New South Wales District Court CITATION: Commonwealth Bank of Australia v Hilellis & Ors [2009] NSWDC 9 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S): 2, 3, 4, 5 and 6 February 2009 JUDGMENT DATE: 13 February 2009 JURISDICTION: District Court - Civil JUDGMENT OF: Levy SC DCJ DECISION: 1. Verdict and judgment for the Plaintiff in the sum of $121,804.54. 2. The Defendants are ordered to pay the Plaintiff's costs. CATCHWORDS: SUB-PRIME MORTGAGE – claim by a bank alleging misleading and deceptive conduct on the part of purchasers, vendors and an employee of a mortgage broker who introduced the purchasers to the lender for the procurement of a mortgage – purchasers shown to have acted fraudulently – transaction not at arm's length – action by mortgagee against vendors and employee of mortgage broker to recover shortfall in funds after mortgagee sale of property following default by the mortgagor LEGISLATION CITED: Fair Trading Act, 1987 (NSW) Trade Practices Act, 1974 (Cwth) Best v Housing Commission of NSW 17 LGR (NSW) 129 Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 Brien v Dwyer (1978) 141 CLR 378 Chamberlain v R (No 2) [1984] HCA 7; (1984) 153 CLR 521 Doney v R [1990] HCA 51; (1990) 171 CLR 207 CASES CITED: Equity Access Pty Ltd v Westpac Banking Group (1990) ATPR 40-994 Havyn v Webster [2005] NSWCA 182 King v GIO Australian Holdings Pty Ltd [2001] FCA 308 Palmer v Dolman; Dolman v Palmer [2005] NSWCA 361 Richard Evans & Co Ltd v Astley [1911] AC 674 Taco Company of Australia Inc & Anor v Taco Bell Pty Ltd (198) 42 ALR 177 Yorke v Lucas (1985) 158 CLR 661 PARTIES: Commonwealth Bank of Australia (Plaintiff) George Petter Hilellis (First Defendant) FILE NUMBER(S): 3277 of 2006 COUNSEL: Mr D A Smallbone (Plaintiff) Mr B Carney (Defendants) SOLICITORS: Gadens Lawyers (Plaintiff) Koutzoumis Lawyers (Defendants) JUDGMENT Nature of the case 1. The Plaintiff bank has brought these proceedings arising out of a property transaction in which the purchasers had acted fraudulently and which involved a low document or sub-prime mortgage. The Plaintiff claims damages against the vendors, purchasers and a witness to the signatures on the contract for sale of property alleging misleading and deceptive conduct in the course of trade or commerce. Introduction 2. In order to understand the issues in the case it is necessary to first outline the inter-relationship between the parties. The parties 3. The First Defendant, Mr George Peter Hilellis is and was an employee of Community Mortgage Corporation Pty Ltd, a finance broking company operated by his father, Mr Ignatios Hilellis. His father was not a party to these proceedings. He was not called to give evidence although he was available to do so. 4. The Fourth Defendant, Mr George Hilellis senior and the Fifth Defendant, Mrs Aspasia Hilellis, are husband and wife. They were the registered proprietors of an investment home unit property, the sale of which is the subject of the proceedings. They are the grandparents of the First Defendant and they are the parents of Mr Ignatios Hilellis. 5. The Second Defendant, Mr Micheal Elsadir and the Third Defendant, Mr Meliad Farad are brothers. They were the purchasers of the home unit property that belonged to the Fourth and Fifth Defendants. The purchase took place following discussions between their father, Mr Sam Elsadir and the Fourth Defendant. That purchase was procured by fraudulent means. 6. The Plaintiff, the Commonwealth Bank of Australia, provided mortgage finance to the Second and Third Defendants for the transaction which is the subject of these proceedings. That mortgage finance was provided by the Plaintiff to the Second and Third Defendants after they were introduced to the Plaintiff by the First Defendant in the course of his employment with the finance broking company Community Mortgage Corporation Pty Ltd. Short summary of the factual basis of the claim 7. The Fourth and Fifth Defendants agreed to sell their investment home unit to the Second and Third Defendants for a consideration of $550,000. They were introduced to the Plaintiff by the First Defendant who later witnessed the contract for the sale and the mortgage document which formed the basis of the transaction. The introduction to the Plaintiff occurred because Community Mortgage Corporation Pty Ltd was unable to assist the purchasers to obtain finance for the transaction. The vendor and the purchasers engaged the same solicitor for the transaction, Mr George Caramanlis of Daniels Lawyers. At the settlement the vendors accepted $440,000 as the consideration for transfer notwithstanding that the contract for sale provided for the sum of $550,000 to be paid. They did so notwithstanding the advice of Mr Caramanlis to the effect that the deposit cheque for $55,000 that was provided by the father of the purchasers should be banked with the outstanding balance secured by the execution of a deed. Instead, the Fourth and Fifth Defendants acceded to the request of the father of the purchasers to not only not bank the deposit cheque for $55,000, but to return it to him for the proffered reason that there were no funds in the account on which the cheque was written. 8. The reason proffered by the Fourth and Fifth Defendants for allowing the transfer to proceed notwithstanding that payment was to be for less than the agreed consideration of $550,000 was that the Fourth Defendant trusted assurances given to him by Mr Sam Elsadir, the father of the Second and Third Defendants, to the effect that he expected the sum of $500,000 to come from Lebanon. The Fourth Defendant accepted the intimation from the father of the purchasers that this money would be used to settle any outstanding amounts due in respect of the transaction. It appears that trust was misplaced. It also appears that the vendors were the victims of a fraud perpetrated by the Second and Third Defendants and the father of those Defendants. 9. After being told there was a delay in obtaining the anticipated monies from overseas the Fourth and Fifth Defendants agreed to incur a $110,000 shortfall in the final accounting of the transaction which was to have been for a consideration of $550,000. Subsequently, Mr Sam Elsadir and his sons the Second and Third Defendants disappeared after having made no payments under the mortgage. The Plaintiff then exercised its rights under the mortgage and subsequently arranged for a mortgagee sale that then resulted in a shortfall between the amount owing under the mortgage and the amount ultimately realised on the mortgagee sale of the property. 