Supreme Court New South Wales Medium Neutral Citation: Ling v Beyond Development Group Pty Ltd [2022] NSWSC 685 Hearing dates: 11, 15-18 November 2021 Date of orders: 30 May 2022 Decision date: 30 May 2022 Jurisdiction: Equity Before: Ward CJ in Eq Decision: 1. Dismiss the plaintiffs' claim against the second and fourth defendants with costs. 2. Enter judgment for the plaintiffs against the third defendant in the sum of $800,000 plus interest and costs. 3. Direct that any brief written submissions as to costs of the second and fourth defendants be filed within 14 days with a view, if possible, to dealing with costs on the papers Catchwords: CONSUMER LAW – Alleged misleading or deceptive conduct – Accessorial lability GUARANTEE AND INDEMNITY – Contract of guarantee – Deeds – Fraud – Whether second defendant signed deed – Whether fourth defendant falsely attested signing of deed NEGLIGENCE – Duty of care where claim for pure economic loss – Whether witness owed duty of care – Loss of opportunity case – Issues as to reliance and causation – Defences – Proportionate liability, concurrent wrongdoers, contributory negligence Legislation Cited: Civil Liability Act 2002 (NSW), ss 5B, 5D(3)(b), 34A(1) Competition and Consumer Act 2010 (Cth) s 87CC(1), Schedule 2 Conveyancing Act 1919 (NSW), s 38 Corporations Act 2001 (Cth), ss 127(3), 129(3) Evidence Act 1995 (NSW), s 128, 140 Legal Profession Uniform Legal Practice (Solicitor) Rules 2015, r 11 National Electronic Conveyancing Law (NSW) Real Property Act 1900 (NSW), s 56C Trade Practices Act 1974 (Cth), s 52 Uniform Civil Procedure Rules 2005 (NSW), r 25.14 Cases Cited: Aardwolf Industries LLC v Tayeh [2020] NSWCA 301 About Life Pty Ltd v Maddocks Lawyers [2021] NSWSC 1370 Allen v Tobias (1958) 98 CLR 367 Astley v Austrust Ltd (1999) 197 CLR 1 Australian Securities and Investment Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17 Badenach v Calvert (2016) 257 CLR 440; [2016] HCA 18 Banque Commerciale SA (in liq) v Akhil Holdings Ltd (1990) 169 CLR 279 Briess v Woolley [1954] AC 333 Briginshaw v Briginshaw (1938) 60 CLR 336 Chandra v Perpetual Trustees Victoria Ltd (2007) 13 BPR 24,675; [2007] NSWSC 694 Chapman v Luminis Pty Ltd (No 4) (2001) 123 FCR 62; [2001] FCA 1106 Clark Equipment Credit of Australia Ltd v Kiyose Holdings Pty Ltd (1989) 21 NSWLR 160 Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536 Commercial Banking Co of Sydney Ltd v R H Brown & Co (1972) 126 CLR 337 Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594; [1990] HCA 17 Delany v Tenison (1758) 3 Bro PC 659; 1 ER 1559 Ellison v Vukicevic (1986) 7 NSWLR 104 Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 Ginelle Finance Pty Ltd v Diakakis [2007] NSWSC 60 Glueck v Stang (2008) 76 IPR 75; [2008] FCA 148 Gors v Henderson, unreported; Supreme Court of WA (Steytler J); Library No 980499, 7 September 1998 Graham v Hall (2006) 67 NSWLR 135; [2006] NSWCA 208 Gray v Haig (1854-1855) 20 Beav 219; 52 ER 587 Hastie Group Ltd (in liq) v Bourne; Hastie Group Ltd (in liq) v Moore [2017] NSWSC 709 Houghton v Arms (2006) 225 CLR 553 Hoxton Park Residents Action Group Inc v Liverpool City Council [2012] NSWSC 1026 In the matters of Earth Civil Australia Pty Ltd, RCG CBD Pty Ltd, Bluemine Pty Ltd, Diamondwish Pty Ltd and Rackforce Pty Ltd (all in liq) [2021] NSWSC 966 Jackson v Sterling Industries Ltd (1987) 162 CLR 612; [1987] HCA 23 Jainti Pty Ltd v Fraser Panorama Pty Ltd [2021] NSWSC 744 Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 Katsilis v Broken Hill Pty Co Ltd (1977) 18 ALR 181 Kayteal Pty Ltd v Dignan (2011) 15 BPR 29,515; [2011] NSWSC 197 Lloyd v Grace, Smith & Co [1912] AC 716 Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 Manly Council v Byrne and Anor [2004] NSWCA 123 Matouk v The Entrance Seabreeze Pty Ltd [2010] NSWSC 649 Musa v Alzreaiawi [2020] NSWSC 638 Musa v Alzreaiawi [2021] NSWCA 12 National Commercial Banking Corporation of Australia Limited v Cheung (1983) 1 ACLC 1326 National Roads and Motorists' Association Ltd v Construction, Forestry, Mining, and Energy Union (2019) 291 IR 28; [2019] FCA 1491 NEC Information Systems Australia Pty Limited v Linton (Wood J, 17 April 1985, unreported) Ninemia Maritime Corp v Trave Schiffahrtsgesellschaft mbH & Co KG; The Niedersachsen [1984] 1 All ER 398 Nominal Defendant v Cardin (2017) 79 MVR 210; [2017] NSWCA 6 NWR FM t/a North West Radio v. Broadcasting Commission of Ireland & Anor [2004] IEHC 109 Payne v Parker [1976] 1 NSWLR 191 Perpetual Trustee Company Limited v Peter Ishak [2012] NSWSC 697 Perpetual Trustee Company Ltd v Milanex Pty Ltd (in liq) [2011] NSWCA 367 Perre v Apand Pty Ltd (1999) 198 CLR 180 Perre v Apand Pty Ltd (1999) 198 CLR 180 Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492; [1985] HCA 34 Rosebanner Pty Ltd v Energy Australia (2009) 223 FLR 406; [2009] NSWSC 43 Scottish Amicable Life Assurance Society v Reg Austin Insurance Pty Limited (1995) 9 ACLR 909 Sellers v Adelaide Petroleum NL (1994) 179 CLR 332; [1994] HCA 4 Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610 Severstal Export GmbH v Bhushan Steel Ltd (2013) 84 NSWLR 141; [2013] NSWCA 102 State Bank of NSW Ltd v Yee (1994) 33 NSWLR 618 Steinberg v Federal Commissioner of Taxation (1975) 134 CLR 640; [1975] HCA 63 Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2022] NSWSC 144 Street v Luna Park Sydney Pty Ltd (2009) 223 FLR 245; [2009] NSWSC 1 Superbarn Supermarkets Pty Ltd v Cotrell Pty Ltd [2016] ACTSC 49 Tepko Pty Ltd v Water Board (2001) 206 CLR 1; [2001] HCA 19 The Ophelia [1916] 2 AC 206 Vella v Permanent Mortgages Pty Ltd (2008) 13 BPR 25,343; [2008] NSWSC 505 Vukicevic v Alliance Acceptance Co Ltd; Vukicevic v Ellison (1987) 9 NSWLR 13 Watson v Foxman(1995) 49 NSWLR 315 Wickham v Marquis of Bath (1865) LR 1 Eq 17 Yorke v Lucas (1985) 158 CLR 661; [1985] HCA 65 Texts Cited: Bruce Feldthusen, Economic Negligence (2000, 4th ed, Carswell) David Rolph et al, Balkin & Davis Law of Torts (2021, 6th ed, LexisNexis) at [13.24] Found B & Rogers D Eds (1999) Documentation of Forensic Handwritting Comparision and Identification Method: a Modular Approach, Journal of Forensic Document Examination 12 G E Dal Pont, Law of Costs (2009, 2nd ed, LexisNexis) Gino Dal Pont, Law of Agency (2020, 4th ed, LexisNexis) R F Norton, R J A Morrison, H J Goolden, Norton on Deeds (1928, 2nd ed) Torts Cases and Commentary (2017, 8th ed, Lexis Nexis) Young, Newton and Cahill, Conveyancing Service New South Wales (2003, Lexis Nexis) Category: Principal judgment Parties: Kuo Shu Ling (First Plaintiff) Chuan Dian International Trade Co Ltd (Second Plaintiff) Beyond Development Group Pty Ltd (First Defendant) Liping Wang (Second Defendant) Peter Zhuang (Third Defendant) Pang (trading as O Pang & Co) Oliver (Fourth Defendant) Representation: Counsel: DP O'Connor with P Lin (Plaintiffs) DC Eardley (Second Defendant) DA Lloyd SC with C Robertson (Fourth Defendant) Solicitors: Pinnacle Lawyers (Plaintiffs) Praxis Lawyers (Second Defendant) DLA Piper (Fourth Defendant) File Number(s): 2018/00012504 Publication restriction: Nil Judgment 1. HER HONOUR: This matter involves a dispute between various parties relating to the plaintiffs' attempt to recover moneys under two instruments each titled "Mortgage Linked Loan Agreement" (and referred to collectively in submissions as the Loan Agreements) but which in their terms guaranteed the obligations of the first defendant, Beyond Development Group Pty Ltd (Beyond Development Group) (a company now in liquidation), to repay sums totalling $900,000 plus interest to the plaintiffs. The instruments are expressed to be executed as deeds. 2. Neither of the Loan Agreements was signed by Beyond Development Group; thus the instruments on which the plaintiffs sue would seem to be guarantees as such (not loan agreements per se). However, in reply submissions the plaintiffs contend that Beyond Development Group is a party to the Loan Agreements (an argument that I address in due course). Parties 1. The first plaintiff is Ms Kuo Shu Ling (the wife of Mr Jonathan Lee, a director of the second plaintiff). The second plaintiff is a company, Chuan Dian International Trade Co Ltd (Chuan Dian). Ms Ling did not give any evidence in the proceeding. Rather, the evidence given for the plaintiffs was from Mr Lee and Mr Tupou, the solicitor for the plaintiffs. 2. The first defendant is Beyond Development Group, which was placed into liquidation in September 2018, after default judgment was entered against it in the proceeding in the sum of $1.3 million pursuant to orders made by Rees J on 25 May 2018. 3. The second defendant is Ms Liping Wang who purportedly signed the Loan Agreements as a guarantor. I say "purportedly" because Ms Wang denies that she signed the Loan Agreements and denies liability under the guarantees. 4. The third defendant, Mr Peter Zhuang, was the director of Beyond Development Group and also a guarantor under the Loan Agreements. Mr Zhuang (Ms Wang's former husband) did not appear in the proceeding (and default judgment is sought against him). I was informed by the plaintiffs' Counsel that Mr Zhuang had "effectively absconded" – see T 2.31-2.48; and that Mr Zhuang's trustee in bankruptcy did not wish to take any part in the proceeding – see T 308.23. 5. The fourth defendant is Mr Oliver Pang, an accountant (and, relevantly, a Justice of the Peace) trading as O Pang & Co, who purportedly witnessed the guarantors' signatures on the Loan Agreements (next to the words "SIGNED SEALED & DELIVERED in the presence of O Pang"). I say "purportedly" because Mr Pang (who concedes that the signatures look like his own) cannot recall whether or not he witnessed the signatures but says that, if he did, then it would have been done in accordance with his invariable practice (i.e., to do so only in the presence of the signatory in question). Issues 1. As adverted to above, Ms Wang denies that she signed the Loan Agreements (and has adduced expert evidence providing strong "qualified" support for the proposition that they are not her genuine signatures). Should that contention be accepted, it logically follows that Mr Pang cannot have witnessed Ms Wang's signature in her presence, despite (on the face of the documents) attesting that he had done so. Therefore, on the hypothesis that Ms Wang's signature is not genuine, if Mr Pang's signature on the Loan Agreements is genuine, there are logically only a number of possibilities: that Mr Pang witnessed a blank document (or at least one without anything appearing to be Ms Wang's signature); that Mr Pang witnessed a document that already purportedly bore Ms Wang's signature (but not in her presence); or (though no-one suggests this occurred) that someone other than Ms Wang attended Mr Pang's offices and he witnessed that other person sign the documents (whether or not knowing that it was not Ms Wang (see discussion at T 309.7-309.20). In any of those scenarios, the attestation by Mr Pang would be false but only in the first two scenarios would it necessarily be knowingly false. 2. It is also relevant to note that Mr Pang's own evidence is that he did not deal with Ms Wang (whose tax returns he prepared) in person (but only communicated with her through her husband, Mr Zhuang, by email) and had not met Ms Wang (and this is corroborated by Ms Wang, although her evidence is somewhat unreliable in a number of other respects – as to which I say more in due course). If so, it might perhaps be expected that Mr Pang would have been more definitive about not having witnessed Ms Wang physically sign any document (let along the documents in question). Hence, the significance the plaintiffs attach to Mr Pang's seeming acceptance of the possibility that it is his signature. However, the explanation for this appears to be that Mr Pang has been scrupulous not to deny something of which he has no positive recollection (and he was adamant that if he had witnessed the signature then in accordance with his invariable practice he could only have done so in the presence of the signatory). 3. The issues for determination may be summarised as being: first, whether Ms Wang signed the Loan Agreements and is bound by the guarantees contained therein; second, if the signatures on the Loan Agreement are not those of Ms Wang, whether Mr Pang signed the Loan Agreements; third, whether (if it be found that Mr Pang did sign the Loan Agreements) whether Mr Pang is liable to pay to the plaintiffs the outstanding amount under the Loan Agreements as a result of: knowing involvement in the alleged misleading or deceptive conduct of Mr Zhuang; or misleading or deceptive conduct in his own right; or in negligence for breach of a duty of care owed to the plaintiffs in relation to his execution of the Loan Agreements; and, finally, if Mr Pang is liable to the plaintiffs, whether that liability is reduced as a result of the defences Mr Pang has here raised. 4. In essence, the plaintiffs say that their claim against Mr Pang is a loss of opportunity claim – that they lost the opportunity (at a time when Beyond Development Group was not insolvent or when it had funds available to repay the loans) to rescind the (oral) agreement with Beyond Development Group and recover their moneys (see at T 8.42-9.18) or, alternatively, to seek freezing orders to preserve the funds lend to Beyond Development Group. They rely on expert evidence from an accountant (Mr Trevor Vella) as to the time at which the funds were disbursed from Beyond Development Group (and thus effectively lost to the plaintiffs). 5. Insofar as it was suggested in opening submissions that the plaintiffs also lost an opportunity to trace the funds (see at T 9.5-9.12), Mr Pang takes issue with the fact that no such claim is pleaded (and says that had it been pleaded evidence might have been deployed on that issue – see T 16.41-16.47). It is noted by Mr Pang that the lost opportunity claim (as pleaded at [30] of the fifth further amended statement of claim) is pleaded, in essence, as a loss of opportunity to call on the guarantee, to rescind the oral agreement, and to commence action in a timely fashion to freeze the funds advanced or to sue for their return (T 16.38-16.48). I accept that the plaintiffs should be held to their pleading in this regard. 6. Mr Pang raises issues as to reliance and causation; and a number of defences in the event (which is denied) that he is liable on the claims as pleaded against him (including defences of contributory negligence (see at [32]-[33] of his defence); proportionate liability (see at [34] of his defence); and concurrent wrongdoer defences (see at [35A]-[83] of his defence)). The concurrent wrongdoers identified by Mr Pang are, variously, Mr Zhuang, the plaintiffs themselves, and the plaintiffs' lawyers (Pinnacle Lawyers). There is hence an overlap between the various defences. 7. It seemed to be common ground that the proportionate liability regime was applicable (see T 16.1-16.34; T 369.26-371.46), at least other than for claims raising fraud or equitable fraud. In that regard, it was accepted by Mr Pang (see at T 338.40; 369.14-369.24) that on the authorities a "knowingly concerned" claim would not attract the concurrent wrongdoer defence; however, issue was raised as to the fact that the plaintiffs did not invoke s 87CC of the Competition and Consumer Act 2010 (Cth) (CCA) in their reply (and did not specifically plead that the regime does not apply to "knowingly concerned" claims). In the plaintiffs' written closing submissions (at [50]), the plaintiffs maintain the contention that if a defendant concurrent wrongdoer intended to cause loss, then no apportionment is permissible pursuant to s 87CC(1) of the CCA. In this regard, the suggestion (faintly put) that the operation of s 87CC(1)(b) of the CCA might be disregarded because it had not been pleaded (see T 369.26-370.14) is not palatable. Chronology of Events 1. Mr Lee (as noted above, one of the directors of Chuan Dian) was a business associate of Mr Zhuang, having known Mr Zhuang for some ten years (see at T 22.35-22.37) and having met through Mr Lee's business of importing and selling mobile telephones (see Mr Lee's first affidavit sworn 17 April 2019 at [4]). Mr Lee made clear in his oral evidence (more than once) that he trusted Mr Zhuang (and said he had no reason to distrust him). 2. Mr Lee's evidence is that in early 2016 he had discussions with Mr Zhuang, in which Mr Lee says Mr Zhuang told him about an investment opportunity in relation to a commercial property development at 117-119 Stoddart Street Roselands, NSW (referred to in submissions as the development properties) for which Mr Zhuang said he had already obtained funding from NAB (see T 24.36-24.39). Mr Lee says that Mr Zhuang told him that he had set up a new development company called Beyond Development Group. According to Mr Lee, Mr Zhuang sought a $1 million loan from Mr Lee for one year, with a fixed interest rate of 30% p.a. (an interest rate that in cross-examination Mr Lee did not regard as high but which he seems to have been keen at the time to procure – at one point in cross-examination suggesting that the fixed interest rate was a factor contributing to it being a "safe" investment). (I note that it is accepted by the plaintiffs that the best that the plaintiffs can now achieve is to be put back in the position they were in prior to advancing the funds and hence that they cannot obtain interest at 30% – see T 336.38-336.45.) 3. Mr Lee says that Mr Zhuang offered security over the property development, and that personal guarantees would be given by Mr Zhuang and his wife, Ms Wang. Relevantly, Mr Lee has also deposed that, in January 2016, Mr Zhuang indicated that his and his wife's Bella Vista property would secure (or provide a guarantee for) the loan, by Mr Zhuang saying to Mr Lee words to the effect that "my wife and I own property in Bella Vista and we would personally guarantee the loan" (see [8] of Mr Lee's first affidavit). (There is a distinction between proffering a guarantee and proffering security for such a guarantee but this may not have been appreciated by Mr Lee.) 4. Mr Lee accepted in cross-examination that he was not in the property business (T 26.15); that he had not seen the land (only pictures of the land) (T 27.5). Mr Lee was based at all relevant times overseas. Mr Lee seems to have relied on projections of profit put to him by Mr Zhuang (see T 26.47) but said in cross-examination that he intended to do "research" if he was going to lend Mr Zhuang the money (T 27.35). 5. More than once in his oral evidence (indeed it was a constant refrain), Mr Lee reiterated the importance to him of the provision of personal guarantees (from Mr Zhuang and Ms Wang) (see, for example, and this is not intended to be an exhaustive list of such references, at T 27.18, T 27.45, T 27.49, T 28.11, T 28.43; T 29.1-29.11; T 33.5; T 35.29). (It is therefore somewhat surprising, to say the least, that ultimately Mr Lee advanced the loan funds before any such guarantee was signed – see below; simply on the faith of Mr Zhuang's word.) 6. Mr Lee has deposed that he asked Mr Zhuang for the projected profit and loss figures and information as to whether Mr Zhuang had sold any properties off the plan (see [10] of Mr Lee's first affidavit; T 30.26-30.47) (presumably this being part of the research to which Mr Lee has referred). In response, Mr Zhuang sent Mr Lee a copy of a letter dated 4 July 2016 from solicitors to Beyond Development Group, which enclosed various documents relating to the purchase of the development properties including settlement adjustment sheets and a copy of the front page of each of the contracts for sale of land, the price for the properties in question being $1.2 million and $2 million. (I interpose to note that the settlement statements record that deposit amounts of $240,000 and $400,000 were paid for each property. However, the contracts appear to record lesser deposit amounts: of $120,000 and $200,000, respectively – see Ex "JL1" to the first affidavit of Mr Lee.) 7. On 18 October 2016, Mr Leonard Tusa, an accountant helping Mr Lee in relation to the documents (T 32.22), sent requisitions to Mr Zhuang by email. Mr Zhuang responded to Mr Tusa's email that day (see Ex "JL2" to the first affidavit of Mr Lee). 8. Mr Lee has deposed (see at [12] of his first affidavit; T 32.30-32.37) that, based on that reply email to his accountant, he formed the view that the development "would most likely be profitable" (which one might think was a somewhat remarkable conclusion given the paucity of information that had been provided) and he noted that Mr Zhuang told him that he had already sold two properties off the plan (see [12] of Mr Lee's first affidavit; T 32.48-32.50; see also Mr Zhuang's email to Mr Tusa sent on 18 October 2016 at 7.18pm, exhibited at p 23 of the fourth defendant's tender bundle, Ex 10). Mr Lee did not identify any documents he had seen which supported this conclusion but said that he thought Mr Zhuang had given him a contract and that he would need to check his emails (T 45.21-45.49). In oral evidence, Mr Lee also said (at T 32.48-33.6) that he saw no reason for Mr Zhuang to lie to him about it and, based on Mr Zhuang's estimation, he believed it would be profitable (though adding that there was "always risk") but that he told Mr Zhuang that he still needed personal guarantees to lend the money. 9. Mr Lee said (T 34.25-34.38) that he did not ask Mr Zhuang for many of the details (as to the development) but that he knew Mr Zhuang had purchased the land and was doing a development; and that this was sufficient for him (though Mr Lee again stressed the importance to him of personal guarantees). At T 34.22-34.28, Mr Lee said that, based on the material sent by Mr Zhuang, he made the decision to go ahead; and that, because there was a fixed interest return and there was a personal guarantee, he believed that it was a "safe" investment. 10. On 6 October 2016, Mr Lee sent an email to his solicitor (Mr Tupou of Pinnacle Lawyers), attaching a net worth statement of Mr Zhuang (which referred to large and fixed assets of $3.46 million and liquid assets of $420,000; liabilities of $2.2 million; and a house worth $3.2 million) (see Ex 10 at p 1). Mr Lee deposed (at T 37.9-37.13) that he understood that the house there referred to was the Bella Vista Property. Pausing here, the $3.2 million figure (coincidentally or otherwise) matched the purchase price in total of the development properties at Roselands. 11. In his 6 October 2016 email to Mr Tupou, Mr Lee said that the contract was to state that Mr Zhuang and his wife would be "personal guarantor" and that he wanted a background check to make sure they were not in debt. In cross-examination, Mr Lee said that he did not try to analyse the figures (in the net worth statement); he forwarded them to his accountant (Mr Tusa) (T 37.28); and (at T 37.49) that he did not put a lot of importance on what was said in the (net worth) document as to Mr Zhuang's financial position (forwarding it to his accountant and solicitor to check). At T 38.11, Mr Lee accepted that he did not take steps to find out if Mr Zhuang was the legal owner of the Bella Vista Property before advancing the money, to which answer Mr Lee added: And, anyway, if he is not a legal owner, the wife will be the legal owner, and both are in the guarantee. So it doesn't matter to me if he owns it or the wife owns it, because I have guarantee from both of them … I knew that the Beyond Development is owned by him, but for the personal guarantor, I am not completely sure it's a joint name on the property or it's just the property of the wife, but as long as I get a guarantee from both of them, I feel that my investment is secure. 1. Mr Lee's solicitor (Mr Tupou) responded at 4.53pm on 6 October 2016 that the document sent to him (i.e., Mr Zhuang's net worth statement) did not say much and that they still needed the documents he had requested in his previous email (see Ex 10 at p 2). Taken to this email in cross-examination, Mr Lee's somewhat dismissive response was that "he's just a solicitor, he's not a financial adviser" and that "every business has a risk" (T 38.46) (though having earlier said that it was important to him that Mr Zhuang had "liquidity" – see T 38.34). 2. Mr Lee responded to his solicitor that he did not think that there was a balance sheet as the company was newly formed but that "maybe we can get him to pledge his house as a collateral for the loan" (see Ex 10 at p 2) (which suggests that to that point Mr Lee did not understand that the personal property was to be security as such). 3. On 9 October 2016, Mr Lee sent an email to Mr Tupou asking him to do searches involving Mr Zhuang and his wife, the Bella Vista house and the development properties; and to check that "both of them are not under any bankruptcy" as he would "need both of [Mr Zhuang and his wife] to be guarantor[s] for the loan" (see Ex 10 at p 4). 4. On 10 October 2016, Mr Lee emailed his solicitor a copy of the couple's passports (which Mr Lee believes were sent to him by Mr Zhuang – see T 39.46) (see Ex 10 at pp 4-5). On the same day (10 October 2016), Mr Tupou emailed Mr Lee to say that there was a lot of work to be done, noting that "it is a fairly large amount of money" and saying that he would conduct searches and due diligence. Mr Tupou quoted an amount for his fees (both for the searches and for the contract) (see Ex 10 at p 7). Mr Lee's response was that he was "somehow taken a back by the amount of the invoice so [he] need[ed] to check with [his] partners" (see Ex 10 at pp 6-7). In cross-examination (T 40.39), Mr Lee explained that he had two partners in Taiwan (the other two directors of Chuan Dian) but he later said that they left it to him to make the decision – T 54.30. 5. Mr Lee authorised Mr Tupou to conduct the due diligence searches (estimated at $5,500) but does not appear at that stage to have authorised the work in relation to the loan contracts (also estimated at $5,500) (T 41.31; see also Ex 10 at p 9). 6. On 18 October 2016, Mr Tusa sent an email to Mr Zhuang (copied to Mr Tupou), asking for various documents (see Ex 10 at p 13). In cross-examination, Mr Lee accepted (T 42.6) that it was probably "20%, 30%" important to conduct due diligence but said that he still felt that the personal guarantees were more important. 7. In response to the above email, Mr Zhuang sent an email to Mr Tusa, copied to Mr Lee, on 18 October 2016 (see Ex 10 at pp 18-21), which was later discussed in a telephone conversation between Mr Tusa and Mr Lee on 19 October 2016 (see at T 48.47-50). Mr Pang says that this email highlights a number of deficiencies in the information provided by Mr Zhuang regarding his personal finances and those of Beyond Development Group. Mr Lee made no further enquiries regarding these matters (admitting in cross examination that he was prepared to "take the business risk on [the investment]" (see T 48.47-50; T 49.15-16). 8. Mr Zhuang's email response to Mr Tusa attached some documents. Mr Zhuang then emailed Mr Tusa again, with respect to the query about pre-sales (see Ex 10 at pp 16-17). At 9.32pm, Mr Zhuang sent an email to Mr Tusa, copied to Mr Lee, with a co-ordinated response to the matters that had been raised (see Ex 10 at pp 20-21). In relation to the request for a Beyond Development Group balance sheet, Mr Zhuang's response was to refer to his personal profit and loss statement. In response to a question as to the details of any loans to Beyond Development Group used to finance the purchase of the Roselands real estate (question 3), Mr Zhuang responded "no" (an answer that was clearly incorrect). Mr Lee said in cross-examination that he did not know this was false; and that this was to his accountant "so I didn't take fully notice of the email" (see T 44.4). Mr Lee accepts that he did not ask Mr Tusa or Mr Zhuang about this (T 44.44). Similarly, as to at least one other response by Mr Zhuang (the answer to question 10), Mr Lee said that he did not take much notice of the answer and assumed that Mr Tusa would reply on that issue (T 48.4). At T 47.7, Mr Lee again said that he felt the most important thing was the "personal guarantees". 9. Mr Tusa then sent an email to Mr Zhuang (not copied to Mr Lee), querying the finance for the Roselands Property (the development properties) and noting that the balance sheet of the company showed $1.6 million in equity (see Ex 10 at p 19). 10. On 19 October 2016, Mr Lee sent an email to Mr Tusa referring to a discussion ("nice speaking to u") (see Ex 10 at p 22). In cross-examination, Mr Lee thought he remembered speaking to Mr Tusa (about concerns that Mr Tusa had in relation to the information from Mr Zhuang) but said that he "decided to still take the business risk on it because I have actually instructed him to actually put a … caveat on his personal property and to guarantee the loan" (T 48.47) and that he still decided to go ahead with the loan because he felt that the business risk was minimised by the personal guarantee (T 48.48). 11. Following his telephone conversation with Mr Tusa, Mr Lee gave instructions (see Ex 10 at p 22) to move ahead and prepare the Loan Agreements with a caveat on the Bella Vista property and a charge on the development properties to guarantee the loan. Mr Lee agreed (T 49.31-49.46) that at the time it was important to protect his interests to have each of: the loan documents, caveat on personal property, and a charge on Roselands, but adding to that list of things "and also importantly is the personal guarantee on the house – on the personal loan". 12. Then, at 4.36pm on 19 October 2016, Mr Lee sent an email amending the previous email (see above), saying that "we will raise the loan document just with the charge on his property development" and "will not do a caveat on his property" (see Ex 10 at p 23). Mr Lee thus clearly instructed Mr Tusa and Mr Tupou to proceed without lodging a caveat on the Bella Vista property. In cross-examination, Mr Lee explained that this was at Mr Zhuang's request. At T 50.19-50.23, Mr Lee said that he thought he had some discussion with Mr Zhuang in which he told Mr Zhuang that he was going to put a caveat on his private property and "so he asked me to hold off for one or two days, because he is trying to get a loan". Mr Lee said in cross-examination that this is why he asked Mr Tusa not to have a caveat on the private property but added that "eventually I did put a caveat on his private property". 