Supreme Court New South Wales Medium Neutral Citation: Jainti Pty Ltd v Fraser Panorama Pty Ltd [2021] NSWSC 744 Hearing dates: 23 – 26 November 2020 Date of orders: 25 June 2021 Decision date: 25 June 2021 Jurisdiction: Equity Before: Ward CJ in Eq Decision: 1. Order that the sum of $161,160 (plus interest) held in the controlled moneys account of Bird & Bird be paid to Jainti Pty Ltd as trustee for the Zambito Trust. 2. Reserve the question of costs to be dealt with on the papers if possible. 3. Direct the parties to file brief written submissions on costs within 14 days, with a view to dealing with the question of costs on the papers if possible, and any submissions on any interest claimed by Jainti for the period from payment of the distribution to Anthony Zamattia and the placement of the moneys in the controlled moneys account. Catchwords: EQUITY — Trusts and trustees — Beneficiaries — Wrongful distribution of trust property –– Rule in Saunders v Vautier Legislation Cited: Corporations Act 2001 (Cth), ss 436A, 477(2A)-(2B) Cases Cited: CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 224 CLR 98; [2005] HCA 53 Australian Securities and Investments Commission v Rich (2005) 53 ACSR 752; [2005] NSWSC 417 Baden Delvaux & Lecuit v Société Générale pour Favoriser le Développement du Commerce et de l'Industrie en France SA [1993] 1 WLR 509 Barnes v Addy (1874) LR 9 Ch App 244 Beck v Henley (2014) 11 ASTLR 457; [2014] NSWCA 201 Boensch v Pascoe [2019] HCA 49 Brandi v Mingot (1976) 12 ALR 551 Delaforce v Simpson-Cook (2010) 78 NSWLR 483; [2010] NSWCA 84 Giumelli v Giumelli (1999) 196 CLR 1; [1999] HCA 10 Hasler v Singtel Optus Pty Ltd (2014) 87 NSWLR 609; [2014] NSWCA 266 HML v R (2008) 235 CLR 334; [2008] HCA 16 Ho v Powell (2001) 51 NSWLR 572; [2001] NSWCA 168 Jones v Dunkel [1959] HCA 8; (1959) 101 CLR Kalls Enterprises Pty Ltd (in liq) v Baloglow (2007) 63 ACSR 557; [2007] NSWCA 191 Katsilis v Broken Hill Pty Co Ltd (1977) 18 ALR 181 Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11 Lucent Technologies Inc v Krone Aktiengesellschaft (No 3) [2000] FCA 100 Macquarie Developments Pty Ltd v Forrester [2005] NSWSC 674 Northampton Borough Council v Cardoza [2019] EWHC 26 Payne v Parker [1976] 1 NSWLR 191 Re Marshall; Marshall v Marshall [1914] 1 Ch 192 RHG Mortgage Ltd v Rosario Ianni [2015] NSWCA 56 Rosebanner Pty Ltd v Energy Australia (2009) 223 FLR 406; [2009] NSWSC 43 Saunders v Vautier (1841) 41 ER 482 Stone v Melrose Cranes & Rigging Pty Ltd (2018) 125 ACSR 406; [2018] FCA 530 Category: Principal judgment Parties: Jainti Pty Ltd (in liquidation) (Plaintiff) Fraser Panorama Pty Ltd (First Defendant) Anthony Zamattia (Second Defendant) Representation: Counsel: Mr H W Somerville (Plaintiff) Mr M Luitingh (Second Defendant) Solicitors: William James (Plaintiff) Grace and Grace Plus (Second Defendant) File Number(s): 2019/0042253 Publication restriction: Nil Judgment 1. HER HONOUR: This proceeding involves a dispute as to the entitlement to the sum of $161,160 currently held in a solicitor's controlled moneys account, those moneys being part of the final distributions made by Fraser Panorama Pty Ltd (Fraser Panorama) (which was formerly the first defendant in the proceeding), in its capacity as trustee of the Fraser Panorama Trust (to which I will refer as the Fraser Unit Trust), in respect of an approximately $20 million property development in Hervey Bay, Queensland (the Fraser Panorama development). 2. The plaintiff, Jainti Pty Limited (Jainti), which has been in liquidation since 2011, contends that it is entitled to those moneys, in its capacity as trustee of a discretionary trust (the Zambito Trust); its contention being that all distributions out of the Fraser Unit Trust in respect of 34 units in the Fraser Unit Trust (the 34 Units) were payable to it as trustee of the Zambito Trust. 3. The claim as against the first defendant (Fraser Panorama) for, among other things, breach of trust in relation to the payment of distributions to persons or entities other than Jainti, was settled on 27 June 2019 (see orders made by Robb J on that date), subject to approval pursuant to ss 477(2A)-(2B) of the Corporations Act 2001 (Cth) (Corporations Act), which approval was granted on 4 November 2019 (see orders made by Rees J on that date). The liquidator of Jainti, Mr Reidy, has deposed that Jainti settled the matter with Fraser Panorama, under the terms of agreed orders, in respect of Fraser Unit Trust distributions for 4/5ths of the entitlements of the holder or holders of the 34 Units, which thus leaves only the claim by Jainti in respect of the 1/5th entitlement paid to the account of the second defendant (Mr Anthony Zamattia) (those being the moneys that have been placed in a controlled moneys account pending the outcome of this dispute). 4. I will refer to the second defendant, without intending any disrespect, by his first name, as I will also do with the other members of his family (except where necessary to distinguish between family members with the same first name). 5. By its amended statement of claim filed 26 July 2019, Jainti now seeks declaratory relief (declarations that Anthony holds the sum of $161,160 on constructive trust for it – prayer 4; and that Jainti has a proprietary interest in and/or an equitable charge over the whole of the amounts frozen by orders of this Court on 7 and 12 February 2019 – prayer 5) and an order that Anthony either account to it or pay equitable compensation (prayer 6), with consequential claims for damages, interest and costs. (Jainti has confirmed that, following the settlement with Fraser Panorama, it does not press for the relief claimed at prayers 2-3 of the amended statement of claim – see at T 322.39-T 323.9.) Prayer 1 of the amended statement of claim, which is still pressed, seeks a declaration as to the holding of the 34 Units (as to which relief, some criticism is made by Anthony to which I refer in due course). 6. Although issue was taken in Anthony's outline of opening submissions as to inconsistency between the relief sought in the amended statement of claim and that sought in the summons pursuant to which the proceeding was commenced, as far as I can see nothing here turns on this. I proceed on the basis that the substantive relief now sought is that claimed in prayers 1, 4-6 of the prayers for relief in the amended statement of claim. 7. In substance, what Jainti contends is that the sum held in the controlled moneys account is part of the distributions to which it was entitled in its capacity as trustee of the Zambito Trust; and that Anthony received that distribution knowing that it was made by Fraser Panorama (of which company he was a director) in breach of trust (i.e., a knowing receipt first limb Barnes v Addy (1874) LR 9 Ch App 244). To the extent that an issue was raised in oral submissions as to what relief might be granted if the knowing receipt claim were ultimately found not to be made good but it were nevertheless to be held that Jainti was the entity which was entitled to the sums that had been paid to Anthony – see the debate at T 321-T 323, I will address that in due course, if and when it arises. Suffice it to note that, in that event, Anthony ultimately accepted that Jainti would be entitled to an order for the money held in the controlled moneys account (see T 323). 8. What Anthony, on the other hand, contends is that he was entitled to be paid, and to receive, the distribution out of the Fraser Unit Trust in respect of 1/5th of the 34 Units, as the registered unit holder in the Fraser Unit Trust of that 1/5th share of the 34 Units or, alternatively, as the beneficial owner of that 1/5th share in the 34 Units (see [35] of the amended defence). 9. Relevantly, Anthony contends that the 34 Units in the Fraser Unit Trust were never held by Jainti as trustee for the Zambito Trust but, instead, were held from 12 May 2006 by Jainti as trustee of a separate trust (to which I will refer as the Family Trust) for five individual beneficiaries: Anthony (i.e., himself); his brother, David Zamattia; their father, Bruno Zamattia; and Anthony and David's uncles, Salvatore (known as Sam) Morabito and Sam's brother, Frank Morabito. There is no suggestion that there were five separate trusts created, one each in favour of each individual beneficiary – rather, it is said by Anthony that what was intended was that there be a single trust held for the five beneficiaries each as to a 20% share. 10. Pausing here, as to the family connections, Sam and Frank are Bruno's brothers-in-law (Bruno's wife, Carol, being their sister). Another Zamattia family member who features in the proceeding (but is not suggested to be a beneficiary of the alleged Family Trust) is Sam Zamattia, David and Anthony's brother, who gave evidence of a particular conversation with Anthony relating to the execution of documents by him (to which I will refer in due course). (For clarity, when I refer to Sam in these reasons, I am referring to Sam Morabito; where I refer to Sam Zamattia, I will use his surname in order to distinguish between the two.) 11. Anthony further contends that the Family Trust was terminated, insofar as it related to Anthony, David and Bruno only (i.e., the Zamattia family beneficiaries) in October 2008 but in any event by no later than in or around September 2016 (relying on Saunders v Vautier (1841) 41 ER 482 (Saunders v Vautier) and, for the later date, on a direction given by a document headed "Notification of Termination of Trust" bearing the date of 9 September 2016); with the effect, Anthony says, that Jainti does not have any right to the distributions of the Fraser Unit Trust insofar as those distributions relate to the three members of the Zamattia family. 12. The September 2016 "Notification of Termination of Trust" document (hereafter referred to as the Notice of Termination of Trust) bears the purported signatures of each of Anthony, David and Bruno. However, David denies having executed that document (see his first affidavit sworn 17 April 2019 at [10]); and he denies any knowledge of the Family Trust or that Jainti ever held the units in the Fraser Unit Trust in any capacity other than as trustee for the Zambito Trust. For Jainti, it is said that David's position is contrary to his own financial interest and is confirmed by evidence from Frank and Sam, as well as objective documentation (including that which was supplied by Anthony to Jainti's liquidator since his appointment, and by way of financial statements over many years). (For Anthony, criticism is made as to the submission that reliance can be placed on David's evidence being contrary to David's own financial interest, but I will come to that criticism in due course.) 13. As to the purported execution of the Notice of Termination of Trust by Bruno, the position is complicated by the fact that his affidavit in the proceeding was ultimately withdrawn by the liquidator (in the circumstances to which I refer below) and hence there was no direct evidence from Bruno in relation to the execution or otherwise of this document; and the liquidator accepts that a Jones v Dunkel inference (see Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298 (Jones v Dunkel)) is available in this regard (see T 334.12-20). 14. Ultimately, both parties accepted that the outcome of the present dispute turns largely, if not wholly, on what findings are made as to the 12 May 2006 meeting of the directors of Fraser Panorama (Anthony and John Derek Taylor (to whom I will refer as Derek Taylor)) in relation to the issue of units in the Fraser Unit Trust. 15. For his part, the liquidator accepts that, if there was a valid Family Trust and if it was validly terminated, then Jainti's claim fails. Conversely, the liquidator maintains that, if (as he contends is the case) there was no valid Family Trust (such that Jainti only ever held units in the Fraser Unit Trust as trustee for the Zambito Trust), or if there was a Family Trust but there was no valid termination of that trust, then Jainti's claim should succeed. 16. Anthony, for his part, says that if the 34 Units were held as contemplated by a unit holders' agreement entered into in 2006 (Unit Holders Agreement) (as to which, see below), then Jainti's claim must fail (and, conversely, that if he, Anthony, fails in establishing that the position is as was provided for in the Unit Holders Agreement, then he must fail) (see T 320.40-43). Anthony also maintains that the liquidator must not only establish that the 34 Units were held by Jainti as trustee for the Zambito Trust but also that the documents relied upon by Anthony were concocted (since it is said there is no other explanation for the competing versions of particular documents and the Unit Holders Agreement) and that such a serious allegation cannot be established. Background Jainti 1. Jainti was incorporated on 15 June 1993. At all relevant times, each of Frank, Sam, Bruno, David and Anthony was a director of Jainti; and the company secretary was Frank. It appears that for some time the Zamattia and Morabito family members were together involved in property development. 2. Following its incorporation, Jainti invested in two property developments: one, in respect of a property in Burradoo, New South Wales (not relevant for the purposes of this proceeding) and the other, in respect of the Fraser Panorama development, which comprised some 163 lots of real property in Hervey Bay, Queensland. Anthony's evidence (corroborated by Derek Taylor) is that he sourced the Fraser Panorama development with Derek Taylor in or about 2005 and that he, Anthony, was the project manager of the development and received project management fees over a period of 14 years (see Anthony's affidavit sworn 20 September 2019 at [3.1]-[3.12]; affidavit of Derek Taylor sworn 7 October 2019 at [3.1]-[3.2]). Zambito Trust 1. The Zambito Trust was established by a Trust Deed dated 21 December 2004, which was executed by Mr Phillip John Ashton as settlor, and Jainti, as trustee of the Zambito Trust. 2. Mr Ashton is an accountant, who himself was an investor in the Fraser Panorama development (through an investment vehicle – Ashmoor Pty Ltd), and who prepared the financial statements of the Fraser Unit Trust and Zambito Trust for the relevant years. The Trust Deed of the Zambito Trust was varied by a Deed of Variation executed by Jainti on 1 July 2011. For reasons that I will explore in due course, Mr Ashton was (as acknowledged by Counsel in the course of submissions) what might be referred to as the "missing pachyderm in the room", having not been called by either party (see T 287.45-50). 3. The liquidator has deposed that, so far as he is aware, Jainti did not undertake any business or activity other than in its capacity as trustee of the Zambito Trust (see Mr Reidy's affidavit sworn 7 February 2019 at [10]). 4. The beneficiaries of the Zambito Trust at all relevant times included: Anthony, David, Bruno, Sam and Frank, and parties related to those individuals. I have referred above to the family connection between the Zamattia and Morabito families. The liquidator (in the context of Anthony's submissions as to the Zamattia/Morabito families wishing in 2008 to separate their respective family interests) notes that the Zambito Trust remains in existence and that no steps have been taken to dissolve it. Fraser Panorama – incorporation 14 February 2006 1. On 14 February 2006, Fraser Panorama was incorporated, with Anthony and Derek Taylor appointed as the directors of the company and Derek Taylor as its company secretary. Fraser Unit Trust established 1. On the same day, the Fraser Unit Trust was established by Trust Deed dated 14 February 2006, executed by SMH Guardian Services Pty Ltd, as settlor, and Fraser Panorama, as trustee. 2. The Trust Deed establishing the Fraser Unit Trust provided that the trust fund was to be divided into the number and classes of units set out in the Schedule thereto and was to be held by the initial unit holders as set out in the Schedule. (While there was provision for differential classes of units, there was no reference in the Trust Deed to "A" Class or "B" Class units as such.) 3. The initial unit holders specified in the Trust Deed were Jainti as trustee for the "Zamabito [sic] Trust" (as to one ordinary unit) and an entity associated with Derek Taylor named Leading Edge (Pacific) Pty Ltd (Leading Edge) as trustee for the Raidell Trust (as to the second of the two ordinary units). It does not appear to be disputed that the reference in the Schedule to the "Zamabito Trust" is a typographical error and that it must have been intended to be a reference to the "Zambito Trust". Anthony and Derek Taylor executed the Trust Deed in their capacities as directors of Fraser Panorama. 4. The Fraser Unit Trust Deed conferred rights on unit holders in relation to the participation in income distributions (see as pleaded at [8] of the amended statement of claim). Those rights were not preferential as between unit holders. 16 February 2006 meeting of Fraser Panorama 1. There is in evidence a copy of minutes of a meeting held by directors of Fraser Panorama on 16 February 2006 (signed by Anthony as chair) in which it is recorded that a trust deed for the Fraser Unit Trust was tabled and it was resolved that the company accept appointment of that unit trust with Jainti "atf The Zambito Trust" and Tuta Products Pty Ltd (Tuta Products) each being issued with one unit (see Exhibit A at 258). 2. Pausing here, as noted above, the Trust Deed in fact named Leading Edge as the holder of the second ordinary unit. Hence, it would seem that there was an error in the minutes in the reference to Tuta Products. However, as I understand it, both Leading Edge and Tuta Products are entities associated with Derek Taylor (and Derek Taylor gave evidence to which I refer below which suggests that he may have seen Tuta Products as a substitute unit holder or else treated the two entities interchangeably – referring to his interest in the Fraser Unit Trust as holder of 20 units; i.e., an amalgamation of the initial unit issued to Leading Edge and the additional units issued to Tuta Products). (He also had an interest in some "A Class Units" in the name of Pepco, to which I refer below.) 3. The 16 February 2006 minutes of meeting recorded that a contract was tabled for the purchase of vacant land at "Harvey Bay" [sic], Queensland, for a price of $7.75 million and it was resolved to execute the contract "on the basis of obtaining bank finance and from loans to be raised from unitholders"; and that the land was to be developed as residential building blocks in accordance with already existing approved council plans. 4. Therefore, from the inception of the Fraser Unit Trust, it is clear from the Trust Deed that there were created two ordinary units in the trust (held, as noted above, one each by Jainti and Leading Edge; and each held by those entities in a trustee capacity – the dispute here being as to the beneficiary or beneficiaries for whom Jainti held these, and other subsequently issued, units in the trust). Preparation of documents to record issue of additional units in Fraser Unit Trust 1. At this point it is relevant to put what follows in context and to note in general terms the way in which the Fraser Panorama development was to be structured or undertaken, namely that, after the Hervey Bay property was "sourced" (i.e., presumably, identified as a suitable development project site and acquired), it was proposed that funds for working capital to develop the land would be procured by way of loans from investors in the project to whom units would be issued in the Fraser Unit Trust. Derek Taylor's evidence was that he and Anthony came to an arrangement where Anthony would find the investors "to come in and fund the project" and that the difference in the classes of units that were ultimately issued was that he and Anthony would be allocated some "shares" that were "basically carried free" (because they had started the project) and that the balance of the investors would acquire a different class of "shares" (i.e., units in the trust) and those investors would provide loans to the trustee commensurate with their unit holdings (see T 129). Jainti, as trustee of the Zambito Trust, for example, is recorded in the accounts as having contributed some $700,000 by way of loan for the purposes of the development. 2. Further, it seems apparent from Derek Taylor's evidence (to which I will refer in due course) that there was what I might charitably describe as some informality in how the investors' interests in the project would be recorded (it being his evidence that there were some changes made to reflect the desire of one or more of the investors to bring in tax losses or the like). Therein, perhaps, lies an explanation for the fact that there are in evidence different versions of relevant documents recording the tabling of applications for, and issue of, units in the Fraser Unit Trust. However, whatever the cause of the competing versions of various of the documents, what that has ultimately led to is the present dispute as to the entity or persons for whom the plaintiff (Jainti) holds the 34 Units in the Fraser Unit Trust as trustee. 3. Anthony's evidence is that in the two months prior to the meeting ultimately held on 12 May 2006 (to which I refer below at which the issue of the additional units was approved), he prepared a bundle of documents for each unit holder including a copy of: the Fraser Panorama certificate of incorporation; the Fraser Unit Trust Deed; the Unit Holders Agreement, documents relating to project feasibility, forecast cash flow, funding proposals and other related documents; unit holder certificates relevant for each unit holder; survey and photos of the site; marketing proposals; and, the Fraser Unit Trust meeting minutes (see his affidavit sworn 30 October 2020 at [3.4]). His evidence is that these were prepared for distribution or collection by other family members at the "communal office". (Reference was made in cross-examination of various of the family members to documents being left on a snooker table; and it appears that the "communal office" was in fact the basement or pool room of Bruno and Carol's house.) Those documents (that Anthony maintains were only draft documents but some of which he accepts bore his electronic signature – apparently in anticipation of the 12 May 2006 meeting) referred to the relevant units as being held by Jainti as trustee for the Zambito Trust. 4. In closing submissions, it was submitted for Anthony that those documents were prepared at an earlier time than that to which he deposed in his affidavit (i.e., in February 2006) (and indeed it was said by Counsel for Anthony that this was beyond dispute and that it was also beyond dispute that those documents were placed on the snooker table in the downstairs room of Bruno's house). The February 2006 date placed by Counsel for Anthony on the creation of the "draft documents" (albeit inconsistently with Anthony's own affidavit evidence) may derive from the fact that it was in February 2006 that the Fraser Unit Trust was established but there is no documentary record (or metadata) of the creation of those documents at that time. 5. There was, however, evidence in Frank's cross-examination which placed the version of the documents on which the liquidator relies (and which Anthony refers to as the "draft documents" in his affidavit sworn 20 September 2019 at [10.11]) as being created in February (albeit that this "February" time frame may have been prompted by the question put to him). See in this regard the following exchanges with Frank (T 78.4-45): Q. Are you aware of when those certificates were prepared? A. Where they were prepared? Q. When they were prepared? A. They were prepared‑‑ Q. Would it be in the February? A. They were, yeah, they were prepared on 16 February 2006. [I interpose that 16 February 2006 is the date of the meeting of Fraser Panorama at which the Fraser Unit Trust Deed was tabled.] Q. They were prepared in anticipation of this meeting? A. Of what, could you‑‑ Q. They were prepared in anticipation of this meeting, those documents? A. I don't know what meeting you're talking about. Q. 12 May 2006‑‑ A. I can't‑‑ … Q. Are you aware of the fact that there was a meeting on 12 May 2006? A. I can't recall that. Q. But you know that documents were prepared in February? A. I know the share documents were prepared in February, the certificates there. Q. You know that at some stage, during or about 12 May 2006, you took those documents off the table? A. I can't recall that. 1. Earlier, Frank's evidence as to taking documents from the snooker table was as follows (at T 75.40-T 76.2): Q. Did you from time to time take records off that table for your own self keeping? A. I took things which were not passed on to me by Anthony. I took copies of them and I kept a copy for myself, because I never received anything else off him. Q. Yes, so that was the Jainti records? A. That would have been the Jainti, the whatshisname, the Zambito certificates. The beneficiaries … A. That's all I grabbed, I think it was, I'm not a hundred per cent certain. I can't actually recall if there was any other stuff there. 1. Taken to [16] of his affidavit sworn 23 May 2019 in which Frank had deposed that it was his practice to attend the office and that he would normally take a copy of documents for safekeeping and would usually show them to Sam, he said (see T 76.12-26): A. … Right, the banking records, yes. The, the beneficiaries are the, the certificates. Yes, I did take them, I did take copies of them. I did take, I did put bank statements there. … Q. You said "I would normally take a copy of them for filing and safekeeping and I would usually show the documents to Sam". Is that still your evidence? A. Yes, of course it is. I did do that because otherwise, no one, Anthony never gave us copies of anything. You'd ask him for it, you don't get it. Q. Copies of these documents were left on that table, is that your evidence? A. Yes, they were on the table, yes. Q. You would take copies of those documents and you would show them to Sam, is that correct? A. Correct. 1. Relevantly, I will refer to the documents that Anthony submits were created as draft documents (in either February or in April/May 2006 but in any event before the 12 May 2006 meeting), and on which the liquidator here relies, as the Zambito Version of the documents (see Exhibit A at 257) because those documents in terms provide that Jainti holds the relevant units as trustee for the Zambito Trust. 2. As noted above, Anthony says that the Zambito Version of the documents was left at Bruno's house (on the snooker table) and that the evidence is that at some stage those documents were picked up by Frank or Sam (and hence came into the possession of the Morabitos). Frank, as noted above, gave evidence that he could not recall taking those documents off the snooker table but in re-examination he accepted that he had picked up at least the unit certificates comprised within the Zambito Version of the documents (see at T 79.16-30): Q. You gave evidence that you saw some share certificates with words on the snooker table. You also referred to unit certificates on the table? … Q. You said that you picked up some share certificates‑‑ A. In the office. Q. ‑‑off the snooker table, and you also said some unit certificates. I'd like to know are you talking about two different things? A. No, no the share certificates. Q. Share certificates? A. The beneficiary ones there, which, which said on the five, whatever units they were. I think it was 14 and 19, which were in Zambito Trust, they were not the individual ones. That's all I picked up. 1. Sam's evidence as to those documents (put to him as the documents evidencing the deal between Jainti and the Fraser Unit Trust) was that (see T 82.33-44): A. … I remember on the snooker table there were piles of documents which covered the whole table, of which those documents were for each of the unit holders and we were told not to touch them, they are for the unit holders and I've - my wife was a, a unit holder and she had a set of those documents and they had in them the feasibility, they had in them the - how many blocks there were, the subdivision, I've got the copies here if you want to have a look, but there was nothing between Fraser and Jainti that I'm aware of. I mean - yeah, Fraser and Jainti. Q. Did you ever have a look at what those packages, those documents were? A. No. I was just told not to because they're for the, for the unit holders and the information task was limited by Anthony. 