10. Close scrutiny of the transaction in the context of the litigation has revealed some curious features concerning the documentation. This has led to the Plaintiff asserting that the transaction involving the Defendants should be characterised as a "scam", namely a sale at overvalue which was settled with monies provided by the Plaintiff without any monetary contribution from the purchasers, with the result that the Fourth and Fifth Defendants were paid more than their property was worth even despite the $110,000 shortfall at settlement. The Plaintiff claims that the evidence discloses that the purchasers' stamp duty, legal costs and mortgage brokerage fees were paid from the proceeds of settlement which rendered the transaction suspicious. Consequently, the Plaintiff instituted these proceedings to seek to recover its losses from the Defendants. Formulation of the proceedings and the procedural history 11. The Plaintiff proceeds upon the Second Further Amended Statement of Claim filed on 4 April 2008 claiming damages pursuant to s.82 of the Trade Practices Act, 1974 (Cwth) and s.68 of the Fair Trading Act, 1987 (NSW) which provide for liability in damages in respect of other provisions of these respective acts. Since the Second and Third Defendants have not been located the proceedings were not served upon them and consequently, the Plaintiff's claims against those two Defendants have been discontinued. 12. The formulation of the Plaintiff's claim is that in the transaction, and in particular in the course of their dealings with the Plaintiff, which is alleged amounted to representations, each of the Defendants engaged in misleading or deceptive conduct in trade or commerce within the meaning of the Trade Practices Act, 1974 (Cwth) in relation to the First Defendant as an employee of Community Mortgage Corporation Pty Ltd and the Fair Trading Act, 1987 (NSW) in relation to the conduct of the Fourth and Fifth Defendants as vendors. The primary claim by the Plaintiff is against the Fourth and Fifth Defendants on account of conduct in trade or commerce that was allegedly misleading or deceptive conduct that was likely to mislead or deceive. The claim against the First Defendant is for accessorial liability for the legislatively proscribed contraventions carried out by the Fourth and Fifth Defendants. The claim regarding accessorial liability is founded upon the claim that the First Defendant is a person involved in the alleged contravention. The Plaintiff claims that the circumstances of the transaction justify an award of damages in its favour to recoup the claimed losses. Witnesses who gave oral evidence 13. The Plaintiff called the following witnesses in its case: (a) Mr Jon Lee, the Plaintiff's credit manager; (b) Ms Magda Egeto, a compliance checking officer employed by the Plaintiff; (c) Mr Peter Siganos, a settlement officer employed by the Plaintiff; (d) Mr David Walker, the Plaintiff's credit compliance manager; (e) Mrs Christine Michaelopoulos, a real estate agent. 14. The following witnesses were called in the case for the Defendants: (a) Mr George Peter Hilellis, the First Defendant; (b) Mrs Aspasia Hilellis, the Fifth Defendant; (c) Mr George Hilellis, the Fourth Defendant; and (d) Mr George Caramanlis, the solicitor who acted for both the vendors and the purchasers on the conveyancing transaction in question. Documentary evidence 15. The parties relied upon an array of affidavits and documentary material to which I will refer where necessary. The issues to be determined 16. On the first day of the hearing the parties were given some time to try to narrow the issues arising in the proceedings. As a consequence the parties have agreed that the following eight issues arise for determination:- (a) In the case against the First Defendant, whether the three pleaded representations were made; (b) In the case against the Fourth and Fifth Defendants, whether the relevant representation was only made in their role as vendor not otherwise; (c) In the case against the First Defendant, whether the relevant representations were made in trade or commerce; (d) In the case against the First Defendant, whether the relevant representations were made by the use of postal telegraphic or telephonic services; (e) Whether each or any of the representations was misleading or deceptive or likely to mislead or deceive; (f) Causation, namely whether the Plaintiff can show reliance on the representations; (g) The quantum of the Plaintiff's loss; (h) Whether the First Defendant has accessorial liability under Trade Practices Act 1974 s.75B / Fair Trading Act 1987 s.61. 17. Before addressing these issues it is necessary to review the relevant facts. Before doing so I will outline the effect of the relevant legislation. Applicable legislation 18. The Plaintiff relies upon section 42 of the Fair Trading Act, 1987 (NSW) and sections 52 and 75B of the Trade Practices Act, 1974 (Cwth). 19. Section 42 of the Fair Trading Act 1987 and section 52 of the Trade Practices Act, 1974 each deal with misleading or deceptive conduct and prohibit persons in the former case and corporations in the latter case from engaging in conduct that is misleading or deceptive or is likely to mislead or deceive in activity described as being in trade or commerce. 20. Section 75B of the Trade Practices Act, 1974 is an interpretation provision that extends accessorial liability for contraventions of section 52. Such accessorial liability is thereby extended to persons who have amongst other things, aided, abetted, counselled, procured or in any way, or who were directly or indirectly, knowingly concerned in, or were parties to the contravention. Section 61 of the Fair Trading Act, 1987 (NSW) is to a similar effect. The facts Background 21. In about March 2004 the Fourth and Fifth Defendants acquired the property in question comprising Lot 19/SP68114, being a strata home unit situated at 19/259 New Canterbury Road, Dulwich Hill. They did so by paying a consideration of $365,000. They did not ever reside in the unit but instead held it as an investment property. From time to time they let the premises for rent for the purpose of gaining income from the property. The agreement to sell 22. On or about 23 July 2005 a contract of sale was prepared by which the Fourth and Fifth defendants contracted with the Second and Third Defendants to sell the property to the Second and Third Defendants. The contract for sale recorded that the purchase price for the sale was $550,000. It was a term of the contract of sale that upon exchange of contracts the Second and Third Defendants would pay the Fourth and Fifth Defendants a deposit of $55,000 to demonstrate that they were serious purchasers. Mr Sam Elsadir, the father of the purchasers, gave the Fourth and Fifth Defendants a deposit cheque in the sum of $55,000 but then requested that this cheque not be banked because of a lack of funds in the account. He also asked for the cheque to be returned to him and the Fourth Defendant obliged that request. This inevitably meant that the deposit was a sham, or in reality, no deposit. The contract for sale recorded that the selling agent was Crystal Realty. Mrs Michaelopoulos, the proprietor of that agency gave evidence and explained that her agency had an open agency for the sale of the property but did not receive a commission because it was not instrumental in the sale. This was so notwithstanding that the name of her agency was included in the contract for sale. In fact the only involvement of her agency with the property was a letting agency relationship that was arranged before the Fourth and Fifth Defendants decided to sell the property. Purchasers introduced to the Plaintiff for finance 23. In July 2005, the Second and Third Defendants initially tried to arrange finance for the purchase through the First Defendant's employer, Community Mortgage Corporation