent legal advice before signing the loan documents. Kaji's and Mr Webster's solicitors then paid the ATO the amount owing to it and on 7 March 2011 the ATO's creditor's petition was dismissed (as noted at [10] above). 8. A week or two later, Mr Lippits told Mr Glover that the anticipated loan from St George Bank had "fallen through" and that Mr Nicholson was trying to organise another loan. He was not able to do this. As a result Mr Glover defaulted in repayment of the short-term loan from Kaji and Mr Webster. THE PRIMARY JUDGE'S FINDINGS 1. The primary judge said that Mr Glover was articulate and obviously intelligent but was "a most unsatisfactory witness" (Judgment [99]). His Honour based the latter conclusion on a number of identified matters which included Mr Glover's deception, with Mr Lippits, of Mr Shields at their meeting with him concerning the subject loan and his denial of this in his initial affidavit evidence, which the primary judge found contained "lies". As well his Honour found "significant non-disclosure[s]" in other parts of his evidence (Judgment [100]-[130]). As a result, the primary judge said that he was unable to accept Mr Glover as "a truthful witness" (Judgment [131]). 2. Despite a vigorous attack on Mr Shields' credit, his Honour concluded that Mr Shields had not been dishonest and that if Mr Shields had known of the falsity of the Boston Traders letter, the loan to Mr Glover would not have proceeded. 3. The primary judge was prepared to accept Mr Glover's uncorroborated evidence on only one matter. This was that the signatures on the St George Bank loan application were not his. His Honour however rejected Mr Glover's contention that Mr Nicholson "was behind the fake loan application and approval from St George" (Judgment [143]). His Honour stated: "[143] … It is difficult to see what benefit Mr Nicholson could think that he would derive from engaging in such behaviour. The submission made by the defendant's solicitor, Mr Newell, during the hearing that Mr Nicholson was doing this to take 'a slice of the equity of the [defendant's] house', or to take 'a secret commission derived from the equity in the property' was improperly made because not only was it made without any evidence to support it, it is impossible to see how Mr Nicholson would ever be able to take any equity in the defendant's property. Since the plaintiffs through Mr Shields were conducting the auction they were, presumably, the only party who could pay Mr Nicholson a secret commission. It was never put to Mr Shields that any commission or fee was to be paid or was paid to Mr Nicholson for any reason by the plaintiffs." 1. His Honour further found that Mr Shields was not to be criticised for accepting the Boston Traders letter as proof of Mr Glover's employment as there was nothing improbable about it (Judgment [153]). His Honour also found that Mr Glover's reliance on the purported St George Bank loan approval "was almost entirely based upon" what he was told by Mr Lippits and not what he was told by Mr Nicholson (Judgment [221], [225]). 2. The primary judge summarised as follows his reasons for rejecting the allegations of fraud and conspiracy made against Mr Nicholson: "[251] First, I accept that the St George Approval in Principle was a sham. That is likely because St George has no records, electronic or documentary, of the loan application or the approval. It is also likely because the loan approval ceased without any formal rejection in writing or adequate reason being offered. It is also likely because the employee apparently involved, Mr Hanna, was subsequently dismissed for 'serious misconduct'. [252] However, the evidence discloses that the only thing connected with those matters that Mr Nicholson knew before the defendant entered into the loan agreement with the plaintiffs was that the loan application had stalled 'due to internal bank audit reasons'. The delay was the reason Mr Nicholson, on Mr Lippits' instructions, approached Mr Shields. [253] Secondly, I accept as I noted earlier, that Mr Nicholson was careless in submitting the St George Loan Application by reason of negative answers to the two questions concerning judgments against the defendant. I accept also that Mr Shields did not notice that incorrect information. However, as I noted earlier, those wrong answers could only have assisted the defendant to obtain the St George loan. [254] Thirdly, the Approval in Principle was for a lesser sum than had been sought in the Loan Application. I find it difficult to see that that was significant. Even if Mr Nicholson and Mr Shields had noticed it, they could be comforted by the fact that there was at least a conditional approval that might result in the loan from the plaintiffs being able to repaid by St George. It was not a matter that rang warning bells about the authenticity of the St