1. Later, Sam seemed to accept that his wife had taken a set of those documents, saying that "[s]he was told she can have a set" and there was the following exchange (see T 83.22-45): Q. Did you have a look at that set? A. Later on when we smelt a dead rat, yes. Q. So you knew what that package was made up out of? A. I've got them here. Yes. Q. No, no. I'm asking you about at the time. A. This was sometime after the actual - yes. I did see them later on, yes. Q. Could you tell us more or less when that was? A. That was quite a while after, once we started having issues with Anthony. Q. Could you give me a year? A. Well, if I give it, it's only a guess. Q. Yes. A. So-- Q. Your best estimate. A. Let me think. Because I think we got them to give them to the, to the lawyers. So it might've been eight, 2008, nine-- Q. 2008. A. --eight – I'm only guessing. 1. I draw from the above that it is likely that documents prepared in relation to the 12 May 2006 meeting (see below), prepared by Anthony, were indeed left on the snooker table; but when they were left there and when they were picked up (let alone looked at) by other family members is unclear. Alleged 11 May 2006 conversation 1. Anthony deposes that, on 11 May 2006 (i.e., the evening before the 12 May 2006 meeting), he had a conversation with Sam; and that Sam said that he did not want "this" project (the Fraser Panorama development) affecting the previous development (at Burradoo) or the Zambito Trust because it was too "risky". 2. Sam denies that at this stage he thought that the Fraser Panorama project was "too risky" (I refer to this evidence in due course). His affidavit evidence implicitly puts into dispute the suggestion by Anthony that Sam did not want the units held in the name of the Zambito Trust. In his affidavit sworn 23 May 2019, Sam deposed at [35] (which paragraph was read as to his understanding at the time) that he understood that the Zambito Trust would allow him and Frank to split income they received and that if that had not been the case, he would have wanted to raise this with Mr Ashton. For Anthony, it is said that Frank's subjective belief is irrelevant – see T 278. I accept that it is not relevant to the construction of the documents in question. Nevertheless, it does put in issue whether there was any conversation on or around 11 May 2006 (as Anthony has deposed there was) between Anthony and Sam of the kind which Anthony says led to the changes to the Zambito Version of the documents. I refer in due course to the credit submissions made for Anthony in relation to Sam's evidence in this regard. 3. Anthony says that the draft documents (resolution, certificates, Unit Holders Agreement and register) were changed to delete the reference to the Zambito Trust and to record that the 34 Units were to be held by Jainti "atf" the five individual family members (Anthony, David, Bruno, Sam and Frank), which Anthony says was a bare trust (see his affidavit sworn 20 September 2019 at [3.9]) and that in due course this trust was terminated by certain of the beneficiaries (see below). 12 May 2006 meeting – Fraser Panorama 1. What followed next was that, at a meeting on or about 12 May 2006, the directors of Fraser Panorama (Anthony and Derek Taylor) resolved that the company, in its capacity as trustee of the Fraser Unit Trust, accept applications for the issue of further units in the trust (and unit certificates were issued, bearing the date of 12 May 2006, in respect of those additional units and for the initial two units that had been created at the inception of the trust). 2. There are two versions of the minutes for this meeting (and two versions of the unit certificates purportedly issued on the date of that meeting). 3. On the version of the minutes that Jainti submits is the correct version (Exhibit A at 257), which is part of the bundle of documents to which I refer as the Zambito Version of the documents, it is recorded that the directors tabled applications by each of Jainti "atf The Zambito Trust" and by Tuta Products – in each case for 19 "B Class Units" (i.e., totalling 38 units) and by various entities for "A Class Units" (including 14 units in the name of Jainti "atf the Zambito Trust"), totalling 60 units. Thus, consistently with the fact that there were already 2 ordinary units that had been created at the inception of the trust, on the resolution as recorded in the Zambito Version of the minutes (relied upon by Jainti), there were then a total of 40 "B Class Units" (i.e., 19 new units plus the one original unit for each of Jainti "atf the Zambito trust" on the one hand and a combination of Leading Pacific/Tuta Products on the other). The liquidator places weight on the numerical consistency of this version of the documents (and the fact that the minutes record the tabling of applications for units not the substitution or cancellation of the two initial units). 4. On this version (the Zambito Version) of the minutes, 12 of the 60 "A Class Units" were recorded as being the subject of an application by T&L Walton Pty Ltd (atf Walton Family Trust). 5. This version of the minutes bears no handwritten annotations (and, on the evidence before me, is the only version that was provided to the liquidator prior to September 2016 (see T 254) – though I refer to Anthony's submissions on this in due course). The liquidator emphasises that this version is consistent with the financial statements prepared by Mr Ashton in relation to the respective trusts – the Fraser Unit Trust and the Zambito Trust. 6. On the version of the minutes that Anthony says is the correct version (see Exhibit 1), to which I will refer as the Individual Beneficiaries Version of the documents, what is recorded as being tabled at the meeting on 12 May 2006 were, relevantly, applications for 40 "B Class Units" in total (20 for each of Jainti "atf Sam and Frank Morabito and Anthony, David, Bruno Zamattia" and Tuta Products (against which there appears the handwritten notation "Derek Taylor")); and applications for 60 "A Class Units", again including 14 for Jainti (but here again describing Jainti "atf" the five individuals). 7. There was on this competing version of the minutes a handwritten correction to the number of units applied for by T&L Walton (reducing the number from 12 to 10) and adding in handwriting a new applicant (Bland Investments) for two units. There is also a handwritten notation after the entry for Sam Zamattia/Sam Morabito, namely the words "(Partnership) 2 EACH". Against the entry for Pepco (Australia) Pty Ltd (atf The Pepco Trust) of 10 "A Class Units", on this version of the minutes appear the handwritten initials and numbers "DT 6 PL 4" (consistent with Derek Taylor's evidence that six of the 10 Pepco units were for him as a "partner in the Pepco thing that I had"). 8. Anthony says that the changes to the unit holdings following his conversation with Sam are set out in the confirmed minutes of the 12 May 2006 meeting, with further hand-marked changes to the named unit holders of other units (i.e., the Individual Beneficiaries Version of the documents). Anthony's evidence is that all parties were advised of the 12 May 2006 meeting, that the minutes of meeting were subsequently distributed; and that no objection thereto was received (see his affidavit sworn 20 September 2019 at [10.13]). (I was taken to no documentary record of any such notification of the outcome of this meeting; and it is relevant to note that when the Morabitos produced documents to the liquidator in 2016, the version they produced was the Zambito Version – although I note the uncertainty as to the precise sequence of events in which the Morabitos picked up the Zambito Version of the documents from the snooker table.) 9. Derek Taylor has deposed that he was at the "meetings" when the initial unit holding in the Fraser Unit Trust was agreed, including the holding of the 34 Units by Jainti (as trustee for the 5 listed individual beneficiaries). However, his cross-examination makes clear that this recollection is based largely on what he has read in the documents to which he was taken in the preparation of his evidence for this proceeding. In the witness box, he had no clear recollection of the basis on which Jainti held the 34 Units. In this regard, see the following exchange at T 117.10-19: Q. The reality is, isn't it, that you've got no idea what capacity Jainti held those units in, do you? A. When you say capacity, what do you, what do you? Q. You don't know whether it was as trustee for the Zambito Trust or whether it was trustee for some other trust? You just don't know, do you? A. No, I don't. Q. The best you could say is that Jainti held 34 units in the Fraser Unit Trust? A. Yes. 1. Derek Taylor nevertheless did maintain in cross-examination that he could recall (by looking at the Individual Beneficiaries Version of the minutes) that "there were conversations around the fact that they wanted to change the, the thing from Jainti to the Zambito Trust" (T 119.40-4). However, he gives no evidence of the content of any such conversations (and it is not suggested on the evidence that he was a party to any of the conversations between the Zamattia and Morabito family members). 2. It is not disputed that, following the issue of the new units in the Fraser Unit Trust, there were a total of 100 units in the Fraser Unit Trust (divided into 40 "B Class Units" and 60 "A Class Units") (i.e., not 102 units), which is consistent with the evidence as to the subsequent distributions made out of the Trust; and it also does not appear to be disputed that the 40 "B Class Units" on issue included the two initial units that had been created on the establishment of the Fraser Unit Trust. 3. The distinction between the "B Class Units" and "A Class Units" (by reference to the Unit Holders Agreement – see below) is that the "A Class" unit holders (i.e., the investors that Anthony brought into the project) provided loans (of $50,000 per unit held – totalling $3 million) to establish working capital and that those loans were interest bearing "at appropriate market rates and as per the Unitholders Agreement"; whereas the "B Class Units" were said to be "free carry" units, reflecting Anthony and Derek Taylor's initial involvement in relation to the Fraser Panorama development. 4. In cross-examination, Derek Taylor's recollection of this was as follows (T 135.38-44; T 136.1-38): Q. Why don't I come at it a different way. Was there any difference in terms of income rights as between A class and B class unit holders? A. I don't recall any difference, apart from the fact that the A - or specifically Anthony and I went personal guarantees on all the loans. That was about the only, about the only difference. We, we funded the thing and, and put our personal guarantees up for all the loans which, which we, we didn't ask anybody else to expose themselves to a personal guarantee. … A. I think the B class got their money first. I mean, I can't remember exactly, but there was some - we did something - I mean, what we, what we actually did, at one stage we wanted to distribute back to all the unit holders, apart from us, the B class unit holders, we distributed back to them their capital. We, we had a situation where we, we, we sold a whole bunch of blocks. We paid down a lot of the debt. And we actually refunded, took more money and refunded - took a, a loan again, which we once again guaranteed, to pay the unit holders their‑‑ Q. I'm going to‑‑ A. ‑‑money back‑‑ Q. ‑‑interrupt you, I‑‑ A. ‑‑90% of their initial investment back, so‑‑ Q. I'm not asking about payments back of loans. I'm asking about distributions to unit holders. A. Well, the difference was we didn't get any money - obviously we didn't get any money. The unit - the point I'm making, we didn't get money. The, the A class shareholders got virtually all their money back in, in a early tranche. So they, after about 15 months they had their money back. Q. You're talking about the repayment of loans. I want to ask you about distribution of income, and I've directed your attention to subclause 10.9(f). So I'm asking you about distribution of income by the Fraser‑‑ A. Yeah, okay. Q. ‑‑Unit Trust. Do you understand? A. Yeah, yeah, yeah. Q. The first question I've asked you is in relation to the distribution of income that is referred to there. Was there any difference as between the different classes of shares? A. I, I, I don't recall. I, I - you‑‑ Q. You don't recall, okay. A. You'll have to ask the accountant. I mean, that's an accountancy thing, basically. 1. As adverted to above, Derek Taylor's evidence was that the Individual Beneficiaries Version of the minutes was the correct version of the minutes but it was apparent that he was basing this on the fact that it recorded his own unit holdings correctly (rather than on any independent recollection of events at the relevant time) (T 134.25-50): Q. So you can't say which one is the correct one. Is that right? A. This is the correct one. [To my observation, as I noted at the time for the benefit of the transcript, Derek Taylor was there pointing to the Individual Beneficiaries Version at 1337 of the Court Book (see Exhibit 1)] Q. Why do you say that? A. Well, because that, because that's the shares that I got. That represents what I had for my - I don't know about anybody else's shares. It represents the true position of what my position is in there. [my emphasis] … Q. When you say that's the correct one, you're surmising that because you think that the units that are shown on 1337 represent the total of the units that your entity ever had in the Fraser Unit Trust. A. That's correct, 20 and - well, six of, six of the ten in Pepco(?), which that actually notes down there, DT6 be the commentary for, because a partner in the Pepco thing that I had, that we had some - we were picking up some tax losses in again Unit Certificates dated 12 May 2006 1. Corresponding to the two versions of the minutes of the 12 May 2006 meeting, there are two competing versions of the unit certificates purportedly issued pursuant to the resolutions at that meeting (each signed by the directors of Fraser Panorama – Anthony and Derek Taylor). 2. Relevantly, on the version relied upon by the liquidator (part of the Zambito Version of documents), the description reads: "Jainti Pty Ltd (atf The Zambito Trust)" on the unit certificates for 14 "A Class Units" (Certificate Number 5), 19 "B Class Units" (Certificate Number 3) and one "B Class Unit" (Certificate Number 1). The competing version of the Unit Certificates (also dated 12 May 2006 and similarly numbered) (part of the Individual Beneficiaries Version of the documents) relevantly records Jainti as the holder of the units as trustee for the five individuals. Unit Holders Register 1. Again there are competing versions of the Unit Holders Register which reflect the same differences (as between the Zambito Version and the Individual Beneficiaries Version of the documents) as to the manner in which the holding of Jainti's 34 Units was recorded in the register of the Fraser Unit Trust. 2. There is a copy of the Unit Holders Register that is consistent with the version of the unit applications and certificates contended for by Jainti (part of the Zambito Version of documents), which includes T&L Walton as the holder of 12 units. Anthony, however, relies on a competing version of the Unit Holders Register (part of the Individual Beneficiaries Version of documents). 12 May 2006 Unit Holders Agreement 1. I have referred above to a Unit Holders Agreement. Anthony places no little weight on this document, it being a Unit Holders Agreement dated 12 May 2006 between Fraser Panorama, Jainti "as trustee of the Zamabito Trust" [sic]; and Leading Edge as trustee of the Raidell Trust (Jainti and Leading Edge there being identified as the unit holders of the Fraser Unit Trust). It appears to bear a computer generated footer with the date "29.3.06". It also bears a number of handwritten annotations (against which there are initials of at least one of the signatories). It is perhaps not insignificant that it has the same typographical error in respect of Zambito (Zamabito) as does the Fraser Unit Trust Deed (which might suggest it was prepared around the same time). It is consistent in a number of respects with the Zambito Version of the documents but it bears handwritten amendments consistent with the Individual Beneficiaries Version of the documents. 2. The Unit Holders Agreement recites: at Recital A, that the Fraser Unit Trust was created by Deed dated (incorrectly and incompletely) "17th 2006"; at Recital B, that it is the intention of the unit holders (i.e., Jainti and Leading Edge in their (there acknowledged) trustee capacities) that Fraser Panorama "is acquiring" the Hervey Bay property for the purpose of subdivision into residential lots; at Recital C, that the Trust intends engaging Anthony and Derek Taylor to carry out the project management of the development; and, at Recital D, that the parties wished to record certain agreements and understandings that had been reached between them on the terms that were set out therein. 3. Relevantly, at cl 6, the parties, among other things: acknowledged, at (a), that there were 100 units to be issued in the Trust each having a $1 par value; provided, at (b), that 20 units in the Trust "shall be issued to Jainti and 20 units to Leading Edge (the "B Class Units"), with a handwritten annotation after "Jainti" to add the initials "ATF AZ, DZ, BZ, SM, FM" followed by the figure 20% and to cross out "Leading Edge" and add in handwriting "TUTA PRODUCT"; provided, at (c), that the balance of 60 Units be issued to the unit holders in the numbers there set out (see below); and, provided at (d), that each holder of an "A Class Unit" agreed to advance to the Trust the sum of $50,000 for each unit held by such unit holder on the terms there stated. 4. The list of "A Class" unit holders bore a number of handwritten amendments. Relevantly, the typed list commenced with a reference to "Jianti" [sic] for 10 units but was amended in handwriting to add "(ATF AZ, BZ, DZ, FM, SM)" and to change the number of units from 10 to 20 units; "Terry Walton" was included originally for 20 units and amended to 10 units; Samuel Zamattia was included for 4 units and amended to add "Samuel Morabito" and "Partnership"; and two additional investors were added in handwriting: Bland Investments for 2 units and "PEPCO" for 10 units. The handwritten amendments appear to have been initialled by Anthony and Derek Taylor. 5. As adverted to above, Anthony places some weight on this document. It certainly supports the conclusion that there was at some stage an intention that Jainti hold its 20 "B Class Units" as trustee for the five individuals. The difficulty, however, is in determining whether this came before or after the final decision at the 12 May 2006 meeting (assuming that was indeed when the final decision was made – a perhaps unsafe assumption in light of Derek Taylor's evidence about "re-jigging" the unit holdings, which seems to suggest that Derek Taylor understood it to be a bit of a moveable feast depending on things such as whether investors had tax losses that they wished to bring in or otherwise deal with in some way referable to their investment in the trust – although any such later decision would require the necessary formalities to be complied with to effect a change in the beneficial ownership of units issued by reference to a decision on 12 May 2006). Allocation of units 1. Anthony's evidence is that his family members acquired 14 "A Class Units" upon a consideration of $700,000, initially in a trust of which Jainti was the trustee, and that he gave them a 1/5th share each in 20 "B Class Units" so that all five acquired a 1/5th share in the 34 Units (see his affidavit sworn 20 September 2019 at [3.1]). 2. Jainti, however, contends that the unit holding of the 34 Units was held by it as trustee for the Zambito Trust, as recorded in the Zambito Version of the documents (that Anthony acknowledges he prepared albeit, he says, in draft before the 12 May 2006 meeting) and as recorded in draft accounts prepared for Jainti in 2010, to which I refer below. 3. Derek Taylor's account of how the units were allocated in broad terms was that (see T 128.45-T 123.20): Q. That's what I'd like to ask you, were there 98 units issued in addition to the two or were there a hundred new units issued, do you remember? A. No, I don't remember. I mean, I would've thought that there would've been 98 more issued, but actually no, probably a hundred because they would've substituted for those, I would've thought. Because what happened was Anthony and I, having started the thing off, we were the directors, shareholders and we had half the project each basically at its conception which you can see is represented by that. And, and then we issued us, we came to this arrangement where Anthony would find the, the investors to come in and fund the project and we allocated ourselves 20 shares each into our various different entities which were basically carried free because they, we started the project. And the balance of the shares of which there, I mean presumably would've been 60, or whether it's 58 or 60, I'm not sure because I don't know what happened with those initial two units. But then there was therefore 60 shares, cause I think it was a hundred in total, were then used to sell down to investors to fund the project. So that's an overview of the thing. Where, how, how that worked technically I can't, I can't recall but‑‑ Q. You flagged a possible substitution. Do I take it that you're just guessing as you sit here now, you don't actually recall that occurring? A. I don't recall, I don't recall how, how that was structured. But I mean, that's an overview of, of what the intention was and what in fact happened. But whether it was, whether we formed another 98 units or whether we had, I think we probably substituted, I don't know how, how that worked but. 1. Taken to the version of the 12 May 2006 minutes on which the liquidator here relies (Exhibit A), Derek Taylor said (see T 129.31-49): A. Yes. That makes that pretty clear don't it because we've issued another 19 units to Jainti Zambito Trust, and 19 units to another entity that, of mine, or mine and my, another partner that I put that in because we had some tax losses in there and we wanted to put it into that, that, so that's where we ended up, so‑‑ Q. You remember now? A. Well it's obviously, it's obviously there's 19 there, so we, the other, the ones have stayed presumably in the original entity and those are the, and those 19 have been issued to make it up to the‑‑ Q. I just want to be fair to you, are you agreeing that you remember or are you making presumptions? Because I don't want the latter, I just want to ask you what you remember? A. Well, I, that's, that's actually not correct, because that only adds up to 60, doesn't it. Q. We'll deal with‑‑ A. 60 and plus 30 (as said) is 98, yes, okay. 38 is 98, yes, well. 1. When I attempted to clarify whether this was Mr Taylor's independent recollection or if he was just drawing this from the document, Derek Taylor said (see T 130.17-21): A. My recollection was that Anthony had, we split the first 40 units up between Anthony's entity and my entity. Where that, where that ended up, I'm reminded now it looks as if it appears that it was Jainti and Tutor(?) [Tuta Products] which is, so that's, yeah. I mean that's, that's, that appears to be what's happened so, the documents show that. Is that what you need to know? 1. He also indicated that there was some 're-setting' of the unit holdings (see T 132.13-29): A. This was, this was where we - you know, because mine was reset, you know, and there were various other people that wanted to reset them in different entities. So this was a, this was rejigging the original document. Q. Are you basing what you're saying on what you're seeing on the page here? A. No, but I, I, I recall there was - not specifically, the specific detail, but I remember there was - because I did the same thing, because mine, you know, I had some shares that, that I'd also bought with a partner, which had to, you know, we had to note that down. And I think there was somebody else wanted to change their, their - the Walton Family Trust wanted to change theirs. There was, there was, there was various changes where we adjusted - because you know, the original thing as, as you start to get into a project like that, you know, different people have different requirements. Like I sort, sort of was doing, picking up some tax losses and, and, and that sort of thing. So you know, there were some changes made to the original document. I remember that, and it's, and the, this represents that document. 1. Pausing here, it is not wholly clear from this evidence whether the "rejigging" to which Derek Taylor there made reference was something he recalled was made right at the outset – i.e., at the time of the 12 May 2006 meeting, or during the course of the project as one or more investors changed their mind as to how they wished their units to be held. What is, however, clear from this is that Derek Taylor (at least) seemed to regard the allocation to investors of units in the trust as a relatively arbitrary matter; i.e., that investors could simply "substitute" in some fashion the entity through which units were held. 2. Significantly, Derek Taylor was not aware of any resolution having been passed by Fraser Panorama whereby there was any such substitution (see T 134.8-12): A. I honestly don't know the - all I know is we, we initially issued one share each, and then we, and then when we, we, we went to the, to the investors to, to bring the investors in, we allocated ourselves 20 shares each and sold down the rest of the shares. So you know, the one became 20, in some - I don't know what that mechanism is. I'm not an accountant. Taxation statement for Fraser Unit Trust year ended 30 June 2006 1. Also significant, in my opinion, is the taxation statement of the Fraser Unit Trust for the year ended 30 June 2006 (as to which there is no competing version in evidence) which recorded the Zambito Trust as the holder of 14 "A Class" and 20 "B Class Units" and recorded the Zambito Trust as having advanced $700,000 in loan funds (see Exhibit 1), that being the amount that Anthony says his family members invested (as I understand it through Jainti) in the project. Family disputes 1. There was much focus during the hearing on the disputes between the various family members (both to set the context for the events that are said to have occurred in relation to the unit holdings in the Fraser Unit Trust and as to the credibility of evidence given by various of the witnesses). 2. Anthony has deposed (in his affidavit sworn 20 September 2019 at [4.1]) to a disagreement between Sam and Anthony's mother (Carol, Sam's sister) during 2007 and to his understanding that Sam did not want to work with any of the Zamattia family. In particular, he has deposed (in evidence admitted subject to relevance) to the taking out of an Apprehended Violence Order (AVO) by Carol against Sam during 2007. (The evidence suggested that there may have been similar AVOs taken out by one or both of Bruno and Anthony at the time – see T 293.) Anthony asserts that all parties made attempts up until September 2008 "to negotiate a reasonable outcome in respect of the Jainti Pty Ltd developments and for Jainti to achieve a winding up" (see at [4.3]). 3. There are varying accounts of when the dispute between the families occurred (Sam places this variously as being in 2007 and as late as 2009) but there is no doubt that there was a falling out between the Morabitos and the Zamattias (and indeed even between the members of the Zamattia family itself though that came later – see below). The significance of this from the point of view of this proceeding is that Anthony says that in 2008 there was an agreement for the family members to separate their interests in the trust. Sam and Frank deny this. However, Anthony maintains that both Sam and Frank accepted unequivocally that, after the family discontent came to a head, both wanted to end the relationship with the Zamattias. 4. At T 74.9-11, Frank's evidence was that "we tried to separate our business interests with them, with the Zamattias. We gave my other sister a letter to take over to the Zamattias, right? She took the letter there and they said to her, 'Mind your own business, get out of here'". For Anthony, it is said that this shows that the Morabitos were trying to separate and that the Zamattias did not co-operate but it is submitted that the Morabitos never changed their mind and that, on 7 October 2008, the Zamattias agreed to separate (in effect some kind of bilateral but separate decision to separate). 