Pty Ltd but that organisation was unable to assist with such finance having regard to the time urgency with which the purchasers wanted to proceed. In these circumstances the First Defendant arranged for the purchasers to be introduced to a Ms Lily Stojkovic who was at that time, an employee of the Plaintiff bank. Following that referral the purchasers applied to the Plaintiff bank for a loan to assist them with their purchase of the unit. That loan application sought finance in the amount of $440,000 which was to be secured by first registered mortgage. At the relevant time the First Defendant referred the Second and Third Defendants to the Plaintiff for the purpose of applying for finance to acquire the purchase. The First Defendant at that time worked for his father, Mr Ignatios Hilellis, or more correctly, for his father's company which was known as Community Mortgage Corporation Pty Ltd. I find that all of his dealings in the transaction in question, that is, the referral to the Plaintiff, the introduction to the Plaintiff and the subsequent witnessing of signatures on documents, were carried out in the course of his employment with Community Mortgage Corporation Pty Ltd, the principal of which is his father, Mr Ignatios Hilellis, who is the son of the Fourth and Fifth Defendants. Common solicitor acted for the vendors and purchasers 24. At the time of the transaction in question the offices of Community Mortgage Corporation Pty Ltd were located in the same building as the offices of Daniels Lawyers. The First Defendant referred the Second and Third Defendants to Daniels Lawyers to act for the Second and Third Defendants on the purchase of the property from the Fourth and Fifth Defendants. Mr George Caramanlis, a solicitor with the firm Daniels Lawyers, acted for both the vendors and the purchasers on the sale and transfer of the property. Loan approval and mortgage 25. Following an application to the Plaintiff for a loan the Plaintiff requested further information. On 26 July 2005 the Plaintiff approved the Second and Third Defendants' loan application subject to conditions. It was a condition of such approval that the borrowers provide to the Plaintiff a completed front page of the executed sale contract as only an incomplete copy had been provided at the time the application was submitted to the Plaintiff. 26. That loan application was based on a web of deceit that was underpinned by false, deceptive and misleading documentation that ranged from misleadingly completed details on the contract for sale to false letters attesting to the employment and the income of the purchasers. 27. On 1 August 2005, the First Defendant witnessed the Second and Third Defendants' execution of the Plaintiff's mortgage in respect of the property. That mortgage was executed by the Second and Third Defendants in the presence of the First Defendant at the office of Community Mortgage Corporation Pty Ltd. 28. At some time on or before 3 August 2005 the First Defendant witnessed the Second and Third Defendants' execution of the Consumer Credit Contract Schedule in respect of the loan at the Marrickville branch of the Plaintiff bank. The signed Consumer Credit Contract Schedule was then returned to the bank on 3 August 2005 and settlement of the transaction subsequently occurred on 17 August 2005. Unusual payments made at settlement 29. At all relevant times Community Mortgage Corporation Pty Ltd was a finance broker. At or shortly after the completion of the sale, through their solicitor, the Fourth and Fifth Defendants directed that the Plaintiff pay the sum $9,680.00 on their behalf to Community Mortgage Corporation Pty Ltd. That sum was paid from the funds advanced by the Plaintiff to the Second and Third Defendants on completion of the purchase of the unit from the Fourth and Fifth Defendants. Notwithstanding that the Fourth Defendant has denied that this sum was for a brokerage commission, and claimed instead that it was a payment of reimbursement of repairs and maintenance paid for by Mr Ignatios Hilellis in respect of another property, I find that the payment of the sum of $9,680 to Community Mortgage Corporation Pty Ltd was payment for a brokerage fee for brokering the transaction in which that organisation introduced the purchasers to the Plaintiff as a financier. I reject the evidence of Mr George Hilellis senior to the effect that it was a co-incidence that the sum of $9,680 is the equivalent of 2% of $440,000 plus 10% GST. He sought to shelter himself from cross-examination on key questions by claiming a lack of knowledge or recollection yet, conveniently, he was able to isolate and recall the explanation for the payment of the sum of $9,680. I do not believe his evidence was credible in this regard. Mr George Hilellis senior was an astute investor in property as was evident from his many property transactions over many years. I do not accept as genuine his lack of recollection of detail in respect of this transaction. I find the amount of $9,680 was a commission for brokering the finance for the transaction by the act of introduction of the purchasers to the Plaintiff. 30. Curiously, and unusually, upon settlement of the transaction the purchasers' stamp duty in the reduced sum of $11, 249 on account of the first homebuyer's discount, and the purchasers' legal fees in the sum of $1,500 were paid out of the monies advanced by the Plaintiff at settlement. Those payments upon settlement were made pursuant to a written direction to the Plaintiff and provided by the solicitor who was common to both sides of the transaction. This was so notwithstanding that such fees and charges that are applicable to purchasers are usually paid by purchasers. False information provided to assist in obtaining the loan 31. At the time of the transaction Mr Ignatios Hilellis was also a director of Hock A Car Pty Ltd ACN 108 221 325. That company was duly incorporated on 3 March 2004. Its business comprised pawnbroking using motor vehicles as collateral. For the purpose of assisting the Second and Third Defendants to obtain finance for the purchase, a letter dated 8 July 2005 was procured and purporting to be from Hock A Car Pty Ltd and which stated that the Third Defendant had been employed by that company since July 2003 on a permanent basis as sales manager with a gross annual salary of 58,000 (sic for $58,000). 32. That letter was false and misleading because, notwithstanding the content of that letter, the Third Defendant had not been employed by that company since July 2003 on a permanent basis as sales manager. That letter was provided to the Plaintiff for its consideration in support of the Second and Third Defendants' finance application in relation to the purchase of the property. No one from Hock A Car Pty Ltd was called to identify the letter as a forgery. There is no evidence tendered to indicate that Mr Ignatios Hilellis was in any way implicated in this misleading correspondence. 