George loan. But even if it was, the defendant was still in urgent need of some finance until a more permanent solution was found. [255] Fourthly, there is the statement in Mr Hanna's email of 1 February about the valuation being returned on that day for $316,000. There is no evidence that Mr Nicholson or Mr Shields had any knowledge about that. It may now be apparent that no such valuation was carried out, although that is far from clear. Mr Valentino [a finance broker called by Mr Glover to give evidence as an expert] accepted that the issue was not suspicious because the valuation could have been what was called a desktop valuation. Further the defendant [Mr Glover] gave contradictory evidence about whether a valuer had ever been out to his house (Cf his affidavit of 29 July 2015 paragraph 15 and his affidavit of 4 June 2016 paragraphs 5 to 7). Again, the statement that the valuation was satisfactory would have given comfort to Mr Nicholson that the St George loan was more likely to go ahead. [256] Fifthly, Mr Nicholson had no files to produce. The defendant relies strongly on that fact to infer, as far as I understood the submission, that Mr Nicholson had something to hide and that the 'something' was his involvement with Mr Hanna and possibly Mr Lippits in cooking up the St George Loan Approval. Reliance on this failure to produce was, in effect, an attempt by the defendant to re-agitate the adequacy of Mr Nicholson's discovery which I decided in Kaji Australia Pty Ltd v Glover (No 2) [2018] NSWSC 414. I refer in that regard to what I said at [39] to [47] of that judgment. [257] Sixthly, it appears that a Bankwest approval dated 20 December 2010, and apparently used to obtain an adjournment in the Federal Magistrates Court on 21 December 2010, was not a genuine approval. The evidence about this Bankwest approval was scant. The only evidence of Mr Nicholson's involvement with it is evidence given by Mr Glover in his affidavit of 30 April 2018 of what Mr Lippits said to him in January 2011 after the defendant's second meeting with Mr Nicholson. [258] In the letter from the defendant's solicitors of 2 August 2018 the following appears: The Cross-Claimant relies upon the propensity and practice revealed by the role of the Third and Fourth Cross-Defendants in collaborating with Joseph Prestia ("Prestia") in the preparation and use of a fraudulent unconditional approval letter from Bankwest dated 20 December 2010 which letter of approval was used to deceive the Federal Magistrates Court and the ATO. That role included procurement of payment of $2000 into the bank account of the Third Cross-Defendant in consideration of the joint role of Prestia and the Fourth and Fifth Cross-Defendants [sic] in facilitating the creation and use of the Bankwest approval letter. It seems likely that the reference in the penultimate line should be to the Third and Fourth Cross-Defendants because Mr Shields (the Fifth Cross-Defendant) had not even been contacted in December 2010. [259] The only evidence to support what appears in that letter is the fact that on 23 December 2010 Mr Nicholson sent an email to Mr Lippits saying (inter alia): As discussed with Joseph Prestia, the $2000 for services rendered remains outstanding and we are now out of pocket to this effect. [260] What inference should be drawn from that email is hard to determine. Even if the inference is that Mr Nicholson had assisted Mr Prestia in the work he had been doing with Mr Lippits to obtain repeated adjournments in the Federal Magistrates Court, that says nothing about Mr Nicholson's knowledge of, or involvement with, the Bankwest approval. [261] Seventhly, the suggestion that the failure of the plaintiffs to sue Mr Nicholson is indicative of a conspiracy assumes that Mr Nicholson must have committed wrongdoing separately from the plaintiffs. Otherwise, it is question begging. Any separate wrongdoing by Mr Nicholson could only be concerned with him being a party to the sham loan approval from St George. For reasons already given and matters to which I will come, the defendant fails to show that Mr Nicholson was a party to the sham loan approval, or even aware that the loan approval was a sham. … [270] In the same way, none of the matters identified by the defendant considered singly or together, leads to an inference that Mr Nicholson engaged in fraud or that he conspired with the plaintiffs and Mr Shields to enrich themselves from the sale of the defendant's land …" 1. His Honour also rejected similar claims against Mr Shields, stating: "[280] That Mr Shields was involved in a conspiracy was never put to him in the lengthy cross-examination that Mr Newell conducted. The idea that the parties to the conspiracy intended for the loan not to be repaid so that high quantities of interest could be run up is entirely inconsistent with the documents signed by the defendant at the time the loan was entered into which noted the need of the plaintiffs to have the money repaid in due time. it was never put to Mr Shields that those documents were not to be taken at face value, but were some sort of charade to hide the real intentions of the parties to the conspiracy. The notion that the plaintiffs and others intended that the loan not be repaid, allowing the defendant to be gouged, is also inconsistent with the fact that when judgment was entered by the plaintiffs in the District Court they did not claim the much higher default rate of interest." 