5. Anthony submits that what occurred in October 2008 only makes sense if what happened was separation of transfer for the five beneficiaries; since otherwise there would have had been a dissolution of the trust with all five. With respect, that seems to me to beg the question. 6. As adverted to above, the falling out between members of the Zamattia family appears to have occurred somewhat later. So, for example, David gave evidence as to his falling out with Anthony (at T 50): Q. You also worked with Anthony at Zamtech is that correct? A. Yes. Q. You remember when you left Zamtech? A. 2012. Q. Would it be correct to say that the relationship between you and Anthony has broken down? A. Well considering we haven't spoken to each other since then, pretty much. Q. Since then? A. Pretty much. Q. Yes and so when you left Zamtech did you also, were you discontented with the fact that you left Zamtech? A. In part. Q. Was there conflict? A. There was a conflict between Anthony and myself, yes 1. Sam Zamattia (Anthony and David's brother) who worked with Anthony at Zamtech also left the business in circumstances where he accepts that he was discontented as to the manner in which he "was removed" out of the business (see T 47.40-5): Q. And during or about 2016, 2017 you left that business? A. I was removed out of the business but no I didn't leave. I was removed out of the business. Q. You were removed out of the business? A. Yep. 1. Returning to the chronology of events, it is clear that, by around 2008, the relations between the Zamattia and Morabito families were strained. Sam Zamattia confirmed that there was a "bit of a family feud" between the Zamattias and the Morabitos during about 2008 and that he was aware of the AVO obtained by his mother against Sam. 2. Sam himself agreed that the cooperation with Anthony "more or less came to an end during or about 2007", saying that (see T 80.41-2): A. In a way it did, cause Anthony chose to do, pursue his, his mechanical career. "Meeting invite" – September 2008 1. Against the background of the family tensions at the time, Anthony says that a "meeting invite" was sent to Sam and Frank in about September 2008, inviting them to attend a meeting of Jainti to discuss the winding up (presumably of the trust) (and that agenda item 6 of the agenda was to deal with "the units held by Jainti on behalf of the [Family Trust] beneficiaries") (see his affidavit sworn 20 September 2019 at [4.4]). 2. There is in evidence (Exhibit 1) a copy of a letter dated 18 September 2008 from Anthony (apparently signing on behalf of Jainti) to Sam and Frank giving notice of a meeting on 7 October 2008. Agenda item 6 reads simply "Update of Fraser Panorama Pty Ltd unit holdings and project by AZ [i.e., Anthony]". (Whether such a meeting in fact happened on 7 October 2008 has been doubted by the liquidator – see below.) 3. Anthony has deposed that he delivered the "meeting invite" for this meeting to Sam's home address, two houses up from Anthony's parents' house and (in oral evidence) he said that Sam and Frank were on the verandah at the time. This is at a time when, on Anthony's evidence, there was an AVO in place against Sam and he, Anthony, was fearful of Sam and Frank (to the extent that he said that they were going to kill him – see T 186.39). Hence, it is somewhat implausible that Anthony would have chosen to hand deliver a meeting invitation to them (even by putting it in the letterbox) (or that he would have wished for Sam to attend the meeting – and query how Sam could have attended in person without infringing the AVO – an issue which Sam emphasised in cross-examination). 4. However, Anthony says that he dropped the meeting invitation in the letterbox and was not expecting Sam and Frank to be on the verandah. Anthony says that he spoke to them from the street. Anthony says that Sam said that they were not coming to any more meetings with Anthony or his family (see his affidavit sworn 20 September 2019 at [4.5]). That sentiment is perhaps not surprising in the context of the family disputes – moreover, there was some force to the observation made in the witness box by Sam that they (the Morabitos) were always outvoted 3:2 in any event – Sam saying in relation to the 24 October 2008 minutes which recorded confirmation of the minutes of the earlier meeting, that "every meeting of Jainti was voted three to two, because they all hung together. So they were all three to two, so why would this be any different?" (T 87). 5. Sam seemed quite genuine in his evidence as to the incongruity of Anthony delivering a meeting invitation at a time when the AVO was in place (see T 89.1-18): Q. I'd like you to have a look at - do you recall speaking to Mr Ashton about a meeting at that time, more or less October of 2008? A. We probably did speak to Mr Ashton regarding this, because with the AVOS that they had in place we were unable to speak to them directly, so we had to go to them through Mr Ashton. And at this particular time, three weeks before this, I think it was 26, I think it was 26 September, Anthony took out an AVO out against us, saying that he feared for his life because we are very, he's never seen us so angry and he's fearing for his life that we might kill him and his family. So that's why we didn't attend this. Q. Yes, and did you speak to Mr-- A. And I don't know anything about this meeting. He's saying in his affidavit he delivered it to my place. Q. Yes. A. Which that's not the case. If there was an AVO in place, he was scared, feared for his life, would he walk up to my place and deliver the invitation? 1. In any event, the metadata for the meeting invitation letter corroborates that such an invitation was created on 18 September 2008 (whether or not the meeting in fact went ahead). September 2008 advice as to "transfer" 1. Anthony has deposed that, in preparation for the "transfer" (by which he is referring, as I understand it, to the transfer of Jainti's beneficial holding in respect of the 34 Units to Anthony, David and Bruno directly), in or around September 2008 he contacted Fraser Panorama's solicitors (Day Dockrill) and sought advice as to how to put effect to the transfer from Jainti to the individuals directly "as agreed in the resolution". 2. There is an obvious timing difficulty with this (even leaving aside the doubts raised as to whether there was in fact a meeting on 7 October 2008 – see below) in that the relevant resolution is recorded as having been passed at the 7 October 2008 meeting, whereas Anthony places his request for advice as to how to effect the transfer "as agreed in the resolution" as occurring before the meeting (on or around September 2008). That may, however, simply be infelicitous wording in his affidavit evidence. More pertinently, there is no evidence of any such advice having been given by Day Dockrill (or as to what any such advice may have been). The mere assertion that Anthony sought advice as to this issue cannot corroborate anything. Moreover, what is not clear is that the "transfer" advice sought related to a transfer of the beneficial holding from the Zambito Trust or the Family Trust. October 2008 events 1. As adverted to above, Anthony says that there was a meeting of Jainti held on 7 October 2008 in relation to the "updating" of the register of unit holders in the Fraser Unit Trust. He says that the meeting was held at the clubhouse at Abbotsford Cove, and that Sam and Frank did not attend (see at [4.5] of his affidavit sworn 20 September 2019). Anthony deposes that certain resolutions were passed at the 7 October 2008 meeting (in effect to separate the Zamattia family members' "beneficiary interests" in the 34 Units and the Morabito family members' "beneficiary interests" in the 34 Units) (and that these changes are set out in the amended documents that were then issued – see Exhibit 1). Anthony says that Bruno and David were at the meeting. 2. David's evidence was that he could not recall any meetings of Jainti in which the relationship or the issues with Fraser Panorama arose (see at T 52.34-6); and that he did not remember having seen any minutes of the Fraser Panorama and Jainti meetings (though his affidavit sworn 17 April 2019 recorded at [6] that he had been shown certain minutes). He did recall having previously given Anthony a proxy but was unclear as to when or why he did so. 3. Anthony has deposed (see at [4.6] of his affidavit sworn 20 September 2019) that the resolution of the board authorised him to transfer 1/5th of the 34 Units held in the Fraser Unit Trust to himself and 1/5th each to David and Bruno "individually and respectively". Anthony says that the minutes of this meeting were sent to Frank and Sam on or about 8 October 2008 and that he received no objection to those minutes. Further, Anthony says that, in July 2009, at the first following meeting of Jainti, the minutes of the October 2008 meeting and resolution to make these changes were confirmed (see below). 4. The minutes of the 7 October 2008 meeting of Jainti's directors (Exhibit 1) include the statement that "SM and FM have advised through Phillip Ashton they will not be attending" (which I pause to note is somewhat inconsistent with Anthony's evidence that this is what he himself was told when he delivered the "meeting invite" but I accept that that does not mean that there might not have been the same advice given through Mr Ashton as Anthony says was given to him at the time to the effect that they would not be attending the meeting). (Since Mr Ashton gave no evidence in the proceeding that issue could not be clarified with him.) 5. Item 4 of the minutes records as follows: A minute of the Fraser Panorama P/L is tabled consenting of the transfer of units from Jainti to it's [sic] members, AZ, DZ, BZ or as directed. It is resolved to authorise AZ to do all things necessary to distribute AZ, DZ and BZ interests in units as instructed. No representations have been made by FM or SM as to their wishes. 1. It is relevant here to note that there does not appear to be a minute of an earlier meeting of Fraser Panorama (i.e., a meeting before the 7 October 2008 meeting of Jainti directors) at which any consent to the transfer of units was given and it is therefore not clear what is the minute that the 7 October 2008 minutes record as being tabled at that meeting. The liquidator points to this as casting doubt as to whether the meeting occurred on 7 October 2008 at all – or whether, more consistently with item 4, this is a reference to a meeting later on 24 October 2008 of Fraser Panorama. (It might also illustrate the unreliability of the minute taking as a whole.) Derek Taylor, asked about this, gave the following evidence (see T 124.33-48; T 125.17-37): Q. Can I just ask you to go down? If you'd again look at the left-hand side of the page, you'll see various descriptors and in particular you'll see, "4) Distribution of units Fraser Panorama." Do you see that? A. Yep. Q. What's referred to in this document is the following: "A minute of the Fraser Panorama Pty Ltd is tabled consenting of the transfer of units from Jainti to its members AZ, DZ, BZ, or as directed." Do you see that? A. Yes. Q. As at 7 October 2008, can you tell the Court whether there had been any meeting whereby a resolution was passed by Fraser Panorama consenting to the transfer of units that were held by Jainti to Jainti's members? A. I simply don't recall. I, I mean, I just can't recall this stuff now. It's, I've gone half a dozen projects like this between then and now, and you know, I just don't remember this stuff. … Q. You agree, do you not, that the meeting that this refers to did indeed occur around 24 October 2008? A. It would appear that way, yes. Q. So it's quite obvious but it occurred after 7 October 2008? A. Well, is, is there a date on this, there's no date on this is there? Q. Yes, if you look at the top, the heading see the underlined stuff? A. Yeah, yeah 25 October, well yeah, that's, so that's correct. I mean I've got, I, I need to rely on the documents for my point of view because my, you know I just don't remember this stuff now. Q. Have you seen minutes of any meeting prior to 7 October 2008 where there was some sort of resolution to transfer units from Jainti to its members? A. You're asking me if there's any documents? Q. Yes. A. Are there any, are you aware of any documents? Q. No, I'm asking if you're aware of any? A. No well I, you know, without seeing the documents, I can't tell you. 1. Sam, unsurprisingly, did not recall attending any such meeting (and it is not suggested that he did) (see T 90.4-8): A. I could not attend this meeting due to the fact that there were AVOs in place. … A. So whether I recall or don't recall, I could not attend. 1. Relevantly, Anthony contends that the outcome of the 7 October 2008 Jainti meeting was that: the beneficial interest in the 34 Units formerly held in the Fraser Unit Trust by Jainti (as trustee for Anthony, David, Bruno, Frank and Sam) was converted to a direct holding by each of Anthony, David and Bruno in respect of a 1/5th legal interest in each in the 34 Units; and that those voting against the proposal remained, as originally constituted, as beneficial owners of a 1/5th interest held in the 34 Units by Jainti (as trustee for Frank and Sam). 2. Anthony has deposed that he contacted Derek Taylor (his "fellow trustee") and that they "tabled the new unit certificates and adopted the changes" and that the unit register was also updated and tabled at the meeting (which in the context of his affidavit seems to mean the 7 October 2008 Jainti meeting but seems more likely to be the 24 October 2008 Fraser Panorama meeting – see below) (see at [4.9] of his affidavit sworn 20 September 2019). 3. In evidence there is a copy of the version of the three Jainti unit certificates dated 12 May 2006 that described Jainti as trustee for the individual beneficiaries (i.e., the Individual Beneficiaries Version that Anthony contends was the correct May 2006 version of the unit certificates) ruled through with the word "VOID" (see Exhibit 1). 4. Derek Taylor's affidavit evidence is that he was at the 24 October 2008 Fraser Unit Trust meeting when the unit holding was changed, as a result of which Anthony's beneficial interest in the Fraser Unit Trust was changed to a direct unit holding of a 1/5th interest in the 34 Units. Derek Taylor confirms that he signed the minutes of the 24 October 2008 meeting that resolved to make these changes (see his affidavit sworn 7 October 2019 at [3.13]). However, his evidence in cross-examination (see above) casts doubt on whether his recollection relates to a meeting on 24 October 2008 (or an earlier meeting), since it was clearly based solely on the documents he was shown. 24 October 2008 meeting 1. Unit certificates dated 24 October 2008 were in evidence in respect of the 34 Units in the Fraser Unit Trust held by Jainti in which the certification states that "Anthony Zamattia, David Zamattia, Bruno Zamattia and Jainti Pty Ltd (atf, Frank Morabito, Sam Morabito) in proportion 20% each" is the registered holder of the respective units. There is also a copy of the amended unit register (see Exhibit 1). 2. In evidence is a copy of minutes of a meeting of directors of Fraser Panorama (Anthony and Derek Taylor) on 24 October 2008, which includes the following: Other New unit certificates issued for Jainti and unit register updated. Jainti minute tabled authorising transfer of units to beneficiaries Anthony Zamattia, David Zamattia, Bruno Zamattia. DT/AZ phone call with Day Dockrill to amend certificate with same number and note new percentage holding. 1. The minute includes two handwritten notes, the first of which is: – Unit Certificate for Samuel Zamattia & Samuel Morabito amended to reflect request to pay distributions separately (50/50 split). New Unit Holders register tabled. 1. Pausing here, I note that Anthony's evidence is that he paid tax of approximately $50,000 on distributions of income received from the Fraser Unit Trust during the 2006, 2007 and 2008 tax years (the funds for the distributions he says were not received but the distribution amounts were declared as income) (see his affidavit sworn 20 September 2019 at [4.11]). 18 June 2009 meeting 1. There was in evidence a copy of minutes of a meeting of Jainti on 18 June 2009, convened by a notice issued on 17 June 2009 (see Exhibit 2), to take place by teleconference. The minutes of meeting (apparently created on 24 June 2009 by reference to the metadata in evidence) record that it was attended by Anthony, David, Stephen Jenkins (a solicitor, as proxy for Sam) and Frank; and that Bruno had given a proxy to Anthony. 2. The minutes record that a vote was called to confirm the minutes of the previous meeting (i.e., the meeting in October 2008 – on whatever date that actually occurred), which was passed 3 to 2 (the dissenting votes being those of Sam and Frank). The minutes record that Sam and Frank claimed that they were not advised of the meeting; that Anthony advised that they had been advised of the meeting; and that Anthony advised that "discussions with Phillip Ashton confirmed FM and SM were advised of the meeting and Phillip was asked to act as their proxy but was unable to do so due to other commitments". 3. Sam was cross-examined as to this meeting. He accepted that on at least one occasion he had given Mr Jenkins a proxy but, as I understand his evidence, he did not recall seeing the minutes of the meeting and did not recall speaking to Mr Jenkins about them (see T 86.22-5; T 88.27-T 89.47; T 90.4-8; T 90.41-7): Q. Yes, of course. Read the minute. A. Right. I don't recall this meeting actually. I'm trying to work out - the only thing I could say, if this was accurate it would have been, it would have been the time of the AVOs. If it was accurate. I can't recall, Mr Luitingh. … Q. Is that, according to any recollection that you might have, correct; that you didn't attend that meeting? A. Just to get it all straight, Mr Luitingh, so what you're saying is that we were sent an invitation and we just sent apologies for being unable to attend, is that what you're saying? Q. That's what the minute says. A. Yes, so is this what your client is saying? Q. No, don't worry about my client. A. That's what the minute says. Q. I'm asking you if you have a recollection, is it correct that you did not attend that meeting? A. I can tell you exactly as to why we didn't attend this meeting. Q. No, I don't want to know that. I just want to know whether you attended it? A. No. Q. You didn't. You say you can't recall seeing this minute? A. No. Q. But you may have? A. Well I said I can't recall Q. I'd like you to have a look at - do you recall speaking to Mr Ashton about a meeting at that time, more or less October of 2008? A. We probably did speak to Mr Ashton regarding this, because with the AVOS that they had in place we were unable to speak to them directly, so we had to go to them through Mr Ashton. And at this particular time, three weeks before this, I think it was 26, I think it was 26 September, Anthony took out an AVO out against us, saying that he feared for his life because we are very, he's never seen us so angry and he's fearing for his life that we might kill him and his family. So that's why we didn't attend this. Q. Yes, and did you speak to Mr-- A. And I don't know anything about this meeting. He's saying in his affidavit he delivered it to my place. Q. Yes. A. Which that's not the case. If there was an AVO in place, he was scared, feared for his life, would he walk up to my place and deliver the invitation? Q. Mr Morabito, please try only to answer the question that I'm asking you. Did you speak to Mr Ashton about this meeting? A. I can't recall so, but we did speak to Mr Ashton about, regarding meetings, because we're not allowed to speak to any of the Zamattias. Q. You can't recall whether you spoke to Mr Ashton about this meeting? A. Well I can't, no. I can't say definite yes or no. Q. If you have a look at the subheading called, "Minutes," just have a look at the last sentence. If says "FM and SM have advised to Phillip Ashton that they will not be attending." A. Okay, so? Q. Is that correct? A. Well I've just told you I can't recall that. And if we did do this, it was caused due to the AVOs. Q. Yes, I'm not asking you why. A. Yes. Q. I'm just asking you whether you can recall? A. No. Q. So you can't recall whether or not you spoke to Ashton about this meeting, and you can't recall contacting Mr Ashton about this meeting, but you do recall that you didn't attend the meeting, is-- A. But I'm saying I would not have attended this meeting due to the AVOs in place. … A. I could not attend this meeting due to the fact that there were AVOs in place. Q. Okay. A. So whether I recall or don't recall, I could not attend. … Q. Yes, and that-- A. Mr, Mr Zamattia always confirmed them regardless of - we were always a minority, so no matter what we said, we could, nothing would be changed. He, he was Jesus Christ, he, he signed everything, he did what he wanted. Q. That's fine, Mr-- A. So that's what happened in these relations. Everything's three-two. 2010 Financial statements 1. The liquidator places weight on the 30 June 2010 financial statements prepared by Mr Ashton in respect of the Zambito Trust (copies of which were provided to the liquidator's office after his appointment as liquidator – see Exhibit A). The financial statements are unsigned and Anthony says that they are draft and unaudited accounts. Relevantly, the profit and loss statement records distributions from trusts for each of the 2009 and 2010 year. The liquidator points out that, arithmetically, the amount of those distributions represents 34% of the distributions made out of the Fraser Unit Trust (see the Fraser Unit Trust financial statements referred to below), which is inconsistent with Anthony's assertion that Jainti held its units on trust for the individual family members. 2. Mr Ashton also prepared financial statements for the Fraser Unit Trust for that financial year, which recorded the beneficiaries' profit distribution for 2009 in the amount of $722,493 (34% of which is $245,647) and for 2010 in the amount of $196,213 (30% of which is $66,713) (see the Zambito Trust figures in those amounts). It is noted that the Fraser Unit Trust income tax return, also prepared by Mr Ashton, recorded a distribution to the Zambito Trust of $66,713 in the 2010 financial year. Fraser Panorama development 1. The sales of the Fraser Panorama development were apparently delayed by the 2008 global financial crisis (and there is reference in some of the minutes as to the project going slow). When all sales were finalised, the net sales proceeds (after the operating expenses of the funds) were available to be distributed to "close" the Fraser Unit Trust. Final distributions were not, however, made at that stage in respect of the 34 Units (due, Anthony says, to dispute between the family members, which included a dispute in relation to alleged misappropriation of funds in relation to a separate trust account – see Anthony's affidavit sworn 20 September 2019 at [2.6], [4.1]-[4.11], [6.1]-[6.6]). 2. Anthony says that the funds representing the distribution out of the Fraser Panorama development were "quarantined" by Fraser Panorama in the Fraser Unit Trust bank account before agreement was reached whereby distributions were made in 2018 of the entitlements in respect of 1/5th of the 34 Units to each of the beneficiaries entitled to the 1/5th share in the 34 Units. Due to the existing dispute, payment in respect of what Anthony contends is his 1/5th share of the unit holding was placed in the controlled moneys account referred to above (see Anthony's affidavit sworn 13 February 2019 at [2.3]). Appointment of administrator (and then liquidator) to Jainti – May 2011 1. Meanwhile, on 27 May 2011, a voluntary administrator (Mr Geoffrey Reidy of Rodgers Reidy) was appointed to Jainti pursuant to s 436A of the Corporations Act. On 5 September 2011, Mr Reidy was appointed as liquidator of the company by resolution of Jainti's creditors. 2. The beneficiary loans schedule sent to the liquidator by Mr Ashton on 2 October 2014, when information was sought as to the break up of the loan to the Fraser Unit Trust of $1,186,474 (as recorded in the financial statements), records the Zambito Trust as having a balance as at 30 June 2009 of $1,119,761.01 and that income of $66,712.50 was credited to the Zambito Trust. (See also the loan schedule at Exhibit A which records the share of trust income for Jainti as trustee for the Zambito Trust over the period from 2006 (the initial loan of $700,000) and recording the balance at 30 June 2011 of $1,229,622.71.) 3. Also in evidence are financial statements for the Fraser Unit Trust for the year ended 30 June 2014; as well as unsigned "draft" financials and a tax return for the financial year ending 30 June 2015 (which Anthony's lawyers confirmed to the liquidator were the same as the documents ultimately filed). 4. A report as to the affairs of the company was provided by Anthony (see Exhibit L). August 2016 Financial statements – Fraser Unit Trust 1. The financial statements for the year ended 30 June 2016 for the Fraser Unit Trust were prepared by Phillip Ashton in or about August 2016. Those accounts include a schedule of Beneficiary Loans (2016), which records an amount of $1,159,622.71 as a loan from "Zambito Trust" (consistently with the earlier years' statements) and contains a declaration dated 15 August 2016 and signed by each of Anthony and Derek Taylor declaring, in standard form, that the financial statements and notes fairly presented the trust's financial position as at 30 June 2016 and its performance for the year ended on that date, in accordance with the accounting policies described in Note 1 to the financial statements. (A similar schedule of Beneficiary Loans in the 2017 accounts recorded the Zambito Trust as a beneficiary.) Complaints by Sam and Frank Morabito as to distributions 1. By August 2016, it appears that Sam and Frank, through their solicitors, James Beatty & Associates, were raising complaints with the liquidator as to the receipt by Jainti of its "proper distribution" out of the Fraser Unit Trust (see letter dated 16 August 2016), the assertion being made that there was some $750,000 that was then available for distribution. 2. That was followed by a letter dated 26 August 2016 from the solicitors acting for the liquidator (William James) to Polczynski Lawyers (acting, among others, for Anthony), in which complaint was made that distributions had been made to unit holders but not to Jainti; and asserting that this was a "flagrant breach" of the Trust Deed and the trustee's fiduciary duties. Demand was made for certain undertakings to be provided by Fraser Panorama and each of Anthony and Derek Taylor (not to deal or cause Fraser Panorama to deal with any property held by it pursuant to the Fraser Unit Trust without the prior written consent of the liquidator and for a full accounting of the sale of properties made by Fraser Panorama and all payments made by it to unit holders of the Fraser Unit Trust within the previous six years). There was no response to that letter until 19 September 2016 (see below). Notice of termination of trust 1. Not long after the making of the above (26 August 2016) complaint by the liquidator, notification was given by notice dated 9 September 2016 addressed to the directors of Fraser Panorama and purportedly signed by each of Anthony, David and Bruno, as to the termination of the Family Trust in the following terms: Anthony Zamattia, David Zamattia, Bruno Zamattia having previously being beneficiaries indefeasibly and absolutely entitled to 3/5ths of the aliquot share of the above trust hereby give notice to Fraser Panorama Pty Limited that they have terminated the trust insofar as it related to all of their rights and entitlements. Please see attached a copy of the notice of termination. Anthony Zamattia, David Zamattia, Bruno Zamattia require Fraser Panorama Pty Limited to immediately account to them in relation to their entitlements presently under the control of Fraser Panorama Pty Limited. 1. Anthony has deposed that the termination of trust was discussed in the offices of a solicitor (Mr Edney from Polczynski Lawyers) during or about June 2016. Anthony asserts that Bruno and Carol agreed to the termination of the Zambito Trust (the advice being that they do so "for the avoidance of doubt" in order that there could be no claim by the Zambito Trust against the Fraser Panorama Trust assets) (see his affidavit sworn 20 September 2019 at [11.3]). The temporal proximity between the issue of the notice of termination and the complaint raised by the liquidator as to distributions out of the Fraser Unit Trust is therefore perhaps not a coincidence. (There is no copy of any such advice or contemporaneous record of that advice in evidence.) 