33. At the time of the transaction, MPS Security Group (Aust) Pty Ltd ACN 101 035 401 had offices in the same building as Daniels Lawyers the solicitors who acted for both the vendors and the purchasers and Community Mortgage Corporation Pty Ltd. The company MPS Security Group (Aust) Pty Ltd was incorporated on 20 June 2002. For the purpose of assisting the Second and Third Defendants to obtain finance for the purchase, MPS Security Group (Aust) Pty Ltd apparently provided a letter dated 20 July 2005 which stated that the Second Defendant had been employed by that company since February 2002 on a permanent basis as control room manager with an annual gross salary of $52,300.00. That letter purported to be signed by a Mr Con Kalls who, by the terms of the letter, was represented to be a director of that company. That representation was untrue because on 20 July 2005 Mr Con Kalls was not a director of MPS Security Group (Aust) Pty Ltd. 34. That letter was also false and misleading in that the Second Defendant had not been employed by MPS Security Group (Aust) Pty Ltd since February 2002 on a permanent basis as control room manager. This letter was also false and misleading in that it was not signed by a director of MPS Security Group (Aust) Pty Ltd although it purported to have been signed by a director. 35. Notwithstanding that the letters from Hock A Car Pty Ltd and MPS Security Group (Aust) Pty Ltd were false and misleading they were submitted to the Plaintiff for the purpose of its consideration of the Second and Third Defendants' finance application in relation to the purchase of the property. Representations relied upon by the Plaintiff 36. As a basis of the loan application and for the transaction to proceed, the Plaintiff relied upon three key representations that were each made on 12 August 2005. 37. The first representation was that the Second, Third, Fourth and Fifth Defendants represented to the Plaintiff that the sale and purchase of the property was an arm's length transaction. 38. The second representation was that the Second, Third, Fourth and Fifth Defendants also represented to the Plaintiff that the sale price listed in the contract was the market value as at July 2005. 39. The third representation was that the Second, Third, Fourth and Fifth Defendants represented to the Plaintiff that the Second and Third Defendants were paying to the Fourth and Fifth Defendants a consideration in the sum of $550,000 to acquire the property. 40. Those representations were communicated to the Plaintiff by the use of postal, telegraphic or telephonic services, namely, by a facsimile transmission. Those representations were also made in trade or commerce. Each of those representations were untrue and thus constituted misleading or deceptive conduct or conduct that was likely to mislead or deceive. The role of the solicitor engaged to act for both the vendors and the purchasers 41. Mr George Caramanlis is a solicitor with Daniels Lawyers. He was known to the vendors. The First Defendant referred the purchasers to Mr Caramanlis for him to act for them in respect of the transaction. In his oral evidence Mr Caramanlis acknowledged that, with hindsight, he recognised that there were a number of unusual aspects of the transaction. He agreed that with hindsight these features ought to have alerted him to the fact that something was not quite right with the transaction. He excused his oversight by saying at the time his office was short-staffed, he was over-burdened with work and he was not in good health. Misleading statements as to deposit and agency 42. The Fourth and Fifth Defendants had instructed their solicitor, Mr Caramanlis, that the deposit for the transaction was to be paid to Crystal Realty as deposit holder under the contract of sale. In fact no deposit was paid to Crystal Realty in respect of the sale of the property. The deposit was expressed to be $55,000 however, no deposit was paid at all in respect of the sale of the property. This meant that the Second and Third Defendants were not paying the sum of $550,000 to the Fourth and Fifth Defendants to acquire the property. In fact the only money that was paid by the purchasers to the Fourth and Fifth Defendants was the sum of $440,000 which was the amount of the finance that had been advanced by the Plaintiff at the completion of the transaction. 43. Further, the sale was not effected through the intervention of Crystal Realty. In fact the sale was not even effected through the intervention of any real estate agent. The parties to the negotiations for the sale 44. The terms of the sale were negotiated between the Fourth Defendant on behalf of the Fourth and Fifth Defendants and Mr Sam (also known as Gazzin) Elsadir on behalf of the Second and Third Defendants. Mr Sam Elsadir was a neighbour of the Fourth and Fifth Defendants. Mr Sam Elsadir was well known to the Fourth and Fifth Defendants. The Second and Third Defendants were sons of Mr Sam Elsadir. At the time of the transaction the Second and Third Defendants resided in a residential unit in the same complex as the subject unit, the Fourth and Fifth Defendants and Mr Sam Elsadir. The stated reasons for Mr Elsadir wanting to purchase another unit in the building was for his sons to be able to live close to other family members who had property holdings in the same building. That reason was untrue as the Elsadir family holdings were a sham procured by ruses that were exposed when the mortgagee sales of those properties subsequently occurred. Early settlement of the transfer and shortfall in funds paid to the vendors 45. Notwithstanding that the contract provided for a settlement 35 days after the contract date so that it was scheduled to take place on 7 September 2005 the settlement was brought forward so that it took place 14 days after the contract was signed, namely 17 August 2005. The settlement was brought forward at the request of the purchasers for reasons that were not fully apparent. 46. At the completion of the transaction the Fourth and Fifth Defendants did not require payment of the balance of the purchase price beyond the sum of $440,000 that had been advanced by the Plaintiff. At completion, and despite the advice given by Mr Caramanlis, the Fourth and Fifth Defendants did not take or seek any deed from the purchasers to secure payment of the shortfall of $110,000 or in respect of any part of that amount. Neither did they subsequently take any steps to recover the outstanding shortfall. 47. The Second and Third Defendants did not and did not intend to pay $550,000 to the Fourth and Fifth Defendants to acquire the property. The transaction between the Second and Third Defendants and the Fourth and Fifth Defendants was not at arm's length. The value of the property at the time of the transaction was not $550,000 but substantially less than $550,000 and more likely to be of the order of about $370,000. 48. As a consequence of the matters set out above, the abovementioned representations made by the Defendants on 12 August 2005 were untrue. Further, those representations were misleading or deceptive or likely to mislead or deceive. Settlement and transfer 49. On 17 August 2005 the Plaintiff advanced the sum of $440,000 to the Second and Third defendants so that settlement of the transaction could proceed. The sole purpose of that advance was to assist the Second and Third Defendants to purchase the property from the Fourth and Fifth Defendants, the property comprised in Lot 19/SP68114, being the strata unit at 19/259 New Canterbury Road, Dulwich Hill. I am satisfied that the Plaintiff relied upon the veracity of the impugned representations made to it as the basis for advancing to the purchasers the sum of $440,000 so that the transaction could proceed. 