1. His Honour concluded his findings concerning the fraud and conspiracy allegations as follows: "[289] The defendant's evidence about why he had not joined Mr Lippits to the proceedings or sued him separately was entirely unconvincing. He knew as little of Mr Nicholson's and Mr Shields' wherewithal as he did about Mr Lippits. Nevertheless, the defendant, having used Mr Lippits' assistance to set aside the judgment for possession, then chose not only not to call him to give evidence but chose not to join him to the proceedings to claim against him. [290] From the point of view of causation, any loss suffered by the defendant was entirely brought about by Mr Lippits, and the defendant himself who was prepared to do anything to borrow money to pay the ATO to avoid losing his house. [291] The claims in fraud and based on a conspiracy fail." DISPOSITION OF THE APPEAL 1. Before addressing particular points raised by Mr Glover in support of his appeal, I make the following observations by way of overview. 2. As Mr Glover's case recognised, it was essential for the success of his fraud and conspiracy claims against Mr Nicholson that Mr Glover prove that Mr Nicholson was aware that the purported loan approval from St George Bank was a sham and that with that knowledge Mr Nicholson caused Mr Glover, who was not aware the letter was a sham, to take the subject loan from Kaji and Mr Webster. That the case against Mr Nicholson thus involved serious allegations of dishonesty on his part was a matter to which the Court was required to have regard in deciding whether the case against him was established (Evidence Act 1995 (NSW), s 140(2); Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34). As the plurality in Berry v CCL Secure Pty Ltd [2020] HCA 27; (2020) 94 ALJR 715 recently confirmed at [39], proof of fraud requires clear evidence. Moreover, as Mr Glover's case was circumstantial, without any direct evidence of Mr Nicholson's alleged fraud, he faced a formidable task in proving it. The matters he relied upon fell well short of doing this. The principal of these are referred to separately below. 3. A particular difficulty that Mr Glover faced in seeking to have the Court draw an inference of fraud on Mr Nicholson's part was that Mr Glover's case did not exclude the possibility that the sham St George Bank loan approval was procured by Mr Lippits without any guilty knowledge on the part of Mr Nicholson. Mr Lippits had a compelling reason, which neither Mr Nicholson nor Mr Shields had, to facilitate Mr Glover's borrowing, whether from St George Bank or otherwise. This was that it was Mr Lippits' borrowing from Mr Glover that gave rise to Mr Glover's CGT liability and to the ATO's consequent bankruptcy proceedings against Mr Glover. Mr Lippits was unable to repay Mr Glover and therefore had, quite apart from their friendship, every reason to want to assist Mr Glover to avoid bankruptcy. 4. Moreover, it is known from the evidence in the proceedings that Mr Lippits was prepared to act fraudulently to provide such assistance. He did so by falsifying the Boston Traders' letter and facilitating its use to deceive the prospective lenders. It is but a short step to conclude that the inference was available that Mr Lippits may have also acted fraudulently in relation to the procuring of the St George Bank letter. Furthermore nearly all of the information Mr Glover received about the St George loan was conveyed to him through Mr Lippits and not verified by any other person (Judgment [35]). 5. The primary judge noted that Mr Glover had used Mr Lippits' assistance earlier in the proceedings but chose not to call him to give evidence, and not to sue him (see [32] above). His Honour concluded that "any loss suffered by [Mr Glover] was entirely brought about by Mr Lippits, and [Mr Glover] himself". This inference was clearly open to his Honour and militated strongly against a finding that Mr Nicholson must have acted fraudulently in relation to the obtaining of the St George Bank approval letter. 