2. Anthony has deposed that the solicitor prepared the termination notice and that he, Anthony, gave it to Carol and Bruno on or about 9 September 2016 and asked that they get David to sign it and return it to him (see his affidavit sworn 20 September 2019 at [11.5]). He says that they return the signed notice to him on or about 19 September 2016 (at [11.6]). For Anthony, it is emphasised that he predated the notice of termination and received it back signed, and that he did not ever allege that he saw the parties' signatures being appended on the documents – just that he got the notice back; that it had David's signature on it; and that he sent it off. Further, it is noted that neither Carol nor Bruno gave evidence to dispute that the document which was returned to Anthony was signed. 3. By letter dated 19 September 2016, Polczynski Lawyers forwarded to the liquidator the notice of termination of trust and advised the liquidator that the date of execution on the termination notice for Bruno and David was incorrect and that they executed the document on the weekend of 17/18 September 2016. David has deposed that, over that particular weekend, he was away from Sydney for work visiting properties in regional New South Wales including Nyngan and that he did not sign, and could not have signed, the document over that weekend. Sam Zamattia has deposed, in evidence to which objections were taken by Anthony, to a conversation in which he says Anthony suggested that he would just sign documents in Bruno's or David's names (see below). For Anthony, it is noted that in cross-examination he accepted that he gave instructions to the lawyers in relation to the longer letter dated 19 September 2016 but did not give instructions for shorter letter (T 182.42). Anthony says that the inference could only be that instructions for that letter came from Bruno, Carol or David. 4. On the same day, in a separate letter to the solicitors for the liquidator, Polczynski Lawyers responded to the liquidator's solicitors' letter dated 26 August 2016. Their response was to deny that the Fraser Unit Trust had earned any income as defined in the Trust Deed for several years; and to state that payments to unit holders had been in respect of the discharge of genuine debts (all of which had now been re-paid) or part payment of beneficiary loans "relating to previously-distributed income". The letter further stated that, to the extent that any payments had been made to unit holders in respect of previously distributed income, Fraser Panorama had set aside cash sufficient to make an equivalent payment to Jainti in proportion to its unit holding (referring to this as the "Preserved Funds"). 5. The 19 September 2016 letter to the liquidator's solicitors also asserted (for the first time) that the 34 Units owned by Jainti in the Fraser Unit Trust were not held on behalf of the Zambito Trust but, instead, on trust for the individuals (attaching the version of the unit certificates dated May 2006 that Anthony here contends are the correct certificates) and asserted that Anthony, David and Bruno had terminated that separate trust insofar as it related to their beneficial entitlement. The letter went on to state: 2.4 As the Separate Trust insofar as it relates to Anthony, David and Bruno Zamattia has only recently been terminated Fraser Panorama proposes for the time being to continue to retain 3/5ths of the Preserved Funds and provides an undertaking to not deal with the Zamattias' share of the Preserved Funds without the Liquidators' consent or at least 7 days' written notice being provided to the Liquidator. 2.5 In the meantime, Fraser Panorama will immediately release to the Liquidator the 2/5ths of the Preserved Funds not affected by termination of the Separate Trust insofar as it relates to the Zamattia's [sic] entitlements … 1. The liquidator's solicitors responded to the letter of 19 September 2016, not surprisingly, by seeking provision of documents in relation to the alleged Family Trust (the existence of which had only just been disclosed to the liquidator) (see the letter dated 27 September 2016 at Exhibit A); and raising the issue with the solicitors acting for Sam and Frank (by another letter of the same date). 2. Sam and Frank's solicitors responded on 27 September 2016 to the liquidator's solicitors, attaching copies of what Jainti contends are the correct unit certificates; asserting that none of the "Zamattia's" was registered in May 2006 as a unit holder nor had they ever been shown as unit holders in the financial reports; and denying that Sam and Frank had ever been notified since 2006 that any of Anthony, David or Bruno had been registered as unit holders. Complaint was made that any attempted change to the register of unit holders of the Fraser Unit Trust "is not only unauthorised but illegal and we would say fraudulent". 3. On 16 November 2016, Polczynski Lawyers responded to the liquidator's lawyers conveying their instructions that the "Separate Trust" on which Jainti held its units in the Fraser Unit Trust on behalf of Anthony, David and Bruno Zamattia, and Sam and Frank Morabito, did not have a trust deed but "was agreed to orally at the time the Units were issued". It was asserted that the existence of the "Separate Trust" and the fact that the units were held on account of the "Separate Trust" instead of the Zambito Trust was demonstrated by the unit certificates for the units "being contemporaneous records from the time of the Units' issue". (Pausing here, that rather begs the question as to which version of the May 2006 documents, including the competing unit certificates, is the final version.) 4. For completeness, I note that there was by this stage (and it appears this had been the case for some time) complaint by Anthony as to the liquidator's conduct of the liquidation and the liquidator's costs and there was correspondence on that issue between the parties (matters raised in the affidavit evidence of Anthony). I do not consider this relevant to the issues in dispute in this proceeding and do not propose here to delve further into this issue; other than to note that much complaint was made in the course of the present proceeding as to non-production of notes of investigations by the liquidator or members of the liquidator's office and it was suggested that there could be no confidence that there had not been a selective production of material to the Court by the liquidator. Pausing here, that is a serious allegation to make in circumstances where the liquidator is an officer of the Court and has professional and ethical responsibilities. Any suggestion that the liquidator has adopted other than an impartial position in the proceeding must in my opinion be rejected. The liquidator (who made clear he has no personal knowledge of the relevant events, nor would he be expected to have since they occurred before his appointment) has presented a documentary case. The family disputes have nothing to do with the liquidator. Commencement of present proceeding 1. Jainti commenced the present proceeding by way of summons in 2019, seeking an injunction to prevent distributions by Fraser Panorama directly to the beneficial or legal owners of the 1/5th entitlements in the 34 Units. Freezing orders were made (as referred to earlier) in 2019 and, ultimately, the matter proceeded by way of pleadings. Pleaded case 1. As noted at the outset, the only extant claim made in the proceeding is the claim in respect of the transfer to Anthony in December 2018 of the sum of $161,160 as a distribution out of the Fraser Unit Trust (see at [34] of the amended statement of claim). 2. Pausing here, it should be observed that it is wholly disproportionate for there to be a four day hearing in this Court over such a relatively small amount. I understand that the case as initially commenced was for a much larger amount (and I do not suggest that it was not properly commenced in this Court). However, it is an unfortunate state of affairs that the sum in issue is likely to be largely, if not wholly, subsumed by the legal costs of the proceeding. 3. The claim pleaded against Anthony is one of knowing receipt of the distribution of that amount in breach of trust by Fraser Panorama (see at [43] of the amended statement of claim). The allegation is that, by reason of the matters pleaded at [7], [11], [18], [22]-[24] and [35] of the amended statement of claim (and presumably the liquidator here also intends to refer to the new [35A]), Anthony knew at the time of receiving that distribution from Fraser Panorama that it had been made in breach of cl 10.1(f) [sic] of the Fraser Unit Trust Deed. It appears that the relevant clause to which reference was intended to be made at [43] of the amended statement of claim is cl 10.9(f), to which reference was made at [35A] and which provides as follows: 10.9 Distribution of Net Income The Income arising in each Financial Year shall be dealt with no later than the end of the Financial Year as follows: … (f) the net Income less the sums retained, applied or set aside ('income available for distribution') shall be distributed or applied by the Trustee, firstly, in accordance with any special rights as to sharing Income attached to any Units and then to or for such persons who at midnight on the last day of each Financial Year are Unit Holders in proportion to the Units registered in their respective names. The Unit Holders shall be presently entitled to their respective proportions of the net Income. 1. "Income" is defined in cl 1.1 of the Trust Deed and it is not necessary here to set that definition out. Clause 3.1 provides that "[s]ubject to the rights of holders of Units of a class, the beneficial interest in the Trust Fund as originally constituted and existing from time to time shall be vested in the Unit Holders for the time being in proportion to the Units held by them". 2. Clause 12.1 of the Trust Deed provides that "[a]ll Income payable under this Deed to Unit Holders shall be payable to them separately and Income received by the Trustee [i.e., Fraser Panorama] shall not be received or be taken to be received by or on behalf of the Unit Holders jointly or otherwise than separately". 3. It is alleged in the amended statement of claim that at no time was Anthony a unit holder of the Fraser Unit Trust (see at [35]) and that, pursuant to cll 3.1 and 10.9 of the Fraser Unit Trust Deed, Jainti was presently entitled to 34% of the amount distributed to Anthony and that, as a result of the payment by Fraser Panorama of Jainti's proportionate (34%) share ($54,794.40) to other unit holders, Jainti immediately had an equitable charge over, and a proprietary interest in, the remaining undistributed Income of the Fraser Unit Trust in respect of that sum (see at [35A]). As noted above, it is alleged that the distribution made to Anthony was in breach of cll 3.1, 10.9(f) and 12.1 of the Fraser Unit Trust Deed. 4. By his amended defence filed 9 August 2019, Anthony denies outright the allegation (at [35A]) that Jainti had an equitable charge over, and proprietary interest in, the remaining undistributed Income (as defined) of the Fraser Unit Trust in respect of 34% of the amount distributed to him and the allegation (at [43]) of knowing receipt of the distribution in breach of trust by Fraser Panorama. Throughout his amended defence, various other denials (and assertions) made by Anthony are pleaded as being "reliant upon actions and knowledge as a director of [Fraser Panorama]" (see for example his denial at [41] of the allegation of breach of trust by Fraser Panorama). 5. Anthony pleads a positive case as to the resolutions made at the 12 May 2006 meeting of Fraser Panorama (see at [9]) and, in particular, alleges "reliant upon actions and knowledge as a director of [Fraser Panorama]" that, at that meeting, Fraser Panorama did not resolve to issue unit certificates to Jainti in its capacity as trustee for the Zambito Trust; and he asserts that at all material times after 12 May 2006 Jainti held 14 "A class units" and 20 "B class units" as trustee for the Beneficiaries (as defined at [1](c) of the defence, namely the five members of the Morabito and Zamattia families referred to above). 6. Anthony further alleges (again reliant upon actions and knowledge as a director of Fraser Panorama) that on or about 7 October 2008 the "Separate Trust" (i.e., what I have defined as the Family Trust) was terminated insofar as it related to Anthony, David and Bruno; and that, since about 7 October 2008, Fraser Panorama has been "legally obliged" to pay 3/5ths of its distributions to them (see at [13] of the amended defence). 7. In answer to the allegation at [35] of the amended statement of claim, Anthony pleads that he was a unit holder of the Fraser Unit Trust and/or had an entitlement to the rights attached to those units, namely, as a "beneficial owner of 20% of the Jainti Units from the inception of the Fraser Unit Trust" and as a "unit holder of one-fifth of the 14 A Class Units and 20 B Class Units pursuant to the 7 October 2008 Jainti resolution". Evidence 1. As noted above, Jainti's case was primarily put as a documentary case (based on records obtained by the liquidator) but Jainti also adduced evidence from each of Sam, Frank, David, Sam Zamattia, and the liquidator himself (Geoffrey Reidy). 2. For Anthony, reliance was placed on a number of affidavits sworn by him and an affidavit of Derek Taylor sworn 7 October 2019, the co-director of Fraser Panorama and project manager for the Fraser Panorama development. Broadly speaking, Derek Taylor supports Anthony's account of events (although in cross-examination, as I have already observed, it became evident that his recollection was largely based on what was contained in the documents by which he had refreshed his memory). 3. I set out later in these reasons my observations as to the credibility of the witnesses. Jones v Dunkel 1. Anthony invokes the principles articulated in Jones v Dunkel, arguing that, where Jainti's case is based upon indirect evidence, assertion or inference, and a relevant witness has not been called to provide evidence, the documentary evidence submitted by Anthony should be preferred, particularly where the challenge raised by Jainti is many years after the relevant events. In particular, an adverse Jones v Dunkel inference is said to be raised as to the lack of evidence from the following persons. 2. First, Carol (Bruno's wife), in relation to communications about the Jainti meeting in October 2008 concerning the change in unit holding and the signatures on the notice of termination of trust dated 9 September 2016. 3. Second, Mr Thyge Trafford-Jones (an employee in the liquidator's office, who assisted in the liquidation of Jainti and who had carried out investigations or made enquiries on the liquidator's instructions). Counsel for Anthony suggests that Mr Trafford-Jones compiled a report. However, at T 29.24-T 30.12, while the liquidator accepts that he instructed Mr Trafford-Jones to have a meeting with Mr Ashton, there is nothing said which clearly indicates that a written report was prepared by Mr Trafford-Jones (as opposed to there being merely a conversation with Mr Reidy following the meeting or some notes taken at the meeting). Anthony says, nevertheless, that an adverse inference should be drawn from the fact that Mr Trafford-Jones was not called as a witness and from the fact that his notes of investigations during the liquidation (and any conference with Mr Ashton) have not been produced. 4. Third, Bruno, on the basis that an affidavit of Bruno was filed and served by the liquidator but ultimately withdrawn (he not being made available for cross-examination even though approval had been given for that to be by audio-visual link). In particular, it is noted that, after an affidavit of David sworn 20 November 2020 (testifying that Bruno was immobile) was read, and there had been some cross-examination of David as to Bruno's alleged immobility; but (over Anthony's objection) I had indicated that I would permit Bruno's evidence to be given by audio-visual link, Jainti then made a formal application to withdraw the affidavit evidence of Bruno. 5. Anthony submits that an adverse inference should be drawn that Bruno's evidence would not have supported Jainti's case, in particular: in relation to the "Jainti meeting" held on 7 October 2008; in relation to the "Jainti meeting" held on 9 July 2009; as to the communications leading up to the meeting in May 2006; as to the terms of Bruno's affidavit filed in the proceedings; and as to the terms of the affidavit of David sworn 20 November 2020 (attesting to Bruno's immobility). It is submitted that it should be inferred that Bruno would not have contradicted the Notice of Termination of Trust in 2006 either in relation to the notice of termination or his signature. (Pausing here, Jainti accepts that it would be open to draw an adverse inference to some extent from Bruno's failure to give evidence but submits that this is not determinative.) 6. For completeness, I note that, although Anthony initially pressed for the drawing of an adverse Jones v Dunkel inference from the fact that the liquidator had not called evidence from Mr Ashton (the external accountant) regarding the draft accounts that were prepared by him in relation to the Fraser Unit Trust, ultimately no such inference was pressed by Anthony (see below). The liquidator, however, contended for his part that an adverse inference should be drawn against Anthony's case from the failure of Anthony himself to adduce evidence from Mr Ashton. Ruling as to Jones v Dunkel inferences 1. In RHG Mortgage Ltd v Rosario Ianni [2015] NSWCA 56 at [75], the Court of Appeal observed that reference to the "rule" in Jones v Dunkel (that the unexplained failure by a party to call witnesses may in appropriate circumstances lead to an inference that the uncalled evidence would not have assisted that party's case) was inapt in that it implied a consequence where the rule was breached. Rather, the so-called "rule" is one that enables the Court more confidently to draw an inference that is available from facts proved by direct evidence, and the question is whether it should be drawn, in circumstances where the party disputing it might have proved the contrary, had it chosen to give evidence (see Davies AJA in Ho v Powell (2001) 51 NSWLR 572; [2001] NSWCA 168 at [16]; [76]; HML v R (2008) 235 CLR 334; [2008] HCA 16 at [302]-[303]; Brandi v Mingot (1976) 12 ALR 551 at 559-60; Jones v Dunkel at 312, 320–321; Katsilis v Broken Hill Pty Co Ltd (1977) 18 ALR 181 at 197). In order for a Jones v Dunkel inference to arise it is necessary that the witness be one that would be expected to have been called – i.e., as has been described by Glass JA in Payne v Parker [1976] 1 NSWLR 191, that the witness be someone in that party's "camp" and that the failure to call that witness be unexplained. A Jones v Dunkel inference, if one does arise, does no more than permit the inference that the uncalled evidence or missing material would not have assisted the relevant party's case; it would not permit an inference that the uncalled evidence was in fact damaging to that party's case. 2. As to the various Jones v Dunkel inferences that have been sought, there can be little doubt that Mr Ashton was the "missing elephant in the room". He was the accountant who had prepared the financial statements and tax returns on which the liquidator was relying; he had forwarded that material (or at least some of that material) to the liquidator; and, intriguingly, it had been foreshadowed (in the context of an application by Anthony for security for costs) that he would be called as a witness in Anthony's case. In the security for costs application, Anthony had deposed to the belief that "[s]ubject to any new matters that plaintiffs' proposed new third defendant Derek Taylor may raise", Mr Ashton would be called at trial (and he estimated a length of some 7 or 8 days). Although Anthony suggested otherwise in the witness box at the present hearing, this cannot sensibly have been a reference to the length of time of the costs application (cf., T 290). 3. The liquidator says (and I accept) that, in the absence of any other explanation for the absence of evidence from Mr Ashton, there must have been a forensic decision on Anthony's part (after the security for costs application) not to call Mr Ashton (see at T 249); and that a Jones v Dunkel inference should be drawn against Anthony insofar as he seeks to challenge the veracity of documents by reference to which the liquidator has advanced his case. As noted above, Anthony accepts that there is no such inference to be drawn against the liquidator (on the basis that the liquidator does not have personal knowledge and is putting forward a documentary case). Moreover, it was accepted for Anthony (at T 298) that, as he had alleged that he advised Mr Ashton about the issues in relation to his unit holding and then did not call him to confirm this, a Jones v Dunkel issue might operate against him. 4. While Mr Ashton was the external accountant for Jainti, it might have been thought that he was not necessarily someone in the "camp" of one of its directors. However, Mr Ashton was also an investor in the project (indeed, Derek Taylor's evidence was that Anthony introduced the investors – see T 123.1-7); and he was someone that (at least at the time of the security for costs application) Anthony believed would be called in his case. It might reasonably be expected that, if the taxation or financial records had been seen by Anthony as inaccurate at the time, he would have raised this with Mr Ashton but, as matters stand, there is no evidence that he did. To the extent that Anthony asserts that he did draw this to Mr Ashton's attention, but did not call him to give evidence to confirm this, I would infer that Mr Ashton would not have been able to assist the case put forward by Anthony (i.e., Anthony's case that the issues in relation to the unit holding had been raised with him). 5. That permits me more comfortably not to accept (as indeed I do not accept) Anthony's uncorroborated assertions as to him having raised the issue with Mr Ashton at the relevant time. 6. As to the remaining persons against whom Jones v Dunkel inferences are sought, I accept that the circumstances in which leave was sought for Bruno's affidavit to be withdrawn give rise to an adverse inference that he would not have been able to assist Jainti's case in relation to the execution (by him) of the Notice of Termination of Trust (and that he might have been able to shed light on the October 2008 meeting, which he is recorded as having attended, but that inference would not go so far as to raise a positive case as to what occurred at the October 2008 meeting or when precisely it occurred. In any event, ultimately it is not necessary to rely on any adverse inference from the failure to call Bruno for the reasons I will explain in due course but in essence because I am not persuaded that the Family Trust was established in the first place or, if it was, that it could be terminated without unanimous consent of the beneficiaries. 7. As to Carol, I am not persuaded that she is in Jainti's "camp", as such; nor is it apparent that she would be able to shed much light on events other than in relation to the circumstances in which the Notice of Termination of Trust was purportedly signed by Bruno and David and returned to Anthony. 8. As to Mr Trafford-Jones, who I was informed from the Bar table is no longer employed in the liquidator's firm, I do not accept that an adverse inference should be drawn. The liquidator gave evidence as to the investigations carried out in the liquidation and was able to be cross-examined on those matters. Mr Trafford-Jones' experience or otherwise at the relevant time as to the winding up of trusts (an issue to which reference was made in Anthony's submissions) is not to the point. As to the suggestion that there were missing notes or records of meetings or the like which could have shed light on the time at which Anthony first raised the issue of the Family Trust, those could have been the subject of a subpoena or notice to produce. The call for such notes (made somewhat obliquely in the course of cross-examination) was ultimately not pressed (T 287.21-5); and, even if an inference were to be drawn from Mr Trafford-Jones' absence from the witness box, it would not permit a conclusion that there was something in existence in his notes that was positively damaging to the plaintiff's case or that would positively advance that of Anthony. Credibility of witnesses 1. Before turning to the submissions made by the respective parties as to the issues in dispute in the present case, it is convenient at this point to consider the credibility of the various witnesses. For the liquidator, it was accepted that serious credibility findings were sought as against Anthony; whereas for Anthony, while any suggestion that the Morabito witnesses were dishonest was expressly disavowed (T 277.21-5), it was submitted that their evidence was implausible and that Anthony's evidence should be preferred. Turning to the respective witnesses, I note as follows. Mr Reidy 1. The liquidator gave evidence and was cross-examined as to his investigation of the company's affairs. It was not suggested that his evidence was dishonest but, as noted above, there was a submission put for Anthony to the effect that an inference could be drawn that the liquidator's evidence was selective. At T 287, Anthony says that the liquidator's submission to the effect that the liquidator had produced all of the (relevant) documents in his possession was not correct; the liquidator having not produced Mr Trafford-Jones' report. I do not accept this; not least because it is not clear that there was a "report" as such. 2. I considered that Mr Reidy gave his evidence in a considered and professional manner; and I consider that there is no basis on which to suggest that he did not attempt to put forward a complete picture of the relevant material in his possession as liquidator. Insofar as complaint is made by Anthony that he drew the Family Trust to the liquidator's attention at an earlier time but that the liquidator did not appear to understand this, I note that he called no evidence from Polczynski Lawyers to corroborate that assertion. Morabito and Zamattia family members 1. As to the evidence of the respective family members, the liquidator says that Anthony's account of events is implausible; that each of Sam and Frank was a forthright and honest witness; and that the evidence of David, Frank and Sam, against their own financial interests, should be accepted as the more plausible. Anthony, for his part, says that the evidence of the witnesses called by the liquidator should not be accepted. I address each of those witnesses in turn. Sam Morabito 1. I accept that Sam gave his evidence in a forthright manner (as can be seen from some of the transcript that I have extracted above) (indeed he did so with feeling). Sam did not mince words and was argumentative at times with the cross-examiner (such as his emphatic evidence as to why it was that he could not have attended the October 2008 meeting by reason of the AVOs). The liquidator emphasises Sam's evidence as to the events in September and October 2008 as casting doubts on Anthony's evidence of the "verandah" conversation. There is no doubt that Sam was intent on making clear his side of the story, so to speak. He was less focussed on the questions put to him than on his recollection of the overall context of the events in question (at least in relation to the October 2008 meeting and the meeting at which the minutes were confirmed). 2. Anthony challenges Sam's evidence as to the 90% pre-sales at a time when the DA was not approved (T 277.5-16). As noted above, Anthony does not contend that Sam is a dishonest witness as such but he did submit that Sam's evidence was "disingenuous" in this regard (which amounts to the same thing) and Anthony says that the suggestion that there were 90% pre-sales as at the time of the alleged May 2006 conversation cannot be true, which Anthony says undermines Sam's overall credibility. It is noted that the project started in July 2006 and that the level of sales did not reach $15.483 million until some two and a half years after the payment started (i.e., in October 2008). Reference is also made to Derek Taylor's evidence as to it being a difficult project (see T 305). 