50. That money was advanced by cheques drawn in accordance with cheque directions provided by the solicitor for the vendors and purchasers. Those directions were given by Mr Caramanlis to the Plaintiff, by his facsimile transmission of 16 August 2005, a copy of which appears at page 51 of the bundle that comprises Exhibit "C". Those cheque directions were the Fourth and Fifth Defendants' directions for payment to them of the sum of $440,000 by the Second and Third Defendants upon completion of the sale of the property. That sale was completed on 17 August 2005. On that date the sum of $440,000 was advanced by the Plaintiff on the security of its incoming mortgage. 51. Following the completion of the transaction the Second and Third Defendants did not make any payments to the Plaintiff in respect of the mortgage facility created in the transaction. By the terms of their loan facility with the Plaintiff, the Second and Third Defendants undertook to repay to the Plaintiff the advance of $440,000 together with interest at the rates provided for in the Consumer Credit Contract Schedule that they signed. The annual percentage rates applicable to the facility for the period after expiry of the first year of the facility are set out in Exhibit "E". Shortfall following sale by mortgagee 52. Following default on the mortgage the Plaintiff sold the property using its power of sale as mortgagee. Completion of the Plaintiff's mortgagee sale of the property occurred on 28 June 2006. The price at which the Plaintiff sold the property under that sale was $370,000. The net proceeds of that mortgagee sale were $359,281.09. As a consequence the Plaintiff claims to have lost the difference between the advance of $440,000, and the amount of the net proceeds of its mortgagee sale. The Plaintiff has also lost the benefit of the use of the sum of $440,000 prior to that recoupment and has permanently lost the benefit of the use of the amount of the shortfall on that recoupment. The first issue – In the case against the First Defendant, whether the three pleaded representations were made 53. The Plaintiff claims as against the First Defendant that the three pleaded misleading and deceptive representations were made to the Plaintiff on 12 August 2005. When reduced to their short form these representations may be summarised as follows: (a) The Second, Third, Fourth and Fifth Defendants represented to the Plaintiff that the sale and purchase of the property was an arm's length transaction when the Plaintiff claims it was not; (b) The Second, Third, Fourth and Fifth Defendants represented to the Plaintiff that the sale price of $550,000 listed in the contract for sale was the market value of the property as at July 2005 when the Plaintiff claims that was not the true sale price and not the true market value; and (c) The Second, Third, Fourth and Fifth Defendants represented to the Plaintiff that the Second and Third Defendants were paying a consideration of $550,000 to the Fourth and Fifth Defendants to acquire the property when the Plaintiff claims that this was not the case. 54. In support of those claims the Plaintiff points to admissions made by the First, Fourth and Fifth Defendants that a representation was made that the transaction was at arm's length. In my view the statement of the sale price implies, especially in the context of a bank financed purchase, that the listed price was the market price. The unambiguous reference on the front page of the contract for sale to the fact of a ten percent deposit having been paid is also a representation, so too was the claim that there was an agent for the sale who would hold the deposit which gave rise to an implication that ten per cent deposit had been paid. There is little room for doubt that the three representations were in fact made as alleged. 55. The evidence of the solicitor for the parties to the transaction, Mr Caramanlis, at T 221 is instructive. He confirmed the indicia of an arm's length transaction, which, when compared to the front page of the contract for sale that was provided to the Plaintiff and dated 23 July 2005 and reproduced at page 43 of Exhibit "JL1" to the Affidavit of Jon Lee that was read in the proceedings clearly shows that the documents and its contents were structured and completed in a way that was aimed at satisfying the requirements of the Plaintiff's lending policy. Accordingly, in my view the contents of that document amounted to representations as claimed by the Plaintiff. That view is confirmed by the evidence of Mr Caramanlis in paragraph 14 of his affidavit sworn on 30 January 2009 which was read in the proceedings. There is no doubt that the matters pointed to by the Plaintiff were representations aimed at inducing the Plaintiff to provide a loan. Also, having regard to the fact that Exhibit "JL1" to Mr Lee's Affidavit comes from the Plaintiff's files I am satisfied these representations were made to the Plaintiff. 56. In my view the Plaintiff has proven that the claimed representations were made as pleaded. The second issue – In the case against the Fourth and Fifth Defendants, whether the relevant representation was only made in relation to their role as vendor and not otherwise 57. The issue of whether or not the pleaded representations were made by the Fourth and Fifth Defendants only in relation to their capacity as vendors is irrelevant because the property in question was an investment property. In my view the sale of an investment property was an activity of trade or commerce. There is little room for doubt that the Fourth and Fifth Defendants made the representations in their role as vendors. However I find that in the context of these proceedings involving the sale and purchase of an investment property, that fact is of no significance or consequence to the outcome of these proceedings. The position may well have been different if the property being sold comprised residential domestic premises rather than an investment property. The third issue – In the case against the First Defendant, whether the relevant representations were made in trade or commerce 58. The Plaintiff submits that the representations relied upon were made in trade or commerce. The Fourth and Fifth Defendants concede that the representations were made in trade or commerce. Only the First Defendant contests the point. In support of its submission the Plaintiff relies upon the fact that the property was an investment or rental property. In support of its submission that the representations were made in trade or commerce the Plaintiff points to a number of features. Firstly, the Fourth and Fifth Defendants did not reside in the premises in question. Second, the property was a rental property. Third, when it became vacant the Fourth Defendant entered into a management agreement with the managing agent on 6 June 2005. Fourth, the agent reported to the Fourth Defendant on 20 June 2005 as is evident in Exhibit "F". Fifth, the attempt to