6. In these circumstances, Mr Glover's claim against Mr Nicholson was bound to fail, as it did. It followed that the appeal in relation to that claim was likewise bound to fail. 7. Many of the same considerations apply in relation to Mr Glover's claim against Mr Shields, although there is, if anything, even less of a basis for an inference of fraud and conspiracy against him. The only particular points of any arguable significance relied on by Mr Glover are dealt with below. Neither individually nor together do they amount to a basis for the relevant inference. 8. I should add that on appeal Mr Glover asserted that in a manner which he did not make clear he was assisted by the principles stated in Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 and Browne v Dunn (1894) 6 R 67. I can discern no error by the primary judge in this respect. If any Jones v Dunkel argument was available it would have worked against Mr Glover in relation to him not calling Mr Lippits to give evidence, but it is unnecessary to form a view on that point as it was not pressed on the Court by the respondents. 9. Mr Glover also relied on the principle stated in Blatch v Archer (1774) 1 Cowp 63 at 65 (98 ER 969 at 970) but he failed to have regard to the limited operation of that principle as identified in ASIC v Hellicar (2012) 247 CLR 345; [2012] HCA 17 at [165]-[168]. Particular matters relied on in relation to Mr Nicholson 1. First, Mr Glover submitted that the fact that Mr Nicholson had been told that the "loan application had stalled due to internal bank audit reasons" was "clearly evidence, given what Mr Valentino had to say about it, that the loan was a sham". 2. The reference to Mr Valentino's evidence was to evidence adduced by Mr Glover from Mr Peter Valentino, an experienced finance broker, of practices within the finance industries. Mr Valentino referred to a number of aspects of the purported St George Bank loan application and approval and concluded that "[t]here is cause for serious suspicion that the alleged loan from St George was not genuine and was a fabrication by the broker [Mr Nicholson]". Leaving aside its admissibility, any support, however small, it gave to Mr Glover's case was removed by Mr Valentino's concession in cross-examination that "there would be no reason whatsoever if a broker received a letter like [the St George Bank approval letter] to think anything other than it's a genuine conditional approval of a loan" (Tcpt, 18 April 2019, p 314). 3. Secondly, Mr Glover referred to various anomalies he said were apparent from the terms of the application to St George Bank and the purported conditional loan approval. Whilst, as his Honour found, the errors in the application indicate carelessness by Mr Nicholson in submitting it, if he did in fact submit it, they fall far short of indicating any fraudulent conduct on his part. Moreover, his Honour did not consider significant the fact that the St George approval letter conditionally approved the loan for an amount less than what was applied for and that the valuation of Mr Glover's house was returned the same day as the conditional loan approval. His Honour dealt with these alleged anomalies without any apparent error in his reasons (see Judgment [253]-[255] quoted in [30] above). 4. Thirdly, Mr Glover submitted that Mr Nicholson's explanation for his inability to produce any files in relation to the subject transaction was inherently improbable "and his account should not be accepted". There was however no inherent improbability in that explanation which was fully described in his Honour's earlier judgment of 9 April 2018 ([2018] NSWSC 414 at [12], [16] and [31]). 5. Fourthly, Mr Glover relied on evidence that he submitted established that on an earlier occasion (in December 2010) a "fake Bankwest approval" was used to obtain an adjournment of the ATO's bankruptcy proceedings. The evidence did not however establish any knowledge of Mr Nicholson that such approval was fake, if in fact it was. Again, his Honour adequately dealt with the argument (see Judgment [257]-[260] quoted in [30] above). 6. Next Mr Glover relied on the fact that the St George loan approval was a sham and that as Mr Nicholson lodged the application for it, he was "integrally involved in the transaction", such that he could be described as "the architect" of it. Mr Glover submitted that no attempt was made at first instance to suggest "some other scenario that did not presuppose [Mr Nicholson's] knowledge and which would explain the St George loan being a sham". 