13. The 4.36pm email from Mr Lee asked Mr Tusa to "let me know when it can be done so I can get him [presumably Mr Zhuang] to come in and sign all your documents" (see Ex 10 at p 23). Mr Lee accepted that it was important to protect his interests for Mr Zhuang and Ms Wang to come in and be identified but said that it was only for his solicitor (not Mr Tusa) to identify him (T 50.48-51.1). 14. On 20 October 2016, Mr Tusa sent an email to Mr Lee setting out a range of concerns Mr Tusa had regarding the proposed transaction, including: a lack of documentation establishing the contribution of $1.6 million towards the project, the basis upon which loan repayments were being made; and that Mr Zhuang may have issues obtaining a loan from a bank at a much lower interest rate of five percent (see Ex 10 at p 24). Mr Tusa suggested that the total costs of the project concerning the development properties be verified; that controls with Beyond Development Group be established; and that a quantity surveyor be appointed to ensure the project concerning the development properties was not a risk. 15. Mr Pang points out that several of the matters the subject of Mr Tusa's email to Mr Lee on 20 October 2016 were also contained in Mr Tusa's later email to Mr Lee on 31 October 2016 (see below; see T 60.35), to which Mr Lee responded, on 1 November 2016, that "I do understand the risk involved and I have fully understand his project work & costing" (see Ex 10 at p 48). Mr Pang notes that Mr Lee accepted in cross-examination that, by this, Mr Lee meant he understood what Mr Zhuang was telling him about the development (T 61.30), in the absence of documents or expert advice from a quantity surveyor. 16. Mr Tusa also said in his email that he would like Mr Zhuang to authorise a credit check on himself and his wife (see Ex 10 at p 49). 17. Mr Lee's evidence in cross examination was that he "looked at" Mr Tusa's view but "decided to take the risk to actually still go ahead with the loan" (T 51.38-40) "looking at the personal guarantee he's going to give me". Mr Lee said "but as I was mentioning before I mean this is business transaction and I think that you know with the guarantee I can limit my risk (T 51.24-51.25)", emphasising again the personal guarantee. Mr Lee accepted that Mr Tusa had raised legitimate concerns (T 52.33) but said "it is up to me to decide" (T 53.29). 18. Mr Lee accepted that Mr Tusa had offered to meet with Mr Zhuang to continue the review process if Mr Lee had any doubts (T 53.39-53.48) and Mr Lee agreed in cross-examination (T 65.13) that he had rejected the offer that Mr Tusa made to meet with Mr Zhuang as to his financial position. Mr Lee's position in this regard was not that it was not necessary to do the things that Mr Tusa had said; rather Mr Lee said that, after that, he "weighed out the pros and cons". 19. Mr Lee accepted that he had replied to Mr Tusa's email to the effect that he understood the risks involved and wanted to "raise the contract" (i.e., in effect instructing Mr Tusa to prepare the loan agreements; and to put a charge on the development properties and for credit checks on Mr Zhuang and Ms Wang (a matter which Mr Lee accepts he never followed up – T 55.46) (see Ex 10 p 26). Mr Pang emphasises that these were all matters that Mr Lee considered needed to be in place before advancing the funds, referring to his evidence in cross-examination at T 59.15-34. 20. Mr Lee's position (see at T 54.23-54.30), in effect, that Mr Tusa gave him the advice; he thought about it and discussed it with his partners; they asked him to make the decision and he decided to go ahead with it. 21. Mr Lee says that, on or around the end of October 2016 , he had a conversation with Mr Zhuang to the effect that he (Mr Lee) was willing to proceed but could only provide $900,000 (as opposed to $1 million) and that the agreement was to be reduced to writing. Mr Lee then instructed Mr Tupou to prepare two loan documents reflecting the proposed advance to Beyond Development Group in two tranches: one tranche of $200,000 from Mr Lee's wife, Ms Ling, and another tranche of $700,000 from Chuan Dian. Mr Tupou has deposed that he acted for the plaintiffs (being Ms Ling and Chuan Dian) though I note that it appears he only took instructions from Mr Lee (see [2]-[3] of Mr Tupou's affidavit sworn 18 April 2019). 22. On 21 October 2016, Mr Lee sent an email to Mr Tupou copied to Mr Tusa, saying that he had told Mr Zhuang that they would contact him by email to ask some questions (see Ex 10 at p 32). Mr Lee gave Mr Tupou and Mr Tusa the details of Mr Pang's firm (so that they could contact him to talk about Mr Zhuang's financial details) (T 55.35; see also Ex 10 at p 30). In cross-examination, Mr Lee could not remember following up on this as to them speaking with Mr Pang (and there is no evidence that either did so at that stage) (see T 55.46). 23. At 9.29am on 21 October 2016, Mr Tupou sent an email to Mr Lee (over which the plaintiffs maintained a claim for legal professional privilege, so it is not known precisely what was there said). However, Mr Lee's response to that privileged email was in evidence (see Ex 10 at p 31). In that response, Mr Lee said that he was aware of the risk involved and that he will "sign a letter to indemnify u" (see Ex 10 at p 31). Mr Lee also there asked Mr Tupou to get the contract out "ASAP by next Tuesday so that Peter [Zhuang] and the wife [Ms Wang] will be able to come down and signed [sic] them". In cross-examination (at T 56.26), Mr Lee said that Mr Zhuang also told him that his wife may not be able to make it down to the city so he suggested that it be witnessed by a Justice of the Peace "which is his accountant". 24. Mr Tupou, in cross-examination (at T 84.47), denied that he was seeking indemnification from Mr Lee and said that he did not give Mr Lee business advice. At T 85.11, Mr Tupou said that it was Mr Lee's idea as to indemnification. Asked about whether he had concerns about the transaction, Mr Tupou responded, matter of factly, "Of course, yes". 25. Pausing here, it is clear that the instruction given by Mr Lee to Mr Tupou to prepare the loan agreements was before any of the matters referred to in Mr Lee's 20 October 2016 email (see above) (such as the credit checks) had been undertaken. 26. On 25 October 2016, Mr Lee sent Mr Tupou an email, asking how he had gone with the loan agreement and expressing the hope that Mr Tupou could finalise it by Wednesday (the following day) so that he could get Mr Zhuang and his wife to go down and sign it by Thursday (see Ex 10 at p 33). (I interpose here to note that it seems clear from this and the earlier emails of 21 October 2016 that Mr Lee expected that Mr Zhuang and Ms Wang would personally attend at his solicitor's office to sign the documents.) 27. Asked in cross-examination what the "rush" was (T 57.1-57.6), Mr Lee said that it was because Mr Zhuang was saying that he needed funds to finish his investment; so that he (Mr Lee) was asking if the contract could be done ASAP; Mr Zhuang was saying that he needed the funds for the development (T 57.9). Mr Lee said that he did not ask Mr Zhuang for what aspect the money was needed (T 57.13). 28. On 25 October 2016, Mr Tupou sent an email to Mr Lee saying that Mr Tusa was finalising the background check for the borrower and was looking at putting a caveat or charge on the development properties at Roselands (see Ex 10 at p 34). Mr Lee accepted that what remained at that stage was the background check and the caveat or charge over the development properties (and at T 58.4-58.15 that the caveat over the private property was important to him but he was prepared to defer it). 29. On 27 October 2016 (the Thursday), Mr Lee emailed Mr Tupou to the effect that the contracts were "kind of urgent" (see Ex 10 at p 36). 30. On 28 October 2016 (the Friday), Mr Tupou emailed Mr Lee to say that Mr Tusa would have his part completed by next Thursday (which Mr Lee said in cross-examination he understood to include the check on Mr Zhuang and Ms Wang – see T 57.33-57.35) (see Ex 10 at p 37). 31. At 11.11am on 28 October 2016, Mr Lee emailed that "when its finalised the money is going to Beyond Development Accounts right?" (see Ex 10 at p 39). In cross-examination, asked about this, Mr Lee volunteered (at T 58.49) that "but I did advance this earlier because he really needed the money but I had a guarantee from him that he's going to sign the agreement" (i.e., not the formal guarantee as such but some kind of assurance that Mr Zhuang would eventually sign some kind of guarantee). Further, in cross-examination (T 58.49-58.34), Mr Lee accepted that "when its finalised" meant that: the signed documents were to be in place; Mr Tusa was to have completed checks on Mr Zhuang and Ms Wang; there was to be a charge or caveat on the development properties and there was to be a caveat on the Bella Vista property (i.e., all to occur before the money was advanced). 32. About two hours after the above email, Mr Lee emailed Mr Tupou to the effect that the caveat on the development property should be done a month after the contract, as Mr Zhuang was applying for a construction loan from the bank and he did not "want to have a issue [sic]". Mr Lee said in cross-examination that Mr Zhuang asked him to delay putting the caveat on the development property (T 59.48-60.2). 33. Mr Lee's evidence is that, at about the end of October 2016, before the documents had been executed, Mr Lee received a telephone call in which Mr Zhuang indicated that there was an urgent need for the funds and requested that Mr Lee advance the funds forthwith. Mr Lee said that he was initially hesitant about advancing the funds prior to the finalisation of a written agreement, but that Mr Zhuang said words to the effect "Yes, it's not going to be a problem, I'm happy with the terms we discussed". (This seems to be the "guarantee" to which Mr Lee was referring in cross-examination at T 58.49; i.e., nothing but Mr Zhuang's word that he would "sign the agreement".) 34. On 1 November 2016, Mr Lee sent an email to Mr Tusa telling him that he totally understood his [Mr Tusa's] concerns in relation to the loan but that he was willing to limit Mr Tusa's due diligence (see Ex 10 at p 48). Mr Lee said that he understood the risks involved in the loan and fully understood the project work on costing. In cross-examination, Mr Lee explained that by this he meant "I fully understand in my experience of understanding not to a very detailed understanding" (T 61.25) and said at (T 61.35-61.50): But, as I told you before, I know him for ten years, and a lot of our mobile phone deals are based on words that he provide to me through the deal, and I see no reason for him to come up with, you know, a story about a property. But, of course, I have partners to answer to, so I requested more security, which I have mentioned, it is the personal guarantee that I feel is safe for me, and I did feel that the signature by him and the wife being witnessed by the JP - and on that aspect I keep asking my lawyer to check if the Justice of Peace, you know, has actually witnessed the signature, everything has been done, you know, and he told me that, yes, he has a copy and everything has been done. … Yeah, I trust Peter [Zhuang] in business sense. 1. Mr Lee accepted that, on 1 November 2016, he told Mr Tusa that he (Mr Tusa) did not need to do a credit check and that he was happy to proceed with signing the contract (see Ex 10 at p 48). At T 62.11, Mr Lee said "I felt that I was willing to take the risk". 2. At T 63.12, Mr Lee was taken to the conversation to which he had deposed at [8] of his affidavit (namely, the conversation in January 2016 when Mr Zhuang made him an investment proposal); that conversation being some four or so months before Beyond Development Group had even purchased the development properties (in May 2016). Mr Lee was "not too sure" if Mr Zhuang had already bought or negotiated the property, saying that the discussion was always about Mr Zhuang "going to be some property development" (T 63.32). 3. On 2 November 2016, Mr Lee himself transferred the funds to Mr Zhuang (see [17] of Mr Lee's first affidavit). This is of no little relevance in relation to the reliance case. It is clear from the contemporaneous documents that Mr Tupou did not realise this had occurred – see, for example, Ex 10 at p 60). Thus, the funds were advanced before any loan agreement(s) were signed and before Mr Lee had obtained any signed guarantees (whether from Beyond Development Group or from Mr Zhuang and Ms Wang). 4. Mr Lee emphasised in his oral evidence that Mr Zhuang had promised him that he would sign the loan agreement (T 66.38; 66.48; and see earlier at T 58.49); and Mr Lee said that Mr Zhuang was a businessman and that he trusted him. Mr Lee said that he wanted to do some credit checks but at the end he decided to leave the credit checks aside. Mr Lee accepted that, prior to advancing the funds, there was no security in the form of any caveat. Mr Lee agreed (T 67.15) that when he advanced the money he only had Mr Zhuang's word that he would sign some agreement (and Mr Lee agreed, at T 67.48, that it would have been prudent to accept his solicitor's advice). 5. As noted earlier the first Loan Agreement is dated 9 November 2016 and it is accepted that the second Loan Agreement (though not dated) may be taken to have been signed on 9 November 2016. 6. At 8.54am on 10 November 2016, Mr Tupou sent an email to Mr Zhuang in relation to the contracts to Mr Zhuang (see Ex 10 at p 50). In that email, Mr Tupou referred to three things that were required: that Mr Zhuang and Ms Wang obtain independent legal advice; confirmation that the documents were witnessed by a Justice of the Peace; and provision of 100 points of identification. (By this stage, as noted above, the funds had already been transferred to Mr Zhuang.) 7. On or about 18 November 2016, the signed agreements were given to Mr Tupou by Mr Zhuang (T 88.43; 90.33). Mr Tupou's evidence is that, when Mr Zhuang provided the agreements, he said "Hi I'm Peter Zhuang, these are the loan agreements you asked me to execute" (see Mr Tupou's first affidavit sworn 18 April 2019 at [8]). 8. On 18 November 2016, Mr Tupou sent an email to Mr Zhuang, copied to Mr Lee, at 3.04pm enclosing the signed "contract" (in the body of the email Mr Tupou referred to "the contract" in the singular; however, the attachment to the email is entitled "Signed Contracts.pdf" plural) (see Ex "SFT4" to Mr Tupou's first affidavit). The email stated that Mr Tupou wanted to see 100 points of identification from Mr Zhuang and Ms Wang to compare signatures and asked that the witness (Oliver Pang) state his address and competency as witness for the signed signatures. (I interpose here to note that this did not in terms request that Mr Pang confirm that he had in fact witnessed the documents – the focus here seemingly being on his address and competency as a witness, the assumption being that he had in fact witnessed the signatures). 9. Mr Pang points out that there is no reference in this email to any independent legal advice but in cross-examination Mr Tupou said that once he received the document witnessed, he assumed that Mr Zhuang "got the independent legal advice" (T 92.1). (It is not immediately apparent how such an assumption would follow from the fact that the document purported on its face to be witnessed.) Mr Tupou also said that this gave him confidence that someone had witnessed the signatures (T 93.21). Mr Tupou agreed (at T 94.22) that on 18 November 2016 he did not know anything about Mr Pang's role. (Therefore, logically, Mr Tupou could not have known whether the witness was qualified or competent to give any legal advice.) 10. There is an entry in Mr Tupou's office time recording system (LEAP) at 2.50pm on 21 November 2016, summarising an email a few days before (the 18 November email) see (T 96; see also Ex 10 at p 194). 11. At 9.25am on 21 November 2016, Mr Tupou emailed Mr Lee, thanking him for the documents (although, as noted, the documents were provided to Mr Tupou by Mr Zhuang); and saying that he was "just waiting" on Mr Zhuang and his wife to come into the office "so I can view his 100 points of ID" and "have the witness properly identify his capacity as a witness" (see Ex "JL4" to Mr Lee's first affidavit). Mr Pang notes that this was, as acknowledged by Mr Tupou in his oral evidence, the second of the three matters Mr Pang had identified in his email to Mr Zhuang of 10 November 2016 as being required (see Ex 10 at p 50). Mr Pang thus submits that the 21 November 2016 email is consistent with Mr Tupou having in his mind (when he contacted Mr Pang the following day) asking Mr Pang, in effect whether he was a Justice of the Peace. 12. On 22 November 2016, Mr Lee instructed Mr Tupou to call Mr Zhuang on his mobile (to talk about coming into the office with his wife – see T 70.1-70.9). 13. Mr Tupou's evidence is that, on 22 November 2016, Mr Tupou called Mr Pang and that, during that telephone call, Mr Pang indicated that he had witnessed the Loan Agreements. Mr Tupou deposed in his first affidavit (at [12]-[13]) that the conversation with Mr Pang was to the effect: Mr Pang: Hello. Mr Tupou: Hello my name's Tame from Pinnacle Lawyers, is this Oliver Pang? Mr Pang: Yes, it is. Mr Tupou: I have this contract from Peter Zhuang, did you witness it? Mr Pang: Yes. Mr Tupou: Okay thanks. 1. Pausing here, it must be noted that in this account of the conversation there is a reference only to a contract in the singular (not to plural contracts) and only to a contract from "Peter Zhuang". There is no reference to Ms Wang. Moreover, the conversation, as thus recounted, it very brief and it rather assumes that Mr Pang would have known what "contract from Peter Zhuang" Mr Tupou was there referring to (thus leaving in doubt whether Mr Pang would have understood the enquiry there being made in any event). 2. Mr Pang has deposed that he does not recall the conversation or witnessing the execution of the loan agreements (see [42]-[43] of Mr Pang's affidavit sworn 3 July 2019; see also T 194.35-194.45; T 197.46). 3. Mr Tupou says that he made a file note on 22 November 2016 after the conversation (T 100.13-100.24; see also the typed transcription of Mr Tupou's handwritten file note dated 22 November 2016, Ex 7). I interpose here to note that Mr Tupou's file note does not support his assertion that Mr Pang confirmed he witnessed the signatures on the loan agreements; rather, the file note records that Mr Pang confirmed his status as a "JP" and accountant. This inconsistency was put to Mr Tupou in cross-examination who nevertheless maintained that the conversation to which he deposed in his affidavit took place as he described it – see T 102.37-102.41.) 4. On 22 November 2016 at 1.28pm, Mr Tupou emailed Mr Lee, saying that "I have also called the witnesser of the contract, Oliver Pang, and he confirms he is a JP" (see Ex "JL5" of Mr Lee's first affidavit). Pausing here, this implicitly assumes that Mr Pang in fact witnessed the contract but does not expressly say that this was confirmed with Mr Pang; and, again, the email refers to a single contract. 5. In cross-examination, Mr Lee was "not too sure" whether he had telephoned or emailed Mr Tupou on 22 November 2016 (there is nothing in the affidavit about any such telephone conversation and no documentary record of it) (T 70.44). Ultimately, Mr Lee agreed that he did not have a recollection (T 71.48) but nevertheless confirmed that he was informed that Mr Tupou had spoken to Mr Pang and that Mr Pang had confirmed that he was a "JP" and an accountant (T 72.3). Mr Lee clearly drew comfort from Mr Pang's status as a Justice of the Peace, saying in cross-examination "but I also understand in Australia a JP is able to witness documents, right?" (see at T 69.21.) 6. The plaintiffs received the Loan Agreements on 22 November 2016. 7. On 30 November 2016 (i.e., some days after the conversation he says he had with Mr Pang), Mr Tupou sent an email to Mr Lee, saying "[a]s discussed I contacted the lenders' accountant and he confirmed that he had witnessed the signatures of both borrowers" (see Ex "JL6" to Mr Lee's first affidavit). I note that this is consistent at least partially with the file note – though that referred only to one borrower – and with Mr Tupou's recollection of the conversation. (It is perhaps worth noting that the reference to "borrowers" seems in error since Mr Zhuang and Ms Wang were named as guarantors.) At this point no issue had been raised as to the authenticity of the signatures, so I accept that there is no reason to think that Mr Tupou had any incentive to misstate the position in this email. I simply note that the focus in the email that had earlier been sent was on the technicalities of identification of the signatories – namely, the address and capacity of the witness; whereas by this stage a more expansive assurance is being given. 8. By 30 November 2016, the contracts had been sent to Mr Lee to be signed. Mr Tupou advised that "Once these documents are done then the money can be transferred". (That is telling, to my mind, because by then the money had already been transferred – indeed this had happened some 28 days before Mr Tupou's email; so the transfer cannot have been made in reliance on the authenticity of the execution of the Loan Agreements or any representation by the purported witness of the signatures.) In cross-examination, Mr Lee said that he thought that Mr Tupou had been shown a copy of the telegraphic transfer but, if so, this is inconsistent with Mr Tupou's 30 November 2016 email. 9. On 2 December 2016, the contracts were signed by the plaintiffs and returned to Mr Tupou (see Ex 10 at p 54). 10. On 31 January 2017, Mr Tupou requested that Mr Zhuang provide the identification that Mr Tupou had previously requested (see Ex "SFT4" of Mr Tupou's first affidavit) (i.e., still pressing for one of the three requirements). 11. On 7 February 2017, Mr Tupou sent an email to Mr Lee saying that he would keep chasing Mr Zhuang for certification ID. Mr Lee's response was to thank Mr Tupou for the information. Mr Lee said "just talk to Peter and he'll be back this Thursday from his cruise. Apparently there is some document issue with the council so he will solved it [sic] when he comes back" (see Ex 10 at p 55). In cross-examination, Mr Lee accepted (T 74.2) that by then he knew that Mr Zhuang and his wife had not been to see the solicitor with the 100 ID points but Mr Lee said that he felt "quite safe" because he knew Mr Zhuang for more than ten years and as long as he knew the contract was signed with a witness from a Justice of the Peace he felt quite safe (T 74.5-74.7). 12. On 28 February 2017, Mr Tupou sent an email pressing Mr Lee in relation to the certificate ID from Mr Zhuang and his wife. Mr Tupou said in that email that "he [Mr Zhuang] keeps saying he will send it. But I have not received anything" (see Ex 10 at p 59). Mr Lee's response was that "I call him and he says he has difficulty finding a JP" (an explanation inconsistent with Mr Zhuang and his wife having purportedly already signed the documents in the presence of Mr Pang – unless Mr Pang had by then left his offices or otherwise become unavailable to witness signatures as a Justice of the Peace). Mr Lee suggested that Mr Zhuang might have to come to Mr Tupou's office with identification. 13. Confronted in cross-examination with the inconsistency inherent in the explanation that Mr Tupou was apparently being given by Mr Zhuang, Mr Lee (at T 75.15) said at first that he did not know Mr Pang was a Justice of the Peace at that stage (1 March 2017) but almost immediately withdrew that evidence and confirmed that Mr Tupou had by then confirmed to him that Mr Pang was a Justice of the Peace (T 75.21). Mr Lee accepted in cross-examination that he knew the explanation from Mr Zhuang was ridiculous but said he did not act on it because he trusted Mr Zhuang (T 75.44). 14. It seems that in February 2017 at some stage Mr Zhuang attended Mr Tupou's office to provide some documentation (see [16] of Mr Tupou's first affidavit). (It is suggested by Mr Pang that the plaintiffs probably came into possession of the passport documents (certified by Mr Pang) in early 2017 (T 13.11). However, that seems inconsistent with the passport copies having been emailed by Mr Lee to Mr Tupou in October 2016 (see chronology above). 15. Mr Tupou nevertheless gave evidence that he received the certified documents in the latter part of February or early March 2017 (T 110.18). Mr Tupou said that he never sat down with Mr Zhuang and Ms Wang to certify their "IDs" (T 128.10; 128.49); and that he never met Ms Wang or spoke to her on the telephone and never received any communication from her (T 132.21-31) (and see at T 133.17-135.2 with respect to his conversation with Mr Pang). 16. In about April 2017, Mr Tupou arranged for a caveat to be lodged over the development properties. The caveat was defective (as Mr Tupou accepted in cross-examination) in that Mr Tupou accepts that he included the wrong people as the caveators in the caveat (see T 130.47). In any event, on 5 May 2017, Mr Lee instructed Mr Tupou to remove the caveat over the development properties, at the request of Mr Zhuang, so that Mr Zhuang could secure additional funding. On 10 May 2017, the caveat was withdrawn. 17. On 16 May 2017, Mr Tupou sought instructions as to when caveats should again be lodged over the development properties. Mr Lee's response, on 24 July 2017 (hardly a quick response) was to seek advice from Mr Tupou as to how long he could refrain from taking steps to register caveats over the development properties. Mr Tupou responded the same day to the effect that Mr Lee could "hold off" from lodging caveats. 18. Meanwhile, on 10 July 2017, another entity, Megatop Trading Pty Limited (Megatop Trading) lodged a caveat over the development properties in respect of an unregistered mortgage between Megatop Trading and Beyond Development Group by virtue of a mortgage agreement dated 10 July 2017 (see copy of the registered caveat – Ex 12). 19. Repayment under the Loan Agreements was due on 9 November 2017, at which time the total principal amount of $900,000 was unpaid. 20. By letter dated 19 December 2017, Pinnacle Lawyers issued a demand pursuant to cl 12 of the Loan Agreements on Beyond Development Group for payment of principal and interest (see Ex 10 at p 127). The letter was addressed to both Ms Wang and Mr Zhuang at their residence at Bella Vista, NSW. (The Bella Vista property is in Ms Wang's sole name and is valued at approximately $2.5 million.) The letter (directed at Beyond Development Group) was addressed to each of Ms Wang and Mr Zhuang at their Bella Vista home. The plaintiffs say that this had the effect of placing Ms Wang and Mr Zhuang on constructive notice that their personal liability to perform as guarantors might imminently be called upon should Beyond Development Group be unable to pay. 21. The present proceeding claiming recovery of the debt owing by Beyond Development Group was commenced on 12 January 2018. 22. On 26 February 2018, Mr Zhuang (apparently in his capacity as director of Beyond Development Group) paid $100,000 to Chuan Dian (thus reducing the principal outstanding under the loans to $800,000). (In reply submissions, the plaintiffs seem to cavil with whether this was a reduction of the outstanding loan but it is not suggested there was any other reason for the payment.) 23. On 25 May 2018, as noted above, default judgment was entered against Beyond Development Group. 24. The plaintiffs commenced winding up proceedings in respect of Beyond Development Group on 18 July 2018 (see [10](a) of Mr Vella's report annexed to his affidavit sworn 1 October 2021). 25. Receivers were appointed by NAB (the first registered mortgagee) to realise the development properties on 29 August 2018 (six weeks after the commencement of the winding up proceeding) (see [10](b) of Mr Vella's report). 26. Administrators (from Cor Cordis) were appointed to Beyond Development Group on 18 August 2018, and subsequently they were appointed as liquidators on 17 September 2018 (see [10](c) of Mr Vella's report). 27. The administrators prepared a schedule as at 13 August 2018 which estimated that "sundry debtors" had an asset value of $2 million and that this was the only asset other than the development properties. At that time, secured creditors were owed $6,281,128 and unsecured creditors $1.281 million (see [10](f) of Mr Vella's report). 28. Mr Vella has noted that Beyond Development Group maintained no books of account and there are no financial statements for FY17 or FY18 or any other time, and so it is not possible to know the extent of assets and liabilities of Beyond Development Group prior to the assessment made by the administrators in a report of 7 September 2018 (see [10](f) of Mr Vella's report). 29. The liquidators, in their report of 14 December 2018, said that it was their preliminary view that Beyond Development Group may have been insolvent from at least 28 February 2018, and noted that from November 2017 demands for repayment were being made by a number of creditors in respect of outstanding liabilities (see [10](d) of Mr Vella's report). 30. On an undisclosed date, the sale of the development properties was completed, realising the sum of $3.36 million. Costs had been incurred by NAB of $240,000 in excess of the loan principal, legal fees of $97,000 had been incurred and receivers' remuneration was incurred of around $105,000. After allowing for the principal of $2.24 million, the net proceeds paid into Court in August 2019 were $568,963 (see [10](h) of Mr Vella's report). 