relet the premises when they became vacant was not pursued and a decision was made to sell. The instructions were then given to Mr Caramanlis to prepare a contract for sale of the property. In my view this combination of events indicates activity in trade or commerce. I therefore accept that submission and find that the representations were made in trade or commerce : Havyn Pty Ltd v Webster [2005] NSWCA 182 at [99]-[100]. The fourth issue – In the case against the First Defendant, whether the relevant representations were made by the use of postal telegraphic or telephonic services 59. In the case against the First Defendant the Plaintiff claims that the representations were made by the use of postal, telegraphic or telephonic services. In support of that submission the Plaintiff relies upon the fact that the facsimile transmission dated 12 August 2005 and which was used to communicate the representations to the Plaintiff was in fact a relevant postal telegraphic or telephonic service. Annexure "G" to the affidavit of the Plaintiff's employee, Peter Siganos sworn 24 December 2008, demonstrates that Mr Caramanlis of Daniels Lawyers sent a fax to the Plaintiff at 11.09am on 12 August 2005 which contained the relevant representations relied upon by the Plaintiff. I accept the Plaintiff's submission and find that the representations were made by the use of postal, telegraphic or telephonic services. The fifth issue – Whether each or any of the representations was misleading or deceptive or likely to mislead or deceive 60. The Plaintiff submits that each of the claimed representations was misleading and deceptive or was likely to mislead or deceive. Analysis of that submission follows in the ensuing paragraphs. The representation that the sale was at arm's length 61. The sale of the property was negotiated off-market between friends, i.e. Mr George Hilellis senior and Mr Sam Elsadir, and contained many unusual features including the failure of both the vendors and purchasers to undertake some of the normal steps that would be expected to have been pursued in an arm's length conveyancing transaction. 62. This included the fact that the vendors did not insist on the right to a payment of a deposit. In fact the Fourth Defendant acceded to a request to return a cheque handed over by the father of the purchasers in the sum of $55,000 because there were no funds in the account on which the cheque was written. The fact that the cheque account on which the cheque was written had been closed indicated the deposit component of the transaction was a sham. The delivery of a cheque with instructions not to bank it does not constitute a deposit : Brien v Dwyer [1978] HCA 50; (1978) CLR 378 per Stephen J at 397-399. 63. Most curiously, the vendors did not tell their solicitor that the deposit had not been paid despite the fact that the Fourth Defendant conversed with his solicitor shortly before the settlement at which time the solicitor believed the shortfall in the settlement funds was only $56,590 when in fact it was much more. Mr Hilellis senior confirmed that no steps were taken by the vendors to pursue payment of the balance owing. 64. A further unusual feature of the transaction indicating the absence of an arm's length relationship between the vendors and purchasers was that the Fourth Defendant refused to follow the advice of his solicitor Mr Caramanlis who had advised him to obtain a deed to secure the payment of the outstanding shortfall in the balance owing on the transaction. The reason proffered by The Fourth Defendant for not doing so was that he did not want to offend the father of the purchasers. In my opinion this fact also demonstrates the absence of an arm's length relationship. 65. The fact that the purchasers obtained the assistance of Community Mortgage Corporation Pty Ltd in introducing them to the Plaintiff as a source of finance also points to a lack of an arm's length relationship in view of the Hilellis family connection and the friendship of Mr Hilellis senior and Mr Sam Elsadir. These circumstances also lead to an inference of a lack of arm's length in the transaction. It is noteworthy that this company, Community Mortgage Corporation Pty Ltd, was operated by Mr Ignatios Hilellis, the son of the Fourth and Fifth Defendants and that company obtained a payment of $9,680 from the settlement of the transaction. 66. The fact that the solicitor acting for the purchasers did not make the usual pre-contract enquires that were to be expected in a conveyancing transaction except for those the solicitor considered necessary for ascertaining the figures requiring adjustment on settlement, when taken together with the other matters I have outlined, casts doubt on the arm's length nature of the transaction. So too does the absence of the involvement of a real estate agent in circumstances where the contract for sale suggests otherwise. 67. In addition to the foregoing matters there is the curious arrangement whereby the purchasers' obligations to pay their legal costs and stamp duty liabilities in respect of the transaction was paid out of funds advanced by the Plaintiff and to which the vendors were entitled on settlement. In my view this indicates that the transaction was not at arms length. 68. The Defendants submit that the payment of the purchasers' legal costs at settlement and the payment of $9,680 to Community Mortgage Corporation Pty Ltd are not indicative of a lack of arm's length in the transaction. I reject the submission that such payment was for the cost of repairs that Mr Hilellis owed to his son Ignatios Hilellis. If that was truly the case the payment would have been expected to have been made to Mr Ignatios Hilellis personally and not to his company. 69. I am comfortably satisfied that the transaction in question was not an arm's length transaction and as a consequence the representations on which it was based were misleading or deceptive. Representation that the purchasers were paying $550,000 to acquire the property 70. The Plaintiff submits that the purchase price of $550,000 was fictitious from the outset. The Plaintiff submits that this conclusion is evidenced by the fact that the purchasers were not paying $550,000 to acquire the property and the vendors were not receiving $550,000. In fact the purchasers only paid $440,000 less legal fees and stamp duty, putting aside any question concerning the curious payment of the sum of $9,680 paid to Community Mortgage Corporation Pty Ltd. 71. I am comfortably satisfied that the nominated purchase price was fictitious. I have come to this view because the stated sale price bore little if any relationship to the market value of the property at the time except that the price was well in excess of the market. The relaxed attitude of the Fourth and Fifth Defendants to the non payment of the deposit of $55,000 in my view tends to confirm that the Fourth and Fifth Defendants knew that the representation concerning the purchase price of $550,000 was being paid was misleading or deceptive and was likely to mislead or deceive. I am reinforced in this view by the terms of the content of the front page of the copy of the contract for sale of the property by which it was asserted that a deposit of $55,000 was being paid. That was an untrue statement as the deposit cheque, which could not have been met on presentation in any event, was returned on the request of the father of the purchasers, namely Mr Sam Elsadir. 