3. Anthony says that Sam was an angry man, discontent with the history of the development; and that his evidence was glib. I would not characterise his evidence as glib; though I did form the impression that, to some extent, Sam became frustrated with the questioning and retreated into answers that he simply did not recall things. 4. I accept that it is unlikely that there would have been 90% pre-sales as at May 2006 (and there is certainly nothing to support that in the evidence) yet I consider that Sam's rejection of the prospect that he saw the project as risky at that stage because he thought (and he said Anthony had told them – see T 95.31-6) that he would double his money rang true; as did various other parts of his evidence in which his feelings as to Anthony were revealed (the comment, for example, that Anthony was "Jesus Christ…he signed everything, he did what he wanted" (at T 90.42-4)). Sam did not hide the fact that there was dispute within the family. Ultimately, I considered him to be a credible witness though I treat with caution (as I do all the family members, including Anthony) evidence that may consciously or otherwise be a product of a reconstructed recollection of events. 5. I doubt, for example, that Sam paid much attention to the various minutes of meeting or transaction documents at the time (and indeed that is consistent with his own evidence). Anthony says, and I accept, that no doubt Sam had the belief to which he has deposed as to the documents but says that that subjective belief does not assist the plaintiff's case. I would agree, save as to the extent that it casts doubt on Anthony's evidence as to the 11 May 2006 conversation (see below). Frank Morabito 1. Again, Anthony says that he does not contend that Frank was dishonest. Anthony says that no doubt Frank had the belief to which he has deposed as to the documents but again that that subjective belief does not assist. 2. I considered Frank to be a direct witness. He did not engage in debate with the cross-examiner; and his position in relation to his recollection of events was plausible. David Zamattia 1. In David's affidavit sworn 17 April 2019, he denies attending any meeting of directors of Jainti which dealt with any of the matters set out in the alleged 7 October 2008 minutes of the Jainti board meeting (see at [6]-[7]). He denies signing the Notice of Termination of Trust (at [10]). 2. The liquidator says that this evidence was not challenged; and therefore, the Notice of Termination of Trust cannot be a valid document. (I consider this, and the submission that there cannot be a valid notice of termination of trust if one of the persons purportedly entitled jointly to the benefits under the trust did not consent to the termination (see at T 243), in due course.) 3. Anthony makes an adverse credit submission in relation to the evidence given by David as to his father's immobility (noting that in circumstances where, after it was put to David in cross-examination that there might be evidence on which he would be disbelieved or accused of perjury, an application was later made for Bruno's affidavit to be withdrawn). I accept that an adverse Jones v Dunkel inference may be able to be drawn in relation to the failure of Bruno to give evidence in the case (see above). However, any Jones v Dunkel inference would not extend beyond an adverse inference that Bruno would not have been able to assist Jainti's case in relation to the execution (by Bruno) of the Notice of Termination of Trust (and the circumstances of the October 2008 meeting, which he is recorded as having attended). In particular, I am not persuaded that David's evidence as to his father's immobility (based as he said it was on what others had told him about his father and his own observation), even accepting that it was not wholly satisfactory, casts doubt on his overall credibility. As to whether David's evidence is contrary to his financial interests, a submission relied on by the liquidator to support his credibility, ultimately it is not necessary to delve into the debate on this because I do not rely, for the conclusion I have reached, on whether or not the interests of the other so-called individual beneficiaries were affected by their acceptance of the proposition that the shares were held as trustee for the Zambito Trust. Sam Zamattia 1. Sam Zamattia's evidence (see his affidavit sworn 8 September 2020) went to a conversation in which he deposes (at [2]) that Anthony said to him in or about 2016 words to the following effect: "I've got a letter I need to get Dad and Dave to sign to dissolve the Jainti Trust. I reckon I can get Dad to sign it but I bet Dave won't. Fuck it I'll just sign it for him anyway". The liquidator says that Sam Zamattia was an honest witness and was resolute in his recollection of this conversation. 2. The liquidator says that Sam Zamattia's evidence, together with that of David, casts unassailable doubt on the veracity of the purported notices of termination (and argues that notice of termination would not be required if everything had been dealt with at the October 2008 meeting). (Of course, the answer to the last submission could well be, as was suggested had been the advice conveyed by Polczynski Lawyers (see T 179) and said to have been accepted by Bruno and Carol, that this could simply have been done for the avoidance of doubt.) 3. More significant, in my view, is the fact that there was no reference to a separate trust (the Family Trust) in any documents passing between the parties and the liquidator until September 2016 and that the solicitor's correspondence in September 2016 (sent on Anthony's instructions – see at T 178.14-18) refers to the termination of the separate trust as "only recently" having occurred; not that the trust had been terminated quite some time before (i.e., in October 2008). The liquidator submits that the 7 October 2008 minutes of meeting first appeared in a September 2019 affidavit (see T 272). 4. In any event, I accept that Sam Zamattia's evidence as to the conversation with Anthony was credible (not least because of the anomalies surrounding the evidence as to the execution of the Notice of Termination of Trust – such as the admitted dating of the document in advance of it being signed by Bruno and David, and the account given by Anthony's then lawyers as to when it was signed by David (i.e., over the weekend), which I accept cannot have been correct if David was out of Sydney at the time (see T 182)). That said, ultimately nothing turns on this for the reasons I set out in due course. Derek Taylor 1. The liquidator says that the affidavit evidence as to Derek Taylor's purported recollection of events should not be accepted since his oral evidence makes clear that he did not have an actual memory of events but that he was simply basing his evidence on his reading of the documents in the witness box. Further, it is said that Derek Taylor's evidence was infected by the fact that he had spoken to Anthony about the dispute (or about the issues in the dispute) and because he was an advocate for Anthony's cause in that it was his view that Anthony deserved the money. 2. I do not accept that Derek Taylor presented as an advocate for Anthony's cause, although I accept that he candidly accepted that he considered (and no doubt with good cause having regard to Anthony's involvement in the development) that Anthony deserved to be recompensed for his efforts in relation to the Fraser Panorama development. Nor am I persuaded that there is cause for concern as to collusion between the witnesses (of the kind referred to in, say, Rosebanner Pty Ltd v Energy Australia (2009) 223 FLR 406; [2009] NSWSC 43) since a discussion with Anthony as to the dispute itself would be explicable if for no other reason than that there were issues as to how the distributions could be effected (in order to wind up the Fraser Unit Trust after the development was complete) in light of the question or dispute that had emerged as to the parties' entitlements. I do not understand Derek Taylor's evidence to have been that he was speaking to Anthony as to his affidavit evidence. (In that regard I see a distinction between the kind of "cutting and pasting" exercise considered in Macquarie Developments Pty Ltd v Forrester [2005] NSWSC 674 by Palmer J or the discussion between experts considered by Lindgren J in Lucent Technologies Inc v Krone Aktiengesellschaft (No 3) [2000] FCA 100. 3. That said, I accept the force of the observation that Derek Taylor's recollection was largely limited to his reading of the documents to which he was taken and assumptions as to the veracity of what was there recorded. Therefore, I treat his evidence with some caution and I do not accept that his confirmation as to the chronology of events is necessarily reliable. Anthony 1. The liquidator says that Anthony's evidence was false (accepting that this is a serious allegation to make) and implausible in the extreme. It is submitted that, other than concessions extracted from him against his interest, his evidence should not be accepted. For Anthony, on the other hand, it is said that his evidence was credible and that the allegations of dishonesty should be rejected. 2. For Anthony, it is noted that the cross-examination included direct propositions put to Anthony that, in relation to critical documents, meetings and conversations, Anthony was lying or that the documents were not the correct documents; and that in each case, Anthony denied that was the case. Anthony submits that: there is no case pleaded by Jainti on any such basis; in relation to the conversation with Sam, that Sam has not provided affidavit or oral evidence challenging the conversation alleged (though I interpose to note that implicitly he seems to have done so – see at [35] of his affidavit sworn 23 May 2019); and that there is no factual basis in the evidence for the propositions put to him in cross-examination. It is submitted that, in relation to relevant communications following the conversation between Anthony and Sam, there is a Jones v Dunkel issue arising from the fact that the affidavit evidence of Bruno was formally withdrawn and Bruno has not been called as a witness. 3. Anthony points to the recognised challenges in the evaluation of oral evidence, particularly where it conflicts with documentary records and the evidence of independent witnesses, pointing to what was said in Northampton Borough Council v Cardoza [2019] EWHC 26 at [36]-[39] per Barker J. 4. Further, for Anthony, a Browne v Dunn (1893) 6 R 67 (HL) point is raised as to any submission that Derek Taylor and Anthony were involved in forging or concocting documents. Reference is made to Kuhl v Zurich Financial Services Australia Ltd (2011) 243 CLR 361; [2011] HCA 11. It is noted that the allegation that documents were "concocted" in 2016 is tantamount to an allegation of dishonesty and fraud. 5. I considered that Anthony presented in the witness box as an honest witness albeit that some of his evidence (such as in relation to the security for costs application to which I referred above) cannot be reconciled with what appears in the contemporaneous documents. I consider that Anthony has genuinely formed the view that he espouses as to the manner in which the units were to be held but I do not accept that that necessarily accords with what actually happened in relation to the Zambito Trust and I am troubled by the fact that Anthony seems to have been content to proceed on the basis that the unit holding was held by Jainti on trust for the Zambito Trust until such time as the present dispute erupted. 6. Anthony's evidence as to why he signed taxation documents or accounts which reflected distributions in accordance with unit holdings that on his case were incorrect is illuminating in this regard (see T 169.16-48; T 171.39-T 172.27; T 174.3-25; T 175.1-T 176.29; T 177.13-36): Q. It's correct, isn't it, that you knowingly signed a document containing information you knew to be false for the purposes of providing information to the Australian taxation office. That's correct, isn't it? A. No, that's not correct. I signed the document which I knew to have a question mark over who the unit holder was, and the advice to me was until we can resolve who the unit holder is, we have to sign something to pay tax so we wouldn't be evading tax. That's the answer. Q. What about taxable distributions for 2009 that we see there, referable for the Zambito Trust? Again, you were in Court when I asked Mr Taylor some questions, so it's probably a familiar number to you, $245,647.50. Is that a mistake on the document? A. That's the correct amount. It's only a mistake if, indeed, it's not the Zambito Trust who owns the units. Q. So when you say it's the correct amount, do I take it that that is the correct amount that the Fraser Unit Trust paid by way of taxable distributions for 2009 to the Zambito Trust? A. It didn't pay them; it distributed that amount, and that's more a question for the - if that's what it says in the accounts, that's what it is, but I didn't prepare those accounts. Q. But you accept that if you signed this document around about 30 September 2009, there had been distributions made or declared by the Fraser Unit Trust with the effect that the Zambito Trust was credited with $245,647.50 of those distributions? A. That's what the accounts reflect, yes. Q. That's what occurred, isn't it? A. No. Q. No? A. We didn't make distributions to the Zambito Trust? … Q. You accept, don't you, that the Zambito Trust reported to the ATO in the financial year 2009 that it had received distributions from trusts in the order of $245,467. That's correct, isn't it? A. That's what those documents reflect. Q. You're a director of the corporate trustee? A. Yes. Q. You would have consented or authorised for that figure to be reported, wouldn't you? A. No, I don't remember that at all. … Q. You're not saying it's wrong, are you? A. I don't think it's wrong. It was prepared by the same person who prepared the Fraser Unit Trust accounts, Mr Ashton, so he would've prepared it, the two to coincide, and my previous answer is the same; that, pending resolution of who owned the units, he took one path to prepare it, and it's neither right or wrong until we find out the answer today, well, subject to those proceedings. Q. Why didn't you work it out before you paid money and lodged tax returns? A. How can you work it out? We tried. Q. Did you? A. Yeah, of course we tried, and we, so, and the reason why Phil said to go down this route was because it provided a better tax advantage for Sam, Frank, and Bruno, so it'd be easier to negotiate. Q. So this was some sort of charitable act to Frank, Sam, and Bruno was it? A. I'm just saying what Phil said. … Q. So what's the relevance of the 2008 meeting-- A. We had a-- Q. --excuse me, I'll finish - as some sort of basis for saying that this is wrong? A. Because we had a 2008 meeting where the units were then taken out of Jainti as trustee for the bare trust and put it into the three individuals, so-- Q. This is the Zambito Trust. A. It is - so, it's not - well, in terms of lodging for the Zambito Trust, yeah, it shouldn't have been lodged under Zambito Trust. Q. You just say never, never had the 34 units as trustee of the Zambito Trust, that's your case? A. Yeah, 100%. Q. You're telling this Court-- A. Yeah. Q. --that that is correct as a matter of fact. A. 100%, 100%. Q. Are you lying? A. No. Q. So all of these things are just happening as mistakes and because, as the product of some sort of uncertainty, are they? A. No, there was definitely, there was one point of mistake, correct. Q. One point of mistake? A. Yeah. Q. I've shown you three documents so far where a mistake's there. A. But they all stem from the same point. … Q. What is it that happened? Is it that you and Mr Ashton together just decided that because of the uncertainty in relation to the ownership of the units that you've identified, you'd just lodge documents with the ATO not just really knowing what the issue, who the true owner was? Is that what you were doing? A. No, Mister, I'm only one director of five, and one director of two. Q. Did you think it was wrong? A. I did think it was, I thought it was incorrect. But on the basis that we didn't want to evade tax, and Mr Ashton's advice seemed very conservative. Q. In terms of the desire not to evade tax, the Zambito Trust is a discretionary family trust, isn't it? A. Zambito, yes. Q. So if money goes into the Zambito Trust, it filters out to various family members of yours and other people's, doesn't it? A. It can, yes. Q. It's a way of tax minimisation and income splitting, isn't it? A. Minimisation is not evasion. Q. No. A. No. Q. That's why I didn't ask you whether it was a method of tax evasion. A. Yep. Q. I said minimisation. A. That's right. Q. It's that, isn't it? A. That's correct. Q. Yes. If money went through - you can probably tell me this much as a director of these two companies and a qualified accountant - if money went through the Zambito Trust as opposed to just going straight to you as a beneficiary under the Fraser Unit Trust, then you would potentially pay less tax personally, wouldn't you? A. No. Q. No? A. It depends - I'm not a tax accountant. But the tax, the money is taxed in the hands of a beneficiary, not the Zambito Trust, so it's the same person at the end of the day. It still comes back to me. So the tax is the tax. That's why it didn't matter whether we called it Zambito Trust or ABC or whatever. It's, it's taxed in the hands of the beneficiary Q. Yes, but you say that you, you say that you terminated this separate trust. You say you've terminated it. A. In 2008, correct. Q. Yes. A. Yep. Q. Yet after that date, money was coming through from the Fraser Unit Trust through the Zambito Trust to your family members, wasn't it? A. Yes, correct. Q. That was how the distributions that were made by the Fraser Unit Trust to persons associated with you was taxed, wasn't it? A. I, my understanding is you can do that anyway because I allocate income to my family members anyway. Because you, you can - I'm not a tax accountant, but in my normal tax returns with my normal income I allocate to my family members. Q. So now that you know as you've said in your evidence in this case that the identifying of the Zambito Trust as the unit holder was wrong, have you lodged any amended tax returns with the tax office to fix up the problems? A. As I said, I believe it was wrong. You can't fix things until you get a direction as to which way it should be, and that's what we will have to do post this hearing. Q. Why do you-- A. There will be, there may be a correction or there may not be a correction. Q. Why do you need a direction? You've got-- A. Because there's a dispute. I'm sorry. … Q. There was no suggestion to Mr Reidy as the liquidator in 2011 on your instructions by Polczynski Lawyers about a separate trust until 2016, was there? A. Incorrect. Q. Incorrect? A. 100% incorrect, yep. Q. When do you say that you instructed Polczynski Lawyers to tell Mr Reidy about the separate trust? A. I told Mr Reidy with Paul Cooper of Polczynski Lawyers at our very first meeting. Q. When was that? A. 2011. Q. 2011? A. Yep. Q. You told Mr Reidy about the separate trust then? A. 100%. Explained it to him. I re-explained it to him when Stephen Polczynski took over from Paul Cooper in a meeting in Stephen Polczynski's office, and I remember coming out of what meeting and saying, "They still don't understand this." 1. As I have said, I consider Anthony to be genuine in his understanding that there had been a mistake insofar as the Zambito Trust was reflected in the tax returns or statements as the beneficiary of the Fraser Unit Trust unit holding in question. However, what I am not satisfied about is that the mistake was one that happened after the event (i.e., that Mr Ashton wrongly recorded the Zambito Trust as the beneficiary and things progressed from there) rather than that any mistake was as to the documentation of the unit holdings at the outset (i.e., that the tabled applications and issue of units at the relevant time – 12 May 2006 – correctly reflected the position at that time and what happened was that at some stage Anthony and Derek Taylor informally "re-jigged" the unit holdings but did so without attention to the formalities of effecting a change in beneficial ownership). 2. As to the 11 May 2006 conversation to which Anthony deposes, I am left with sufficient doubt as to whether or not it occurred that I cannot make a finding on the balance of probabilities that it did. Equally likely seems to me the possibility that Anthony and Derek Taylor between them later decided to "re-jig" the unit holdings of various unit holders for tax or other personal reasons, without reference to Sam or the other Morabito/Zamattia family members. 3. I do not accept that it follows from the existence of the competing versions of the documents that Anthony must have falsely concocted the Individual Beneficiaries Version at the time or that this was a recent invention, as such. However, that does not mean that I accept Anthony's account of events as the more probable (see below). Jainti's submissions 1. As adverted to above, the liquidator says that the present dispute (as to whether the withheld distribution of $161,160 is payable to Jainti, in its capacity as trustee of the Zambito Trust, or, rather, is payable directly to Anthony) turns on two key issues, namely the 12 May 2006 meeting and the later termination of the alleged Family Trust. 2. The liquidator invokes s 1305 of the Corporations Act in relation to the financial records or financial material produced by Fraser Panorama, or persons connected to Fraser Panorama, or Jainti, which has been provided over the years to him (including material provided by Jainti's external accountant, Mr Ashton, and by Anthony himself). Emphasis is placed on the fact that Anthony was a director of Fraser Panorama during the periods to which this financial material relates. 3. The liquidator refers to what was said by Austin J in Australian Securities and Investments Commission v Rich (2005) 53 ACSR 752; [2005] NSWSC 417 (ASIC v Rich) at [148] and by Markovic J in Stone v Melrose Cranes & Rigging Pty Ltd (2018) 125 ACSR 406; [2018] FCA 530 at [181] in that regard. It is submitted that the documentary evidence available to and relied on by the liquidator (including profit and loss statements of the trusts and the like, as well as taxation documents lodged with the ATO) establishes its claim and has not been rebutted. In contrast, the liquidator says that insofar as Anthony relies on documentary evidence of that kind, the prima facie evidence has been rebutted (see at T 239). 4. The liquidator relies on the Zambito Version of the relevant documents (including the 12 May 2006 unit holder certificates signed by Anthony which record Jainti as unit holder as trustee for the Zambito Trust, the unit holder register provided to the liquidator's office by the solicitor acting for the Morabito family members) and the taxation statements signed by Anthony, financial statements and income tax returns for the Zambito Trust and the Fraser Unit Trust, beneficiary loan schedules for the Fraser Unit Trust provided by the accountant of both the Fraser Unit Trust and Jainti, and financial accounts accepted by Anthony as to their authenticity (see Exhibit A). 5. As to the documentary evidence, the liquidator says the following. 6. First, as to the minutes of the 12 May 2006 meeting (the version for which the liquidator contends is at Exhibit A at 257), it is noted that the minutes record the tabling of applications for units (not a table or register of unit holders per se) (see T 250), the liquidator emphasising that there were already the two initial unit holders on the inception of the trust as per the Fraser Unit Trust Deed. The liquidator says that greater weight should be given to this document than the competing version (at Exhibit 1) because it is consistent with the number of units ultimately issued (i.e., 100 not 102). 7. The liquidator submits that, in circumstances where the founding persons (Anthony and Derek Taylor) or their related entities were the initial holders of one "ordinary" unit each, the minutes of meeting relied upon by the liquidator (the Zambito Version) make sense because, if the initial units are treated as "B Class Units" then the effect of what occurs on 12 May 2006 is that there are a further 38 "B Class Units" issued (with the ultimate total of 40 "B Class Units"). 8. It is noted that it is conceded by Anthony that he, Anthony, was the author of the Zambito Version (T 253.15) which was provided to the liquidator by the solicitors for Sam and Frank in 2016 as part of the documents held by the directors of the corporate trustee of the Zambito Trust (see T 253). 9. The liquidator points out that the Zambito Version is not headed "draft"; that it is signed; and that it was provided to the liquidator by the directors of Jainti (T 254). 10. As to the competing version, it is said for the liquidator that there is no basis to suggest that the liquidator would put forward a selective version of documents to the Court and hence the liquidator says that it should be inferred that what the liquidator has in the liquidator's file was the version provided by Sam and Frank in 2016 (T 254); and that the version relied upon by Anthony was produced only in 2016 (at a time when Anthony first raised with the liquidator the existence of the alleged separate Family Trust). 11. Pausing here, for Anthony, emphasis is placed on the fact that Anthony's evidence in the witness box was that he had several conferences with persons from the liquidator's office and that everyone asked the same questions. It is said that there is no evidence from the liquidator that the first time he heard about the separate family trust was in 2016. Anthony says that there is an unsatisfactory gap between the 2011 report as to the company's affairs and what was done by the liquidator in 2012, 2014 and 2015; and hence he submits that it cannot be found that this matter was only first raised with the liquidator in 2016. Pausing here, it is inherently implausible (and a serious thing to suggest) that a professional liquidator, with no personal interest in the company in question, would deliberately mislead the Court by not producing all the relevant documentary material; and it was not put to the liquidators in cross-examination that he had been advised of the alleged existence of the Family Trust earlier than 2016. The tenor of the correspondence (referred to above) when this was first raised by Polczynski Lawyers is inconsistent with the liquidator already being aware of the allegations. 12. The liquidator notes that the Fraser Unit Trust Deed records that the initial unit is held by Jainti as trustee for the "Zamabito" Trust. The liquidator emphasises that the 12 May 2016 minutes do not record any cancellation or substitution for the initial units – rather, they record the tabling of applications for additional units. 13. Pausing again, here, I consider this to be a strong pointer to the correct version being the version propounded by the liquidator – i.e., the Zambito Version of the documents; particularly since the unit certificates are issued in three groups, the one initial unit (there described as a "B Class Unit", the 19 "B Class Units" and the 14 "A Class Units"). 14. The liquidator also emphasises the Fraser Unit Trust taxation statement for the year ended 30 June 2006 (a record kept as part of the books and records of the Fraser Unit Trust) which was issued for tax purposes and reflects the Zambito Trust as the beneficial unit holder (see also the 30 June 2009 taxation statement to same effect) and the financial statements showing the trust distributions. 15. The liquidator attaches considerable importance to the fact that the documents lodged with the ATO in 2010 report that the Zambito Trust was in receipt of the income distribution (T 259) – that being a document sent by Mr Ashton to the liquidator in 2014; and points to the deposit vouchers in evidence that record receipt of payments to Jainti (see T 261) at a time when (on Anthony's case) the Family Trust had been terminated back in October 2008 (noting the ATO statements from Fraser Panorama of which Anthony is a director). The liquidator also points to Anthony's evidence that money from the Fraser Unit Trust went to Jainti and then through the Zambito Trust to his family members (T 262). 