7. It was however for Mr Glover to establish that an inference of fraud should be drawn against Mr Nicholson. One matter clearly against such an inference being drawn was, as I have pointed out above, that Mr Lippits had a strong motive to obtain the purported St George approval letter and in the very same transaction was shown to have dishonestly provided the Boston Traders employment letter for the same purpose as the St George letter was alleged to have been obtained, namely, to fend off the ATO and to obtain a loan to enable it to be paid. 8. It did not advance Mr Glover's case to any significant extent to show that Mr Nicholson had had a prior working relationship with Mr Hanna from the St George Bank. Mr Nicholson told both Mr Lippits and Mr Glover that he would provide Mr Lippits with a list of the forms and documents required by St George Bank. What role Mr Lippits thereafter played in relation to St George Bank is unknown as he was not called to give evidence. As I noted earlier, Mr Glover's failure to exclude Mr Lippits as the fraudulent party in relation to the St George Bank loan left unavailable the inference that that party must have been Mr Nicholson. 9. Other points that Mr Glover relied on were adequately dealt with by the primary judge in his reasons quoted in [30] above. Particular matters in relation to Mr Shields 1. In his written submissions Mr Glover identified only two matters as founding his challenge to the primary judge's findings concerning Mr Shields. 2. The first matter concerned the Boston Traders employment letter. Mr Glover submitted that "the evidence before Mr Shields was that the income asserted for [Mr Glover] in the Employment Letter was inherently improbable". No compelling argument was put in support of this submission which, in particular, ignored the fact that both the putative employer (Boston Traders) and putative employee (Mr Glover) attended the meeting with Mr Shields and supported the accuracy of the letter. 3. Mr Glover then submitted that Mr Shields must have known that the facts stated in the letter were false because he did not seek and obtain a group certificate to confirm what was in the letter. Whether or not it would have been prudent for Mr Shields to do so, the fact that he did not do this provided no evidence to support an inference that he acted fraudulently. Further, the primary judge accepted the evidence of Mr Shields that he did ask for group certificates at the meeting on 20 February 2011 and was told by Mr Lippits that they were not available (Judgment [150]). 4. Secondly, Mr Glover submitted that Mr Shields must have realised that the St George Bank approval letter was a sham because he had no evidence that a group certificate had been provided to St George Bank and he "confirmed that he understood that that was a requirement [of St George Bank] when he was cross-examined". 5. This submission however rests on the slimmest of bases as the reference given for Mr Shields' confirmation was to the following evidence of Mr Shields in cross-examination: "St George are very thorough in what they do. I had no time to get the – these other papers, but I knew St George would. The fact, the fact that he provided a false letter to me is something that I couldn't have anticipated. I did not expect to be deceived." (Tcpt, 18 April 2019, p 267(37)-(40)). 1. This provides no support for the inference that Mr Glover seeks to have drawn that Mr Shields knew that the St George Bank letter was a sham. Nor does any other aspect of the evidence support that inference. 2. Finally, Mr Glover's fraud and conspiracy case against Mr Shields suffers from the problems identified by the primary judge at [280] of his judgment (quoted at [31] above), in particular that that case was not put to Mr Shields in cross-examination. CONCLUSION 1. For the reasons above, Mr Glover's challenge to the primary judge's rejection of the fraud and conspiracy allegations against Mercia, Mr Nicholson and Mr Shields (and therefore Kaji and Mr Webster) fails. 2. Whilst Mr Glover's Notice of Appeal also complains of errors by the primary judge in not finding that representations were made by Mr Nicholson, that is a complaint that is conditioned on the assertion, which I have found to be ill-founded, that his Honour should have concluded that Mr Nicholson knew that the St George Bank loan approval was a sham. 3. In his written submissions, Mr Glover also complains that the primary judge erred in not finding that the loan by Kaji and Mr Webster to him was unconscionable (at [5(c)] and [98]), however that allegation is not put as an independent submission but only as part of Mr Glover's fraud and conspiracy allegations, which I have found were properly rejected. Moreover, Mr Glover's Notice of Appeal does not raise unconscionability as a separate ground of appeal. 4. In these circumstances, the appeal should be dismissed with costs and the existing stay on execution and issue of a writ of possession discharged. 5. WHITE JA: I agree with Macfarlan JA. I would also endorse the primary judge's finding at [143] (quoted by Macfarlan JA at [28]) that the submission made by Mr Newell, there referred to, was improper. ********** Amendments 16 October 2020 - [49]: the word "unavailable" in the last sentence was moved to earlier in the sentence to improve clarity. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 16 October 2020