72. In truth there was no deposit paid. The untruthfulness of the statement concerning the deposit demonstrates the misleading and deceptive character of the statement that a purchase price of $550,000 was being paid. 73. Further confirmation that the representations were made is the misleading and deceptive nature and content of the contract for sale sent to the Plaintiff on behalf of the parties by Mr Caramanlis on 12 August 2005 and the falsely incorrect statements within it. These comprised untrue statements as to the existence of an agent/deposit holder, the existence of a deposit and the nature of the price. Representation that the value of the property was $550,000 74. The Plaintiff submits that the misleading and deceptive character of the representation that the value of the property in the sum of $550,000 is demonstrated by a number of factors. These include firstly, the evidence of Mr Hubbard and the opinion within his report Exhibit "A" which I am satisfied shows that the true value at the time of sale was $370,000 and second, that the fact that the transactions relied upon by the Defendants in their attempts to impugn the valuation of Mr Hubbard were in fact flawed by the involvement of the Elsadir family in those transactions. 75. In my view the attack by the Defendants on the opinion of Mr Hubbard failed to contradict or weaken his valuation opinion. Mr Hubbard appropriately adopted the conventional direct comparison method of valuation : Best v Housing Commission of NSW 17 LGR (NSW) 129 at 130 per Sugarman J. In my view, for the reasons Mr Hubbard has stated in his supplementary report Exhibit "B" and as explained in his evidence, Mr Hubbard was correct to exclude from the comparison process for valuation the two sales that were relied upon by the Defendants in their attempt to recast the valuations into a higher range of valuation figures to include the prior sales of other properties to Mr Elsadir for higher than market sums in transactions that subsequently resulted in mortgagee sales in 2007 for lesser sums that were more in line with the actual market. 76. The attack upon the valuation evidence of Mr Hubbard was not supported by any evidence from an expert of like qualifications. I reject that attack as being without substance. Accordingly, I find that the representation that the value of the property at the time of the transaction was $550,000 was, and was likely to be, misleading or deceptive. Conclusion as to misleading and deceptive nature of the representations 77. For the reasons I have outlined above I am comfortably satisfied that each of the representations identified by the Plaintiff as the basis for its claim against the Defendants were misleading and deceptive or were likely to mislead or deceive. I am satisfied that in all the factual circumstances of the case I have outlined the conduct that I have found to be misleading and deceptive conveyed the claimed representations. The conduct carried with it a real and not remote chance or possibility of misleading or deception : Equity Access Pty Ltd v Westpac Banking Group (1990) ATPR 40-994 at 50,950. 78. The question of whether the conduct complained of is misleading or deceptive or likely to mislead or deceive is, in the ordinary case, a question of fact : Taco Company of Australia Inc & Anor v Taco Bell Pty Ltd (198) 42 ALR 177 per Deane and Fitzgerald JJA at 199 [35]. The present case is an ordinary case. I find that the conduct complained of was misleading and deceptive and likely to mislead and deceive. The sixth issue – Causation, namely whether the Plaintiff can show reliance on the representations 79. In my view the Plaintiff has shown that it had relied upon each of the representations in question. I am satisfied that if the truth of any of the misleading matters had been disclosed to the Plaintiff prior to the approval of the loan then the property would not have qualified for valuation and therefore it would not have qualified for lending according to the Plaintiff's lending policy on the basis of the content of the front page of the contract for sale which would have meant that the Plaintiff would then have required an external valuation. In my view, had an external valuation been obtained, this would have revealed an opinion along the lines of the opinion of Mr Hubbard. I find that if that had been the case the application to the Plaintiff for finance for the transaction would have been effectively scuttled without mortgage insurance being obtained, which would have been an entirely different lending transaction with entirely different risk assessment parameters. 80. On 12 August 2005 the Plaintiff's settlement officer Mr Siganos requested a completed front page of the contract for sale. I am satisfied that this was done to obtain written confirmation of details of the transaction as a precursor to the bank confirming and communicating its approval for the loan requested by the Second and Third Defendants. I find that the faxed reply from Mr Caramanlis on the same date, which contained the relevant representations in response to that enquiry, was specifically relied upon by the Plaintiff as a precursor to the advancement of the purchase monies. I find that if the impugned material statements of fact contained in the contract were disclosed to have been untrue on 12 August 2005 the Plaintiff would not have proceeded to advance the purchase monies and would not have transacted the mortgage which ultimately caused the losses claimed in these proceedings. This would have been so because the transaction would have been exposed as being suspicious and I am satisfied that in those circumstances it would not have then gone ahead. 81. In my view the Plaintiff has adduced ample evidence to demonstrate that its losses were caused by the misleading and deceptive representations made by the Second, Third, Fourth and Fifth Defendants. It has done so by introducing evidence of the receipt of the representations, showing how, according to the internal business processes of the bank, it relied upon those representations for data entry into the Plaintiff's computerised loan application assessment tool known as VAS which was part of the Plaintiff's assessment process. Whilst the VAS process may have been one which was inherently vulnerable to fraudulent manipulation if incorrect and untrue data was permitted to be entered into its assessment processes without supervision, the evidence discloses that it was nevertheless a business system used by banks to assess low document loan applications. The Defendants argued that it was the computer system that made the Plaintiff vulnerable to suffer the loss. The Defendants have argued that it was not the misrepresentations but the computerised assessment process that caused the loss. In my view that is an untenable argument because it ignores the effect of the underpinning representations and I reject it. 82. I am satisfied that in making the advance of $440,000 to enable the transaction to be completed, the Plaintiff relied on the representations made by the Defendants on 12 August 2005. I am satisfied that had those representations not been made the transaction would not have met the Plaintiff's policy for approval of finance without formal valuation otherwise known as low document or sub-prime mortgage lending. In my view, having regard to the valuation evidence of Mr Hubbard, I am satisfied that if a formal valuation had been undertaken, the loan advance would not have been approved. I therefore find that in the relevant sense the Plaintiff's losses were therefore caused by the conduct of the Fourth and Fifth Defendants. 