31. The administrators' view was that Megatop Trading ranked first behind the NAB; and the amount owing to Megatop Trading secured on the development properties was $2,545,000 (see [10](j) of Mr Vella's report). There were two other secured creditors, entities known as Eclipse and Synnex, which were owed $79,544 and $166,495 respectively (see [10](h) of Mr Vella's report) (Eclipse being a company with its registered office at Mr Pang's office). 32. Mr Vella reported that the plaintiffs ultimately received no payment from Beyond Development Group (see [10](k) of Mr Vella's report) (although Mr Pang points out that this does not account for the $100,000 they were paid as deposed to in Mr Lee's first affidavit at [24]). 33. After Beyond Development Group went into administration, the plaintiffs relied on cl 9 of the Loan Agreements to make a claim against Mr Zhuang and Ms Wang. An application was made for default judgment against Ms Wang (as she had at that stage filed no defence). Ms Wang then filed a defence denying that she had signed the Loan Agreements. The filing of Ms Wang's defence (unsurprisingly) led to an enquiry of Mr Pang by Mr Tupou. 34. On 4 September 2018, Mr Tupou sent Mr Pang an email, enclosing the certification documents and (either one or both of) the guarantees; asserting that there had been a conversation at the end of 2016 where Mr Pang confirmed that he had witnessed the contracts; and asserting that the signatures (of Mr Pang) were very similar in all the documents (see Ex "SFT5" to Mr Tupou's first affidavit). 35. On 7 September 2018, Mr Pang responded by email to the effect that in his normal practice he would keep a copy of the documents and that he would review his log over the weekend and revert (see Ex "SFT6" to Mr Tupou's first affidavit). 36. Mr Pang's evidence is that, when he was contacted by Mr Tupou in September 2018, he looked at the documents in the computer log that he had maintained and found scanned copies of the certified identity documents (see Ex 10 at p 114-118; T 203) but that he was unable to find copies of the guarantees. (Mr Pang confirmed in cross-examination that he did not find the loan agreements on the "log" – see at T 238.21.) Mr Pang has deposed that (after searching the log and being unable to find copies of the guarantees, and noting that the signature above his name on the guarantees looked like his signature) he telephoned Mr Zhuang (see Mr Pang's affidavit sworn 3 July 2019 at [34]). 37. Mr Pang's evidence is that, in that telephone conversation with Mr Zhuang, he (Mr Pang) said to Mr Zhuang that he had been given a copy of some loan documents by Pinnacle Lawyers with what looked like his signature on them; and that he could not find any record of the documents and did not know anything about them. Mr Pang has deposed that Mr Zhuang said to him "[l]ook, it's not your signature and you won't get into trouble for that". Mr Pang says that he asked Mr Zhuang "[w]ell did you sign the documents and how did my signature get on them?", to which Mr Zhuang responded that "I wouldn't get any friends in trouble". Mr Pang said that Mr Zhuang would not directly answer his query about how his signature was placed upon the guarantees (see Mr Pang's affidavit at [34]). (Pausing here, it is therefore incorrect to suggest, as seemed to be asserted in the plaintiffs' submissions, that Mr Pang made no enquiry of Mr Zhuang as to how his signature came to be on the documents.) 38. On 13 September 2018, Mr Pang wrote to Mr Tupou and apologised for being late to respond as he had been "flat out" (see Ex "SFT7" to Mr Tupou's first affidavit). Mr Pang advised that he had found the log with regard to the certification documents but could not find any record of signing as a witness on the guarantees (though acknowledging that the signatures on those documents looked very similar to his own). Further, Mr Pang in that email said that he had called Mr Zhuang and that Mr Zhuang had acknowledged that Mr Pang did not witness the signature in one or both of the guarantees but did not give further details. Mr Pang also said that he could not remember answering Mr Tupou's telephone call from 2016. 39. On 17 September 2018, as adverted to above, Beyond Development Group was placed into liquidation (the external administration subsequently ceasing on or about 23 August 2019). 40. On 7 March 2019, Mr Zhuang was declared an undischarged bankrupt. 41. On 8 November 2018, the plaintiffs served Mr Pang with a further amended statement of claim filed on 31 October 2018, joining him as a party to the present proceeding (see Mr Tupou's second affidavit sworn 7 August 2020 at [13]). 42. Mr Pang's evidence is that in around November 2018 the data on both his computer and the business hard drive he used as a back-up became corrupted (see Mr Pang's affidavit at [44]-[45]; T 232.48). Mr Pang gave evidence that he organised for a Mr Rodney He to assist him in retrieving the data; but that he had only been able to retrieve some limited data in the form of temporary files since then (T 231.46-232.1; T 233.5; see also Mr Pang's affidavit at [44]). Mr He, who it is said has worked in the field of "IT" since 1996 and was employed as a disaster recovery consultant for five years, advised that he spent several days trying to recover the original data for Mr Pang but the recovery was not successful and only temporary files could be recovered (see his email dated 9 April 2020 to Mr Tupou – Ex 11). Pleadings 1. The plaintiffs sue on a fifth further amended statement of claim filed on 10 February 2021. 2. Against Ms Wang, the claim (pleaded at [5]ff and [9]) is a claim under the guarantee for repayment of the moneys advanced. At the time of the hearing, $800,000 plus interest on the Loan Agreements remained outstanding. Ms Wang filed her amended defence on 16 December 2019 and disputes that she signed any loan agreement. Ms Wang has deposed that she did not sign either of the Loan Agreements (see Ms Wang's first affidavit affirmed 5 September 2018 at [13]-[18]) and Ms Wang affirmed this evidence in cross-examination (see T 144.34-144.49; T 146.18-146.19). Ms Wang has also deposed that she did not authorise any other person to sign any document on her behalf. 3. Against Mr Zhuang, the contraventions (in which it is alleged that Mr Pang was knowingly concerned) are pleaded at [18B] of the fifth further amended statement of claim, it being alleged that Mr Zhuang was in breach of s 18 of the Australian Consumer Law, being Schedule 2 to the CCA (ACL). The plaintiffs allege that Mr Zhuang represented to them that: the loans would be personally guaranteed by Ms Wang and Mr Zhuang and that Ms Wang and Mr Zhuang owned the Bella Vista Property, which would provide the plaintiffs with further security over the loans. 4. The alleged representations are said to have been made by Mr Zhuang: in conversations between Mr Zhuang and Mr Lee in January 2016 and October 2016; and on the loan agreements, including on the execution page. 5. The plaintiffs allege (at [18C]) that the representations were false, because (on the hypothesis that it is not Ms Wang's signature on the documents) Ms Wang did not in fact sign the Loan Agreements and that Mr Zhuang either forged Ms Wang's signature or caused someone else to do so. 6. Against Mr Pang, the allegations are of: knowing concern and involvement in the misleading or deceptive conduct of Mr Zhuang; misleading or deceptive conduct Mr Pang in his own right; and negligence (see at [18D]-[29]). 7. Mr Pang is said to have falsely attested that Mr Zhuang had signed the execution page of the loan agreements in his presence and to have done so intentionally (and that, in so doing, Mr Pang made good Mr Zhuang's promise to reduce the loan agreement to writing with terms that provided security over the development properties and the personal guarantee). It is further said that Mr Zhuang could not have made the representation that he would provide the loan agreements in writing without the knowing assistance of Mr Pang. 8. At [24B], the plaintiffs allege that they relied on the representations pleaded at [20] and [24] (being the alleged representation by Mr Pang purporting to witness Ms Wang's signature and the alleged representation in the telephone call to Mr Tupou on 22 November 2016). The plaintiffs allege that they "would not have entered into the loan agreements unless the loans were reduced to writing in the form of an equitable mortgage and executed as a deed witnessed by a justice of the peace" ([24]). 9. As to the negligence case, the sole allegation (at [28]) is that the plaintiffs relied upon Mr Pang's signature on the agreements as proof that Ms Wang had signed the agreements. 10. In his defence, as adverted to above, Mr Pang has invoked a proportionate liability defence, identifying Mr Zhuang and Pinnacle Lawyers as concurrent wrongdoers (as well as Mr Lee, himself). The plaintiffs have pleaded an extensive reply to that case. As referred to earlier, the plaintiffs do not expressly take issue with the allegation (at defence [34]) that the claims against Mr Pang are apportionable but they plead in answer to the factual allegations made in the defence against Pinnacle Lawyers (see reply at [5]-[45]). 11. Mr Pang also raises a contributory negligence defence (at [32]-[33]). Loan Agreements 1. As noted, the first Loan Agreement is dated 9 November 2016 and it is common ground that the second Loan Agreement was signed on that date. Under the first Loan Agreement, Ms Wang and Mr Zhuang each personally guaranteed a loan of $200,000 from Ms Ling to Beyond Development Group (see original loan agreements, Ex D) and, separately, under the second Loan Agreement, each of Ms Wang and Mr Zhuang personally guaranteed a loan of $700,000 from Chuan Dian to Beyond Development Group (see Ex D). 2. Each Deed contains (see cl 9 of the respective Loan Agreements) both a guarantee and indemnity in favour of the plaintiffs in the following terms: The guarantor hereby guarantees to the mortgagee the due and punctual performance of all the obligations of the mortgagor contained or implied in this deed and hereby indemnifies the mortgagee against all losses, expenditure costs and expenses of whatever nature suffered or incurred directly or indirectly by the mortgagee in receiving the principal sum, interest and all other amounts that may become due under this deed or the mortgage. 1. Both Loan Agreements contain signatures underneath the printed names of Mr Zhuang and Ms Wang. Next to those signatures appear the name and apparent signature of Mr Pang. As noted above, Mr Pang accepts that the signatures on the agreements look like his signature. However, Mr Pang's position is that if, in fact, Ms Wang did not sign the documents in his presence, then (based on his invariable practice) he did not witness her signature (because, on Ms Wang's account, that would involve Mr Pang signing the agreements as a witness to her signature, without in fact having seen her sign the documents). Evidence 1. Each of Mr Lee, Ms Wang and Mr Pang gave affidavit evidence and was cross-examined. There was no evidence from Ms Ling; nor was there any evidence from Mr Zhuang. In that regard, amongst a number of Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 (Jones v Dunkel) submissions, the plaintiffs say (in reply submissions) that, despite giving evidence that Mr Zhuang is the person who could best resolve the dispute as to who affixed his signatures to the agreements, Mr Pang did not call Mr Zhuang to give evidence as to what occurred and to bolster Mr Pang's version of the conversation in September 2018 (see the chronology above). The plaintiffs say that this is because Mr Zhuang's evidence would not help Mr Pang, and "probably" would be "quite the opposite" (this last submission, in my opinion, traversing beyond the limits of a Jones v Dunkel inference – which I discuss in due course). 2. I do not accept that an adverse inference should be drawn from the fact that Mr Pang did not call Mr Zhuang (someone who the plaintiffs' Counsel himself suggested had "absconded" – see at T 2.31-2.48; although Ms Wang's evidence was that she was still in contact with her ex-husband – see T 151.15). This is because I do not accept that it can fairly be said that Mr Zhuang is in Mr Pang's camp or that it would be more natural for Mr Pang to call Mr Zhuang than for Mr Lee to do so. The requirements for such an inference to be drawn are well-known (see as summarised at [155] in Jainti Pty Ltd v Fraser Panorama Pty Ltd [2021] NSWSC 744) and are discussed in greater detail below. In my opinion, they are not here satisfied in relation to Mr Zhuang. 3. As to expert evidence, there was the following. 4. Valuation evidence was given by Mr Joshua Towndrow (see his affidavit sworn 22 December 2020), called by the plaintiffs, and Ms Dimity Marshall (see her report dated 30 June 2020 – Ex 3; see also her supplementary report of 15 January 2021 – Ex 4), called by Mr Pang; with a joint report (Ex 6). These experts gave their opinion as to the valuation of the development properties (relevant to the issue as to the ability of the plaintiffs to have recovered the loan amounts had there been action taken at an earlier time). 5. Evidence was given from two solicitors – Mr Dennis Bluth, called by the plaintiffs (see Ex A to his affidavit sworn 30 September 2021), and Mr Peter Rosier, called by Mr Pang (see his report dated 19 March 2020 – Ex 1; and his supplementary report dated 24 March 2021, Ex 2; with a joint report 19 May 2021 (Ex 5), that evidence going to the practice of solicitors in relation to the certification of parties to property transactions. 6. Accounting evidence given by Mr Trevor Vella, called by the plaintiffs (see his report dated 28 May 2020 annexed to his affidavit), going to the capacity of Beyond Development Group to repay the debts as at early 2017. 7. Forensic analysis of the impugned signatures was given by expert handwriting analysts: Ms Melanie Holt, called by Ms Wang, opining as to the authenticity of Ms Wang's signature; and Mr Clifford Hobden, called by the plaintiffs, opining as to the authenticity of Mr Pang's signature. Lay evidence Mr Lee 1. I have referred through the chronology of events to much of Mr Lee's evidence in the proceeding (both his affidavit evidence and the evidence that he gave in cross-examination). I considered Mr Lee to be a genuine and co-operative witness. Mr Lee certainly did not shy away from the fact that he had decided to take the risk or a business risk in his decision to advance the loan funds, though his constant refrain was the importance to him of the personal guarantees. I accept that those were of importance to him but the fact remains that ultimately Mr Lee placed trust in Mr Zhuang (both to make good his promise that the personal guarantees would be executed and to make good the underlying assumption that the Bella Vista property would be sufficient security if those guarantees were to be called upon); just as Mr Lee seems to have placed trust in little more than Mr Zhuang's projections as to the profit to be made from the proposed development. 2. Thus, while I accept that Mr Lee was a credible witness, the issues in dispute do not turn on his credibility as such. Ms Wang 1. Ms Wang was in a number of respects an unreliable witness. In the course of her cross-examination, Ms Wang gave varying accounts of being employed by a company known as Elite Express (whose registered office was the same as the office of Mr Pang) and admitted that she had lied when representing to a bank, from which she had sought to secure a refinance, that she was earning almost $300,000 per annum (see T 175.25 - T 175.41). 2. For Ms Wang, it is submitted that, although the evidence given in relation to the salary recorded and the loan application given to the bank was false (in respect of which Ms Wang was given a certificate under s 128 of the Evidence Act 1995 (NSW)), Ms Wang nonetheless conceded that she had been untruthful. It is said that the untruth that was told by Ms Wang was in relation to a loan application and her employment status (not in relation to questions put to her about signing the loan agreements) and that, although Ms Wang was untruthful in relation to her employment that does not necessarily infect the balance of her evidence as to the signing of the two loan agreements. 3. It is said for Ms Wang that her evidence was clear and unequivocal in relation to not signing the two loan agreements. While Ms Wang accepts that a cautionary approach is warranted in this regard because of the untruthful evidence given by Ms Wang in cross-examination, it is said that this is not the only source of evidence upon which reliance can be placed on the question as to whether Ms Wang did indeed sign the respective Loan Agreements. Mr Pang 1. Mr Pang's evidence as to whether it is his signature on the guarantees (noting he has been a justice of the peace since 24 July 1991 – see his affidavit at [5], which I note is not consistent with Mr Pang's oral evidence at T 198.22 that he has been a justice of the peace since 1995), is that, on viewing the copy of the guarantees provided to him in September 2018, it appeared to him that his signature (or a signature that looked like his signature) is adjacent to the execution signatures of Mr Zhuang and Ms Wang (see his affidavit at [28]); and that his practice is not to certify that he has witnessed a signature unless the person is in his presence (see T 196.48-197.1; T 197.26-28). 2. Relevantly, Mr Pang's evidence is that in about 2013 or 2014, he implemented an invariable practice of making an electronic copy of important documents the execution of which he had witnessed, and saving that electronic copy to the computer system located in his business premises (see his affidavit at [6]). He says that the guarantees and the certified identity documents are documents of the kind that if he witnessed them he would enter into that log in accordance with his usual practice (see T 198.43, T 199.8, T 199.2-3). 3. I have referred above to Mr Pang's evidence that, when he was contacted by Mr Tupou in September 2018, he found copies of the identity documents in his witness log (but no copy of the Loan Agreement). Mr Pang consistently maintained in his oral evidence that he had no recollection as to whether he witnessed the guarantees, but his position that (if it was the case that Mr Zhuang or Ms Wang did not sign them in his presence), then in accordance with his invariable practice that he would not have put his signature on them certifying that he had witnessed the signature ultimately were signed in his presence (see for example T 196.48-197.1, T 197.26-28). 4. Mr Pang's evidence was that he was anxious if someone had forged his signature (T 206.2) but he took comfort from the fact that Mr Zhuang had confirmed at it was not his signature (T 207.24). 5. Mr Pang did not know Mr Lee and had had no dealings with him (T 215.50), basically having dealt with Mr Zhuang most of the time (T 219.49). Mr Pang's office was the registered address for both Beyond Development Group and Elite Express (companies with which Mr Zhuang was associated). Mr Pang, who has been a Justice of the Peace since (at least) 1995, had acted as accountant for Mr Zhuang and his companies and had prepared taxation returns for Ms Wang (though he had not met Ms Wang). 6. Mr Pang gave evidence as to his practice of keeping a log of important documents that he certified (and copies of some but not all of the documents he certified or attested). Mr Pang's evidence (as I understand it) was that if he had witnessed the signing of the Loan Agreements there would have been an entry in his "log" and he would have kept scanned copies of the documents. 7. Cross-examined as to his failure to complain (to the police or other authorities) when he learnt about the (alleged) forgery of his signature (T 215.6-215.26), Mr Pang's position was to the effect that he was concerned but that he did not consider that he was personally affected because he was not being made personally liable under the documents. Mr Pang said that he had never met or spoken to Ms Wang (T 220) (which would seem to me have been an understandable basis for a denial that it was his signature on the document that purportedly witnessed her signature). Mr Pang said that he communicated with Ms Wang about her tax returns through Mr Zhuang by email (consistent with Ms Wang's evidence at [15]). At T 233.39, Mr Pang gave evidence that he did not see Ms Wang sign the documents. 8. Mr Pang denied that he was "panicking" when he received the call from Mr Tupou about Ms Wang's denial of signing the documents (see T 222.45; T 236.4). 9. As to the alleged conversation in 2016, Mr Pang said that he would not just have responded "Yes" to the query, explaining that he would have verified that he was authorised to pass on the relevant information (see at T 224.38-224.44), giving, as an example, queries received from the tax office about clients. 10. The plaintiffs say that Mr Pang's evidence was beset by consistent failures of memory. It is noted that Mr Pang states that he could not remember how he got Ms Wang's passport (at T 204.8) but concedes it could have been from her at (T 204.20); that, later Mr Pang gave contradictory evidence (stating he never met Ms Wang at T 220.19 or even communicated by email or phone at T 220.23). The plaintiffs say that Mr Pang's evidence taken as a whole cannot be accepted; and, somewhat emotively, that it is "riddled with unbelievable lapses in memory and self-serving assertions and improbable explanations that seem to revolve around people not called to give evidence". 11. Contrary to the above submission, I considered Mr Pang to be a credible witness. Mr Pang did not attempt to argue his case and he did not overstate his evidence. The fact that an accountant or a Justice of the Peace may not remember all the documents he or she witnesses does not seem to me to be implausible. Further, I consider that the somewhat awkward nature of Mr Pang's position in relation to the signatures (i.e., his non-recollection of witnessing the signature but his denial, if he had done so, that he did so not in the presence of Ms Wang) was most likely a product of Mr Pang's evident concern not to overstate his evidence – and I accept that it has the hallmark of a witness attempting honestly and truthfully to give his best recollection of events. I also consider that Mr Pang's evidence as to the "log" he kept (and to having contacted Mr Zhuang) are corroborated by the contemporaneous email to Mr Tupou; and that the fact that his immediate reaction was to contact Mr Zhuang (to find out how his signature could appear on documents that Ms Wang denied signing) is more consistent with an innocent explanation on his part than a consciousness of guilt. 12. Further, I consider, as I explain below, that there is nothing from which I could comfortably conclude that Mr Pang had deliberately destroyed evidence of the witness log on his computer (or caused anyone else to do so) and that his attempt to have a forensic expert retrieve the information is inconsistent with having made such an attempt in the first place. Mr Tupou 1. Mr Tupou gave his evidence with due solemnity and in a calm manner. As the plaintiffs emphasise, he was unshaken in his evidence that he had an actual recollection of the 22 November 2016 conversation and that Mr Pang confirmed to him that he had witnessed the documents. I make no adverse credit findings in this regard. I consider that Mr Tupou was a truthful witness. That said, I consider that there are (not surprisingly) inconsistencies in his recollection of events and that it is likely that his adamant recollection of the relevant conversation has been (unconsciously) bolstered in his mind by the conclusion he drew from that conversation and not necessarily by its content. Expert evidence Handwriting experts 1. As to the handwriting experts, I note as follows. Ms Holt 1. Ms Melanie Holt's expert evidence in her report dated 20 October 2018 (annexed to her affidavit filed 22 October 2018) concludes (at [21]-[22]) that there is strong support that someone other than Ms Wang wrote the signatures attributed to Ms Wang. There is no expert evidence to rebut the report of Ms Holt. I found Ms Holt to be a helpful and considered witness who gave cogent evidence and was able to explain the logic behind her conclusions. 2. Ms Holt suggested that one explanation for similarly or uniformly of signatures might be that they are simulated (in that one would ordinarily expect a slight variation in signatures) (see T 286.35; 287). (Here, there were some variations in signatures of Mr Pang – see Ex D, and the loan agreements – see Ex E in the hearing before Pembroke J, – although some were fairly close in appearance.) Mr Hobden 1. Mr Clifford Hobden's expert evidence (see his report dated 8 October 2019, Ex A) concluded that there was "qualified support" for the proposition that the signatures of the witness on the Loan Agreements are genuine and were written by Mr Pang. Although expressed in somewhat different terms (and by reference to what he termed a moral certainty as to particular matters), in essence there was a similar level of support expressed by Mr Hobden for his conclusions as that which had been expressed by Ms Holt for her conclusions. 2. In cross-examination, when taken to the article cited by Mr Hobden as the source of the methodology adopted (being, Found B & Rogers D Eds (1999) Documentation of Forensic Handwritting Comparision and Identification Method: a Modular Approach, Journal of Forensic Document Examination 12, at 1-68, Ex C), Mr Hobden accepted that the description by the authors of that article of the equivalent opinion level to Mr Hobden's opinion level 2, aptly described the status of satisfaction he had reached in expressing his opinion (namely that there was "moderate support" for that conclusion – see T 268.44; Ex 10 at p 303). 3. For Mr Pang, there is criticism of Mr Hobden's conclusion insofar as it is based upon the premise that the copied (i.e., not original) images of the questioned and specimen signatures are accurately representative of the originals they purport to represent. Mr Hobden's conclusion was stated as follows: There is qualified support for the proposition that the question signatures Ql a, band Q2a, b are genuine and were written by the writer of the specimen signature. This opinion level is used when there is an identifiable limitation associated with the examination process. 1. Mr Hobden identified two limitations to his conclusion: first, that the specimen signatures were not so sufficiently complex as to prevent the "unlikely chance" of a "skilled forger copying the specimen signatures to a level of perfection as to render the forgeries undetectable" (Mr Hobden concluding that although extremely unlikely this was a remote possibility preventing him from a more definite conclusion); and, second, that "[t]he examination of the images inserted original ink signatures does not allow an examination of the line quality of the ink strokes used to write their signatures". 2. Mr Hobden accepted in cross-examination that the first limitation presented his conclusion about the degree of skill of a forger required to render someone "a skilled forger", (cf the reference in his report to "a very highly skilled forger"). It is noted that in relation to the first limitation, Mr Hobden offered the opinion that the likelihood that a skilled forger might have copied the specimen signatures but considered that this was "extremely unlikely" or a "remote possibility". Pausing here, I accept the criticism made by Mr Pang as to the basis on which Mr Hobden made such an assessment as to the probability of someone having copied the specimen figures (as going beyond his expertise and straying into the area of fact-finding). 3. In cross-examination (and over the objection of the plaintiffs), Mr Hobden was asked to take into account a number of assumptions of fact (which Mr Pang submits were all made out on the evidence) (see his list of assumptions, in particular assumptions 1-6 – see Ex 9) that Mr Pang says must be relevant to the expression of an opinion about the likelihood of whether Mr Pang's signatures on the loan agreements are forgeries. It is noted that although Mr Hobden said that he did not take into account factual matters of this kind in coming to the conclusion as to the possibility that a skilled forger might have copied the specimen signatures, Mr Hobden said (at T 281.1) that he did take those matters into account in identifying the limitations to his opinions. 4. Mr Pang argues that, if Mr Hobden did take into account considerations of the kind in Ex 9, that is no doubt why he could only achieve moderate support for his conclusion, but says that if he did not take those matters into account then those matters all involve a significant limitation on his expression of opinion about the possibility of Mr Pang's signatures being forged by Mr Zhuang or at his direction. 5. Mr Pang emphasises that Mr Hobden was not asked to perform any analysis of Mr Zhuang's handwriting (and was given no information about Mr Zhuang's skills as a forger or whether he knew people who had skills in forgery). Mr Pang contends that what is likely is that Mr Zhuang was engaged, in his own interests, in seriously dishonest activity in relation to the guarantees and the loan funds advanced by the plaintiffs. 6. As to the second limitation identified by Mr Hobden, Mr Hobden noted that this could sometimes limit a reliable assessment of feature details such as the tremor caused by an act of forgery or differences in line direction revealed by internal ink detail which often could only be observed with a microscope examining the original ink signature. However, Mr Hobden concluded that the quality of the images and the strength in the similarities was sufficient to form the qualified opinion given on the premise that the images of the documents, including the signatures on them, were accurate copies. 