16. The liquidator says that if this was a distribution of the payment to a separate trust of which Anthony was a beneficiary in his own right, then the receipt of income would be ascribed to him, as opposed to going through the Zambito Trust; and that this goes to the implausibility of the scenario now advanced by Anthony. The liquidator says that the position is that Anthony was content for income to be run through the Zambito Trust until the present dispute arose (T 262.46-50). 17. The liquidator's submission in relation to the October 2008 minutes is that the document that purports to be the minutes of the meeting of Fraser Panorama of 7 October 2008 refers to the tabling of minutes consenting to the transfer of units at a meeting before 7 October 2008 but the liquidator notes that there is no evidence of any such meeting. The liquidator submits that this supports Jainti's case that the scenario advanced by Anthony is no more than "poetic licence" (see T 264). 18. Emphasis is placed on the directors' report to the liquidator as to the affairs of the company (see Ex L) and the liquidator says that there is no suggestion in that document that Anthony had any other documents of the kind now relied upon. It is noted that the 17 June 2011 directors' report to the liquidator as to the assets and liabilities of Jainti, signed by Anthony, makes reference to "per accounts attached". The liquidator says that this is contemporaneous evidence and that the explanation proffered by Anthony (that he was there indicating some issue as to the unit holding) should not be accepted (see T 265.17-T 266.14). Insofar as Anthony answered questions to the effect that the books and records were kept by way of review by the company accountant, the liquidator says that this amounts to Anthony conveying to the liquidator that the books and records were properly kept (not that there was an error in them). 19. The liquidator notes that in the answers to questions in that document, Anthony ascribes the breakdown in the relations between directors as occurring in May 2011. The liquidator says that the most telling point of the questionnaire is the answer to question two, which states "[d]escribe the company's business", to which there is a hand-written response: "Trustee of Zambito trust to hold investments for the benefit of its members". 20. The liquidator says that Anthony's account of the discussion with Sam on 11 May 2006 is a recent invention, pointing to Sam's evidence that he did not expect the Fraser Unit Trust project to be risky (rather, he expected it to double his money and he says that is what Anthony told them) (see T 95.31-6). 21. As to the evidence of the respective family members, Jainti says that Anthony's account of events is implausible (see my comments above in relation to the particular witness) and that the contentions of David, Frank and Sam, against their own financial interests, should be accepted as the more plausible. 22. As to the interfamily conflict, the liquidator says that there is some uncertainty as to when it was that things "unwound" or "unravelled" from a personal and business point of view as between the families (noting the evidence of Sam and Frank putting this conflict in around 2009) but accepts that there was at some stage a family dispute (in circumstances where an AVO was taken out in 2008). The liquidator says that the relevance of this is that it casts a degree of implausibility as to Anthony's evidence concerning the verandah conversation and Anthony's hypothesis that what occurred in 2008 was a termination of some separate trust involving the family members. 23. The liquidator's position (see T 271) is that Jainti's money was paid wrongly to Anthony; that it is now quarantined in a trust account, so it is traceable into that account; and that an order should be made for payment to the true owner of the funds or alternatively an order for equitable compensation should be made. A declaration is sought that the funds are due to Jainti as distributions from the Fraser Unit Trust and an order is sought to cause those funds to be paid. Anthony's submissions 1. At the outset, Anthony emphasises that, although he was at all material times a co-director of Fraser Panorama, he did not control Fraser Panorama; that the relevant meeting (the 12 May 2006 meeting) was attended by the two directors of the corporate trustee of the Fraser Unit Trust (he and Derek Taylor); and that the decisions of the board of directors of Fraser Panorama were by unanimous resolution. It is submitted that, on an "economic or practical commercial view", Anthony was a director with special responsibility (or nomination) for the original unit holders (holding 34% of the units in the Fraser Unit Trust) and had introduced other family member investors but that both directors (i.e., Derek Taylor as well as Anthony) were responsible jointly as directors of Fraser Panorama for the allocation of units to all the original unit holders of the Fraser Unit Trust. 2. Anthony points out that the 46 other "A Class" unit holders (leaving aside the 14 "A Class Units" the subject of dispute in this proceeding) included investors introduced to the project by both Anthony and Derek Taylor. It is noted that, as directors, both Anthony and Derek Taylor had unit holdings (through their respective entities) and it is submitted that they were acutely aware that they needed to be very careful to ensure that the interests of all unit holders were considered in all decisions by the corporate trustee. Anthony submits that there is no basis for a finding of undue influence or control by Anthony over the board of Fraser Panorama. 3. Pausing here, apart from the fact that no such finding appears to be sought, there is also little to establish the assertion as to the acute awareness of either director as to his responsibilities to other unit holders. In any event, this issue is not raised on the pleadings. The point of the above submission appears to be the proposition that, where there is reference to actions of Fraser Panorama (the corporate trustee), there is no proper basis to attribute those actions to Anthony in his personal capacity as an individual defendant; and that Jainti must establish by admissible evidence (other than the acts of Fraser Panorama) that actions for Fraser Panorama to pay out the final distributions were something other than payments in the orderly closure of the trust following completion of the development (including sales) or were not in accordance with the original constitution of the unit holding for the 34 Units in dispute when the unit holding was established in 2006 (and that there is no prejudice preventing the making of a declaration that any business records to the contrary are incorrect). 4. Pausing here, the distinction between Anthony in his personal capacity and Anthony as a director of Fraser Panorama does not to my mind assist in the resolution of the issues here in dispute. What is relevant is not so much the decision-making at the Fraser Panorama level as to the payment out of the respective distributions (i.e., Anthony is not being sued in his capacity as a director for the decision to make those payments). Rather, the claim against Anthony is one of knowing receipt of the distribution paid to him. This turns on whether the payment was authorised under the Fraser Unit Trust Deed (and made to the correct beneficiary) and, if not, whether he was on notice of the facts giving rise to that (see Barnes v Addy; Hasler v Singtel Optus Pty Ltd (2014) 87 NSWLR 609; [2014] NSWCA 266). 5. It is said that Derek Taylor is the only independent witness in the proceeding and that his evidence was clear, namely that: this was a reasonably large property development and investment; the equity capital in the venture was $3,000,000; the development required a property development loan facility (guaranteed by the personal guarantees of Derek Taylor and Anthony alone) that reached more than $7 million during construction and before sales of the developed properties allowed the loans (including the equity capital loans) to be paid out. It is said that Fraser Panorama, as trustee of the Fraser Unit Trust, was charged with care and responsibility for all of the investors' funds (including Anthony and Derek Taylor's own personal stakes). None of this seems to me to go to the central issue in the proceeding, which is whether Jainti held the 34 Units in question as trustee for the Zambito Trust (as the liquidator contends) or for the individual beneficiaries under the separate Family Trust (as Anthony contends); or the ancillary question, if Jainti held the units for the individual beneficiaries of the Family Trust, whether that trust was validly terminated as to three of those individuals (including Anthony). 6. Anthony emphasises that Derek Taylor is independent of him; that they are not related by family; and that they do not have ongoing business activities. Anthony also points out that Derek Taylor is also not related to any of the persons claiming, under Jainti's case, to be beneficially entitled to the 34 Units (whether as eligible beneficiaries under the Zambito Trust or, if the property in the 34 Units did not vest in the incoming liquidator, as parties beneficially entitled under distributions made under the Zambito Trust Deed and set out in the accounts or draft accounts of Jainti). 7. Anthony accepts that this is a documentary case in the first instance (T 272.40-1). Further, as adverted to above, it is accepted by Anthony that, if his 2006 case (concerning his version of the events of the 12 May 2006 meeting) does not succeed, then he cannot succeed in the proceeding. More pertinently, it is accepted that, if the 2006 events cannot be resolved "one way or the other", then Anthony's case will fail (T 272.45-8). 8. Anthony says that the primary documents for consideration are the applications for units and allocation of units (characterising as secondary documents those after 12 May 2006 that support what happened on that occasion – the liquidator cavils with the description of these as secondary documents). It is accepted by Anthony that the financial statements are business records and (per ASIC v Rich at [114]-[115]) are prima facie evidence. However, Anthony's primary submission is that ongoing financial statements which "way after the fact" have followed an error do not establish truths; rather, it is said that they simply present a version of events that "may or may not need to be explained". Hence the submission is made for Anthony that, if property was transferred in 2006 (i.e., if the 34 Units were held on trust for the individual beneficiaries, later financial statements cannot change that fact). 9. Pausing here, I accept that financial statements and the like cannot change the title to property. However, it seems to me that what this submission does not take into account is that if there is (as is the case here) uncertainty as to what did in fact occur at the relevant time, then subsequent conduct (including the filing of tax returns and the like) can shed light on what in all the circumstances is the most likely chronology of events and can corroborate evidence as to what was said or done at the relevant time. 10. As to the knowing receipt claim, Anthony contends that the distribution by Fraser Panorama was not in breach of cl 10.9(f) of the Fraser Unit Trust Deed. Anthony's position is that notices by Fraser Panorama (the trustee of the Fraser Unit Trust) of its intention to pay out the final distributions in respect of the 34 Units were issued to all beneficial owners of 1/5th shares in the 34 Units, from about September 2016 through to December 2018; namely to Sam and Frank, holders of two of the 1/5th shares in the 34 Units (as trustee for Sam); and to each of Bruno, David and Anthony as registered holders of a 1/5th share in the 34 Units, respectively. (That, however, turns on who is or are the relevant beneficiary or beneficiaries.) 11. It is said that, in December 2018, when Fraser Panorama paid out the distribution to Anthony in respect of the dividend entitlement for the 1/5th share in the 34 Units, that payment was made in accordance with the Fraser Unit Trust Deed and was made to the registered unit holder in respect of his 1/5th share in the 34 Units. 12. It is further said that the records of the Fraser Unit Trust, relied upon by Fraser Panorama for the notices concerning the final dividend distribution and intended closure of the Fraser Unit Trust, were in accordance with records of the Fraser Unit Trust then dating back 8 years earlier to October 2008. 13. Anthony points to his affidavit setting out the steps taken to provide notice of the October 2008 Jainti meeting. It is noted that the affidavits filed by witnesses for Jainti contradict the version of events stated by Anthony; but Anthony points out that no specific reply affidavits have been filed by parties named by Anthony as included in that process and that Jainti has not filed any affidavit by Carol, who is named by Anthony as having an important role in communicating the notice of meeting and confirming receipt of the notice. It is said that the minutes of the next following meeting (in June 2009) are explicable only on the basis that relevant parties had notice of the meeting. 14. Pausing here, it is no doubt the case that the subsequent minutes (the June 2009 minutes) make reference to (and record a resolution confirming) the earlier minutes of meeting. However, it is difficult to treat the June 2009 minutes as confirming that notice was validly given for the earlier meeting in circumstances where Sam and Frank made complaint about notice of the meeting and would have been out-voted on the resolution to confirm the minutes in any event. 15. Anthony submits that Jainti's allegations are unsupported by admissible contemporary records; and, in relation to the May 2006 meetings that formally established the unit holding in the Fraser Unit Trust, are incorrectly reliant upon draft documents prepared in advance of the relevant meeting. Anthony submits that the documents relied upon by Jainti (i.e., the Zambito Version of the documents) were clearly draft (and not final) documents (noting the evidence from Frank that it was his practice to take a copy of documents left on the table for filing and safekeeping – see Frank's affidavit sworn 23 May 2019 at [16]). Counsel for Anthony accepts in closing submissions that various of the draft documents had Anthony's electronic signature affixed in advance of the relevant meeting and says that this was in the expectation that they were (when the signature was affixed) "in final form" (see also Anthony's affidavit sworn 20 September 2019 at [3.4]; [3.9]). 16. Anthony's evidence (I interpose to note that this is challenged by Jainti's witnesses) is that the "draft documents" were changed by Anthony upon instruction and authorisation before the meeting in respect of the unit holding for the 34 Units (see Anthony's affidavit sworn 20 September 2019 at [3.4]; [3.9]). It is said that no affidavits were filed in reply by Jainti to Anthony's evidence concerning the reason for the change in the unit holding for the 34 Units or the consultation that Anthony undertook to inform all five affected individuals. Anthony says that the documents, as amended by the late change, were further changed and marked by hand with other changes in the meeting of Fraser Panorama. Anthony contends that those changes are: marked on the final form of the minutes of the meeting confirming the initial unit holders of the Fraser Unit Trust; recorded in the Fraser Unit Trust register of unit holders; recorded on the unit certificates prepared for each of the initial unit holders in the Fraser Unit Trust; and confirmed in the affidavit of Derek Taylor, the fellow director of Fraser Panorama. 17. Anthony contends that the tabled and approved minutes of the May 2006 meeting (including hand marked changes made in the meeting and initialled by both Derek Taylor and himself), the Unit Holders Agreement (including hand marked changes made in the meeting and initialled by both Derek Taylor and himself), and the Unit Certificates issued in accordance with the minutes, constitute and record that Jainti was the trustee for five individuals in respect of the 34 Units, the subject of this proceeding. It is said that the Unit Holders Agreement confirms that the five individuals were "20%" (and Anthony submits that this should be construed as "20% each"). Anthony says that there is no credible sequence of events that would have a trust for the benefit of five individuals being changed back to a trust for the Zambito Trust; so that the logical sequence of events is Anthony's version. He says that one is either left with a "concoction" or with Anthony's version. 18. As adverted to above, Anthony submits that subsequent financial records, whether draft or approved, cannot be evidence of legal title to the 34 Units. It is said (referring to the liquidator's affidavit) that the financial accounts are also in draft (see Mr Reidy's affidavit sworn 7 February 2019 at [17]); that the accounts are not verified or audited; that the accounts provide no details or notes in relation to the 34 Units; and that there is no evidence of the basis of instructions provided to Mr Ashton to prepare the draft accounts. Anthony argues that the distribution of entitlements set out in the draft Jainti accounts is explicable only on the basis that the five 1/5th share entitlements in the 34 Units were to be treated in accordance with the individual wishes or directions of the five named individuals (Anthony, David, Bruno, Frank and Sam). 19. Anthony further says that the beneficiaries table is consistent with: the 1/5th share entitlement of Anthony being distributed to Anthony, Anthony's wife and their son and daughter; the 1/5th share entitlement of David being distributed to himself as to 100%; the three 1/5th share entitlements of Bruno, Frank and Sam being "pooled" and Zambito, a family company then with tax losses, being introduced as a beneficiary with balance sums to each of Bruno, Frank, Frank's wife (Gail Morabito), and Sam (referring to Exhibit A at 106). 20. Insofar as the liquidator places reliance on the approved accounts of Fraser Panorama for 2010, which include the approval signature of Anthony, it is again submitted by Anthony that the financial records cannot be evidence of legal title to the 34 Units. Further, it is said that the approval by Anthony was marked without Anthony noticing the error; that approved financial accounts may include errors; that the accounts are not audited; that the accounts provide no details or notes in relation to the 34 Units; that there is no evidence of the basis of instructions provided to Mr Ashton to prepare the accounts; and that the error in the accounts is explicable because the draft Jainti accounts were also prepared by Mr Ashton. 21. The October 2008 change in the unit holding is said to be evidenced by contemporaneous records of Jainti and of Fraser Panorama (the corporate trustee of the Fraser Unit Trust). Insofar as Jainti's witnesses challenge the veracity of those records, it is said that this challenge should be weighed against: the contemporaneous records; the oversight provided by Fraser Panorama having a second director "entirely independent" of the persons named as beneficial owners of the 34 Units (i.e., Derek Taylor); when the records were created and the extended period before any challenge was raised; the records of invitations issued to the relevant meeting, the minutes prepared of that meeting and (which Anthony emphasises) the minutes of the next meeting held (there was an extended period or break between meetings) where the solicitor representing Sam and Frank attended (Mr Jenkins) to voice complaints about the earlier meeting (which complaints are recorded in the minutes). Emphasis is placed on the fact that the first item of business for that following meeting was approval of the minutes of the earlier meeting (see Exhibit 2). It is said that the minutes were circulated following the meetings; that no complaints or disagreement concerning the minutes were issued before these proceedings were commenced and that Jainti has not called Mr Jenkins to provide evidence to contradict the minutes of the meeting that he attended. (Nor, I might add, has Anthony.) 22. As to the declaration sought by prayer 1, it is submitted that there is no proper basis for the declaration sought that the records of the corporate trustee of the Fraser Unit Trust are incorrect or should be rectified in some manner. 23. As to the 12 May 2006 meeting, Anthony says that the central issue turns upon the status of the draft documents prepared by Anthony for the 12 May 2006 meeting (which he says were laid out in bundles for each of the original unit holders to collect); approved minutes of the meeting of the board of Fraser Panorama held on 12 May 2006 (including hand-marked amendments and the initials of Derek Taylor and Anthony); the signed Unit Holders Agreement (including hand-marked amendments to, and the initials of both Anthony and Derek Taylor); and unit holder certificates issued in accordance with the 12 May 2006 meeting. 24. Anthony points to the following aspects of the signed Unit Holders Agreement which he says are errors. First, that the second named party ("Jainti Pty Limited … as trustee of the Zambito Trust") differs in the description of the trust, from the hand-marked changes at cl 6 of the document that are initialled by Anthony and Derek Taylor (see above) (where Jainti is named without any description of its trustee capacity). Second, that the third named party, "Leading Edge (Pacific) Pty Limited", is different from the hand-marked changes at cl 6 of the document that are initialled by Anthony and Derek Taylor where "Leading Edge" is crossed out and "Tuta Product" is handwritten and initialled by Anthony and Mr Taylor; as well as the execution page, where "Leading Edge Pty Limited ACN 003308 590" is crossed out by hand, and a hand-written insertion of "PERCO" is marked and crossed through as an error and details of "TUTA PRODUCTS PTY LTD" are added in handwriting where Derek Taylor's signature is recorded. 25. Anthony places emphasis on the Unit Holders Agreement for three reasons. First, that cl 6(e) sets out the basis of the "free carry" for the "B Class Units" referred to by Derek Taylor in his oral evidence (see above). Second, that the initial two units held in the Fraser Unit Trust, when it was first settled or established, are stated to be "ordinary" units (noting that it is common ground that the Fraser Unit Trust, after the 12 May 2006 meeting, was constituted by a unit holding that totalled 100 units). Third, that the oral evidence of Derek Taylor, and the direct documentary evidence relied upon by Anthony, are that the Fraser Unit Trust was constituted by an allocation of 100 total units, allocated across: 60 "A Class Units", each unit with an obligation to contribute $50,000.00; and 40 "B Class Units", each unit with no obligation to make any payment into the unit holding; and, all 100 units with equal rights to receive distributions. 26. Anthony points to Derek Taylor's evidence that he wanted to change his units from Leading Edge to Tuta Products; and that this was not recorded in the minutes that there was such a change, but that Derek Taylor was emphatic that there was such a change. 27. It is said that the 12 May 2006 unit certificates, in respect of the 34 Units, clarify how the initial 2 "ordinary" units in the Fraser Unit Trust were treated. For the 34 Units, there are 3 certificates: one for the 14 "A Class Units"; one for 19 "B Class Units"; and one for one "B Class Unit". 28. Anthony submits that the certificate for the one "B Class Unit" is the certificate issued "in substitution for" the 1 "ordinary" unit from the original settled unit holding of the Fraser Unit Trust. He says that this is the most straight forward explanation and best accords with the recollection of Derek Taylor and the evidence by Anthony of his understanding; that this results in the Fraser Unit Trust being constituted by a unit holding of 100 units, which accords with the common understanding of both parties in the proceeding; and that this substitutes the ordinary units (with no obligation to contribute capital funds) with a "B Class Unit" that also has no obligation to contribute funds to the development but has equal rights to participate in distributions. 29. Anthony relies upon the conversation between Anthony and Sam (set out in [3.9] of Anthony's affidavit sworn 20 September 2019); the communication that occurred during that conversation to change the unit holder for the 34 Units (set out in [3.9] and [10.13] of Anthony's affidavit sworn on 20 September 2019); the evidence of Derek Taylor that he attended the meeting and signed the documents on the 12 May 2006; and Anthony's evidence that he attended the meeting and signed the documents. 30. Emphasis is placed on the fact that, in 2006, when these documents were created, there was no conflict or acrimony between the Morabito and Zamattia families. It is submitted that there was no basis for the accusation made in cross-examination of Anthony that Anthony was lying or would lie about events in or about the May 2006 meeting of Fraser Panorama, the corporate trustee of the Fraser Unit Trust. 31. Anthony says that, for the liquidator's submission to be right, it would mean that Anthony contemplated in 2006 that some sort of dispute would later arise and tried to falsify a document which disputed a view of which he was not aware at the time (T 282.33-8). 32. Pausing here, I accept that such conduct would be far-fetched but it seems to me that a more plausible explanation is that there were various documents, some draft, some with handwritten amendments, and all (inexplicably) bearing Anthony's electronic signature. When determining what were the correct (i.e., final) ones, one must consider what makes sense logically, having regard to all of the circumstances. Tax records after the relevant meeting that suggest how the parties understood it to be at the time; and Anthony's failure to correct the position, while this cannot determine the construction to be placed on the documents themselves, is subsequent conduct that may relevantly shed light on the relevant chronology of events and what document was the final version at the time. 33. It is noted that Jainti has produced the following documentary evidence: the original unit holding of the Fraser Unit Trust dated on or about February 2006; draft minutes of the proposed 12 May 2006 meeting prepared in final form for the meeting including the electronic signature of Anthony but no signature of Derek Taylor; the document that reads as a minute of a meeting of the trustee of the Fraser Unit Trust held on 12 May 2006, signed by Anthony; and a draft register of unit holders prepared for the 12 May 2006 meeting, unsigned. 34. As to the draft minutes, it is noted that, in cross-examination, Derek Taylor was taken to: the Fraser Unit Trust Deed and shown the details of the original unit holders in the trust (namely 1 ordinary unit – Jainti Pty Ltd atf Zamabito Trust [and it is common ground this is a misspelling of "Zambito"] and 1 ordinary unit - Leading Edge (Pacific) Pty Ltd atf Raidell Trust); and the minutes of meeting signed by Anthony (which Derek said that it looked right or consistent with the Fraser Unit Trust Deed). It is noted that Derek Taylor did not provide evidence, in relation to this document, of a refreshed recollection. (Pausing here, Derek Taylor's cross-examination as to when he made the markings on the document, "[w]ell, presumably around 12 May", is hardly a clear recollection of events – see T 153.6-9.) 35. As to the status of the financial accounts and tax returns prepared by Mr Ashton, it is noted that the financial accounts name the unit holder in respect of the 34 Units as Jainti Pty Ltd (atf for the Zambito Trust). (It is noted that the evidence of the liquidator is that he did not, and has no obligation as liquidator, to verify or complete the accounts.) 36. Insofar as the declaration signed by the company directors (Anthony, David and Bruno) to the incoming liquidator where the declaration lists the business or operation of Jainti as "trustee of the Zambito Trust" and omits any reference to "Jainti Pty Ltd (atf Sam Morabito and Frank Morabito)", Anthony submits (again) that the unverified accounts and tax returns (and, on occasion, documents signed by Anthony) are not evidence of title of Jainti (as trustee for the Zambito Trust) to the 34 Units. 