7. Mr Pang says that there are two further serious limitations on the conclusions that Mr Hobden reached, the first being (as recorded by Mr Hobden in limitation two), that (contrary to the statement on behalf of the plaintiffs at T 214.1) he was only provided with copies of the guarantees and the specimen signatures, he did not have originals of any documents (the relevance of that limitation being said to be apparent from Mr Hobden's own statements in the section of his report dealing with "originals v copies"). In this regard, Mr Pang points to the difference between Mr Hobden's approach and the approach of Ms Holt, where Ms Holt was provided with the originals of the guarantees and, for all but five of the specimen signatures, was provided with originals. 8. The second limitation identified by Mr Pang in respect of Mr Hobden's opinion is that he was only given specimen signatures from eight different occasions (contrary to Mr Hobden's own identified preference for a "successful definite comparison" which he says (see Ex A at p 10) "is usually more likely to require a supply of specimen signatures from more than 12 separate dates/sittings rather than fewer"). Mr Pang submits that Mr Hobden's response when asked about this was less than compelling (see T 279.42-45). It is noted that, in comparison, Ms Holt, who had available to her a total of 69 specimen signatures, 39 of which were from different sittings and that when Ms Holt was asked about the desirability of a large sample of specimen signatures, her response was that "[t]he more you have the better understanding you have of that writer's range of variation, and that's what you're looking for". 9. Reference was made by Counsel for Mr Pang in this context to an earlier case in which it was said that Mr Hobden had changed his position from an earlier report when he was provided with a large number of further specimen signatures (see Ex 10 at p 309; T 282.42), Mr Hobden having earlier experienced qualified support for the proposition that a number of questioned signatures were not genuine (Ex 10 at p 326), and having then concluded in the final report that there was strong support for the conclusion that the questioned signatures were genuine (Ex 10 at p 317). Objection was taken to this evidence (and I accept that it should be rejected) but I note that Mr Pang seemed to rely on this largely to underscore the critical importance of a sufficiently large sample of specimen signatures before conclusions as to dishonesty are reached (a proposition for which recourse to whatever had happened in an earlier case would not be necessary). In this regard, Mr Pang says that Mr Hobden's evidence falls into the category of "inexact proofs, indefinite testimony" as referred to in Briginshaw v Briginshaw (1938) 60 CLR 336 (Briginshaw). 10. Leaving aside the use of terminology of moral certainty (which to my mind introduces an inexact and difficult to test concept of one's moral compass), and the fact that Mr Hobden seemed to stray into an assessment of the likelihood of there being someone who might have forged the signatures (a likelihood that the plaintiffs themselves in fact contend for in relation to Ms Wang's signature on the alternative hypothesis that Ms Wang's signature was not genuine) in essence there seems not much difference in the methodology deployed by Mr Hobden and Ms Holt; the distinguishing factors being the use of copied signatures rather than originals (which seems to me a serious limitation – certainly, from a lay perspective I would prefer at least to see the original of impugned or questioned documents) and the number of specimen signatures (a limitation that Mr Hobden himself accepts). 11. I note that there was a submission by the plaintiffs as to Jones v Dunkel inference by fact that no forensic evidence adduced by Mr Pang to rebut the evidence of Mr Hobden; and a similar submission by Ms Wang in relation to the fact that no forensic evidence was adduced by the plaintiffs to reply to the evidence of Ms Holt. I draw no such inference in either case. It is an available forensic decision in my opinion not to incur further expense in expert reports but to rely on criticisms made of the reports that have been served and to test that evidence in cross-examination. 12. In reply submissions, as to the criticisms made in relation to Mr Hobden's report (to the effect that it was based on only a limited number of signatures) the plaintiffs say that if Mr Pang was of the view that a larger cross section of his specimen signatures would have produced a different result, he was free to instruct his own expert and to provide that person with as many specimen signatures as he wished (given that they are his signatures) or to put further examples of his signature to Mr Hobden and ask him to re-evaluate his position but he chose not to do so. It is submitted that an inference should be drawn that such a course would not only not have helped Mr Pang but would have had the opposite effect. (Pausing here, not only is this an inversion of the position in relation to the adverse inference that can permissibly be drawn under the rule in Jones v Dunkel or the related Ferrcom inference (see Commercial Union Assurance Company of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389 at 418-419 per Handley JA); i.e., to go further than suggesting that the evidence would not have assisted the relevant party's case but that the missing evidence would have been positively damaging to its case, but it also suggests that Mr Pang had some obligation to remedy defects in the evidence relied upon by the plaintiffs. Mr Hobden was instructed by the plaintiffs and it was for them to ensure that he had sufficient material from which to provide an opinion on which the Court could confidently rely.) 13. As to the submission that Mr Hobden's report is further limited because the plaintiffs did not seek his opinion about the possibility of Mr Pang's signatures being forged by Mr Zhuang or at his direction (see at [39] of Mr Pang's closing submissions) the plaintiffs say that this is curious since it is Mr Pang who has raised what the plaintiffs say is the "somewhat unlikely Mr Zhuang or persons unknown, master forger, argument". It is said that Mr Pang bears the onus of making good that "optimistic factual contention". The plaintiffs say that the claim that Mr Zhuang or persons unknown, applied Mr Pang's signature is pleaded as part of Mr Pang's positive case (at [36] of Mr Pang's defence). Thus, it is said that it is not a matter for the plaintiffs to put the assumptions in Ex 9 to Mr Hobden, since assumptions were never part of the plaintiffs' pleaded case. I consider this to be a sterile argument. The concept of a "highly skilled forger" derives from Mr Hobden's own report; and it is ironic that the plaintiffs themselves postulate (in their pleading as noted above) a finding that Mr Zhuang forged or caused to be forged Ms Wang's signature yet complain at the suggestion that he forged or caused to be forged that of Mr Pang. In any event, as discussed above, I place no weight on the fact that the Ex 9 assumptions were not put to Mr Hobden by the plaintiffs. Solicitors' evidence 1. Mr Rosier's report dated 19 March 2020 (see Ex 1 at p 7) concluded that the plaintiffs' solicitors (Pinnacle Lawyers) departed from the usual or common professional practice of reasonably competent solicitors by failing to require Mr Zhuang (on his own behalf and as the sole director of Beyond Development Group) and Ms Wang to execute the loan agreements before a solicitor, instructed independently of the lenders, with a requirement that that solicitor provided the evidence of independent advice as to the effect of the loan agreements and of verification of identity and execution of the documents, in accordance with r 11 of the Legal Profession Uniform Legal Practice (Solicitor) Rules 2015. In the alternative that this first requirement could not be met, Mr Rosier concluded that Pinnacle Lawyers failed to require Mr Zhuang and Ms Wang to execute the loan agreements in the presence of Pinnacle Lawyers for the purpose of ensuring proper execution by each of the three defendants and obtaining verification of identity in accordance with s 56C of the Real Property Act 1900 (NSW) and the Participation Rules under the National Electronic Conveyancing Law (NSW) (ECNL). 2. Mr Rosier further concluded that for Pinnacle Lawyers to be satisfied as to verification of identity and execution of the loan agreements in reliance upon a party not asked to undertake verification of identity in accordance with the Participation Rules and who is not asked to provide any evidence other than a signature as a witness, that the documents were in fact signed by the defendants. Mr Rosier was of the opinion that in 2016, it was common or usual practice for competent solicitors undertaking conveyancing transactions to undertake a formal verification of the identity of a borrower where that solicitor was acting for the lender. Mr Rosier considers that if Pinnacle Lawyers were proposing to rely upon the verification conducted by Mr Pang, Pinnacle Lawyers should have obtained a certification from Mr Pang (see Ex 1 at p 17). Mr Rosier further considered that Mr Tupou's email dated 21 November 2016 (in which he wrote that he was waiting on Mr Zhuang and Ms Wang to come into his office so he could "view his 100 points of ID and have the witness properly identify his capacity as a witness") demonstrated that Mr Tupou realised that a face-to-face verification was the best manner of conducting a verification. 3. Having regard to the emails between Mr Tupou and Mr Lee (without more), Mr Rosier was of the opinion that Pinnacle Lawyers were obliged to ensure that Mr Lee understood exactly what it was he was instructing his solicitors to do and the risk that involved, in particular the risk that the documents might not be enforceable and the moneys might not be recoverable (see Ex 1 at pp 24-25). On the assumption that Mr Tupou only attempted to establish the propriety of the execution, after the event, by way of a telephone call to Mr Pang, Mr Rosier considered that this was a very poor way of managing the risk that the documents had been properly executed and a departure from the common professional practice of a reasonably competent solicitor (see Ex 1 at p 35). 4. Mr Bluth's report dated 16 December 2020, which responded to Mr Rosier's report, emphasised that the loan agreements were never intended to be registered and, accordingly, concluded that the Participation Rules and the requirements for verification were not relevant (see Ex "A" to Mr Bluth's affidavit sworn 30 September 2021 at [8]-[11]). Mr Bluth also noted that Rule 11 only has application to the solicitor giving advice not to the lender's solicitor, and accordingly determined that this was also not relevant. Mr Bluth concluded that Pinnacle Lawyers met the usual standard of competent professional practice in relying on the witnessing of the guarantor's signature by an accountant who was a justice of the peace and then following up with that person. 5. Mr Rosier's supplementary report dated 24 March 2021 (Ex 2) addresses Mr Bluth's contentions and maintains the opinions expressed in Mr Rosier's earlier report. Mr Rosier explained that he considered the loan agreements should be treated as if they were mortgages on the basis that the documents assumed that at some point the lender would be in a position to require a mortgage or registrable charge over real estate in New South Wales (see Ex 2 at p 5). Irrespective of this issue, Mr Rosier contended that the identity of borrowers should in usual practice be identified to a standard of reasonable satisfaction, and in 2016 the standard manner was in accordance with the Participation Rules. Mr Rosier considered that the minimum standard for a solicitor in Mr Tupou's position required face-to-face verification with at least a single form of photographic identity produced in the original and copied for the purposes of evidence. 6. With respect to the applicability of r 11, Mr Rosier acknowledged that it was not a mandatory requirement, but maintained that in his opinion, Mr Tupou should have required Mr Zhuang and his wife to attend upon a solicitor independent of the lender to provide the advice and the form of identification required by r 11, and moreover Mr Tupou's correspondence suggests he was clearly aware that proper verification measures were required. 7. The conclave report dated 19 May 2021 (Ex 5) revealed that the areas of disagreement between Mr Rosier and Mr Bluth were: whether the fact that Ms Wang was the only person registered on the title of the Bella Vista home would influence the advice given by a solicitor; the steps a competent solicitor would take to satisfy himself or herself as to the identity and authority of the guarantors; whether Mr Tupou's conversation with Mr Pang was sufficient for him to be satisfied that the signatures were authentic and adequately witnessed; and whether a competent solicitor would have advised Mr Lee to register a second mortgage over the development properties. 8. Neither of the solicitors was required for cross-examination. Accounting evidence 1. The nature and extent of the plaintiffs' lost opportunity is set out in the expert report dated 28 May 2020 of Mr Trevor Vella to the effect that: Beyond Development Group had capacity to repay the debts plus interest under the Loan Agreements as at January or February 2017; and that, by about 13 August 2018, Beyond Development Group would no longer have capacity to repay the debts. 2. Mr Vella, in his first report, set out what is known about the financial circumstances of Beyond Development Group at the relevant time and what occurred in 2018 and 2019 in the attempts by various parties to recover money from that entity. Mr Vella's evidence may be summarised relevantly as follows. 3. Mr Vella did not know the details of the unsecured liabilities of Beyond Development Group as at January/February 2017, apart from the debt to the plaintiffs ([9](e)); nor the extent of the assets of Beyond Development Group other than the development properties as at January/February 2017, apart from amounts in the bank which varied between I January 2017 and 28 February 2017 between $7,691 and $267,531 ([9](f)). Mr Vella noted that between 4 November 2016 and 25 January 2017 virtually the whole of the funds in the Beyond Development Group account which came from the plaintiffs were withdrawn, leaving a balance of $7,691 ([12](g)). There was no information in the report as to where those funds were paid ([12](h)). (As noted in the chronology of events, it appears that by 2 December 2016, much of the loan funds advanced by the plaintiffs had been disbursed.) 4. Mr Vella then described the events leading to the administration and winding up of Beyond Development Group and the realisation of the development properties by the receivers (see chronology above). Valuation evidence 1. Finally, as to the expert valuation evidence, there was criticism made by the parties of the other side's experts. 2. Mr Pang says that Mr Towndrow was not impressive, particularly having regard to answer 4 in the joint report (see Ex 6) as compared to his oral evidence (see at T 253.43 - T 254.32). In this respect, it is noted that Mr Towndrow agreed with Ms Marshall in the joint report that market activity in January is not generally as buoyant as from February through to November; in cross-examination, he disagreed that there was less market activity or less interest by buyers for commercial properties in the last three weeks of December and the entirety of January (although he acknowledged that activity would be less in the first week of January than in the first week of February). Mr Pang submits that Ms Marshall's evidence as to a discount for a forced sale should be accepted. I accept that Mr Towndrow's evidence as to the likely market activity was not consistently expressed but on balance I accept that his opinions are based on his expertise and explained in his report. 3. The plaintiffs, however, complain that Ms Marshall gives no basis for her conclusion of a 20% discount (and the plaintiffs say that Ms Marshall admitted as much in cross-examination – see T 245.38; 339.48) and it is said that it should be rejected as contrary to the basis rule as outlined in Makita (Australia) Pty Ltd v Sprowles (2001) 52 NSWLR 705 (Makita) (at 731-732 per Heydon JA, as his Honour then was, with whom Priestley JA agreed). Complaint is made that Ms Marshall also gives no basis for her conclusion of a 22.50% deduction for developers' profit and risk (again, it is said that this is accepted by Ms Marshall in cross-examination – see T 245.10), and the plaintiffs note that Ms Marshall further admitted that her report contains no evidence of equivalent forced sales from the period. The plaintiffs contend that the lack of evidence of equivalent market-based evidence to support Ms Marshall's conclusion is fatal to the acceptance of that conclusion. 4. The plaintiffs further say that the whole of Ms Marshall's report is misconceived for the simple reason that is appears to be based on Mr Vella's use of the words "forced sale". It is said that Mr Vella was not asked in cross-examination if his conclusions as to the likely parameters of a forced sale aligned with those of Ms Marshall. The plaintiffs say more weight should be placed on the contemporaneous valuation report commissioned by NAB; and it is submitted that its findings are conservative and representative of what would be recovered if the first mortgagee had to sell. 5. I consider that there is some force to the criticism of Ms Marshall's adoption of a 20% discount for a forced rate. While the concept of a forced sale is not novel, the basis upon which that amount was derived was not made clear. Moreover, on would expect that NAB was looking at the relevant time at a forced sale in any event. I accept that Ms Marshall has the relevant expertise to opine on this issue, and that the valuation (and particularly the discount figure) is drawn from her experience which was clearly explained in report but they are difficult to test. Hence, I have more confidence in the contemporaneous report commissioned by NAB (but ultimately nothing turns on this given the other conclusions I have reached). Adverse inferences sought 1. I have noted that various adverse inferences have been sought from the failure of one or other of the parties to call evidence from particular witnesses (such as Mr Zhuang) or to call expert evidence to rebut the evidence relied upon by others. I do not here repeat my observations as to those matters, save to note the position in relation to the so-called rule in Jones v Dunkel and that it does not permit an inference to be drawn that the "missing" evidence would be positively damaging to the relevant party's case (see below). 2. The rule in Jones v Dunkel (Jones v Dunkel) can be summarised thus: an unexplained failure by a given party to call witnesses, tender documents, or produce particular material to an expert witness in order to contradict a matter which arises upon the issues in the proceedings may, in appropriate circumstances, give rise to an inference that any such uncalled evidence would not have assisted the case of the party expected to call such evidence (Jones v Dunkel at 320-1). 3. The rule in Jones v Dunkel only applies where a party is required to explain or contradict something (see at 321). That is, no inference can be drawn unless evidence is given of particular facts which require an answer (see at 322). Further, no inference may be drawn where a party fails to call a witness unless it would have been natural for, or one may have reasonable expected, that party to call a given witness (Payne v Parker [1976] 1 NSWLR 191 (Payne v Parker) at 201–202 per Glass JA). In order for a Jones v Dunkel inference to be drawn, the missing evidence must be such that it would have elucidated a matter in contention (Payne v Parker at 202). The inference does not permit the filling of gaps; nor does it allow an inference that the missing evidence would positively damage that party's case. Furthermore, the "rule" only becomes relevant if there are competing available inferences (Stellar Vision Operations Pty Ltd v Hills Health Solutions Pty Ltd [2022] NSWSC 144 at [273]). 4. What is relevant to deal with at this point is the submission made by the plaintiffs that there should be an adverse inference drawn from the loss of Mr Pang's computer records (and that the inference would extend to an inference that those records would have been positively damaging to Mr Pang's defence). Reliance is placed by the plaintiffs in this regard on the maxim considered in Allen v Tobias (1958) 98 CLR 367 (Allen v Tobias), namely omnia praesumuntur contra spoliatorem (which has been translated as "all things are presumed against the wrongdoer" per Mozley and Whitley's Law Dictionary as cited by Peart J in NWR FM t/a North West Radio v. Broadcasting Commission of Ireland & Anor [2004] IEHC 109). 5. In Allen v Tobias, at 375, the High Court adopted the statement of this maxim given in The Ophelia [1916] 2 AC 206: If anyone by a deliberate act destroys a document which, according to what its contents may have been, would have told strongly either for him or against him, the strongest possible presumption arises that if it had been produced it would have told against him; and even if the document is destroyed by his own act, but under circumstances in which the intention to destroy evidence may fairly be considered rebutted, still he has to suffer. He is in the position that he is without the corroboration which might have been expected in his case. 1. I noted in Rosebanner Pty Ltd v Energy Australia (2009) 223 FLR 406; [2009] NSWSC 43 at [456] the divergence of judicial opinion on the nature of the inference to be drawn, whether it is limited to matters which could likely have been established by the evidence which has been destroyed or withheld or whether presumptions will be raised against the spoliator on all issues which are not otherwise positively proved; and (at [457]) that there was also some historic divergence as to the amount (if any) of "wrongdoing" or fault required to enliven the maxim; i.e., whether the blameworthiness requires malus animus or mala fides (referring to Delany v Tenison (1758) 3 Bro PC 659; 1 ER 1559) or whether it is sufficient for the presumption to be available that it cannot be shown that the destruction of evidence was proper or justifiable (there referring to Gray v Haig (1854-1855) 20 Beav 219; 52 ER 587). At [458] I noted that the passage of The Ophelia approved by the High Court seemed to suggest that even bona fide destruction could nevertheless have negative consequences (insofar as the High Court stated that even where "the intention to destroy evidence may fairly be considered rebutted, still [the destroyer of evidence] has to suffer). He is in the position that he is without the corroboration which might have been expected in his case" (though I would here add that the last sentence suggests that it is a practical disadvantage suffered by the loss of the evidence in that event – not the raising of a presumption or inference against the party suffering the unintentional loss). 2. In the present case, there is no evidence to support a conclusion that Mr Pang took a deliberate step to cause the destruction of his computer hard drive (and cogent evidence of this would be required given the serious ramifications that such conduct could have when occurring at a time that he was on notice of the Court proceeding). I cannot accept that the maxim adopted in Allen v Tobias extends to permit (nor would it in my opinion warrant) the drawing of an adverse inference such as the plaintiffs here suggest in circumstances where there is an unintentional (apparently cataclysmic) computer failure which renders irretrievable material on a party's computer that might have been relevant to the proceeding at hand. I accept that the loss of that material may well have negative practical consequences (so, for example, Mr Pang is deprived of the opportunity to rely on the witness log to prove that the Loan Agreements were not recorded on it). However, I do not accept that I can infer from the computer failure that there was evidence on the witness log (now destroyed) that would prove that Mr Pang did indeed certify or witness the execution of the Loan Agreements. Claim against Ms Wang 1. I deal first with the claim against Ms Wang, as the conclusion reached on this claim is relevant to the claims made against Mr Pang. Plaintiffs' submissions 1. The plaintiffs maintain that Ms Wang is liable to pay the outstanding loan amount due under the Loan Agreements that the plaintiffs say Ms Wang signed on or about 9 November 2016. 2. The plaintiffs contend that each of the Loan Agreements is an enforceable deed which satisfies the requirement of sub-ss 38(1) and (3) of the Conveyancing Act 1919 (NSW) (Conveyancing Act) having been signed by the parties whose signatures have been attested by a witness not being a party to the deed. In order to be deemed to be sealed, a deed must also stipulate that it is a "deed" (or the deed can stipulate that it is an "indenture" or that it is to be "sealed"). (I interpose to note that the word 'attested' is not defined in the statute; however, the word has been considered judicially to mean "that one or more persons are present at the time of the execution for that purpose, and that as evidence thereof they sign the attestation clause, stating such execution" (see Lord Romily's discussion of the meaning of attestation in Wickham v Marquis of Bath (1865) LR 1 Eq 17 at 24, adopted in Norton on Deeds (1928, 2nd ed) at 24; Ellison v Vukicevic (1986) 7 NSWLR 104 at 112 per Young J (as his Honour then was) (upheld on appeal in Vukicevic v Alliance Acceptance Co Ltd; Vukicevic v Ellison (1987) 9 NSWLR 13 at 17 per Samuels, Priestley and McHugh JJA)); see also Young, Newton and Cahill, Conveyancing Service New South Wales (2003, Lexis Nexis) at [30700].) 3. The plaintiffs say that, as neither Beyond Development Group nor Mr Zhuang was solvent, Ms Wang's liability to guarantee the obligation of Beyond Development Group under cl 9 of the Loan Agreements was triggered; and that Ms Wang bears the onus of establishing that the Loan Agreements should not be enforced. (Ms Wang, to the contrary, maintains that it is for the plaintiffs to prove, pursuant to s 140 of the Evidence Act 1995 (NSW), that Ms Wang did indeed sign the two loan agreements.) (Nothing here turns on the onus issue because I am comfortably persuaded that the signature on the document was not that of Ms Wang. However, insofar as Ms Wang asserts that the purported signature is a forgery, she would bear the onus on that allegation – see, for example, Musa v Alzreaiawi [2020] NSWSC 638, upheld on appeal in Musa v Alzreaiawi [2021] NSWCA 12.) 4. As to the handwriting evidence, the plaintiffs emphasise that the Court is not bound to accept expert forensic evidence (such as that of Ms Holt) and may come to its own conclusion as to the similarities or differences of the signatures in question, referring to what was said by Young CJ in Eq, as his Honour then was, noted in Vella v Permanent Mortgages Pty Ltd (2008) 13 BPR 25,343; [2008] NSWSC 505 (Vella v Permanent Mortgages) at [245]-[247] (to the effect that a judge sitting as a tribunal of fact must "consider all the evidence before making his or her decision", and may prefer the oral evidence to the evidence of experts). Ms Wang's submissions 1. Ms Wang relies upon Mr Pang's evidence (at [34] of his affidavit) as to the conversation with Mr Zhuang, in which Mr Pang recorded his concern about his signature being annexed to the Loan Agreements as a witness; and Mr Pang's acceptance in cross-examination evidence that he did not witness Ms Wang sign either of the Loan Agreements (T 233.20-234.24). Ms Wang says that the evidence clearly establishes that the Loan Agreements were not witnessed by Mr Pang (and she relies on this for the conclusion that they are not enforceable as Deeds – see below). 2. Ms Wang also argues that the fact that Beyond Development Group did not give evidence in the proceeding is compelling (maintaining that that evidence could have greatly assisted in a determination that Ms Wang did not sign the respective Loan Agreements). (Pausing here, I consider that no weight can be placed on the fact that there was no evidence on behalf of Beyond Development Group at the hearing. Apart from the fact that it was initially a party against whom default judgment was entered; and that it is now in liquidation, I cannot see that it could be said to be an entity within the plaintiffs' camp such that it might be expected that the plaintiffs would seek to adduce evidence from an officer of the company in the present proceeding.) 3. Ms Wang (as did the plaintiffs) points to the requirements for the execution and attestation of a deed (set out in s 38 of the Conveyancing Act) and says that the deeds are of no effect in law because they were not signed and attested in compliance with s 38 (referring in that context to the discussion of those requirements in Matouk v The Entrance Seabreeze Pty Ltd [2010] NSWSC 649 (at [53]-[60], including that it is a statutory requirement that a deed must be signed, cf the requirements at common law). Thus, if it be accepted that Mr Pang did not witness the signature of Ms Wang on any document relating to this proceeding, Ms Wang argues that the Loan Agreements are ineffective as deeds. 4. More significantly, in my opinion, Ms Wang relies on the expert opinion of Ms Melanie Holt for the conclusion that Ms Wang did not sign either of the Loan Agreements. Ms Wang says that Ms Holt was a forthright witness who assisted the Court, was not an advocate for her client, and provided cogent and clear reasoning as to her methodology, her approach and her findings; and that it is compelling that the plaintiffs did not call any expert evidence to rebut Ms Holt's evidence. Ms Wang argues that the only inference that can be drawn from this (absent any explanation from the plaintiffs) is that there was a forensic decision taken by the plaintiffs not to call an expert to challenge the evidence of Ms Holt and that any such expert evidence would not have assisted the plaintiffs in their claim against Ms Wang. 5. Ms Wang submits that on the basis of her own evidence and the expert opinion of Ms Holt, it is established that Ms Wang did not sign the Loan Agreements. 6. As noted above, Ms Wang's position is that the Loan Agreements which were purportedly executed as deeds are not deeds at all. Further, it is submitted that neither of the Loan Agreements can be taken to be contracts because there is no consideration in relation to either of the agreements (the moneys having been advanced prior to the execution or purported execution of the Loan Agreements) since past consideration is no consideration at all. Determination 1. Perhaps the most telling piece of evidence in relation to the claim against Ms Wang are the signatures themselves, which to a lay eye appear markedly different to the specimen authentic signatures. Coupled with Ms Holt's expert opinion (to which I have referred above) and Ms Holt's cogent reasons as to why it is not likely that the signatures were disguised signatures (and the absence of anything to suggest that Ms Wang was suffering from some disability at the time the signatures were placed on the documents of the kind postulated by the plaintiffs in submissions), I have no hesitation in concluding (on the balance of probabilities) that the signatures purporting to be those of Ms Wang on the Loan Agreements are not Ms Wang's genuine signatures. 2. Mr Pang's evidence (against his interest since his exposure to liability arises only if Ms Wang did not sign the documents) supports this conclusion, since his evidence in cross-examination was that he never met Ms Wang (the accounting work done for her being conducted through email communications with Mr Zhuang). Logically, if Mr Pang never met Ms Wang (which is also her evidence), he cannot have physically witnessed her sign anything. 3. I accept that Ms Wang was an unreliable witness and I would in general exercise caution in accepting her account of events other than as supported by objective contemporaneous evidence. Apart from the inconsistencies in her evidence as to her employment with Elite Express and the admitted untruths to the bank on her finance application, Ms Wang also gave admittedly untruthful evidence in the witness box (despite it having been explained to her that the s 128 certificate that had been provided would not protect against the giving of false evidence to the Court). 4. However, it does not follow that because a witness is disbelieved on particular matters he or she ought to be disbelieved on all matters (see Steinberg v Federal Commissioner of Taxation (1975) 134 CLR 640; [1975] HCA 63 at 695 per Gibbs J, as his Honour then was; Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 (Farah Constructions) at 136 [100] per Gleeson CJ, Gummow, Callinan, Heydon and Crennan JJ; Australian Securities and Investment Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17 at [232] per Heydon J). 5. I place weight on the forensic analysis of Ms Holt, which to my mind overcomes the problematic nature of Ms Wang's evidence. Thus, I have concluded that the signatures on the Loan Agreements purporting to be those of Ms Wang are not her genuine signatures; and the claim against Ms Wang therefore fails. Claim against Mr Pang Plaintiffs' submissions 1. In the alternative to the claims against Ms Wang, the plaintiffs contend that Mr Pang is liable to the plaintiffs for the outstanding loan amount, putting their claim on three bases: for knowing concern in the misleading or deceptive conduct alleged against Mr Zhuang (the accessorial liability claim); for contravention of the prohibition against misleading and deceptive conduct (the misleading or deceptive conduct claim) and for breach of a duty of care owed to the plaintiffs in relation to the execution of the Loan Agreements (the negligence claim). 2. The plaintiffs say that it follows that, if Ms Wang did not sign the Loan Agreements, then Mr Pang cannot have witnessed Ms Wang's signature notwithstanding that he signed as witness on the Loan Agreements. It is submitted that, in so doing, Mr Pang gave the plaintiffs the misleading understanding that the documents were duly executed by Ms Wang. 3. As to the second of the ways in which the claim is put, the plaintiffs contend that Mr Pang breached the prohibition on misleading or deceptive conduct in four main ways, each with compounding effect on the former; namely by: improperly signing as witness; thereafter failing to correct the position; subsequently confirming to Mr Tupou (in 2016) that he did witness the documents; and his continuing silence and ongoing failure to correct the position. 4. As to the third of the ways in which the claim is put, the plaintiffs rely upon Graham v Hall (2006) 67 NSWLR 135; [2006] NSWCA 208 (Graham v Hall), to which I refer in due course. There, Ipp JA (at [107]) said that: Justices of the peace who sign attestation clauses stating that declarants have made and subscribed the declaration before them when that is not true, commit an act that is the antithesis of their function. Such an act strikes at the heart of the system they are charged to protect. … 1. Addressing in turn the ways in which the claim against Mr Pang is put, I note the plaintiffs' submissions as follows. Accessorial liability claim 1. As to the claims based accessorial liability, the plaintiffs contend that Mr Pang was knowingly concerned in Mr Zhuang's misleading or deceptive conduct. 2. The plaintiffs say that, if it is found that Ms Wang did not execute the Loan Agreements, then Mr Zhuang's representations to the effect that Beyond Development Group, Ms Zhuang and Ms Wang would secure the loans were misleading or deceptive. (As noted above, the plaintiffs also say that Mr Zhuang took the additional step of either falsely signing the Loan Agreements on behalf of Ms Wang or procured someone else to do so.) It is submitted that this conduct was intended to (and did) induce the plaintiffs into thinking that Ms Wang had executed the Loan Agreements and, accordingly, that the moneys advanced were properly guaranteed by the Bella Vista property. 3. The plaintiffs contend that that Mr Pang knew or ought to have known at least two essential facts: first, that he was witnessing a deed (which it is said would have been apparent from any cursory glance at the documents); and second (on the hypothesis that Ms Wang did not sign the documents), that he did not witness anyone sign at all. It is said that, despite this, Mr Pang proceeded to sign the Loan Agreements, and, in doing so, he was knowingly concerned in, and party to, Mr Zhuang's contravention (because to sign, without in fact witnessing, was clearly apt to mislead). 4. Reference is made to Yorke v Lucas (1985) 158 CLR 661; [1985] HCA 65 at 670, where Mason ACJ, Wilson, Deane and Dawson JJ said that there can be no question that a person cannot be knowingly concerned in a contravention unless he has knowledge of the essential facts constituting the contravention and is an intentional participant ("the necessary intent being based upon knowledge of the essential elements of the contravention"). The plaintiffs say that the essential fact in the present case was that Mr Pang was witnessing a deed (without in fact witnessing the document). The plaintiffs further say that Mr Pang's failure to correct this when he knew or ought to have known he had an obligation to do so was a failure that contributed to the misleading or deceptive conduct. 5. To the extent that Mr Pang knew that he was falsely attesting the signature of Ms Wang it is said that he had actual knowledge for the purposes of the requisite categories of knowledge in Farah Constructions Pty Ltd v Say-Dee Pty Ltd (2007) 230 CLR 89; [2007] HCA 22 at [174]-[178]. In the alternative, it is said that Mr Pang had knowledge of circumstances which would indicate the facts to an honest and reasonable person (the fourth of the categories of knowledge there said to be sufficient for accessorial liability). 6. The plaintiffs say that there is a causal link between Mr Pang's misleading conduct and their loss. They maintain that Mr Pang's failure to raise the true position at an earlier opportunity meant that the plaintiffs' chances of seeking redress diminished over time as Beyond Development Group and Mr Zhuang became less and less creditworthy and eventually insolvent. It is said that the apparent due execution of the Loan Agreements allowed the relationship between lender and borrower to continue in circumstances where the plaintiffs would have discontinued the relationship had the true position been made clear. Reliance is placed on the approach to claims for loss of opportunity in in Sellers v Adelaide Petroleum NL (1994) 179 CLR 332; [1994] HCA 4 at 355, namely that there must be proof on the balance of probabilities that the plaintiff has sustained some loss or damage (which may be demonstrated by showing that the contravening conduct caused the loss of a commercial opportunity which had some value (not being a negligible value), the value being ascertained by reference to the degree of probabilities or possibilities). Misleading or deceptive conduct claim 1. As noted above, the plaintiffs contend that Mr Pang's conduct was misleading or deceptive in four main ways (each predicated on a finding that Ms Wang did not sign the relevant documents): by improperly signing as a witness; by failing to correct the position thereafter; by representing to Mr Tupou that he had witnessed the signature(s); and by his continued silence and failure to correct that position thereafter. 2. As to the first of those ways, the plaintiffs contend that, by signing as witness, Mr Pang was effectively attesting to witnessing Ms Wang's signature where Ms Wang did not in fact sign the Loan Agreements. The plaintiffs says that this was clearly misleading because it gave, or was likely to give, the plaintiffs the understanding that the signatures of the guarantors were true because they were witnessed by an independent party to the transaction. The plaintiffs emphasise that Mr Pang is an accountant and a justice of the peace. It is submitted that his attestation ought bring a degree of confidence to those who would rely on the due execution of the document (referring to the observations made in Graham v Hall as extracted above). The plaintiffs contend that from the moment they received the (on this hypothesis) falsely executed agreements this constituted ongoing misleading and deceptive conduct by Mr Pang. 3. As to the second of those ways, it is said that Mr Pang would (or ought to) have known that his attestation as witness was inappropriate. It is submitted that this gave rise to an obligation that Mr Pang correct the position (and that his failure to do so was an omission that contributed to the misleading conduct). 4. As to the third, reliance is placed on the 22 November 2016 conversation to which Mr Tupou has deposed with Mr Pang (see the chronology of events above). The plaintiffs say that, in circumstances where both Loan Agreements have the apparent signatures of Ms Wang, it was sufficiently clear that Mr Tupou was asking Mr Pang about the witnessing of the whole deed, including Ms Wang's signature. It is said that Mr Pang knew, or ought to have known, that the plaintiffs wanted to confirm the due execution of the whole "contract"; and it is submitted that an answer in the affirmative was apt to mislead in circumstances where the "contract" was not so executed. 5. Fourth, as to the continued silence by Mr Pang, the plaintiffs say that candid disclosure was required from the beginning. They submit that the fact that the true position was not revealed by Mr Pang led them to believe that the documents had been duly executed; and therefore they were lulled into the comfort of believing that they did not need to take any remedial action prior to the end of the loan term to reclaim their advances. 6. The plaintiffs contend that Mr Pang's misleading conduct occurred in trade or commerce, pointing to the definition of the phrase "trade and commerce" in s 2 of the ACL, as including any "business or professional activity (whether or not carried on for profit)". It is submitted that this definition is wide enough to cover Mr Pang's conduct because he purportedly witnessed the Loan Agreements in his role as accountant and (though Mr Pang cavils with this) as a Justice of the Peace. 7. It is said that this is reinforced by statements made in Mr Pang's affidavit of 3 July 2019, in which Mr Pang deposes, among other things, not only to his usual record keeping practice for the witnessing and execution of documents but also refers to his "Business hard drive" having been corrupted in 2018. It is submitted that the logic underlying these statements is that the witnessing of these loan agreements fell within, or was related to, Mr Pang's business or professional activities. 8. The plaintiffs say that they suffered loss in the form of the loss of opportunity to rescind the Loan Agreements and to reclaim, or preserve, their funds while Beyond Development Group (the manager) and Mr Zhuang were still solvent. (In oral submissions, as already noted, it was also put that there was a loss of an opportunity to trace the funds but this was not pleaded.) 9. It is submitted that Mr Pang's conduct had the effect of placing the plaintiffs into a false sense of security as to the due execution of the Loan Agreements. Mr Lee's evidence is that had he known of the true position, he would immediately have rescinded the Loan Agreements and taken steps to reclaim the plaintiffs' funds; and would at least have sought to prevent the dissipation of the balance of the advances (approximately $255,906 as of 18 November 2016) and sought a freezing order against the assets of Beyond Development Group and Mr Zhuang while they were still solvent. Negligence claim 1. Further, in the alternative, it is said that Mr Pang is liable to the plaintiffs in damages for negligent execution of the Loan Agreements. The plaintiffs contend that Mr Pang owed them a duty to take reasonable care, in the witnessing of the Loan Agreements, to avoid causing the plaintiffs loss (it being reasonably foreseeable that Mr Pang's conduct may be likely cause loss to the plaintiffs, because they would no longer be able to rely on the Loan Agreements as duly executed). 2. As noted above, reliance is placed by the plaintiffs on Graham v Hall, which they maintain is analogous to the present case. There, a Justice of the Peace falsely attested in a statutory declaration that a mortgage document was signed by a signatory in his presence (the relevant signature having been forged by the purported signatory's husband). It was held that the witness, by attesting the signature, implicitly assumed responsibility to those who could be affected by negligence on his part in carrying out that task (at [66]). In the present case, the plaintiffs say that Mr Pang assumed responsibility to the plaintiffs by representing that Ms Wang had executed the Loan Agreements in his presence. 3. The plaintiffs also refer to State Bank of NSW Ltd v Yee (1994) 33 NSWLR 618, where a solicitor had wrongly attested that a loan facility document was signed in his presence (though there it was not disputed that solicitor owed a duty of care both with respect to the representation of due execution and with respect to failure to correct the position thereafter). The plaintiffs say that these authorities demonstrate the general proposition that a witness owes a duty of reasonable care to other parties who will foreseeably rely, or be affected by, the apparent due execution of the document. 4. Thus, the plaintiffs say that Mr Pang owed them a duty to take reasonable steps to ensure that the persons signing the Loan Agreements were in fact Ms Wang and Mr Zhuang; and that Mr Pang either should not have attested to the proper execution of the document (if it in fact did not happen) and/or should have corrected the position thereafter by advising the plaintiffs, or their legal representative, of the true position. It is submitted that it was foreseeable that, if Mr Pang did not take reasonable care to duly execute the documents, the plaintiffs would be oblivious to the underlying "anomaly" that the guarantor did not actually sign the document. 5. The plaintiffs submit, again, that, but for Mr Pang's conduct, the plaintiffs would have taken some early remedial steps to prevent further disbursement of the advances, to rescind the Loan Agreements and to commence action to reclaim the advances while Beyond Development Group and Mr Zhuang were still solvent. The disadvantage which it is said the plaintiffs suffered was the loss of the opportunity or chance of taking these steps (reference being made in this context to the opinion of Mr Vella as set out in his report dated 28 May 2020). 6. The plaintiffs contend that they are entitled to damages that would put them in a position in which they would have been able to rescind the contract and commence proceedings for the repayment of the cash advances. Mr Pang's submissions 1. At the outset, Mr Pang notes that the causes of action against him are overlapping, stemming from the allegation that Mr Pang witnessed Ms Wang sign two loan agreements on 9 November 2016. As noted above, Mr Pang's evidence is that he does not recall witnessing Ms Wang's signature on the Loan Agreements but (if it be found that Ms Wang did not sign the agreements), then (based on his claimed invariable practice) Mr Pang denies that he signed the documents without actually witnessing Ms Wang execute the document. 2. Mr Pang further says that even in the event of a finding that he did witness Ms Wang's signature without Ms Wang being present, the case against him should fail because the plaintiffs have not established reliance, or that any conduct by Mr Pang caused loss. Further, if there was a breach which caused loss, Mr Pang says that the damages should be discounted for contributory negligence and/or on account of concurrent wrongdoer and proportionate liability defences. 3. As to the two relevant contested factual matters in the case against Mr Pang (first, whether Mr Pang placed his signature on the guarantees other than in the presence of Mr Zhuang and Ms Wang; and, second, whether Mr Pang made the representations as alleged in the telephone conversation with Mr Tupou on 22 November 2016), Mr Pang says the following (noting that the first is an allegation of dishonesty on the part of Mr Pang, giving rise to the principles stated in Briginshaw at 361-363). I consider each in turn. Witnessing of the signatures other than in the presence of the signatories 1. For Mr Pang, it is said that the effect of his evidence (which I have summarised earlier) is that the only circumstance in which Mr Pang would have put his signature on the guarantees is if he had in fact witnessed the signatures of Mr Zhuang and Ms Wang. It is said that this evidence admits of the possibility that Mr Zhuang and Ms Wang signed the documents in his presence (in which case Mr Pang accepts that it may be his signature that is on the documents) and of the possibility that he did not witness their signatures in his presence (in which case Mr Pang contends that his signature on the documents must have been forged). What Mr Pang does not accept (as being inconsistent with his claimed to be invariable practice) is a third possibility, namely that the documents were brought to him with the signature already on the document and that he then falsely attested that they were signed in his presence. 2. Mr Pang contends that the more likely finding is that at least Ms Wang (and probably Mr Zhuang) did not sign the documents in his presence, on the basis that such a finding is more consistent with Mr Pang's usual practice with respect to the witness log. (Pausing here, it seems to me that it is unlikely that there would be a relevant distinction between Ms Wang and Mr Zhuang's signatures in this regard unless there is an alternative scenario under which Mr Pang witnessed Mr Zhuang sign the document(s) but that Ms Wang's signature was not on the document(s) at that time; and no such scenario was here put.) 3. Mr Pang relies upon the following matters in support of his submission that his evidence should be accepted. 4. First, (and I accept) it is said that Mr Pang's evidence during cross examination demonstrated that he was a witness who was doing his best to assist the Court. It is said that Mr Pang did not overstate the extent of his recollection about any relevant matters (cf Mr Tupou) but was firm in his position that he would not have certified that he had witnessed the signatures unless the parties executing the documents were in his presence when they signed. 5. Second, that Mr Pang's position is corroborated by the evidence of the witness log that Mr Pang contends he maintained (this being a reference, as I understand it, to Mr Pang's evidence that he looked at that log, and that it did not contain scanned copies of the guarantees – since there is in fact no evidence of the witness log itself; it having been corrupted and lost in the cataclysmic computer incident of which Mr Pang gives evidence). Reference is made to Mr Pang's evidence was that it was his invariable practice to have scanned, and to keep a copy on that log, of documents such as the guarantees (T 202.9-202.10). It is noted that in cross examination Mr Pang denied that that he had looked at the log and that the agreements were in fact there (T 222.39-222.42); and that Mr Pang also denied the proposition that he had then deliberately destroyed the computer hard drive or arranged for that to be done (T 223.1-223.3). 6. Mr Pang says that there is no basis to conclude that Mr Pang was giving false evidence about what he saw when he looked at the log, noting that it is supported by his contemporaneous email to Mr Tupou. I agree. As to the suggestion that Mr Pang deliberately caused the computer hard drive to be destroyed (which is unpleaded and a serious allegation to be made, particularly when it is suggested that this was at a time when the Court proceeding was already on foot, although Mr Pang was not yet a party thereto), it is said for Mr Pang that there is no basis to support that allegation. In particular, it is noted that Mr Pang gave evidence that he had engaged a data recovery specialist to help recover the data (see his affidavit at [44]) (Mr He of Fortune Consulting Services). Indeed, the plaintiffs caused a subpoena for production of documents to Mr He and it is noted that there has been no complaint about the adequacy of compliance with that subpoena nor has any evidence been adduced to undermine Mr Pang's sworn evidence at [44] and [45] of his affidavit. 7. As to the plaintiffs' submission that there should be a Jones v Dunkel inference arising from the "failure" by Mr Pang to call Mr He as a witness (T 324.12), Mr Pang says that Mr He is not in Mr Pang's "camp"; that there is no matter in Mr Pang's case which Mr He's evidence could elucidate (since Mr Pang's evidence on this topic is clear and unchallenged); and that the "absence" of Mr He's evidence from Mr Pang's case is easily explained (i.e., that it is not necessary for Mr Pang to call that evidence). 8. In any event, it is said that even if the "rule" in Jones v Dunkel were engaged, it would not assist the plaintiffs since the inferences sought must be available to be drawn on the evidence which has been admitted (at 308 per Kitto J, 312 per Menzies, 320-321 per Windeyer J). It is noted that the rule cannot "fill gaps [in the evidence] or to convert suspicion into inference" (Jones v Dunkel at 313 per Menzies J) and that the "strength, or weakness, of the case made out by the evidence actually presented in the case bears on whether inferences should be drawn from other evidence not having been presented" (see Manly Council v Byrne [2004] NSWCA 123 at [74] per Campbell JA). 9. As to the suggestion (by reference to Allen v Tobias) that an adverse inference (positively damaging to Mr Pang's case) should be drawn against Mr Pang by reference to the loss of his witness log in circumstances in which he had an obligation to keep his log and it was lost or destroyed (whether by accident or intentionally), which I have addressed above, Mr Pang submits that Allen v Tobias contemplates deliberate acts of destruction (a factor which is not present in this case, other than by assertion in cross examination of Mr Pang). It is said that, while the principle in that case also contemplates circumstances in which the intention to destroy can be rebutted, such a circumstance requires the document to be destroyed by the person's own act (see Allen v Tobias at 375). It is noted that in Katsilis v Broken Hill Pty Co Ltd (1977) 18 ALR 181, Barwick CJ (dissenting) at 198 made clear that "if the destruction is innocent no such inference can be drawn – by innocent means that because the significance of the document is not known or because the destruction was not deliberate but, for example, accidental". 10. Third (and to my mind most significantly), it is notes that Mr Pang's account is consistent with his written communications with Mr Tupou in September 2018 (see above). Mr Pang contends that the sequence of those events is what would be expected of a person in Mr Pang's position, who has been confronted with documents which appear to contain his signature and no recollection of signing them but who has a usual practice. It is submitted that, contrary to the plaintiffs' suggestion (that if Mr Pang's position was an honest and truthful one, he would have notified the Department of Justice or contacted the police or contacted Ms Wang), none of those things is something that a person in Mr Pang's position would necessarily do; and it is said that there is no basis to find that there was any reason to contact the Department of Justice; and, as for contacting the Police, Mr Pang knew that the proceeding was were listed in Court and that the plaintiffs' interests were being protected by solicitors (referring to the email dated 7 September 2018 from Mr Tupou to Mr Pang at 2.20pm). 11. Fourth, Mr Pang submits that it is inherently unlikely that he would have certified that Mr Zhuang and Ms Wang signed the documents in his presence unless that were so. It is said that there was no special relationship between Mr Pang and Mr Zhuang (T 198.2); and that Mr Pang had nothing to gain from a false certification of the signatures (nor was it suggested to him that he had anything to gain from it). Further, it is said that the potential consequences for Mr Pang in falsely certifying documents, even if not in his capacity as a justice of the peace, are obviously serious. 12. Fifth, it is said that Mr Pang's account is corroborated by the person with direct knowledge of the matter (Mr Zhuang) (albeit that it is Mr Pang's account of that conversation on which reliance is here placed). Mr Pang says that, while one would be slow to put any weight on statements by Mr Zhuang on this particular point, the evidence should be accepted in circumstances where Mr Zhuang's statement to Mr Pang is against Mr Zhuang's interest. It is said that there is no reason to think that Mr Zhuang would be lying about this particular issue when he spoke to Mr Pang on the telephone. For Mr Pang, it is said that the statement by Mr Zhuang that Mr Pang did not witness the signatures on the guarantees (albeit that it is only evidence that comes from Mr Pang's account) is evidence that is before the Court without limitation and should be accepted. 13. In the plaintiffs' reply submissions on this issue it is submitted that Mr Pang has given no persuasive evidence to show that he did not sign the loan agreements and that any finding that Mr Pang did not sign the agreement could only be based on his assertion that such a signature would be outside his usual practice given it did not appear on his unproduced log (because he has no memory one way or another of signing the agreement). (Pausing here, I do not accept that this assertion is the only basis on which such a finding would be available to be drawn – see below.) 14. Against that assertion, the plaintiffs point to the following: that the signatures look very similar (with which I agree); that Mr Pang agrees that he can recognise his own signature (T 197.3) and concedes that the signatures look very similar to his own (T 196.35); that Mr Pang does not deny in his evidence that the signatures are his; and it is submitted that, as Mr Pang cannot remember if he did or did not sign the agreements, it logically follows that it is possible that he did. The plaintiffs point to Mr Tupou's evidence of his conversation with Mr Pang on 22 November 2016 (see the chronology above) in which Mr Tupou says Mr Pang confirmed that he had witnessed the signatures (a conversation that it is noted Mr Pang says he does not remember but concedes "it's possible" it happened (T 224.50 T 194.39)); and the plaintiffs say that Mr Tupou confirmed that Mr Pang had witnessed the signatures by email on 22 and 30 November 2016 (see the chronology above). 15. The plaintiffs rely on Mr Hobden's expert testimony concluding that the signatures are genuine (see Ex A at p 2), and to Mr Hobden's opinion that "the specimen signatures are not particularly vulnerable to a successful undetectable forgery of several signatures, i.e. a series of undetectable forgeries that successfully replicate all of the genuine features of the specimen signatures including the natural variation between them" (see Ex A at p 4). As noted above, the plaintiffs point to the fact that Mr Pang did not answer the expert conclusion of Mr Hobden with any competing expert testimony reaching a competing or different conclusion. 