37. Anthony points to the distributions made to the Walton Family Trust and Bland Investments Pty Ltd (Bland Investments) and that there was no mention of Bland Investments on the Zambito Version of the documents. Therefore, Anthony says that the Individual Beneficiaries Version must be the latest version. However, what is clear is that there is inconsistency in the treatment of distributions – some distributions which are consistent with the Zambito Version of the documents and a distribution to Bland Investments which is consistent with Anthony's version of events (see T 284). 38. Anthony says that only his version gave rise to the tax accounts because Tuta Products was assessed on unit tax on 20 units (not 19); and Bland Investments was included in the distribution (see T 299), i.e., it is said that tax paid in relation to those unit holders is consistent with Anthony's version and tax paid in relation to Jainti is not consistent. 39. The liquidator in response says that the plaintiff's case theory does not require a finding that the Zambito Version of the minutes correctly reflected every single unit holder; and points out that there was no evidence as to what happened with other unit holders such as Bland Investments after the units were issued. 40. As to the October 2008 meeting and the separation of the Morabito and Zamattia interests, Anthony submits that the documents and evidence concerning the October 2008 meeting are entirely consistent with the 12 May 2006 minutes and the unit certificates in evidence. It is said that the documents for the change made in October 2008 consist of: minutes of the 7 October 2008 Jainti meeting; minutes of meeting of Fraser Panorama dated 24 October 2008; the invitation dated 17 June 2009 to attend the meeting of 9 July 2009; and minutes of the 9 July 2009 meeting of Jainti confirming the minutes of 7 October 2009. 41. As to the oral evidence, Anthony points to the evidence that Frank gave to the effect that the Zamattias wanted to split their business interests from the Morabitos (from 2007 – see T 74.1-11 – or in or about mid-2008), and that the Morabitos wanted to remain; and to the evidence of Sam that the parties had decided at that time that they were no longer going to do business together. 42. Anthony submits that, in the absence of evidence from Mr Ashton as to when he prepared the accounts, ending 30 June 2008 (which would in the normal course be prepared a few months after that date), the true events are as represented or reported in the Fraser Unit Trust accounts signed by Anthony and the tax return filed in accordance with those accounts; and that an inference may be drawn that the accounts would have been prepared and submitted to the relevant officers of Jainti and to the directors of Fraser Panorama after the end of the financial year, and most relevantly for the continuing proceeding, after the May 2006 meeting. 43. It is noted that Derek Taylor provided evidence that the decision of Fraser Panorama to make the payment of the sum of $161,160 to Anthony was made following receipt of legal advice by the board of Fraser Panorama addressing the disputed claims of entitlement to the 34 Units or to proportionate 1/5th interests in the 34 Units; and was made because Anthony, in his individual capacity, was the unit holder on the Fraser Unit Trust register of unit holders of a direct 1/5th interest in the 34 Units and thereby entitled to receive the payment (see Derek Taylor's affidavit sworn 7 October 2019 at [2.4]). (There is no evidence of this advice.) 44. Anthony therefore submits that the actions of Fraser Panorama as the corporate trustee of the Fraser Unit Trust to make the payment of the sum of $161,160 are an intervening cause that cannot be attributed to Anthony or challenged as wrongful conduct by Anthony or otherwise be attributed to Anthony. 45. Anthony argues that the actions of Fraser Panorama as the corporate trustee of the Fraser Unit Trust were in accordance with the terms of the Fraser Unit Trust Deed because the payment was made to Anthony as the registered holder of a 1/5th interest in the 34 Units; and that if Jainti is to impugn the actions by Fraser Panorama, Jainti must establish by probative evidence, that the original unit holding of the Fraser Unit Trust, made in respect of the 34 Units in May 2006, was incorrect and that Anthony knew of this error. 46. Anthony in his submissions raises a raft of other complaints. 47. First, insofar as the liquidator has submitted that witnesses have given evidence against their own financial interests, there is a suggestion in Anthony's submissions as to there being ethical issues arising insofar as he submits that Jainti or the liquidator ought to have insisted that the persons with "Boensch v Pascoe rights" seek independent legal advice (referring to Boensch v Pascoe [2019] HCA 49 (Boensch v Pascoe) rights concerning property said to be held on trust for the individuals). Anthony complains of delay on the part of the liquidator in this regard (pointing to the Hayne Banking Royal Commission and the body of law developed to protect parties providing mortgages or securities for a third party borrower as stark reminders that, where there is a legal conflict in position, the party with commercial power or the advantage of legal representation cannot take or press that advantage without providing (and in some cases, insisting) that the other party not act to their peril or disadvantage without being independently advised). 48. Second, Anthony submits that the delay by Jainti in challenging the effect of the events in May 2006 and October 2008 (absent a pleading alleging, or evidence of, fraud or deliberate concealment) is prejudicial and that Jainti is not entitled in these proceedings to seek to reopen the 12 May 2006 and October 2008 "unit-holding constitutional meetings". (Pausing here, no defence based on delay appears to be pleaded.) 49. In that regard, Anthony submits that the delay by Jainti should be considered in three periods: from 27 May 2011 (when Mr Reidy was appointed as voluntary administrator) to 2 December 2016 (as to which period he says Mr Reidy's evidence in relation to his conduct of the administration of Jainti, either as voluntary administrator or as liquidator, is sparse); from 3 December 2016 to 30 September 2019; and from 1 October 2019 to date. 50. As to the first period, complaint is made that there is no evidence as to what steps the liquidator took to finalise draft accounts; to investigate matters; and to press for a directors' report from Sam or Frank. As noted already, Anthony submits that a Jones v Dunkel inference may be drawn from the absence of evidence of the liquidator's file notes of meetings that they may not assist Jainti's case. 51. As to the second period, complaint is made that the financial report submitted by the liquidator (as to which there are two versions) concerning the administration of Jainti does not provide details which permit verification of the information there reported. 52. Third, it is said that Jainti has not sought rectification of records but that it is seeking relief by way of declaration (prayer 1) which would operate retrospectively and which is contrary to those records. It is noted that the critical requirement for the remedy of rectification (and, it is said, for a declaration contrary to the records) is cogent evidence of a common intention. Anthony submits that it is clear from the evidence that there is a common intent in the proceedings, but that is "an intent formed at the wrong time and place" and he says that it is "not of probative value except to inform reception of their oral testimony of events 8 to 10 years earlier". 53. It is submitted that there is no evidence of probative value by Jainti of contemporaneous expressed concern or complaint that: the May 2006 Fraser Unit Trust register of unit holders for the 34 Units did not reflect the common intention of the five named beneficial unit holders; and the October 2008 transfer to separate the beneficial interests of the Zamattias (including the second defendant) from the beneficial interests of the Morabitos did not reflect the intention of the five named beneficial unit holders. 54. It is submitted that there is more than mere delay in the present case because the delay in challenging the May 2006 Fraser Unit Trust register of unit holders for the 34 Units relevantly prejudices: the actions taken by the parties in October 2008 to separate the beneficial interests of the Zamattias (including the second defendant) from the beneficial interests of the Morabitos; and the actions of Fraser Panorama as the corporate trustee of the Fraser Unit Trust in finalising the distributions to unit holders for closure of the trust upon completion of the development including all sales of the properties. 55. It is said that the relationship between the Zamattia family members (Anthony, David and Bruno) broke down in late 2016, when Polczynski Lawyers advised the three Zamattias that the firm could no longer act for the three clients, jointly, because of the internal conflict between the family members. (Pausing here, the letter from Polczynski Lawyers to this effect is dated 6 March 2018 – see Annexure E to David's affidavit sworn 17 April 2019.) Anthony says that although this is external to the liquidator, the prejudicial impact of this was because of the delay by the liquidator in resolving the disputed claims to the 34 Units. It is submitted that further contemporaneous records would have been available if the inquiry or claim had been made within a reasonable time or (at the latest) within the usual limitation period for civil complaints; and that relevant parties/witnesses would have had a better recollection (or memory refreshed by consideration of contemporaneous records). (Again, there is no pleading of any defence of laches or the like.) 56. Anthony says that, while David is adamant that his position has not changed (and Anthony accepts that is a true statement of his current beliefs and attitudes following the breakdowns in the relationships within the family), this is clearly at odds with the records, namely that: David regularly appointed Anthony to be his proxy at meetings; and that David, with Bruno and Anthony, engaged Polczynski Lawyers to represent the Zamattia interests in the 34 Units until Polczynski Lawyers withdrew because of a conflict between the firms' then three clients. 57. In these circumstances, Anthony submits that there has been delay and prejudice and hence that Jainti should not be permitted to reopen: the May 2006 meeting establishing the original unit holding in respect of the 34 Units; and the October 2008 transfers of 1/5th beneficial interests in the 34 Units to the beneficiaries, including relevantly for the continuing proceeding, to the second defendant. 58. As to the reliance placed by Anthony on the "rule" in Saunders v Vautier (that parties beneficially entitled under a trust may terminate such trust), confirmed in Australia by CPT Custodian Pty Ltd v Commissioner of State Revenue (2005) 224 CLR 98; [2005] HCA 53 (CPT) at [43]-[48]), and discussed by Leeming JA in Beck v Henley (2014) 11 ASTLR 457; [2014] NSWCA 201 (Beck v Henley) at [32]ff); and the contention for the liquidator that Anthony has no rights under the rule in Saunders v Vautier on the basis that the resolution of Jainti set out in the minutes of the 7 October 2008 meeting was passed by a majority 3:2 and that decisions affecting the rights of five named individual beneficiaries (under Anthony's case) cannot be made by a majority, Anthony submits that the 12 May 2006 unit certificates need to be read with the Unit Holders Agreement that sets out the rights and obligations of the different classes of units and includes the handwritten notation "20%" at the end of the list of initials of the five beneficiaries; and, second, that, at October 2008, there was a common and shared agreement of all five listed beneficiaries that the Morabito and Zamattia business interests were to be separated. It is said (again) that the shared or common intent of the Morabitos (referring to their oral evidence) is that they wished to remain and that the Zamattias wished to leave or separate; and that this was the outcome of the October 2008 meeting. 59. In effect there seemed also to be a submission for Anthony as to the unlikelihood of concoction of documents based on him giving his family a free carry interest and working for his family. It was said to be implausible for him to change his mind. Anthony's supplementary submissions 1. By leave, Anthony filed supplementary submissions predicated on the assumption that the Individual Beneficiaries Version of the documents (i.e., the minutes with hand-marked and initialled amendments that align with the same unit holder amendments in the Unit Holders Agreement) is the correct minute or record of the 12 May 2006 meeting (i.e., his version of the 12 May 2006 meeting) – an assumption that the liquidator in his supplementary submissions in response says is not made good. 2. On that basis, Anthony puts forward what he says is a third construction of the events of 12 May 2006 to the effect that the two classes of units ("A" and "B" Class) and the original ordinary units should be dealt with discretely. Anthony invokes the principle of the "minimum equity" in this regard, suggesting that minimum equity may be achieved by addressing the two classes of units and the original ordinary units separately. 3. It is noted that Jainti has adduced evidence (and Anthony accepts this fact) that the Zamattia and Morabito families provided an equity investment loan of $700,000 to meet the subscription obligations in respect of the 14 "A Class Units" but it is said that Jainti has not provided any evidence of the basis of the claim that the 20 "B Class Units" were subscribed by Jainti (as trustee for the Zambito Trust) or were otherwise issued to Jainti (as trustee for the Zambito Trust). Thus, it is submitted that any intervention by equity should be limited to a declaration in respect of the 14 "A Class Units". 4. Anthony submits that, should equity intervene to declare that title in the 14 "A Class Units" is held by Jainti (as trustee for the Zambito Trust) (or that Anthony is estopped or prevented by the admissions in secondary documents signed by him from denying that this is so), the relief should be limited to such a declaration on the grounds that: first, such declaration is in accordance with the principle of minimum equity; second, such a declaration is in accordance with the intention of the parties when the Fraser Unit Trust Deed was settled and Jainti (as trustee for the Zambito Trust) was named as the holder of one "ordinary" unit; third, equity follows the law and the documents relied upon by Anthony in respect of the 12 May 2006 meeting (including the Unit Holders Agreement) do not include a document executed by the holders of the two ordinary units when the Fraser Unit Trust was settled. 5. Fourth, it is said that the grant of title to the 14 "A Class Units" to Jainti (as trustee for the Zambito Trust) is in accordance with: the rights of Jainti (as trustee for the Zambito Trust) as one of two original unit holders under the Fraser Unit Trust Deed; the admitted fact that the Zamattia and Morabito families provided an equity investment loan of $700,000 to meet the subscription obligations in respect of the 14 "A Class Units"; and Jainti's evidence that the financial records of Jainti (as trustee for the Zambito Trust) include a $700,000 loan and such declaration of title would accord with that loan being the subscription amount of $700,000 (i.e., 14 x $50,000) for the 14 "A Class Units". 6. Insofar as equity looks to intent, Anthony says that the plaintiff, as liquidator of Jainti (as trustee for the Zambito Trust) (i.e., as trustee), has petitioned the Court for a declaration (the trustee's intention) that includes the 14 "A Class Units"; and that Sam and Frank (whether in their role as directors of Jainti at the relevant time, or as eligible beneficiaries under the Zambito Trust) gave evidence that they believed that the Zamattia and Morabito investment would be via the Zambito Trust. Anthony says that, while such evidence of intent is partial, it may be sufficient in respect of the 14 "A Class Units". 7. Anthony submits that he is an eligible beneficiary under the Zambito Trust and is entitled to 20% or a 1/5th share in any dividend in respect of the 14 "A Class Units": as a vested interest in distributions or entitlement under the trust; or subject to the priority and administration of the liquidator and orders of the Court. 8. Relevantly, Anthony here submits that, on the evidence filed by Jainti, orders in equity to achieve "minimum equity" should not extend to the title claimed by Jainti in respect of the 20 "B Class Units". 9. It is submitted again that, absent proof of the 12 May 2006 meeting (or the intervention of equity), when the Fraser Unit Trust was capitalised, all Jainti's "secondary" evidence of title to the units is rebutted and Jainti has failed to provide evidence of the issue of the 20 "B Class Units" to Jainti (as trustee for the Zambito Trust). 10. Anthony refers to the evidence of Derek Taylor that the 40 "B Class Units" under the Unit Holder Agreement were allocated at the 12 May 2006 meeting to him (as to 20) and to Anthony (as to 20); that the "B Class Units" were issued in consideration of his and Anthony's shared role in introducing the unit holder investors for the 60 "A Class Units", and the guarantees provided by him and Anthony alone of the loan facility of about $7 million required to fund the subdivision and construction works required for the project; that Derek Taylor subscribed for 20 "B Class Units" and the units were issued in the name of unit holding entities nominated by him; and that Anthony, without obligation to do so, proposed to share his 20 "B Class Units" with the five nominated members of the Zamattia and Morabito families (Sam, Frank, Bruno, David and Anthony). Anthony submits that this is a gift that has failed. 11. Anthony submits that Jainti, acting as trustee of the Zambito Trust has provided no evidence of any valuable consideration or other basis for a legal claim of title in respect of the 20 "B Class Units"; has disputed the record of the 12 May 2006 minutes of the meeting that issued the 20 "B Class Units" as a gift by Anthony (i.e., no payment) to Jainti ("atf SM, FM, BZ, DZ and AZ 20%"); that Sam and Frank, in their evidence in the proceeding, have repudiated any such entitlement or basis of entitlement in respect of the 20 "B Class Units" and could not provide any evidence as to why they were claiming (through Jainti as trustee for the Zambito Trust) an entitlement to 34 Units when their only knowledge (and evidence) supported a subscription for 14 units at $50,000 per unit or a total of $700,000; and that David's evidence of his belief (against his financial interest) that he was unaware of any arrangement whereby he was to hold any interest in the Fraser Unit Trust is consistent in respect of the 20 "B Class Units" with David having no interest in the units. 12. Against these findings or rulings, Anthony submits that: the decision by Anthony to allocate the 20 "B Class Units" to "Jainti Pty Ltd (atf SM, FM, BZ, DZ and AZ – 20%)" was a gift without consideration by any of the named beneficiaries; that gift has failed because the beneficiaries, by their evidence in the proceeding or by their conduct referred to in that evidence, have repudiated any such allocation of the 20 "B Class Units" at the 12 May 2006 meeting and have positively contended for a different allocation of the 20 "B Class Units", contrary to the "20%" share held by each of the named beneficiaries, in favour of an allocation that would result in Anthony's interest being only that of a beneficiary under a discretionary trust (i.e., "lost"). 13. Anthony submits that the minimum equity needed to avoid relevant detriment to Anthony in respect of the 20 "B Class Units" to which Anthony was entitled (matching Derek Taylor's allocation of 20 "B Class Units") is either: that there should be a finding that the gift fails entirely, with the 20 "B Class Units" not having vested in "Jainti Pty Ltd (atf SM, FM, BZ, DZ and AZ – 20%)", and thus declare Anthony as the unit holder beneficially entitled to the 20 "B Class Units"; or there should be a finding that the gift fails in respect of 20% of the 20 "B Class Units" (i.e., in respect of 4 "B Class Units"), and there should be a declaration that Anthony is the unit holder beneficially entitled to 4 of the 20 "B Class Units" and that the remaining 16 "B Class Units" are to be held by Jainti (as trustee for the Zambito Trust). 14. As to the original Fraser Unit Trust "ordinary units", it is noted that the parties agree that the Fraser Unit Trust was capitalised and the unit holders subscribed for the units in the Fraser Unit Trust at the meeting held on 12 May 2006. 15. Anthony submits that, in accordance with the equitable maxim of "minimum equity", the 34 Units should be considered discretely for "A Class Units" and for "B Class Units"; and the original ordinary units should be considered as dormant and non-participating in the project because they were not dealt with in the documentary records of the 12 May 2006 meeting. 16. Anthony submits that should his "minimum equity" submissions be accepted, he should be declared, alternatively: (a) if the gift by Anthony of the 20 "B Class Units" fails in its entirety, the beneficial owner of 20 "B Class Units" entitled to distributions made by the Fraser Unit Trust of $473,529.41 (i.e. 20/34ths of the $805,000 distribution made in respect of the 34 Units); or (b) if the gift by Anthony of the 20 "B Class Units" does not fail in its entirety, the beneficial owner of 4 "B Class Units" and entitled to distributions made by the Fraser Unit Trust of $96,600.00 (i.e. 4/34ths of the $805,000 distribution made in respect of the 34 Units); and further, that he should be declared as a beneficiary under the Zambito Trust with a vested 20% (1/5th) entitlement to distributions made by the Fraser Unit Trust in respect of the 14 "A Class Units" (i.e. 20% of 14/34ths of the $805,000 distribution made in respect of the 34 Units) or a present entitlement to $66,294.12. 17. In those circumstances, Anthony submits that Jainti should be declared the unit holder of 14 "A Class Units" as trustee for the Zambito Trust; and, if the gift by Anthony of the 20 "B Class Units" does not fail in its entirety, 16 "B Class Units" as trustee for the Zambito Trust. To ensure finality in respect of the $161,160 held in the controlled moneys account of Bird & Bird, Anthony seeks final orders that the sum of $161,160 be released from that account and paid to Anthony (to an account advised to Bird & Bird). Jainti's Supplementary Written Submissions 1. Jainti says that Anthony's supplementary submissions are expressly predicated on an assumption (see [1] of Anthony's supplementary submissions) that is wrong in fact and cannot be made out. Jainti says that the two documents on which Anthony relies for that submission (the Individual Beneficiaries Version of the 12 May 2006 minutes and the Unit Holders Agreement) do not align; rather that they are materially different in the following respects. 2. First, it is noted that the Zambito Version of the minutes notes nine persons as having applied for units (in addition to the existing two units on issue at the time) whereas the Unit Holders Agreement notes eight persons as having applied for units. Second, the Individual Beneficiaries Version of the 12 May 2006 minutes records that a John Allan Wright is a person whose application for units was tabled at the 12 May 2006 meeting. However, the Unit Holders Agreement makes no reference to this person. Third, the Individual Beneficiaries Version of the document makes reference to a company, T&I Walton Pty Ltd (atf Walton Family Trust) as having applied for 10 "A Class Units" (and has hand-marked amendments next to it) whereas the Unit Holders Agreement refers to an individual by the name of Terry Walton with no reference to any Walton Family Trust. Fourth, the Individual Beneficiaries Version of the 12 May 2016 minutes ascribes 14 "A Class Units" to Jainti and 20 "B Class Units" whereas the Unit Holders Agreement ascribes 20 "A Class Units" (at paragraph 6(c)) and 20 "B Class Units" (at paragraph 6(b)). Finally, that the Unit Holders Agreement defined "Jainti" as Jainti Pty Ltd as trustee for the Zambito Trust. 3. As to Anthony's supplementary submissions concerning a gift, the liquidator says that this argument is new; that it is not pleaded, nor was it the subject of any written or oral submissions; and that Anthony should not be permitted to raise it now. Further, it is noted that none of the plaintiff's witnesses was cross-examined in relation to the purported gift (and it is said that the submission should not be made on that basis alone). The liquidator says that the raising of this contention at such a late stage invites an application to ameliorate any prejudice by adducing further evidence. It is submitted that this would be undesirable having regard to the disproportionate quantum of costs already incurred by the respective parties. 4. Insofar as the gift argument relies on an acceptance of Anthony's evidence, it is submitted that Anthony should not be regarded as a reliable or credible witness. Further, it is said that the gift argument also makes little sense as a matter of law. It is said that neither Jainti (whether as trustee for the Zambito Trust or the alleged separate Family Trust) nor the Morabitos or Zamattias (as beneficiaries of either the Zambito Trust or the alleged separate Family Trust) would have been required to provide consideration for the issue of units in the Fraser Unit Trust. It is said that there is no legal or equitable requirement that beneficiaries give consideration when a trust is settled for their benefit. Further, it is said that there is no legal basis to support the submission that the Morabitos and Zamattias, as beneficiaries of either the alleged separate Family Trust or the Zambito Trust, could retrospectively repudiate the issue of units in the Fraser Unit Trust to Jainti by way of their evidence in these proceedings or their conduct referred to in that evidence. 5. It is submitted that the "post-hearing hypothesising" by Anthony flies in the face of the manner in which his case was propounded at hearing; i.e., that at all times throughout the hearing, Anthony adopted a position whereby he adhered to a specific recall of the subject events. The liquidator submits that Anthony's attempt in supplementary submissions to explain away the body of contemporaneous documentation which supports Jainti's case serves only to dilute and infect the case which Anthony advanced at trial. 6. The liquidator further submits that Anthony's supplementary submissions put a gloss on, and mischaracterise, Jainti's case (referring to [2] of the submissions). The liquidator maintains that the evidence suggests that there were only ever 100 units on issue and that this accords with the distributions to Jainti as trustee for the Zambito Trust and the payments it received. The liquidator says that speculation as to the affairs of other unit holders from time to time is irrelevant. The liquidator says that the supplementary submission (at [3]) also puts a gloss on the plaintiff's case. As to the reference to "secondary documents" (in the supplementary submissions at [5]), the liquidator disputes the characterisation of taxation documents as secondary documents. 7. As to the supplementary submission at [6], the liquidator says that this re-agitates the question of whether declaratory relief is required. It is noted that it was not until the final day of hearing that Anthony, through his Counsel, conceded that an order could simply be made for payment in Jainti's favour, rather than imposing a constructive trust. It is noted that this concession was made in the context of Anthony's closing written submissions which it is said were replete with italicised references to "receipt" in recognition of the plaintiff's pleaded case of knowing receipt. The liquidator says that Anthony's ostensible departure from the foregoing concession invites submissions in respect of Barnes v Addy, which were not previously made in light of Anthony's late concession. 8. As to the argument based on the application of the equitable doctrine or maximum of minimum equity, the liquidator observes that the concept of minimum equity is (or was) primarily a discretionary factor considered when determining the appropriate relief to be granted for claims based on equitable estoppel (and it is said that the doctrine of minimum equity has had no place in Australian law since Giumelli v Giumelli (1999) 196 CLR 1; [1999] HCA 10; reference also being made to the Court of Appeal decision in Delaforce v Simpson-Cook (2010) 78 NSWLR 483; [2010] NSWCA 84). It is submitted that Anthony's submissions in this regard are thus at odds with appellate authority. 9. As to the vesting argument (in the supplementary submissions from [7]-[8]), again it is said that this is not pleaded; should not have been raised; and is misconceived. It is noted that this argument relies on an entitlement of Anthony to a 20% interest in distributions under the Zambito Trust, which Anthony contends gives rise to a present entitlement to, and vested interest in, a 14/34th share of the $805,000 distribution made out of the Fraser Unit Trust. The liquidator says that this submission cannot be accepted, noting, first, that the plaintiff's pleaded claim concerns an amount of $805,500 withheld from distribution to the plaintiff by the Fraser Unit Trust between the financial years 2015 to 2018, which distribution has not, at this stage, been recorded in any of the financial accounts for the Zambito Trust; and that this is also not the subject of a determination by Jainti as trustee that it be distributed to the beneficiaries of the Zambito Trust. Accordingly, it is said that there is no basis for Anthony to assert that his share of the $805,500 has vested. 10. Second, it is said that, contrary to Anthony's closing submissions, company property only vests in a liquidator by order; it otherwise remains the property of the company and is subject to the priorities imposed by the Corporations Act, including remuneration and expenses, and creditor claims, before any distributions can be made to beneficiaries. It is said that the decision of Boensch v Pascoe is irrelevant to the position of the Fraser Unit Trust, Jainti and Anthony as a beneficiary of the Zambito Trust. Further, it is noted that Anthony made a claim as a creditor not a beneficiary. Determination 1. I have set out in some detail above the chronology of events because this is a case where the two competing versions of the relevant documents are capable of different constructions. As I have indicated above, the February 2006 documents (the Fraser Unit Trust Deed, which is unamended; and the Unit Holders Agreement, which bears handwritten annotations) are consistent with the Zambito Version of the documents (if, in respect of the Unit Holders Agreement, one puts aside the handwritten annotations); and there seems to be no dispute that what was originally in contemplation was that Jainti would hold a number of units in the trust as trustee for the Zambito Trust (see T 292.38-47). 2. Anthony says that there is no logical regime in which there could have been a change back to the Zambito Trust as beneficiary from the five individual beneficiaries but that seems to me to presuppose when it was that the relevant decision was made as to the issue of units in the trust (because, once issued, the unit holders could not simply be amended by handwritten amendments to minutes and the like). 3. In a dispute such as this, where there are two competing versions of documents which purport to effect the issue of units in a trust to particular unit holders, it is a question of fact as to the order in which those documents were signed, and whether any communications occurred which might constitute consent to subsequent amendments to those documents. It is a question of law, however, as to whether particular documents validly give effect to the issue of units to unit holders (including by satisfying the requisite formalities for the issue of units in the particular trust) and whether any subsequent amendments constitute a valid transfer of units. The Fraser Unit Trust Deed provides that "upon becoming registered as the holder of a Unit", the initial unit holders and each other person shall be deemed to have become a party to this Deed and entitled to benefit from and be bound by the terms and conditions of this Deed (cl 4.3); further, "[e]xcept to the extent provided in this Deed, the person from time to time entered in the register as the holder of a Unit shall be the only person recognised by the Trustee as entitled to such Unit or to exercise or enjoy the rights and privileges attaching thereto" (cl 5.3); and see also cl 8 relating to the transfer of units. Insofar as the register of units is the record of what units were issued (and noting that both versions of the register are unsigned) the question is which came first. Almost certainly, the Zambito Version was prepared first, taking effect in accordance with the Zambito Version of the Unit Holders Agreement. 4. As to the Unit Holders Agreement (upon which Anthony places no little weight), there are, it seems to me, a number of possibilities, depending on whether the document was signed before or after the handwritten amendments were made and depending on whether it actually recorded a final concluded and binding agreement – the first, is that the Unit Holders Agreement was signed before the handwritten amendments on that document were made (i.e., that it was initially intended to record the unit holdings as per the Zambito Version of the minutes of meeting) and subsequently amended by hand (as some kind of variation to that agreement – albeit, one to which it is not clear that the relevant unit holders had consented and in respect of which it is not evident that the necessary formalities were satisfied to effect a change in beneficial ownership; the second, is that the Unit Holders Agreement was prepared in draft but not signed until after the handwritten amendments were made (and the parties simply did not bother to have it executed in a final clean version) (in which case the only explanation for the signed Zambito Version of the short minutes might be if it was prepared and signed in advance of the Unit Holders Agreement being signed; the third, is that the handwritten amendments were made at some time later (i.e., after the 12 May 2006 meeting) and record some ex post facto re-jigging or attempted re-jigging of the unit holding (consistent with, but not necessarily so, the liquidator's contention that this was in effect a later concoction). Anthony accepts that the Zambito Version was the earlier draft version (see T 292.38-47), so it makes sense that the Zambito minutes came first (and it is apparent that they were signed). However, what seems unlikely is that the Zambito Version minutes were signed (as well as the Zambito Version of the unit certificates) but that the Unit Holders Agreement was not signed before the handwritten amendments were made. 5. The matters which point in my mind to the first of the three possibilities above being the most likely, and thus the Zambito Version of the documents being the correct version as at 12 May 2006, are as follows. 6. First, that the version that was signed (being Anthony's electronic signature) and left for collection on the snooker table prior to the 12 May 2006 meeting was not labelled "draft" and, on Anthony's account of events, this was intended to be the final version of the unit holding applications (subject to what he says was the conversation on 11 May 2006 – which I cannot on the balance of probabilities find occurred). 7. Second, that the Zambito Version is consistent with the number of ordinary units initially created by the Fraser Unit Trust Deed – and this provided for 19 additional units for each of Anthony and Derek Taylor's interests (rather than 20 – which would have required a "substitution" or cancellation of some kind). 8. Third, the informality of handwritten (albeit initialled) amendments to the Zambito Version of the documents. What troubles me about this is that there is nothing to suggest that those amendments were not made at some time after the 12 May 2006 meeting (i.e., after the units had been issued as contemplated by the Zambito Version). Derek Taylor's evidence is not persuasive in this regard - he says "presumably" the amendments were made around that time; and he seemed sanguine about informally "re-jigging" the unit holders (see T 132). 9. Fourth, and significantly, there is no evidence that updated versions of these relevant documents were sent to any of the other so-called individual beneficiaries (except Anthony's assertion to that effect); the financial statements and accounts accord with the Zambito Trust having a beneficial interest in the units of the Fraser Unit Trust; distributions were made on that basis and there is no evidence (beyond Anthony's assertion) that the liquidator was apprised of the alleged Family Trust until September 2016. 10. As to the taxation documents signed by Anthony which reflected that the unit holding was held by Jainti on trust for the Zambito Trust, while a finding is not here being made that Anthony is dishonest in now suggesting that the units were held under a separate Family Trust, those documents lend support to the conclusion that the Zambito Version of the documents correctly recorded the beneficial ownership of the units as at the time of the meeting on 12 May 2006 and that any separate Family Trust may only have been contemplated informally, if at all, and without the requisite formalities to effect a change in beneficial ownership such as would have been necessary for tax recording purposes. At the very least, it points against Anthony's argument given that he himself was not prepared formally to identify the separate Family Trust in taxation documents – indeed, if his version of events is what occurred at the 8 May 2012 meeting, then there is no reason not to record that. Again, as considered above, Anthony's failure to call Mr Ashton in this regard gives rise to a Jones v Dunkel inference against Anthony insofar as he seeks to challenge the veracity of documents by reference to which the liquidator has advanced his case. 11. It is not necessary to make (nor do I here make) a finding that Anthony falsely concocted the competing version of the documents (whether back in May 2006 or later when the issue as to the payment of distributions out of the trust arose). It might well be, for example, that there was a working draft of proposed changes to unit holders that was prepared at some stage when the "re-jigging" process took place. It might also be that this was indeed the intention of Anthony and Derek Taylor at some time around 12 May 2006, albeit not properly documented at the time (or reached after the units had already been issued). 12. For the foregoing reasons, I find that the unit holdings held by Jainti in the Fraser Unit Trust were as trustee for the Zambito Trust. In those circumstances, whatever was sought to be achieved by the October 2008 meeting (and whether it was properly convened and when it was held) do not arise. 13. Had it arisen for determination, I would have concluded that any meeting held in October 2008 (whether on 7 October or 24 October) did not effectively terminate the (on this hypothesis) separate Family Trust and nor did the subsequent Notice of Termination of Trust because of the difficulty that there was not consent by each of the individual beneficiaries thereto. 14. The development and meaning of the rule in Saunders v Vautier was summarised by the High Court in CPT at [43] per Gleeson CJ, McHugh, Gummow, Callinan and Heydon JJ as follows: 44. Saunders v Vautier is a case which has given its name to a "rule" not explicitly formulated in the case itself, either by Lord Langdale MR (at first instance) or by Lord Cottenham LC (on appeal). In Anglo-Australian law the rule has been seen to embody a "consent principle" recently identified by Mummery LJ in Goulding v James [1997] 2 All ER 239 at 247 as follows: The principle recognises the rights of beneficiaries, who are sui juris and together absolutely entitled to the trust property, to exercise their proprietary rights to overbear and defeat the intention of a testator or settlor to subject property to the continuing trusts, powers and limitations of a will or trust instrument. 1. In essence, the rule in Saunders v Vautier enables an adult beneficiary of a fixed or discretionary trust with absolute and indefeasible title to require the transfer of trust property to her or himself and thus, terminate any accumulation under the trust. This power is qualified and may be subject to the trustee's rights to reimbursement or exoneration for the discharge of liabilities incurred in the administration of the trust, although the trustee cannot refuse a Saunders v Vautier direction for the trustee's own benefit (see CPT at [50]-[51]; Beck v Henley at [36]). 2. Where there are multiple beneficiaries of the trust, the position, however, becomes more complicated. The rule does not apply where there are multiple beneficiaries of a trust made up of real property, as the distribution of a single beneficiary's share prejudices the share of the remaining beneficiaries. However, that is not the case here (where the property is not realty). If any individual beneficiaries' share in the trust is made up of personal property, then the beneficiary can call for the distribution of that beneficiary's share, even though the distribution serves to reduce the overall value of the undistributed shares, unless there are "special circumstances". In this regard, see the following discussion by Cozens-Hardy MR in Re Marshall; Marshall v Marshall [1914] 1 Ch 192 at 199: Speaking generally, the right of a person, who is entitled indefeasibly in possession to an aliquot share of property, to have that share transferred to him is one which is plainly established by law. There is also another case which is equally plain and established by law, that where real estate is devised in trust for sale and to divide the proceeds between A., B., C., and D. – some of the shares being settled and some of them not — A. has no right to say "Transfer to me my undivided fourth of the real estate because I would rather have it as real estate than personal estate." The Court has long ago said that that is not right, because it is a matter of notoriety, of which the Court will take judicial notice, that an undivided share of real estate never fetches quite its proper proportion of the proceeds of sale of the entire estate; therefore, to allow an undivided share to be elected to be taken as real estate by one of the beneficiaries would be detrimental to the other beneficiaries. But that doctrine, it seems to me, has no application, apart from special circumstances, to personal property. 1. In Beck v Henley, Leeming JA (with whom Beazley P, as her Excellency then was, and Sackville AJA agreed) summarised the principles applicable to a request by one of two or more beneficiaries to a trust for the distribution of their share and went on to discuss what constitutes "prejudice" from [75]; and it is worth setting this out in full: 75. Equity long ago took the step to subject the terms of the trust established by the settlor or testator to the exercise of power by adult beneficiaries who are absolutely and indefeasibly entitled collectively. The question which then arose was what was to occur when they were not unanimous but the property could be divided. The answer was to have regard to any prejudice to a beneficiary who opposes an in specie distribution. However, not every form of prejudice is sufficient. 76. To take an extreme case, one of three beneficiaries of a small trust where the trust property comprises listed securities may be prejudiced by a Saunders v Vautier direction made by another beneficiary, for it may not be possible to secure the same investment return if the principal is diminished, and the fees charged by the trustee will be borne by two rather than three beneficiaries. Yet no one would suggest that those considerations could defeat an adult beneficiary absolutely and indefeasibly entitled to his or her share of the trust property from calling for it. That is to say, the exercise of power by one but not all beneficiaries may be attended by actual prejudice upon the other, yet be insufficient to disentitle the exercise of power by the beneficiary. 77. Similarly, suppose a parcel of non-voting preference shares is held on trust for a number of adult beneficiaries. To the extent that the rights attaching to those shares comprise, for practical purposes, the right to a preferred dividend and return on capital, it is difficult to see how there could be any prejudice if one beneficiary called for his or her share of the parcel. That would be so even if the parcel were large, and its division meant that no longer would a single shareholder be able to block a special resolution of preference shareholders varying class rights. 78. On the other hand, if ten particular shares entitle their owner to exclusive occupation of an apartment in a company title building, and the parcel is held on trust for two adult beneficiaries absolutely and indefeasibly entitled, for my part I would find it difficult to see that one beneficiary would be entitled to call for five of the shares, leaving the balance held by the trustee for the other beneficiary. The prejudice is real and immediate, even though both beneficiaries are treated identically. The purpose of that parcel of shares is to confer a right to live in the apartment, and the analogy with trusts of land is very strong. 1. When considering if there are special circumstances preventing a Saunders v Vautier direction for the distribution of a single beneficiary's share of personal property held on trust, it is necessary to consider the prejudice which the direction would cause to the other beneficiary or beneficiaries who oppose the distribution. 2. In the present case, the difficulty as I see it is that the unit holdings held on trust were particular parcels of units – one "B Class Unit" (the initial ordinary "unit"), 19 "B Class Units" (the additional units); and 14 "A Class Units". 3. If one treats the initial "ordinary unit" as equivalent to one "B Class Unit" then I accept that the parcel of 20 "B Class Units" is divisible by 5 such that there could be no prejudice in one beneficiary (say Anthony) calling in the trust in respect of his 1/5th share of those 20 units. However, the 14 "A Class Units" could not be readily divided into 5 and the effect of calling one beneficiary's share would thus be to prejudice the remaining beneficiaries (since it would require, one would think, a realisation of the units and winding up of part or all of the trust). 4. As at 2016, when the Notice of Termination of Trust was issued, that might not have amounted to relevant prejudice insofar as the trust fund was then in a position to be wound up (and termination by one of the individual beneficiaries would affect the division of the proceeds of distribution out of the trust fund but not the holding of units per se). In those circumstances, if prejudice were not shown, then I accept that it would have been possible for one beneficiary (say, Anthony) to terminate the Family Trust in relation to his position as an individual beneficiary in accordance with the rule in Saunders v Vautier. However, that was not the case back in October 2008. 5. Therefore, it seems to me that there could well have been special circumstances in October 2008 that would have precluded the operation of the rule in Saunders v Vautier at least in relation to the "A Class Units" (and perhaps also, if Anthony's alternative submission as to the discrete treatment of the initial ordinary units were to be accepted, in respect of all of the "B Class Units"). In any event, that does not here arise in view of the conclusion I have reached as to the trust itself. 6. Turning then to the question whether the claim of knowing receipt has been made good, the principles of knowing receipt on a Barnes v Addy claim are well known. A person who receives property for his or her own benefit, knowing (in the requisite sense) that its transfer is in breach of trust, will be made a constructive trustee of that property for the benefit of the principal. Whether a person has satisfied the knowledge requirement is often considered by reference to a scale of five categories of knowledge, as set out by Peter Gibson J (as the Lord Justice then was) in Baden Delvaux & Lecuit v Société Générale pour Favoriser le Développement du Commerce et de l'Industrie en France SA [1993] 1 WLR 509 (Baden Delvaux); specifically, (see at 235; 242-243): actual knowledge; wilfully shutting one's eyes to the obvious; wilfully and recklessly failing to undertake such inquiries as an honest and reasonable person would undertake; knowledge of circumstances which would indicate the facts to an honest and reasonable person; and knowledge of circumstances which would put an honest and reasonable person on inquiry. 7. The requisite degree of knowledge on the part of a third party recipient, in claims for knowing receipt, was considered by the Full Court of the Federal Court in Grimaldi. Relevantly, the Court (Finn, Stone and Perram JJ), in a unanimous judgment, said (at [268]): 268. The High Court in Farah Constructions did not settle the knowledge/notice requirement in relation to recipient liability. Nonetheless, from at least the 1990s and in the wake of the Baden classification, judges had begun in recipient liability cases to generalise from what had been said both by Gibbs J (at 398) and by Stephen J (at 412) with whom Barwick CJ agreed, about the insufficiency of traditional, or category (v), constructive notice — though not of category (iv) notice — as a basis for personal liability. To allow that, as Stephen J commented, would be "to disregard equity's concern for the state of conscience of the defendant": at 412; see eg Equiticorp Finance Ltd (in liq) v Bank of New Zealand (1993) 32 NSWLR 50 at 103G; Koorootang Nominees Pty Ltd v Australia and New Zealand Banking Group Ltd at 105; Hancock Family Memorial Foundation at 209; Tara Shire Council v Garner [2003] 1 Qd R 556 at [66]-[72]; Spangaro v Corporate Investment Australia Funds Management Ltd (2003) 54 ATR 241 at [54]-[60]; see also United States Surgical Corporation v Hospital Products International Pty Ltd [1983] 2 NSWLR 157 at 252-254. In Kalls Enterprise Pty Ltd (in liq) v Baloglow (2007) 63 ACSR 557 — a decision which post-dates Farah Constructions — the New South Wales Court of Appeal applied Baden's categories (i)-(iv), but not category (v) to a knowing receipt claim. Kalls Enterprise in turn has been applied subsequently: see eg Horsman v MG Kailis Pty Ltd [2009] WASC 166; Fodare Pty Ltd v Shearn (2011) 29 ACLC 11-036. 1. As the Full Court went on to say (at [269]-[270]): 269. There is, in other words, an established line of judicial decision and opinion both at first instance and in intermediate courts of appeal spanning at least 20 years adhering to the view taken in the above cited cases. We do not consider that that view is plainly wrong and should be rejected. On the contrary! Finally, for the sake of completeness, we should note we do not consider that what was said by Bryson J in Maronis Holdings Ltd v Nippon Credit Australia Pty Ltd (2001) 38 ACSR 404 at [469]-[478] is inconsistent with that view. Commendably, his Honour emphasised the fault based character of recipient liability: "[u]nconscionability cannot be fictionalised, and the grounds on which constructive trust liability is imposed should be real and substantial": at [471]. 270. Accordingly, we do not consider the primary judge erred in law in finding that knowledge falling within category (iv) of Baden was sufficient for the imposition of liability for knowing receipt… 1. In Kalls Enterprises Pty Ltd (in liq) v Baloglow (2007) 63 ACSR 557; [2007] NSWCA 191, the Court of Appeal (Giles JA, with whom Ipp JA and Basten JA agreed) held that it is sufficient, in a claim for knowing receipt, that the third party recipient had constructive knowledge of the kind captured in the fourth category (but not the fifth) in the classification deployed in Baden Delvaux (see at [199]). Accordingly, for the purposes of knowing receipt, knowledge in any of the first four categories identified above is sufficient. 2. Here, there can be no dispute that if (as I have found) the 34 Units were held on trust for the Zambito Trust then it was a breach of trust by Fraser Panorama to pay distributions referable to Jainti as trustee for the Zambito Trust direct to the individuals said to be beneficiaries of the Family Trust. 3. Anthony emphasises that for the knowing receipt claim to be established, it must be established that he received the funds with the requisite notice that they were funds paid out in breach of trust. 4. The difficulty for Anthony here is that on his own evidence he understood by the time the payment was received that there was an issue as to the way in which the unit holdings were recorded. He has asserted that he sought (and acted on) advice in that regard. There is no evidence of that advice; as adverted to above. In circumstances where he was on notice of a doubt as to whether the distribution was able to be paid to him, he must have been on notice of facts which would be sufficient to give rise to knowledge in the fourth category of knowledge in Baden Delvaux. 5. Had it been necessary to determine, I would therefore have found the claim for knowing receipt to be made good. 6. However, it is not necessary to go so far because it is conceded (T 323.26-32) that if the moneys (as I have found) were properly payable to Jainti as trustee for the Zambito Trust, then an order for the payment of those moneys to Jainti's liquidator should be made. (Although not pleaded as a money had and received claim, that would be an alternative way to give rise to the same relief.) 7. As to the alternative arguments raised in closing and in supplementary submissions for Anthony, I say briefly as follows. 8. First, complaint as to an alleged failure to draw other family members' attention to "Boensch v Pascoe rights" goes nowhere. Any complaint in that regard would be for them to make. Second, there is no pleaded defence based on laches or delay. Third, the basis on which the supplementary submissions are raised is not made good but, even if it were, the submissions as to a "gift" or as to there being no consideration for a gift of the "B Class Units" are not pleaded and cannot properly be raised in supplementary submissions after the hearing. Nor can the submissions here sought to be made as to the vesting of an interest under the Zambito Trust be raised. 9. Further, the invocation of the principles of minimum equity (now no longer an appropriate test or factor in the context in which it was invoked in Giumelli v Giumelli) seems to me to be inapt. 10. I have concluded that the 34 Units were held by Jainti as trustee for the Zambito Trust. Therefore, the relief sought in the amended statement of claim should be granted, with one exception. I do not see any need for the making of a separate declaration (as pressed in prayer 1) and declaratory relief will not ordinarily be made if it lacks utility. 11. An order for the payment of the moneys held in the controlled moneys account to Jainti is sufficient in my opinion to redress the wrong occasioned by the payment of the 1/5th distribution to Anthony. 12. As to costs, at the request of the parties, I will reserve costs to be dealt with, if possible, on the papers. 13. As to the question of interest, beyond any interest that has accrued on the moneys since they were placed in the controlled moneys account, any claim for additional interest by the plaintiff on the funds distributed wrongly to Anthony would be limited in my view to the period from the distribution in December 2018 and the placement of the moneys in the controlled moneys account; and would be predicated on a finding of knowing receipt of trust moneys. Orders 1. I make the following orders: 1. Order that the sum of $161,160 (plus interest) held in the controlled moneys account of Bird & Bird be paid to Jainti Pty Ltd as trustee for the Zambito Trust. 2. Reserve the question of costs to be dealt with on the papers if possible. 3. Direct the parties to file brief written submissions on costs within 14 days, with a view to dealing with the question of costs on the papers if possible, and any submissions on any interest claimed by Jainti for the period from payment of the distribution to Anthony Zamattia and the placement of the moneys in the controlled moneys account. ********** 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: 25 June 2021