16. The plaintiffs say that if there were to be a finding that Mr Pang did not sign the agreements as alleged, then it would have to be accepted that the signatures are the work of a "mysterious master forger". (I cannot accept either limb of that proposition. There hardly seems to be any mystery as to who might be the likely forger in the present case – since the plaintiffs themselves postulate the likely forger of Ms Wang's signature, if it not be genuine, as being Mr Zhuang or someone he caused to forge the signature. And it does not seem to me that one is necessarily looking for a "master" forger, given the evidence of Mr Hobden in cross-examination and the evidence of Ms Holt as to "disguised" signatures. In that context, the fact that Mr Zhuang was in possession of the Loan Agreements for some days before returning the executed documents to Mr Tupou means that Mr Zhuang would have had ample opportunity to copy Mr Pang's signature (which he presumably had available to him from other documents prepared by Mr Pang in his position as accountant) and seemingly more incentive to do so than Mr Pang would have had.) The plaintiffs nevertheless submit that the balance of probabilities is against such a finding. 17. The plaintiffs further say that Mr Pang's conduct when confronted with the fact that Ms Wang denied she signed the agreements in his presence is consistent with consciousness of guilt, pointing to the following matters: that, despite being told by Mr Tupou that Ms Wang was alleging that her signature was not genuine Mr Pang did not immediately reply to Mr Tupou; that, when further confronted by Mr Tupou, Mr Pang stated "Look I'm busy, I've got make money [sic], I'll get back to you" (see Mr Tupou's first affidavit at [30]), and that Mr Pang did not answer Mr Tupou's further email sent on 7 September 2018. In this context, the plaintiffs note that, as a result of his conversation with Mr Zhuang, Mr Pang "had direct knowledge that somebody has forged" his signature at (T 207.26), yet despite that knowledge Mr Pang did not report the matter to the police; did not inform Ms Wang that his signature had been allegedly forged; nor did he inform the other parties to the agreement. It is noted that Mr Pang agreed that a forgery could result in a criminal prosecution (at T 206.17) and could cause all sorts of mischief (T 206.23) but nevertheless made no enquires of Mr Zhuang as to how his signature came to be on the agreements (T 206.42). As to those matters, as I have already observed, I do not consider Mr Pang's conduct to evince a consciousness of guilt; and there is some overstatement of the matters here relied upon in my opinion. For example, Mr Pang's affidavit evidence does indeed depose to an enquiry as to how his signature came to be on the documents; and the delay in the initial response to Mr Tupou was not lengthy (and there was a 'holding' response of sorts in the meantime). 18. The plaintiffs emphasise that Pt 4.3.18 of the Justice of the Peace Handbook (see Ex B at p 239) states that if a Justice of the peace "later becomes aware" that a document witnessed by the Justice of the Peace) contains false information or that "something else about the circumstances causes you to be suspicious, you should report the matter to the Department so that it can assist in determining what steps (if any), need to be taken". The plaintiffs say that, despite knowledge that somebody had forged Mr Pang's signature (see at T 207.25) coupled with ID verified in his capacity as Justice of the Peace as emailed to him by Mr Tupou, Mr Pang did not inform the Department of Justice in accordance with the requirements outlined in the Justice of the Peace handbook. 19. Further, the plaintiffs point to the fact that, despite being advised by Mr Zhuang that unknown persons had forged his signature and that he understood this to be a criminal act, Mr Pang did not contact Mr Wang or anyone else because (according to Mr Pang) "Mr Zhuang is working on that to deal with Jonathan Lee to work out something" (at T 221.6). The plaintiffs say that the fact that, on Mr Pang's version of events, he became aware of a forgery but did not do anything about it because he was assured that Mr Zhuang was going to "work something out" is itself evidence of dishonest conduct. 20. Thus, the plaintiffs submit that Mr Pang's conduct is more than a lack of taking the appropriate action one would expect from not only a Justice of the Peace but from any law-abiding citizen; that it is conduct that can only be rationally explained by a consciousness of guilt. I do not agree. 21. The criticism made of the failure to notify the Department of Justice seems to assume that the documents were witnessed by Mr Pang in his capacity as Justice of the Peace (which he disputes) but in any event it seems to me to be syllogistic reasoning to say that because there is an expectation (it is not couched as an obligation) in the relevant Handbook of disclosure to the Department and there was no such disclosure Mr Pang must be taken to have known that there was no forgery in relation to the signatures that he had purportedly witnessed. There is an equally plausible explanation, namely that it simply did not occur to Mr Pang to make such a disclosure (even though it was a matter of concern to him that his signature was said to have been forged). 22. As to the fact that there was no report to the police or disclosure to Ms Wang, Mr Pang's explanation was not implausible – that he did not consider that the documents imposed any liability on him and that Ms Wang was not his client. Whether a law abiding citizen (as postulated by the plaintiffs) might have done otherwise seems to me to be pure speculation. The fact that Mr Pang drew comfort from Mr Zhuang's advice that he would sort it out might well have been an instance of someone sticking his head in the sand but does not lead me to conclude that this exhibits a consciousness of guilt, let alone being evidence of dishonest conduct. The equally (if not indeed more likely) available explanation is that Mr Pang was himself also a victim of misconduct by a rogue (and, as did Mr Lee, may mistakenly have placed his trust in Mr Zhuang). It does not lead me comfortably to conclude that Mr Pang was knowingly concerned in any such misconduct. 23. The plaintiffs also cast doubt on Mr Pang's truthfulness as a witness (which I have addressed above). 24. In their reply submissions, the plaintiffs also submit (in the context of the criticisms made of Mr Hobden's evidence) that Mr Hobden's evidence is to be read in conjunction with Mr Pang's own observation that the signatures of the agreements are "very similar" to his own signature, and the fact that he does not rule out the possibility that they are his signature. Further, the plaintiffs say that it would be procedurally unfair for any conclusions to be drawn as to the conduct of Mr Hobden generally as a result of findings in another case (the Earth Civil matter, which coincidentally was heard by me but in which I do not recall any evidence of Mr Hobden being tendered – see In the matters of Earth Civil Australia Pty Ltd, RCG CBD Pty Ltd, Bluemine Pty Ltd, Diamondwish Pty Ltd and Rackforce Pty Ltd (all in liq) [2021] NSWSC 966) of which the plaintiffs know nothing. As already noted, I do not place any weight on this submission, so no question of procedural unfairness can here arise. Telephone conversation of 22 November 2016 1. As to the second of the factual contests (whether Mr Pang made the representations as alleged in the telephone conversation with Mr Tupou on 22 November 2016 – see chronology above), Mr Pang contends that Mr Tupou's evidence about that conversation should be rejected, for the following reasons. 2. First, that the conversation is inconsistent with the contemporaneous file note taken by Mr Tupou on 22 November 2016 (Ex 7). As to the relevance of contemporaneous documents in fact finding of this kind, Mr Pang refers to Nominal Defendant v Cardin (2017) 79 MVR 210; [2017] NSWCA 6. 3. Second, that the account given is inconsistent with the contemporaneous emails authored by Mr Tupou on 21 and 22 November 2016 (see chronology above). Mr Pang submits those emails provide powerful contemporaneous support for the conversation between Mr Tupou and Mr Pang being limited to Mr Pang advising Mr Tupou that he was a justice of the peace, and not a conversation in the terms recounted by Mr Tupou (at [13]). 4. Third, that Mr Tupou's account at [13] is inconsistent in material respects with a number of other accounts of that conversation that he has given or been involved in giving (referring, by way of example, to Mr Tupou's affidavit of 1 March 2021 (at [4] where first appearing (see Ex 1 at p 152)); and the second further amended statement of claim dated 8 February 2019 (at [24] (see Ex 10 at p 247)). In the circumstances, Mr Pang contends that Mr Tupou's evidence that he remembered the actual words used in the conversation of 22 November 2016 (see T 98.44) or anything about the conversation other than by reference to his contemporaneous written documents, should be rejected. 5. In reply submissions as to the findings to be made in relation to the representations as alleged in the telephone conversation with Mr Tupou on 22 November 2016, the plaintiffs emphasise that Mr Tupou was unwavering in his evidence that he did confirm with Mr Pang that he witnessed the agreements as alleged. It is submitted that Mr Tupou should be accepted as a witness of truth. The plaintiffs say that Mr Tupou's evidence was not beset by the continuous lapses in memory that plagued Mr Pang's evidence. It is submitted that regard should be to the fact that Mr Pang does not exclude the fact that the conversation did happen as alleged (see at T 224.46 ff): Q. But nevertheless, is it fair to surmise that your evidence as regards to that conversation is, you don't remember it? A. I don't remember it. Q. But it's possible it happened? A. It possible, yeah. 1. The plaintiffs say that the highest that Mr Pang's arguments go as to this conversation is the allegation that there is inconsistency between Mr Tupou's file note of 22 November 2016 and his affidavit evidence (and the plaintiffs maintain that these are not inconsistent). 2. In that regard, the plaintiffs argue that the fact that the agreements were witnessed by Mr Pang is implicitly subsumed in the words of the file note and the email (see Ex "JL5" to Mr Lee's first affidavit), namely that "I have also called the witnesser of the contract – Oliver Pang and he confirms that he is a justice of the peace". It is said that the alternate view (that Mr Tupou simply called Mr Pang "out of the blue" and "apropos of nothing" asked him if he was a Justice of Peace) seems unlikely (and that this is even more so when the undisputed factual background was that Mr Tupou was trying to confirm that the agreements had indeed been witnessed by Mr Pang). 3. Pausing here, it is not clear to me from the contemporaneous communications that the context in which the query was made was as to whether Mr Pang had actually witnessed the execution of the documents; rather, the focus seems to have been in what capacity Mr Pang signed as witness – which of itself carries with it the assumption that he had witnessed the signing of the documents; and as to whether 100 points of identification had been sighted or would be sighted – an issue on which Mr Tupou had carriage. Further, while I accept that it is unlikely that the conversation was in as abbreviated a form as Mr Tupou recalls, it is difficult to see why it would not have come out of the blue to Mr Pang (who does not appear to have been involved with Mr Tupou in any communications prior to this). As to the strength of the witnesses' respective recollections, I simply refer to the well-known recognition of the frailty of human memory (see Watson v Foxman(1995) 49 NSWLR 315 (Watson v Foxman) at 319 per McLelland CJ in Eq, as his Honour then was) and note that an unwavering insistence on an actual memory of a conversation some five or so years after the event might be thought to be more implausible than an honest inability to remember such a conversation. 4. Reference is also made by the plaintiffs to the (relatively) contemporaneous note of Mr Tupou to Mr Lee of 30 November (see chronology above and Ex "JL6" to Mr Lee's first affidavit) stating that "As discussed previously I contacted the lenders' accountant and he confirmed that he witnessed the signatures of both borrowers". The plaintiffs say that Mr Pang does not offer an explanation as to why Mr Tupou would misrepresent the above conversation in an email years before any controversy arose in the matter. 5. I accept that this email supports Mr Tupou's account of the conversation. However, it was sent about a week after the conversation and that it is entirely plausible that this represented Mr Tupou's conclusion drawn from the conversation rather than what was in fact said. 6. The plaintiffs say that the balance of probabilities militates in favour of a finding the conversation occurred as alleged by Mr Tupou. I address the findings to be made in this respect below. Findings as to contested factual disputes 1. As to the findings in respect of the above two contested matters, I have concluded as follows. 2. First, as to whether Mr Pang's signature was placed on the Loan Agreements other than in the presence of (relevantly) Ms Wang, I am not persuaded to the requisite level of satisfaction that it was. Ultimately, the telling evidence in my opinion is the email from Mr Pang to Mr Zhuang when confronted with the request for information as to Ms Wang's denials from Mr Tupou in September 2018. Mr Pang's inaction or lack of immediate response when confronted with Ms Wang's denials seems to me equally consistent with Mr Pang seeking to avoid involvement in a dispute not of his own making as with this displaying any consciousness of guilt. 3. Second, as to the conversation said to have taken place on 22 September 2016, I cannot confidently conclude that Mr Pang there made an admission as to having witnessed the signature (relevantly) of Ms Wang. I also place weight on the fact that neither Mr Tupou's contemporaneous file note created on 22 November 2016, nor Mr Tupou's email to Mr Lee of same date, provides any evidence that Mr Tupou asked Mr Pang whether he witnessed the signatures on the loan agreements; rather, both documents provide that Mr Pang confirmed his status as a justice of the peace. 4. Returning then to the claims made against Mr Pang, I address those as follows. Accessorial liability claim 1. Mr Pang submits that the accessorial liability (knowingly concerned) claim fails for four reasons, the first being that there is a discord between the pleaded falsity of Mr Zhuang's representations (in [18C]) and the case pleaded against Mr Pang (in [18D]). As noted above, the pleaded representations are that the loans would be personally guaranteed by Ms Wang and Mr Zhuang; and that Ms Wang and Mr Zhuang owned the Bella Vista Property which would provide the plaintiffs with further security over the loans; the alleged representations being said to have been made by Mr Zhuang in conversations with Mr Lee in January 2016 and October 2016 and on the Loan Agreements including on the execution page. 2. Mr Pang argues that, even taking the plaintiffs' case at its highest, there is no evidence that he (Mr Pang) was knowingly involved in Mr Zhuang forging Ms Wang's signature on the loan agreements, or in Mr Zhuang's intention to induce a false belief on the part of the plaintiffs that Ms Wang had signed the agreements. Mr Pang says that the particulars pleaded in [18D], even if accepted, do not support the case that Mr Pang was knowingly involved in Mr Zhuang's fraud. 3. Pausing here, I accept that there is no evidence to suggest that Mr Pang had any knowledge of any conversations between Mr Zhuang and Mr Lee in January 2016 and October 2016, so that any knowledge of the making of a false representation could only (on the pleaded case) come from what appears on the Loan Agreements – and in particular the execution page. The most that Mr Pang could have known if he signed the documents not in the presence of the signatories (which I am unable to conclude on the balance of probabilities that he did) was that the documents were being improperly attested. That says nothing about the falsity of a representation as to the ownership of the Bella Vista Property (of which there is no evidence that Mr Pang was aware) and in that regard I note that the loan agreements themselves do not refer to the Bella Vista property (beyond the fact that it is listed as the residential address of Mr Zhuang and Ms Wang) or that there was some dishonest design relating to the personal guarantees. 4. Second, it is said that the case pleaded against Mr Pang (as noted above) was not put to Mr Pang in cross examination. 5. Third, that none of Mr Pang's conduct was in trade or commerce (see defence at [18D.6]). Mr Pang says that the suggestion that Mr Pang's conduct was in trade or commerce is a suggestion that asserts the same broad construction to s 52 of the Trade Practices Act 1974 (Cth) (now s 18 of the ACL) that was rejected in Concrete Constructions (NSW) Pty Ltd v Nelson (1990) 169 CLR 594; [1990] HCA 17 (Concrete Constructions). It is noted that conduct in the course of business activities which is divorced from any relevant actual or potential trading or commercial relationship or dealing does not of itself constitute conduct "in trade or commerce" for the purposes of s 52 of the Trade Practices Act (Concrete Constructions at 604 per Mason CJ, Deane, Dawson and Gaudron JJ; reference also being made to Street v Luna Park Sydney Pty Ltd (2009) 223 FLR 245; [2009] NSWSC 1; Glueck v Stang (2008) 76 IPR 75; [2008] FCA 148; Chapman v Luminis Pty Ltd (No 4) (2001) 123 FCR 62; [2001] FCA 1106); and that the focus is on the conduct which is alleged to be in breach of the prohibition and not upon the range of activities in which the relevant corporation engages (the plaintiffs citing National Roads and Motorists' Association Ltd v Construction, Forestry, Maritime, Mining and Energy Union (2019) 291 IR 28; [2019] FCA 1491 at [132] per Griffiths J). 6. Mr Pang argues that the witnessing of guarantors' signatures is not, without more, trade or commerce. In this case, it is said that Mr Pang: did not advise Beyond Development Group, Mr Zhuang or Ms Wang (and was never instructed by any of them in relation to the loan agreements or the amounts transferred between Mr Zhuang and Mr Lee in November 2016 and February 2018 – see [25] of Mr Pang's affidavit) in relation to the purchase of the development properties (see Mr Pang's affidavit at [20]); has never been retained by or had dealings with either of the plaintiffs (see Mr Pang's affidavit at [21]); loans which are the subject of this proceeding (see Mr Pang's affidavit at [22]); did not know what the loans were for or of their existence until at the earliest September 2018 (see Mr Pang's affidavit at ([23]). 7. Fourth, as already noted, that Mr Pang did not witness Ms Wang's signature (unless it was in her presence). 8. As to the "knowing concerned" allegation, in reply submissions, the plaintiffs say that their case as far as this issue is concerned is straightforward. It is noted that (at [76] of Mr Pang's opening submissions), it is accepted that, if Mr Pang signed the loan agreements attesting that Ms Wang had signed in his presence when she in fact had not, he has made a representation that was misleading or deceptive. It is said that, in that hypothesis, Mr Pang knew of the essential matter that made up the contravention of Mr Zhuang (that is, that Ms Wang had not in fact signed the agreement in his presence and therefore had not given a personal guarantee). Misleading or deceptive conduct claim 1. As to the claim of direct liability for misleading or deceptive conduct against Mr Pang, it is alleged that Mr Pang made a representation (by witnessing Ms Wang and Mr Zhuang's signatures on the loan agreements), upon which the plaintiffs relied that Mr Zhuang and Ms Wang had executed the documents ([20]); and that Ms Wang instructed Mr Tupou to contact Mr Pang to confirm that he had signed the agreements, and Mr Pang on 22 November 2016 represented to Mr Tupou that he was a Justice of the Peace and he had in fact witnessed Ms Wang and Mr Zhuang's signatures on the Loan Agreements ([23]-[24]). 2. Mr Pang accepts that, if it is established that he in fact signed the loan agreements in circumstances where Ms Wang had not executed them in his presence, then he made the representation alleged in fifth further amended statement of claim at [20], and that that representation was misleading or deceptive. However, Mr Pang submits that this case fails because there should not be a finding that Mr Pang falsely certified that he witnessed Ms Wang's signature on the guarantees. 3. Further, Mr Pang denies that he made the representation to Mr Tupou alleged (at [24]), unless the position was that in fact Ms Wang had signed the agreements in his presence. Negligence claim 1. As to the alleged breach of duty pleaded at [26]-[29], complaint is made by Mr Pang that the plaintiffs' allegations of a breach of duty by Mr Pang do not conform with the pleading rules with respect to a case alleging a breach of a general law duty of care (Mr Pang referring by way of example to Hoxton Park Residents Action Group Inc v Liverpool City Council [2012] NSWSC 1026 at [55]-[73]; Hastie Group Ltd (in liq) v Bourne; Hastie Group Ltd (in liq) v Moore [2017] NSWSC 709; Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610 at [45]-[53]). 2. In any event, Mr Pang contends that he did not owe a duty of care to the plaintiffs because: the plaintiffs' alleged losses are in respect of pure economic loss; there was no existing relationship as between the plaintiffs and Mr Pang; and (most significantly), in Mr Pang's submissions, the plaintiffs were not vulnerable in the legal sense to any want of reasonable care on the part of Mr Pang (noting that the plaintiffs had retained the services of lawyers to protect them against the exact loss for which they now contend). 3. Mr Pang says that Graham v Hall (on which the plaintiffs rely in support of their proposition that a duty of care was owed to them) is distinguishable from the facts in the present case (though the plaintiffs complain that Mr Pang does not identify how this case is distinguishable on the facts, Mr Pang maintains that the representation there was of a different order from that of the representation in the present case – see T 362.41-362.49). In reply submissions, the plaintiffs say that in Graham v Hall the Court of Appeal did not limit the ambit of the duty to a person who is a fiduciary by reason of employment (at [66]-[68]) noting that the duty arose irrespective of whether Mr Graham acted as a justice of peace or as an ordinary witness"). 4. Mr Pang notes that, if a duty was owed, then the question whether that duty was breached must be answered by reference to s 5B of the Civil Liability Act 2002 (NSW) (Civil Liability Act); and that the sole pleaded allegation of breach of duty (at [27]) is that Mr Pang failed to ensure that Ms Wang did in fact execute the loan agreements in his presence. Mr Pang accepts that, in the event that there is a finding that Mr Pang did witness Ms Wang's signature other than in her presence, and if there is a finding that he owed a duty, then that alleged breach will be established. However, Mr Pang contends for a contrary finding. Reliance 1. As to reliance, Mr Pang notes that the plaintiffs must prove that they relied on the relevant representation as a matter of fact (Lloyd v Grace, Smith & Co [1912] AC 716; Briess v Woolley [1954] AC 333; Commercial Banking Co of Sydney Ltd v R H Brown & Co (1972) 126 CLR 337); and that, if factual reliance is established, the plaintiffs must also establish that their reliance upon the relevant representation was reasonable (Tepko Pty Ltd v Water Board (2001) 206 CLR 1; [2001] HCA 19 at [47] per Gleeson CJ, Gummow and Hayne JJ). 2. Mr Pang submits that the plaintiffs' case on reliance should fail for the following reasons. 3. First, that Ms Ling (the first plaintiff) has given no evidence of reliance at all (and it is said that no inference in her favour should be drawn). 4. Second, that there is no evidence of reliance on the part of Chuan Dian. It is said that the highest that the evidence on reliance on the part of Chuan Dian goes is the evidence of Mr Lee (at [17] of Mr Lee's second affidavit sworn 14 January 2020) to the effect that "I cannot see why the plaintiffs were not entitled to rely on it" (which Mr Pang argues, and I agree, is not evidence of reliance at all). Mr Pang says that, to the extent the plaintiffs relied upon any statement with respect to the apparent signatures of Mr Pang on the guarantees, the communication upon which the plaintiffs relied was the email of Mr Tupou of 30 November 2016 (see Ex "JL6" to Mr Lee's first affidavit), which in the first line contains a misdescription of what had occurred in the telephone call contact on 22 November 2016. 5. In reply to Mr Pang's reliance submissions, the plaintiffs say that they have pleaded reliance clearly in their statement of claim and in the reply. The plaintiff say that pleadings repeatedly state that the plaintiffs and Pinnacle Lawyers were entitled to rely upon, and did reply upon, the signatures and statements of Mr Pang attesting that Ms Wang had executed the Loan Agreements. Further, the plaintiffs say that the totality of the lay evidence is "almost entirely premised" upon the fact that the plaintiffs relied upon the signature of Mr Pang to verify the agreements. It is said that there is no rational explanation as to why Mr Tupou would go to such lengths to confirm the identity of Mr Pang, and to confirm that he did in fact witness the signature of Ms Wang, unless Mr Tupou proposed to place reliance on it. 6. Pausing here, reliance by Mr Tupou (or Pinnacle Lawyers) is not to my mind to the point (though I note the argument of the plaintiffs that reliance by Mr Tupou as their agent and solicitor is sufficient). That is because Mr Lee – the controlling mind or relevant decision maker on behalf of Chuan Dian according to his evidence – made it very clear that he did not rely on Mr Tupou for financial or business advice and that he made his own decision, trusting Mr Zhuang, to go ahead with the advance of the funds before the Loan Agreements had been signed at all – and irrespective of any issue as to by whom they were witnessed. 7. Nevertheless, the plaintiffs point to Mr Tupou's evidence to the effect that if he had not received confirmation from Mr Pang that he had in fact witnessed the agreements he (Mr Tupou) would have acted drastically differently. The plaintiffs say that if the evidence is accepted it must necessarily follow that Mr Tupou relied on the representation. Again, this suffers from the problem that Mr Lee does not appear to have accepted any other advice from Mr Tupou (or Mr Tusa) going to the prudence of the transaction and had already advanced the funds before the Loan Agreements were executed. Causation 1. Reference is made by Mr Pang to the observations of Rees J in About Life Pty Ltd v Maddocks Lawyers [2021] NSWSC 1370 (About Life) (at [409]) as to the two stage analysis here required (namely, the determination of factual causation – the but for test; and then the appropriate scope of the defendant's liability); her Honour there posing the question of factual causation as whether the failure in question was a necessary condition of the occurrence of the harm, being deprivation of the relevant valuable opportunity. 2. Mr Pang says that there is no evidence as to what the plaintiffs would have done, but for the alleged misrepresentation or breach of duty by Mr Pang, and that while this may be understandable with respect to the duty case (having regard to s 5D(3)(b) of the Civil Liability Act), that is not so with respect to the claims under the ACL. 3. Insofar as Mr Tupou gives some evidence as to this in his affidavit sworn 1 March 2021, Mr Pang's response is that (having regard to Mr Lee's routine rejection of advice from his retained professionals) that evidence should be afforded no weight. 4. Mr Pang contends that in the circumstances, the inference may be available (though only on the duty case, since he submits that no inference should be drawn favourably to the plaintiffs on the ACL cases) that the first thing that would have happened (but for the alleged misrepresentation or breach) is that Mr Lee would have contacted Mr Zhuang, and that Mr Zhuang would have told him a lie about the circumstances, which Mr Lee would have believed (referring to instances in which Mr Lee admitted to such action). Accordingly, noting that the plaintiffs bear the onus of proof on causation, it is said that in the circumstances an inference should not be drawn that, but for the alleged misrepresentation or breach by Mr Pang, the plaintiffs would have done anything differently. 5. Mr Pang says that if it is established that the plaintiffs would have acted differently, then it is necessary to address the question as to what they would have done and to identify with a degree of precision the nature of the lost opportunity they allege (i.e., whether they have lost anything of value as a consequence of the breach). 6. It is noted that the plaintiffs frame their case as a loss of opportunity ([30]) (as to which reference is made to what was said by Rees J in About Life at [505]-[512]). Mr Pang points to the lost opportunities contended for by the plaintiffs as being: the lost opportunity to recover from Mr Zhuang or Ms Wang under the guarantees (see at [30](d)); the lost opportunity to recover the loan sum from Beyond Development Group by rescinding the agreements and obtaining a repayment of the loan amounts in full from Beyond Development shortly after November 2016 ([30](e) and (f)); and the lost opportunity to seek advice and to commence action in a timely manner to seek a freeze funds advanced or sue for their return ([30](g)). (As noted, a further aspect of the second lost opportunity is the tracing argument that is not pleaded and that I do not here address.) 7. Mr Pang contends that the plaintiffs have not discharged the onus of showing on the balance of probabilities that the lost opportunities they contend for had value (referring to Badenach v Calvert (2016) 257 CLR 440; [2016] HCA 18 at [41] per French CJ, Kiefel J (as her Honour then was) and Keane J). It is noted that this is not a "no-transaction" case because the plaintiffs elected to advance the loan funds before they had in their possession the signed Loan Agreements. 8. As to the claimed loss of the opportunity to recover of loan proceeds from Mr Zhuang or Ms Wang under the guarantees, Mr Pang says that there is no evidence to support a conclusion that Mr Zhuang had the financial capacity at any time to meet any obligations he may have assumed as guarantor for Beyond Development Group's loan from the plaintiffs. It is said that the plaintiffs have not established that this loss of opportunity had any value. As to Ms Wang, it is noted that Ms Wang gave evidence and was extensively cross examined but it was not put to her that, had the question whether she signed the guarantees been raised with her, she would then have been prepared to sign the guarantees. Mr Pang says that there is no basis to draw an inference that Ms Wang would have done so and, accordingly, it is submitted that there is no evidence that this loss of opportunity had any commercial value (because there was never going to be a guarantee enforceable against Ms Wang). (Mr Pang says that this removes the need to address whether, if Ms Wang had been prepared to sign the guarantees, they would have nonetheless been set aside on grounds of statutory unconscionability or unconscionability within the unwritten law.) 9. As to the second alleged loss of opportunity (loss of the opportunity for recovery of loan funds from Beyond Development Group upon the guarantees being rescinded), Mr Pang says that this claim for loss of opportunity has no commercial value, for the following reasons. 10. First, Mr Pang says that rescinding the guarantees would hardly have assisted in the plaintiffs' claim against Beyond Development Group (since Beyond Development Group was not a party to the Loan Agreements). It is noted that the only agreement between the plaintiffs and Beyond Development Group was the alleged oral agreement between Mr Lee and Mr Zhuang in January 2016 (see Mr Lee's first affidavit at [8]). (The plaintiffs cavil with this conclusion.) 11. Second, it is noted that there is no asserted lost opportunity of registering a caveat on the titles to the development properties. Mr Pang says that the plaintiffs appear to accept that they did not have an equitable interest in the development property; there are no signs of the existence of any circumstances that would give rise to a caveatable interest arising out of (referring to Gors v Henderson, unreported; Supreme Court of WA (Steytler J); Library No 980499, 7 September 1998). 12. Third, that even if the plaintiffs did have an equitable interest in the land which would have supported the registration of a caveat, it is noted that when Mr Tuppu solicitor did register caveats, they were ineffective caveats (as he admitted at T 130.33; see Ex 10 at p 171, 177). Thus it is submitted that even if there was an equitable interest, the steps taken would not have protected the plaintiffs from others with interests in the land. 13. Fourth, Mr Pang says that in the circumstances the only chance that the plaintiffs had was to sue Beyond Development Group at an earlier time in relation to the oral agreement; and that there are a number of problems with that asserted loss having any value. The first such problem is said to identify the nature of the action against Beyond Development Group that would have been available to the plaintiffs noting that they advanced the loan funds to Beyond Development Group by 2 November 2016 (see Mr Lee's first affidavit at [17]) at a time when there was no written loan agreement and the terms of that oral agreement were that (as later varied) the plaintiffs would advance $900,000 to Beyond Development Group and the amount was repayable with 30% interest one year later. It is said that, insofar as a promise was made (Mr Pang says probably by Mr Zhuang) that the plaintiffs could have security over the development land, nothing turns upon that because the funds were ultimately advanced without any form of security in place. Hence, it is said that by late 2016, it is difficult to see what breach of the oral agreement on the part of Beyond Development Group the plaintiffs could identify. 14. Pausing here, there was some imprecision in the plaintiffs' submissions as to the cause of action it was contemplated would have been available in January 2017 (when the plaintiffs say that Mr Zhuang was solvent) but reference was made more than once to rescission. Thus it seems to me most likely that what plaintiffs here contemplate is that there would have been some basis to set aside the oral agreement between Mr Lee and Beyond Developments by reference to false execution of the loan agreements on the part of Mr Zhuang (see T 332.48-333.21). However, the likelihood of such approach being determined within a month of the 22 November 2016 conversation (even if by way of a default judgment) seems remote and the position is not much improved if the timeline is moved to around 9 November 2016 when the plaintiffs say that Mr Pang affixed his name to the loan agreements (T 335.20-335.26). (I interpose to note that although the loan agreements are dated 9 November 2016, it appears that Mr Tupou only emailed the loan agreements to Mr Zhuang on 10 November 2016.) 15. The second of the problems identified by Mr Pang with the contemplation that the plaintiffs would have acted earlier is said to be that, even assuming a viable cause of action against Beyond Development Group in late November or early December 2016, the high point for the plaintiffs is that at some point judgment or default judgment against Beyond Development Group may have been obtained, but Mr Pang says that obtaining a judgment would not have given the plaintiffs the legal right to sell the development property (noting that there was a first registered mortgagee, namely NAB). It is noted that the hypothesis here is that Mr Pang would have said on 22 November 2016 that he had not witnessed Ms Wang's signature on the Loan Agreement (that being at a time when Mr Pang says the bulk of the loan funds had already been drawn down). 16. Mr Pang argues that, from Mr Vella's uncontested evidence as to the position of Beyond Development Group, the probable sequence of events on the counterfactual with respect to this asserted lost opportunity (having regard to the time line as to what actually occurred from the period when winding up proceedings were commenced by the plaintiffs on 18 July 2018 until funds were realised from the sale of the development properties) is that the plaintiffs might have commenced winding up proceedings in, say, late December 2016 after obtaining judgment. Assuming, say, about 12 weeks between the commencement of winding up proceedings by the plaintiffs and the appointment of receivers by the NAB (taking the matter to late March 2017), Mr Pang says the sale proceeds might have been realised by, say, March 2018 (noting that receipt of the proceeds from the development properties after the actual appointment of receivers by the NAB appears not to have been until around 23 August 2019, i.e., about one year after the appointment of receivers). 17. Mr Pang says that this would hardly have helped the plaintiffs. It is noted that the amount realised was $3.36 million, of which NAB as the first registered mortgagee was entitled to receive a total of $2,682,000 ($2.24 million, plus amounts of $240,000, plus $97,000, plus $105,000) leaving a balance of $568,963 and from that balance there were three secured creditors ranking ahead of the plaintiffs, with liabilities of $2,545,000 (Megatop Trading); $79,544 (Eclipse) and $166,495 (Synnex) respectively. 18. Accordingly, Mr Pang says that, on this scenario, there is no loss to the plaintiffs because they did not ever have any prospect of recovering their loan funds from the plaintiffs (and, further, they would have incurred the additional legal expenses of an urgent legal proceeding in late 2016). 19. Mr Pang says that if the plaintiffs could have forced the sale of the development properties by February 2017 (as they contend) this scenario also does not produce a loss of any value. Reliance is placed in this regard on the evidence of Ms Marshall, who has valued development properties as at the relevant time in February 2017 at $3.4 million (see Ex 3 at p 6 [19]). (It is noted by Mr Pang that none of the other valuers who has given evidence valued property at that time.) 20. As noted earlier, Mr Pang says that Ms Marshall's evidence as to a discount on the likelihood of a forced sale should be preferred to the evidence of Mr Towndrow (see above). Mr Pang says that plainly a discount would have been appropriate and that the relevant discount to use that is what Ms Marshall has proffered of 20%. Mr Pang has calculated, on that scenario, that the realisation of the development properties by late February 2017 would have been $2,720,000; from which it would be necessary to make a number of deductions: (i) the selling costs (which are, for the agent's commission, in the order of $54,400) (2%) (see Ex 3 at p 32); (ii) the plaintiffs' unrecoverable legal costs (that are not known but estimated for this purpose at $50,000); (iii) NAB legal costs (allowing at least another $50,000 for that figure); (iv) some costs of the receivers (accepting that that amount might be less than $105,000 ultimately incurred but allowing say $25,000); and (v) the sum of $2.24 million to NAB. 21. Mr Pang says that, on that scenario, there would be a sum of around $300,600 to be available for distribution to the creditors of Beyond Development Group as at say March 2017. It is noted that there is no evidence about the other creditors at that time (secured or otherwise). Although no caveats were registered on the title at that time, Mr Pang points out that this does not mean that there were not other creditors (or creditors with interests which ranked above the plaintiffs' interests). Mr Pang further says that, from that sum, must be deducted the amount the plaintiffs already received of $100,000 (leaving $200,600) (see Mr Lee's first affidavit at [24]). 22. Thus, Mr Pang says that if there is any loss of value, there must be applied a discount for the lost chance; and that, in all of the circumstances, it would be relevant to apply a discount for the lost chance on this scenario of at least 50% (leaving $100,300). 23. As to the loss of the opportunity to seek freezing orders, Mr Pang notes that, for a freezing order against Beyond Development Group and or Mr Zhuang the plaintiffs would have to satisfy the test set out in r 25.14 of the Uniform Civil Procedure Rules 2005 (NSW) (a judgment or good arguable case on an accrued or prospective cause of action and a danger that a judgment or prospective judgment will be wholly or partly unsatisfied) referring to Severstal Export GmbH v Bhushan Steel Ltd (2013) 84 NSWLR 141; [2013] NSWCA 102. 24. Mr Pang accepts that, having regard to all of the evidence, the plaintiffs may have been able to establish that there was a danger that a judgment or prospective judgment would be wholly or partly unsatisfied. However, Mr Pang contends that the plaintiffs would have been unlikely to have been able to demonstrate that they had a good arguable case on an accrued cause of action as against either Beyond Development Group and/or Mr Zhuang. It is noted that the strength of the case is relevant to threshold and discretion (Ninemia Maritime Corp v Trave Schiffahrtsgesellschaft mbH & Co KG; The Niedersachsen [1984] 1 All ER 398 at 402-403 per Mustill J). 25. In any event, Mr Pang points out that a freezing order will not undermine the doctrine of equality of unsecured creditors (citing Jackson v Sterling Industries Ltd (1987) 162 CLR 612; [1987] HCA 23 at 618 per Wilson and Dawson JJ, 639 per Gaudron J; Superbarn Supermarkets Pty Ltd v Cotrell Pty Ltd [2016] ACTSC 49 at [62] per Refshauge J). It is said that this is relevant because the loan funds had all been disbursed by 25 January 2017 and, in any event, by 1 December 2016 the balance in Beyond Development Group's main account (see Ex 10 at p 257) was less than the $100,000 the plaintiffs recovered. 26. Mr Pang submits that, given the considerable legal costs and property sale costs associated with attempts to recover the loan funds; the first registered mortgage held by the NAB; and length of time required to achieve a potential recovery it is submitted that any loss apparently that might be established ought to be heavily discounted for the lost chance. Plaintiffs' reply submissions on causation 1. In reply to Mr Pang's submissions on causation (at [89]-[120]) the plaintiffs contend that they would have acted differently had they known that Ms Wang's signature had not been properly witnessed by Mr Pang (as outlined in the affidavit of Mr Tupou of 1 March 2021) and the plaintiffs say that the proposition that Mr Lee would simply have rejected that advice was not put to him in cross examination. (I accept that this hypothetical was not expressly put to Mr Lee. Nevertheless, it is abundantly clear that Mr Lee trusted Mr Zhuang and had chosen not to follow advice as to numerous other steps to protect the plaintiffs' interests. Therefore, the proposition that Mr Lee would suddenly have chosen to act in a more prudent way seems to me highly unlikely.) 2. It is said that Mr Bluth's evidence as to what a competent solicitor would have done in the event that the execution of the Loan Agreements by the guarantor had come into question was unchallenged; as was Mr Tupou's evidence in his affidavit of 1 March 2021. The plaintiffs say that it was never put to Mr Tupou that he would not have acted as he said in his evidence he would have done. 3. As to the balance of Mr Pang's submissions on causation, insofar as Mr Pang argues that the plaintiffs would not have been able to obtain a freezing order because they did not have a good arguable case against Beyond Development Group (as Beyond Development Group was not a party to the Loan Agreements), the plaintiffs contend that on any view of the matter Beyond Development Group was a party to the agreement. It is said that the Loan Agreement noted Beyond Development Group as a party to the agreement (as mortgagor)and that the agreement was executed by the sole director and controlling mind of the company (Mr Zhuang) (see Ex D). It is said that Beyond Development Group purported to give security over property owned by it as part of the consideration of the agreement. The plaintiffs say that the only point that Mr Pang here raises is that Mr Zhuang's signature is not accompanied by the words as director or agent of the company. 4. In Clark Equipment Credit of Australia Ltd v Kiyose Holdings Pty Ltd (1989) 21 NSWLR 160 Giles J, as his Honour then was, having considered what was said in National Commercial Banking Corporation of Australia Limited v Cheung (1983) 1 ACLC 1326; NEC Information Systems Australia Pty Limited v Linton (Wood J, 17 April 1985, unreported) and Scottish Amicable Life Assurance Society v Reg Austin Insurance Pty Limited (1995) 9 ACLR 909), concluded (at 174-175), that the proper approach in determining whether a signatory has assented to be personally bound is to ascertain the objective (not subjective) intention as to that issue, having regard to the construction of the document as a whole and the surrounding circumstances (to the extent to which evidence of the latter is permissible); the enquiry not being limited to consideration of the signature and its qualification, if any. In that case, his Honour declined to find an intention that the directors were personally bound having regard to the form of the signing clause (which stated that one was signing for and on behalf of the company and the other as witness) in circumstances where: the same form of words had been used for a person who no one contended was personally bound; the addition of the common seal pointed to them having signed simply in their capacity as directors; and that the same form of words were used in a separate document where there was no provision for personal responsibility. 5. In that regard, the plaintiffs invoke s 129(3) of the Corporations Act 2001 (Cth) (which permits a person to assume that anyone who is held out by the company to be an officer or agent of the company has been duly appointed and has authority to exercise the powers and perform the duties customarily exercised or performed by that kind of agent of a similar company). It is submitted that even if Mr Zhuang had argued that he did not have authority to execute on behalf of the company that would be yet another reason to seek injunctive relief given that the Loan Agreements clearly purport that part of the consideration the plaintiffs were to receive was security over property owned by Beyond Development Group. 6. It is said that the argument that the plaintiffs would not have been able mount a good arguable case in the event that Mr Pang revealed that he did not in fact witness Ms Wang's signature is not realistic given the surrounding facts and circumstances. The plaintiffs say that if that, case is accepted, Mr Pang falsely attested the agreements on 9 November 2016; and that had he advised the plaintiffs the same day that he had falsely executed the agreements (as he should have), there was still an amount of approximately $426,000 of the moneys advanced in Beyond Development Group's bank account that could have been frozen. (Pausing here, the prospect of freezing amounts held in Beyond Development Group's bank account says nothing about whether the plaintiffs would be able to establish a claim to those funds in competition with say, the secured creditors of Beyond Development Group.) 7. The plaintiffs say that Mr Pang's calculations (at [112]-[115] of his closing submissions) (to resist the conclusion of Mr Vella that Beyond Development could have repaid the loan amount as at early 2017 and later) are not supported by any evidence (with the exception of the agent's fee); and complaint is made that the calculations by Mr Pang make no sense. For example, insofar as it is said that there should be deducted from whatever is recovered an amount of $100,000 (because at least this amount was paid by Mr Zhuang), the plaintiffs say that the amount said to be recoverable is far less that what is owed. Insofar as other aspects of the calculations to suggest the existence of other creditors with higher ranking claims, the plaintiffs say that there was no evidence of this (noting that Mr Vella observes the title was otherwise free of incumbrances). 8. Finally, as noted earlier, it is submitted by the plaintiffs that the evidence of Ms Marshall should be rejected as contrary to the basis rule as outlined in Makita. 9. The plaintiffs thus say that, if their primary case that Mr Pang was knowingly concerned in the misleading or deceptive conduct of Mr Zhuang is accepted, then the arguments raised by Mr Pang as to causation do not assist Mr Pang. Defence raised by Mr Pang 1. Turning then to the defences raised by Mr Pang, I note as follows. Concurrent wrongdoer defences Claim against Mr Zhuang 1. Reference is made by Mr Pang to cases while there has been apportionment of liability to fraudsters in professional liability cases, such as Kayteal Pty Ltd v Dignan (2011) 15 BPR 29,515; [2011] NSWSC 197 (Kayteal), where Brereton J, as his Honour then was, apportioned liability between a solicitor, a negligent valuer and a defaulting borrower; and Chandra v Perpetual Trustees Victoria Ltd (2007) 13 BPR 24,675; [2007] NSWSC 694 (Chandra) per Bryson AJ (as His Honour then was) at [113]. 2. Mr Pang points to the examples listed by Brereton J (as His Honour then was) in Perpetual Trustee Company Limited v Peter Ishak [2012] NSWSC 697 (Perpetual Trustee v Ishak): 10% in Ginelle Finance Pty Ltd v Diakakis [2007] NSWSC 60; 12.5% in Chandra: 12.5% to the negligent solicitor and 15% to a solicitor who engaged in fraud; in Vella v Permanent Mortgages; 12.5% to the negligent solicitor in Kayteal, although a grossly negligent valuer's percentage was put at 40%, and the balance was apportioned to the fraudster; and notes that 25% would have been apportioned to a conveyancer whose misleading conduct was enhanced by his professional status in Perpetual Trustee v Ishak if apportionment orders had been made. 3. Mr Pang relies upon the plaintiffs' pleaded case against Mr Zhuang, which principally alleged fraud he perpetrated on the plaintiffs ([18B]-[18C]) was compounded by Mr Zhuang's conduct in early 2017 (as set out in Mr Pang's defence at [36]). It is noted (see annexure "C" to Mr Pang's affidavit ), that Mr Zhaung had amassed millions of dollars' worth of debt (some of which was through gambling), and it is said that obviously there was further money owing to Megatop, which had lodged a caveat over the development. 4. It is noted that Mr Zhuang persuaded Mr Lee to advance $900,000 on the promise of a 30% return over 12 months and prior to exchanging any loan documentation. Further, it is said that Mr Zhuang lied as to his ability to give security over the residence in circumstances in which he did not own it; lied as to the willingness of his wife to give security over the residence in circumstances in which Ms Wang's evidence is that she knew nothing of the transaction until August 2018 (T 144.22). It is said that Mr Zhaung or someone at his direction, likely forged signatures of Ms Wang and Mr Pang in circumstances in which neither of them knew anything of the transaction (see T 144.22) (regarding Ms Wang); also Mr Pang's affidavit (at [20]-[25], [34]). 5. Mr Pang argues that, when providing the allegedly executed Loan Agreements to the plaintiffs' solicitor, Mr Zhuang must have known that the signatures of Ms Wang and Mr Pang were not genuine and when requesting the plaintiffs remove the caveat on the development properties must have known that he was doing so for reasons other than those conveyed to Mr Lee (referring to Mr Lee's evidence at T 66.23 that "Peter asked me to remove it because he says that he need to raise more fund and I trusted him and I removed the caveat"). 6. In the event of an adverse finding against Mr Pang, it is submitted there should be a significant reduction on account of Mr Zhuang's culpability. Mr Pang contends for 75% in this regard. Pinnacle Lawyers 1. The allegations against Pinnacle Lawyers are pleaded in Mr Pang's defence (at [50]-[83]). 2. It is noted that Mr Tupou admitted in cross examination that he had concerns about the transaction the subject of this dispute (T 84.39) and identified three important matters to be addressed in order to ensure that his clients were protected in respect of the funds they were advancing (T 87.50; see also T 126.20-22). Those matters were: for Mr Zhuang and the guarantors to obtain independent legal advice (see Ex 10 at p 50; see also T 92.18); for Mr Zhuang's signature to be witnessed by a Justice of the Peace or a person qualified to do so (see Ex10 at p 50, see also T 92.18); and the provision of 100 points of identification for each of the parties signatory to the Loan Agreements so that Mr Tupou could properly verify their identity (see Ex 10 at p 50; see also T 92.18), so as to enable Mr Tupou to compare the signatures on the Loan Agreements with the identification provided (T 91.12, 19; see also Ex "SFT3" to Mr Tupou's first affidavit). 3. The plaintiffs note that, despite this, neither Mr Zhuang nor Ms Wang obtained independent legal advice in relation to the Loan Agreements. It is noted that Mr Tupou took no steps to ascertain whether Mr Zhuang and/or Ms Wang obtained independent legal advice in relation to the Loan Agreements, assuming that they had done so (by reference to the fact that their signatures had been witnessed) (T 91.50- T 92.1), in circumstances in which Mr Tupou had no evidence to this effect (T 92-18), and that no solicitor's certificate was requested or provided by Mr Tupou (T 93.17). Mr Pang refers to Mr Tupou's evidence in cross-examination where he accepted that, in order to protect his clients' interests he should have requested from Mr Zhuang proof or evidence that he had obtained independent legal advice (T 94.27; see also T 94.12-13) (Mr Pang says that such a request could have been made for example in the email dated 18 November 2016 from Mr Tupou to Mr Zhuang (see Ex "SFT3" to Mr Tupou's first affidavit). Mr Pang notes that Mr Tupou also failed to advise Mr Lee that he had no evidence that Mr Zhuang or Ms Wang had obtained independent legal advice (and says that Mr Tupou also accepted this was a failure on his part see T 95.44-49). 4. It is noted that it was March or April 2017 (T 128.38), before Mr Tupou received the 100 points of identification for each party that was a signatory to the Loan agreements (T 110.7) and that at no point did he actually meet with Mr Zhuang or Ms Wang to verify their identities (T 128. l 0, 42, 49; T 129.29) (indeed it is noted that Mr Tupou's evidence is that at no point did he ever meet Ms Wang – see T 128.4). 5. While Mr Tupou sought to lodge a caveat on the development properties to protect the plaintiffs' interests, the parties listed as the caveators on the caveats were Mr Zhuang and Ms Wang and Mr Tupou accepted that this was an error (T 130.33); i.e., that when he came to execute the caveats, he included the wrong people as the caveators in the caveat (T 130.50; see T 131.1-10). 6. Mr Pang submits that, in circumstances in which Mr Tupou is a solicitor of some 13 years standing (T 92.49), and has admitted to professional failures on his part (see, for example, T 95.49), the expert evidence of Mr Rosier and Mr Bluth is largely irrelevant. Nevertheless, Mr Pang says that his allegations against Pinnacle Lawyers are supported by the expert opinion of Mr Rosier, an experienced solicitor. As set out above, Mr Rosier's opinion was that Pinnacle Lawyers departed from the usual or common professional practice of reasonably competent solicitors by failing to insist that Mr Zhuang and Ms Wang execute the loan agreements before an independent solicitor or before themselves, in circumstances where the transaction was high-value and the importance of proper execution was known to Pinnacle Lawyers (see also Ex 1). While there are some differences between Mr Rosier and the expert solicitor retained by the plaintiffs (Mr Bluth) as noted in the joint report (Ex 5), Mr Pang contends that the common ground is sufficient to establish the case pleaded against Pinnacle Lawyers. 7. The experts agree that the guarantees (assuming their authenticity) did not provide the security sought by Mr Lee on behalf of the plaintiffs (see Ex 5 answer 4). In answer to Mr Rosier's view that the terms of the "loan agreements" could be improved, Mr Bluth's view was that it was not the intention of the parties that an actual mortgage be executed and registered as a second mortgage but guarantees and a charge to support a caveat (see Ex 5 answer 4). Mr Pang says that, even on that view, it is questionable whether the loan agreements equate to guarantees and a charge, noting that the loan agreements do not appear to have been executed by the borrower (Beyond Development Group) and that Ms Wang denies having signed them. Further, it is said that the caveat which was eventually lodged on 18 April 2017 was defective (as noted above, a matter acknowledged by Mr Tupou (T 130.33), and both experts accept that this gave way of little utility (see Ex 5 answer 9). 8. Further, the experts agree that Mr Tupou ought to have taken steps to satisfy himself as to the identity of Mr Zhuang and Ms Wang (see Ex 5 answer 5). While Mr Bluth says that it was sufficient for Mr Tupou to discharge that duty by making an inquiry of Mr Pang as to whether he witnessed Ms Wang's signature, Mr Pang says that this is not exactly what Mr Tupou says he did (see [13]) and not what Mr Tupou thought was required on 18 November 2016 (see Ex "SFT3" to Mr Tupou's first affidavit) (where he said to Mr Zhuang that he needed to view 100 points of ID of Mr Zhuang and Ms Wang and compare the signatures on the loan agreements with the signatures on the passports, as well as speaking to Mr Pang). 9. As to the allegation that a solicitor in Mr Tupou' s position ought to have advised the plaintiffs by July 2017 to register a second mortgage over the development properties, Mr Rosier's view is that reasonable care required Mr Tupou to give that advice (see Ex 5 answer 13) and the joint report does not reveal Mr Bluth's opinion. If there is disagreement, then Mr Pang submits that Mr Rosier's view is plainly the correct one. 10. Mr Pang says that both of these failures (at least) caused loss to the plaintiffs (assuming the plaintiffs establish any loss) and that there should be a reduction of the plaintiffs' damages on account of Pinnacle Lawyers' acts and omissions. Mr Pang asserts that an apportionment of 33% would be reasonable. Plaintiffs' reply submissions 1. In reply to Mr Pang's closing submissions as to the concurrent wrongdoer defence (see [121]-[139]), the plaintiffs say (and Mr Pang does not dispute this) that if Mr Pang is found intentionally or fraudulently to have caused the loss then no apportionment of its liability to the plaintiff to another concurrent wrongdoer is permissible (referring to s 34A(1) of the Civil Liability Act and s 87CC(1) of the CCA); and the plaintiffs say that their pleading (that Mr Pang "falsely attested" that Ms Wang had signed the execution page of the loan agreements in his presence and that Mr Pang did so intentionally (see [18D] of the fifth further amended statement of claim; and see the reply), sufficiently amounts to a pleading of fraud (see Banque Commerciale SA (in liq) v Akhil Holdings Limited (1990) 169 CLR 279 at 285 per Mason CJ and Gaudron J, and 295 per Dawson J). The plaintiffs further say that they have joined issue by citing the facts said to ground the allegation that Mr Pang behaved dishonestly such as to engage the fraud exception. It is noted that the word "fraud" does not need to be pleaded but the facts that underly the allegation must be pleaded. Thus it is submitted that the concurrent wrongdoer claims fail. 2. The plaintiffs say that even if the claims were able to be prosecuted by Mr Pang the amounts claimed are grossly inflated, noting that no authority is provided for a 75% reduction. 3. As to the claims as against Mr Lee (to the effect that he should not have entered into the agreement in the first place against advice), the plaintiffs maintain that the risk he took was not as egregious as suggested. It is said that, Mr Lee observed in his cross-examination, he was confident in the transaction because he thought he had a personal guarantee from the second and third defendants and they owned property. 4. As to the claims as against Pinnacle Lawyers, the plaintiffs rely on the report of Mr Bluth (see above). Contributory negligence defence 1. Mr Pang refers to the principles regarding contributory negligence by Rees J set out in About Life (at [657]-[660]). It is noted that a finding of contributory negligence turns on a factual investigation of whether the plaintiff contributed to its own loss by failing to take reasonable care of his or her person or property, quoting Astley v Austrust Ltd (1999) 197 CLR 1. 2. The application of the relevant principles involve the following issues: the degree of any departure from the standard of care by the plaintiffs; and the causal potency of any departure(s) from the standard of care of the plaintiffs. 3. Mr Pang submits that the standard of care is that of a reasonable business person and that it at least required the plaintiffs to address the matters particularised in the defence at [31] (many of which, it is noted, Mr Lee himself considered important, and which were raised by the plaintiffs' solicitors and/or accountant at various times). 4. In summary, the particulars of contributory negligence assert the failure to take any steps, or any adequate steps to understand how the deposit and purchase of the development properties had been funded and how Beyond Development Group would service the loan advanced by NAB to Beyond Development Group; to understand the intended use of the funds advanced; independently to verify the identity of Ms Wang; to investigate the creditworthiness of Beyond Development Group and Mr Zhuang and to investigate the ability of Beyond Development Group, and Mr Zhuang and Ms Wang as guarantors, to repay the plaintiffs; to investigate the presale of unit 2, and more generally, the nature and profitability of the development; to have regard to the advice and warnings provided by the accountant and Mr Tusa (see Mr Pang's defence at [31.2(1)]); and to obtain confirmation from Beyond Development Group that it had obtained independent legal advice. 5. It is Mr Pang's case that Mr Lee knew very little about the proposed development (referring to his 10 May 2018 affidavit though see amendments in 17 April 2015 affidavit) and was determined to advance the funds in circumstances in which Mr Zhuang had asked him to do so, and in which Mr Lee trusted Mr Zhuang with whom he had had a close working business relationship with for in excess of ten years (referring to the evidence at T 22.35, 49-50; T 23.22-23.23; T 66.48-66.50). It is submitted that this is apparent from Mr Lee's blatant indifference to the due diligence undertaken by Mr Tusa in relation to the proposed transaction referring to the communication in October 2016 set out in the chronology of events above. 6. Mr Pang says that it is clear from email correspondence (see Ex 10 at p 36), and Mr Lee's evidence (see for example T 58.22), that Mr Zhuang was desperate for the funds, noting the 21 October 2016, for example, where Mr Lee requested Mr Tupou "get the contract out asap ... so that Peter & the wife will be able to come down and sign them" (see Ex 10 at p 31) in circumstances in which "Peter ... needed the funds" (T 57.4-57.6). It is said that in cross examination, Mr Lee could not explain the urgency in which Mr Zhuang needed the funds (T 57.13-57.23). 7. Mr Pang emphasises that the advance of the funds on 2 November 2016 was: in the absence of written loan agreements or guarantees (these only were executed on or about 9 November 2016: see T 58.49-59.2); without credit checks being conducted on Mr Zhuang and Ms Wang (Mr Lee instructed Mr Tusa not to proceed with these (T 61.12; see also Ex 10 at p 48), in circumstances in which Mr Lee's evidence is that he "decided to take the risk" (T 64.47), in respect of Mr Tusa meeting with Mr Zhuang regarding his financial position, Mr Lee requested that this be skipped (T 60.16; T 65.13); and with no caveat or charge on the development properties or the Bella Vista property (noting that Mr Lee requested the caveat on the development properties only be put on them following the signing of the loan agreements, at Peter's request – see Ex 10 at p 41; see also T 66.9-14, 33). 8. It is noted that, as at 2 November 2016, Mr Lee had no document which recorded that either Mr Zhuang or Ms Wang owned the Bella Vista property (T 65.21-22). 9. Accordingly, Mr Pang says that the funds were advanced on Mr Zhuang's "word" that the security and the loan agreements would be forthcoming (T 67.15). It is noted that the identities of Mr Zhuang and Ms Wang had still not been verified as at 7 February 2017 (a matter which it is said Mr Lee was prepared to put to one side – see T 74.24-74.26). 10. Finally, Mr Pang says that the transaction raised so many "red flags" that there was a reference to indemnification of Mr Lee's solicitors in relation to it (T 56.14-56.16, see also T 65.39). The matters raised by Mr Lee's solicitors also were rejected by Mr Lee (T 65.43). 11. Mr Pang submits that if any one of the steps outlined in his defence at [31], or the matters raised by Mr Tupou and/or Mr Tusa had been taken, it would have raised a "red flag" which, if acted upon, would have resulted in the harm suffered by the plaintiffs being avoided. 12. Mr Pang submits that there should be significant reduction of any damages for the plaintiffs' contributory negligence (Mr Pang contends for a figure of 75%). Determination 1. The conclusion reached above as to the lack of authenticity of Ms Wang's signatures gives rise to obvious difficulty for Mr Pang if his signature on the Loan Agreements is genuine. It is accepted that in those circumstances Mr Pang could not have attested the signing of the documents by Ms Wang in her presence (and the attestation would therefore be false). 2. The first issue, therefore, is as to the authenticity or otherwise of Mr Pang's signatures on the documents. In that regard, while I accept that Mr Pang's evidence of his invariable practice (of only attesting documents in the presence of the signatories) is eminently plausible (indeed it would be surprising if that were not the case for someone in his position), I bear in mind that Mr Pang has an obvious self interest in giving such evidence and it is impossible to test on the material before me (so it rests entirely on acceptance of his word). 3. Mr Hobden's expert evidence thus becomes highly relevant. Mr Hobden (as noted above) gave qualified support (much of the same level as that expressed by Ms Holt in her separate opinion about Ms Wang's signature) for the proposition that Mr Pang's signatures were authentic. However, the force of that opinion is lessened in circumstances where it is not disputed that Mr Hobden did not have the original documents from which to make the comparison between signatures and had fewer specimen signatures than his own evidence would suggest was preferable. I reject Mr Hobden's expression of opinion as to the likelihood of the signatures being those of a skilled (or very highly skilled) forger (as I consider that assessment of probability goes beyond Mr Hobden's expertise as a forensic handwriting analyst) but I accept that Mr Hobden has expertise as to forensic analysis of the handwriting itself. (I note that Mr Hobden was not asked to analyse the capital letters on the documents that appear in relation to Mr Pang's signature, which seem to be of the same general handwriting as the signature.) 4. To my eye, some of the "Pang" signatures seem almost identical in the specimen group considered by Mr Hobden but there are certainly others where there are observable variations (which would tell against the signatures having been precise copies but not against them being forgeries). However, and also from a lay perspective, Mr Pang's signature does not appear to be a particularly complicated signature and might well lend itself more readily to copying than, say, Ms Wang's signature. In this regard, it is also relevant to note that Mr Zhuang had possession of the documents for some eight days before the executed documents were provided to Mr Tupou (and therefore ample opportunity to have executed a forgery had he wished to do so). 5. The plaintiffs, in their submissions in support of the conclusion that Mr Pang did sign the documents, say that there is a mosaic made up of the following pieces of evidence: first, the 22 November 2016 conversation between Mr Tupou and Mr Pang; second, the 30 November 2016 email from Mr Tupou to Mr Lee; third, Mr Pang's account of the conversation (in Chinese) with Mr Zhuang in September 2018 which put Mr Pang's mind to rest; fourth, Mr Pang's concession that Ms Wang was "no stranger" to him (in that he prepared her tax returns) but he did not alert her to the discovery (on Mr Pang's evidence) that one or more signatures had been forged on the documents; and, fifth, Mr Hobden's expert evidence (expressed to the level of a moral certainty). 6. Thus, the plaintiffs say that on the balance of probabilities Mr Pang was just presented with the documents bearing signatures already on the documents; and signed the documents (falsely attesting that he was witnessing the documents in the presence of the signatories). 7. Insofar as the plaintiffs place reliance on the 22 November 2016 conversation, as already discussed the evidence on this aspect of the matter is brief in its content (and accounts of the conversation given by Mr Tupou are not wholly consistent). At T 87, Mr Tupou's account was "I've got a contract you witnessed – did you sign it?" which is not how the conversation is expressed in his affidavit. What precisely was said was not clear (and, as I observed in the course of oral submissions, it seems to me that this is an instance where the precise words that were used would be of particular importance). For example, it might be (and I appreciate this is mere speculation but I use this to highlight the difficulty) that what was said was along the lines "I am calling about a contract you witnessed", to which (if Mr Pang said yes) an affirmative response would not necessarily be an affirmation that he had witnessed anything in particular. (In much the same way a judge might say "yes" when a submission was put to him or her without necessarily agreeing thereto; perhaps simply as an acknowledgment that the submission has been made or to indicate that it has been understood.) 8. There is also the further difficulty that English is not Mr Pang's first language and (with no disrespect to him) it is evident from his email communications and from his oral evidence that his level of facility with the English language might well permit misunderstandings to arise on his part or on the part of a listener. In particular, the suggestion in the plaintiffs' submissions that, in context, a query about a "contract" (in the singular) would have been understood to encompass a query about Ms Wang's signature is by no means self-evidently the case (especially when on Mr Tupou's account there appears to have been no reference to Ms Wang). 9. I accept that Mr Tupou understood from the 22 November 2016 conversation (at least by the time he came to recall it when he sent the 30 November 2016 email to Mr Lee) that Mr Pang had confirmed that he had witnessed the signing of the contracts. However, I am left in doubt as to whether that was an assumption or conclusion drawn by Mr Tupou or whether it was something actually stated by Mr Pang. 10. As to the fact that Mr Tupou was not shaken in his evidence in this respect, I would simply note that, if Mr Tupou in fact had drawn a conclusion from something implicit but not explicit in the conversation with Mr Pang, then it would not be surprising that over time his recollection would have firmed (unconsciously or otherwise) (see Watson v Foxman) and therefore the adamance of his evidence (compared with Mr Pang's lack of recollection of the conversation at all) does not take the matter very far. 11. As to the second piece of the mosaic, that suffers from the same problem as the first. I am left in doubt as to whether Mr Tupou's email was in effect expressing a conclusion he had drawn or something that he had actually been told. (In saying this, I do not suggest that Mr Tupou was misrepresenting the position to his client; I simply read the email as open to a different construction.) I also consider it relevant that Mr Tupou's focus, at the time of the 22 November 2016 conversation, seems to have been on confirming the address and capacity of the witness (not whether the witness had actually witnessed the signing of the document as such) – as evident from the emails at around that time; and from Mr Tupou's file note. 12. As to the third piece of the mosaic, as I have discussed earlier, I consider that the conversation to which Mr Pang has deposed with Mr Zhuang is consistent with Mr Pang's version of events. Similarly, as to the fourth piece of the mosaic, I do not accept that this amounts to any kind of consciousness of guilt. 13. Finally, as to Mr Hobden's evidence, I have taken that into account but I am of the view that its force is weakened by the limitations identified by Mr Pang (and discussed above). 14. I consider that Mr Pang's email to Mr Tupou in September 2018 corroborates Mr Pang's account of his telephone conversation with Mr Zhuang as does his reference to the witness log; and that this is consistent with Mr Pang not knowing (or remembering) what had happened in relation to the loan agreements about which he was then being questioned but candidly accepting that the signatures looked like his signatures. 15. Balancing all of the above, I am not comfortably satisfied that the overall mosaic when pieced together reveals or points to the conclusion that the purported signatures of Mr Pang on the Loan Agreements are authentic signatures. On the balance of probabilities, I consider it more likely that the signatures were placed on the documents by someone else (most likely the "chief rogue", as Mr Zhuang was identified by the plaintiffs in oral submissions – see T 328.19 - or someone at his behest). 16. That conclusion means that the various claims against Mr Pang fail. However, for completeness, I briefly deal with the issues that would arise had I come to a different conclusion as to the authenticity of the Pang signatures. 17. Had I concluded that Mr Pang did (falsely) attest to the signing of the Loan Agreements by Ms Wang, then I would have concluded that Mr Pang had engaged in misleading or deceptive conduct in representing (by his attestation) that he had witnessed the execution of the documents by Ms Wang (and, leaving aside the pleading complaint that has here been made, that Mr Pang was in breach of a duty of care owed to persons in the position of the plaintiffs who might reasonably be foreseen as likely to rely on the correctness of the attestation). I do not accept Mr Pang's characterisation of the act of witnessing guarantors' signatures as conduct which is divorced from any relevant actual or potential trading or commercial relationship; rather, while I accept the restriction imposed on the terms "in trade or commerce" contained in Concrete Constructions, I consider that the services of a chartered accountant in his capacity as a justice of the peace may be seen as professional and, in this context, intended to have an impact on commercial activities (since a validly signed and attested deed would have bound Mr Zhuang and Ms Wang as guarantors to the loan made by the plaintiffs and provided security for the loan transaction). In this regard, I refer to Houghton v Arms (2006) 225 CLR 553, in which the plurality accepted at [34] that: … statements made by a person not himself or herself engaged in trade or commerce may answer the statutory expression if, for example, they are designed to encourage others to invest, or to continue investments, in a particular trading entity. 1. I also consider that the conduct of a justice of the peace is sufficiently analogous to a liquidator who fulfills a statutory function by identifying assets with a view to facilitating the interest of other parties in conducting business, which was held to be an activity of essentially trading or commercial character in Aardwolf Industries LLC v Tayeh [2020] NSWCA 301 at [75]-[77] per Macfarlan JA (with whom Bell P and Leeming JA agreed). I further note that s 18 expressly contemplates the inclusion of any professional activity that is not carried on for profit. 2. I would not have concluded that Mr Pang was knowingly concerned in, and party to, the alleged misleading or deceptive conduct on the part of Mr Zhuang (in the absence of evidence that Mr Pang knew of the alleged oral agreement with Mr Zhuang and having regard to the disconformity in the pleaded case against Mr Zhuang and the accessorial liability case against Mr Pang, to which Mr Pang has pointed). 3. In respect of the negligence claim, I note that the 'duty of care' concept is the mechanism by which the law limits liability in negligence for pure economic loss, and the core of this liability is the defendant's voluntary undertaking, although there is no universally agreed test (see Torts Cases and Commentary (2017, 8th ed, Lexis Nexis) at [16.1.9]; Bruce Feldthusen, Economic Negligence (2000, 4th ed, Carswell) at pp 126-127). The scope of the defendant's liability is determined by several factors, including the defendant's knowledge, or means of knowledge, of an ascertainable class of vulnerable persons who are unable to protect themselves against harm, and the degree of control which the defendant has over the dissemination of the information (see David Rolph et al, Balkin & Davis Law of Torts (2021, 6th ed, LexisNexis) at [13.24]); the starting point is the identification of the interests for which the plaintiffs seek protection (see Perre v Apand Pty Ltd (1999) 198 CLR 180 at [192] per Gummow J, which statement was adopted by Ipps JA at [46] in Graham v Hall). 4. The interest of the plaintiffs for which they seek protection is their interest in the enforceability of the guarantees, and I consider that this would have been obvious to Mr Pang if he had attested the signatures on the loan agreement. I accept that there are factual differences between this case and Graham v Hall, and the plaintiffs were not in as vulnerable a position as Mrs Hall was in that case, in the sense that the plaintiffs were aware of the transaction and could have required the attestations to take place in the presence of their solicitors. However, I consider that the interests to be protected and the foreseeability of the harm is sufficiently similar to support the recognition of a duty of care owed by Mr Pang to the plaintiffs. As Ipp JA emphasised in Graham v Hall at [66], false attestation is not a case of omission, rather it is an act over which the attestor has full control and sole discretion; if Mr Pang had attested his signature, he would have implicitly assumed responsibility to those who could be affected by his negligence in carrying out that task. Further, the fact that the imposition of liability would not give rise to indeterminate liability is significant (as here the only possible plaintiffs could be the mortgagees). 5. As to the issue of reliance, I am not persuaded that reliance is made out on the part of the plaintiffs in circumstances where the evidence of reliance comes relevantly only from Mr Tupou (and even if it were sufficient it would suffer from a difficulty in terms of causation since it is apparent that Mr Lee routinely did not act on Mr Tupou's recommendations). I accept that an agent's reliance may be sufficient to establish compensable loss, irrespective of whether the agent may have been careless or failed or comply with standard procedures (see Perpetual Trustee Company Ltd v Milanex Pty Ltd (in liq) [2011] NSWCA 367 at [49]-[69] per Macfarlan JA with whom Campbell and Young JJA agreed). While a solicitor clearly falls into the realm of agency, not every aspect of a solicitor's role involves agency (see Gino Dal Pont, Law of Agency (2020, 4th ed, LexisNexis) at [1.39]). In this respect, Mr Lee's own evidence was that Mr Tupou was "just [his] solicitor and he's not a financial advisor" and as such rejected Mr Tupou's concerns about the transaction (T 65.43). This strongly suggests that the acts and state of mind of Mr Tupou did not govern and represent the state of mind of Mr Lee (or the plaintiffs, for that matter). Accordingly I am not satisfied that reliance is made out on an agency basis. Had reliance been made out, I would have accepted that in principle the plaintiffs lost an opportunity to take steps at an earlier time to protect their interests but I am not persuaded that this was an opportunity of any real value. 6. The plaintiffs made much reference in submissions to rescinding the agreements (variously referring to the Loan Agreements or the oral agreement pursuant to which the moneys were advanced). It is by no means clear precisely what the plaintiffs contemplated by this. Breach of the Loan Agreements (even if Beyond Development Group was a party thereto and I have real doubt about this since Mr Zhuang signed the document only once – clearly in the capacity of guarantor) would ordinarily sound in damages not a claim for rescission; as would breach of an oral agreement to provide a personal guarantee. It seems more likely that what might have been contemplated would have been some kind of claim for misleading or deceptive conduct (of the kind ultimately pleaded against Mr Zhuang) but in that event it seems unlikely in the extreme that relief would have been obtained in the short period of time between the discovery (on this counterfactual) that the signatures of Ms Wang had not properly been witnessed and the time at which the loan funds had been disbursed. 7. Assuming for present purposes that a freezing order could have been obtained (at a time when Beyond Development Group retained some of the loan funds), it is still not clear that the plaintiffs would have had priority in respect of those funds over secured creditors such as NAB. As to the lack of an opportunity to lodge a caveat over the development properties, for the reasons put forward by Mr Pang I accept that this was not the loss of any real or valuable opportunity since there was no caveatable interest identified (and Mr Lee had in any event appears to have expressed reluctance at lodging a caveat after the first caveat was withdrawn. 8. Therefore, had I concluded that the claim for damages for loss of opportunity was made good, and that there was some value to the lost opportunity, I would nevertheless not have assessed that value as being of any real substance. In those circumstances it is not necessary to say anything further as to the debate over whether there would have been funds able to have been realised by the plaintiffs from a forced sale of the development properties (whether in February 2017 or, more likely, sometime later in 2017 or 2018). 9. As to the defences raised by Mr Pang, again these do not strictly arise for determination in light of the findings that I have made. Briefly, my conclusions had they arisen for determination would have been that the contributory negligence defence was well established. The plaintiffs, through Mr Lee, ignored the advice given by Mr Tupou and the concerns raised by Mr Tusa, and advanced moneys prior to the execution of any loan agreements or guarantees at all; chose not to pursue the instructions for due diligence and credit checks; and delayed in lodging a caveat to protect their interests (even assuming that there was a caveatable interest that they held). It is abundantly clear that Mr Lee acted as he did because he trusted Mr Zhuang. It is unfortunate that this trust was obviously misplaced. Nevertheless, it is clear that the plaintiffs in so doing did not act reasonably to protect their own interests. 10. There being contributory negligence, responsibility must be apportioned according to the degree of departure by each party from the standard of care of the reasonable person and the relative importance of the parties' respective acts in causing the loss sustained by the applicant (i.e., the degree of culpability and causative force to be attributed to each of them – see Podrebersek v Australian Iron and Steel Pty Ltd (1985) 59 ALJR 492; [1985] HCA 34 at 494). In my opinion the level of contributory negligence in this regard on the part of Mr Lee is high and I consider that the 75% figure put forward by Mr Pang is appropriate to reflect that level of negligence. It is not to the point to say that the plaintiffs had legal representation when it is clear that they did not rely on the advice they were given (and which Mr Lee accepted would have been prudent). 11. As to the concurrent wrongdoer (and overlapping proportionate liability defences), as already noted Mr Pang accepts that if he were found to have attested the signatures when he had not then this would exclude reliance on the concurrent wrongdoer defence (though it is not conceded by him that the plaintiffs have actually invoked s 87CC and hence it is said that it is open to treat this as an apportionable claim). I have not found that Mr Pang was guilty of dishonest conduct or fraud in this regard, so the issue does not arise. Had it arisen, I would have concluded that (despite the lack of pleading on this issue) the effect of a fraud finding would mean this is not an apportionable claim in respect of the relevant conduct. 12. As to the concurrent wrongdoers identified by Mr Pang, I have already referred to the position of the plaintiffs. As to Mr Zhuang, on the evidence before the Court, it must be concluded that he is the principal culprit in this matter and I would assess his responsibility for the loss at a high level (at least 75%) as against that (on this hypothesis) of Mr Pang, for the reasons put forward by Mr Pang. As to Pinnacle Lawyers, I would assess their liability at a much lower level (noting the expert advice referred to above but also that the advice they gave as to prudent measures to protect the plaintiffs' interests was routinely rejected). I would have assessed this liability at most at, say 20%. Claim against Mr Zhuang 1. As to the claim for judgment against Mr Zhuang, I can deal with this very briefly in light of the conclusions reached already as to the factual aspects of this matter. Assuming that Mr Zhuang's signatures on the Loan Agreements are genuine (and there is no reason to doubt this), there must nevertheless be an issue as to whether Mr Pang attested these signatures. In circumstances where I have found that Mr Pang did not attest Ms Wang's signatures on the documents, and having regard to the evidence of Mr Pang's communications with Mr Zhuang in September 2018, I am not satisfied that the Loan Agreements were properly attested as deeds (and I accept the force of the argument that they would not be enforceable as contracts for lack of consideration – past consideration being no consideration). 2. However, it seems to me abundantly clear that there was misleading or deceptive conduct on the part of Mr Zhuang in the making of the alleged representations; and I would accept that Mr Lee (and through him the plaintiffs) relied on these representations in advancing the moneys (albeit before execution of the documents) and then in not taking steps to recover or attempt to recover the moneys. Mr Lee's constant refrain as to the trust he reposed Mr Zhuang makes that clear. I would also accept that there was a relevant causal link between the misleading or deceptive conduct and the loss of the funds advanced. In addition, it would seem that Mr Zhuang breached his oral agreement with Mr Lee to provide a valid and enforceable personal guarantee, giving rise to damages for compensable and measurable loss. In those circumstances, I will enter judgment against Mr Zhuang for the amount claimed. Costs 1. I see no reason that costs should not follow the event. However, in her written submissions at the hearing, Ms Wang included submissions as to costs, in which Ms Wang made clear that she seeks costs on an indemnity basis or alternatively on an ordinary basis. It appears that the basis on which indemnity costs are here sought is that explained in "Law of Costs" by G E Dal Pont (2009, LexisNexis Butterworths, 2nd ed) at [16.51] (in effect that the proceeding has been commenced or continued in circumstances where the plaintiffs, properly advised, should have known that the proceeding had no chance of success); and see Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536 at [5] per Sheppard J. 2. As it is not clear whether the plaintiffs wish to respond to the special costs order sought by Ms Wang, and Mr Pang may seek to make submissions as to costs, I will make directions to permit any further submissions on the issue of costs. Orders 1. For the above reasons, I make the following orders: 1. Dismiss the plaintiffs' claim against the second and fourth defendants with costs. 2. Enter judgment for the plaintiffs against the third defendant in the sum of $800,000 plus interest and costs. 3. Direct that any brief written submissions as to costs of the second and fourth defendants be filed within 14 days with a view, if possible, to dealing with costs on the papers ********** 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: 30 May 2022