83. There was no defence pleading contributory negligence. I find that the Plaintiff's losses were caused by the misleading and deceptive conduct of the Defendants. The seventh issue – The quantum of the Plaintiff's loss 84. The Plaintiff tendered Exhibit "E" which incorporated calculations of its claimed loss totalling $121,804.54 including interest. That calculation comprised the shortfall following the mortgagee sale and the addition of the contracted rates of interest. The Defendants did not dispute the calculation and I therefore assess the Plaintiff's quantum of loss in the sum of $121,804.54. The eighth issue – Whether the First Defendant has accessorial liability under Trade Practices Act 1974 s.75B / Fair Trading Act 1987 s.61 85. The Plaintiff submits that the First Defendant has incurred accessorial liability for the Plaintiff's losses pursuant to s.75B of the Trade Practices Act, 1974 (Cwth) and under s.61 of the Fair Trading Act, 1987 (NSW). The Plaintiff similarly argues that s.61 is invoked. The difference in these two provisions is that the former applies to corporations and the latter applies to individuals. 86. Intention is not a necessary element for establishing liability for misleading and deceptive conduct in trade or commerce and therefore it is not an essential element in the case against the Fourth and Fifth Defendants. However, for the Plaintiff to succeed against the First Defendant under the accessorial liability provision as a 'person involved' the accessory must be shown to have knowledge of the essential elements of the contravention : Yorke v Lucas (1985) 158 CLR 661 at 666-699. That is, the Plaintiff must show that the First Defendant's accessorial conduct was intentional. 87. In order to establish the requisite intent the Plaintiff relies upon a combination of suspicious circumstances and the failure to make inquiries to infer that the First Defendant had knowledge of essential matters : King v GIO Australian Holdings Pty Ltd [2001] FCA 308 at [7]. The test for circumstantial proof has been stated in Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1 at 5, namely: "Of course as far as logical consistency goes many hypotheses may be put which the evidence does not exclude positively. But this is a civil and not a criminal case. We are concerned with probabilities, not with possibilities. The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence, while the latter you need only circumstances raising a more probable inference in favour of what is alleged. In questions of this sort, where direct proof is not available, it is enough in the circumstances appearing in the evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture: (see per Lord Robson, Richard Evans & Co Ltd v Astley [1911] AC 674, at 687). But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then, though the conclusion may fall short of certainty, it is not to be regarded as mere conjecture or surmise ..." 88. Further, in Chamberlain v R (No 2) [1984] HCA 7; (1984) 153 CLR 521 Gibbs CJ and Mason J said at 536: "When the evidence is circumstantial, the jury, whether in a civil or in a criminal case, are required to draw an inference from the circumstances of the case; in a civil case the circumstances must raise a more probable inference in favour of what is alleged ..." 89. In approaching the evaluation of the conduct of the First Defendant I propose to follow the approach in Palmer v Dolman; Dolman v Palmer [2005] NSWCA 361 at [35]-[37] in which the abovementioned authorities were reviewed in the following terms: "In Doney v R [1990] HCA 51; (1990) 171 CLR 207 Deane, Dawson, Toohey, Gaudron and McHugh JJ said at 211 that when a lesser standard of proof than beyond reasonable doubt will suffice, "the existence of other reasonable hypotheses is simply a matter to be taken into account in determining whether the fact in issue should be inferred from the facts proved". … "It is worth repeating, I think, that in Chamberlain v R (No 2) at 536 Gibbs CJ and Mason J said that in a civil case "the circumstances must raise a more probable inference in favour of what is alleged". 90. With these principles in mind I turn to an analysis of the evidence given by the First Defendant. The first matter to note in that analysis is that the First Defendant swore an affidavit on 2 February 2007 which was tendered in the proceedings as Exhibit "L" and which was in large part inconsistent with a subsequent affidavit he had sworn on 25 June 2008 and which was read in the proceedings. In his oral evidence he disavowed aspects of his first affidavit was as being incorrect. That disavowal requires scrutiny. 91. The First Defendant's first affidavit was prepared by R F Bergagnin & Co, the solicitors who were then acting for him. In that affidavit he deposed to having had a conversation with his grandfather, the Fourth Defendant, in late July 2005 in the presence of three other persons, namely the First and Second Defendants and the father of those Defendants, Mr Elsadir. The conversation was to the effect that the Fourth Defendant introduced the other persons present as purchasers of the property in question with the aim of obtaining the First Defendant's assistance with arranging finance for the purchase. In that conversation the First Defendant discussed the services his business could offer but then concluded that he could not help because of the time frame for the transaction envisaged by the purchasers. He then provided them with the business card of a person who was at that time a loan officer employed by the Plaintiff. I infer that employee was Lily Stojkovic. The affidavit goes on to describe how, on a later occasion in late July 2005 the First Defendant referred the purchasers to Daniels Lawyers in response to their inquiry for a recommendation for conveyancing lawyers. The affidavit also refers to another occasion in late July 2005 when the purchasers visited the First Defendant at his office and requested him to witness their signatures on mortgage documents which he proceeded to do after sighting identifying documents. Those identifying documents, namely the mortgage document, and a Consumer Credit Contract Schedule were annexed to that affidavit along with a letter dated 1 June 2006 from the Plaintiff's solicitors seeking comments and assistance from the First Defendant after the fraudulent conduct of the purchasers had come to light. 92. The First Defendant's second affidavit, which was prepared by his present solicitors, presents a different factual picture. In this subsequent affidavit the First Defendant distanced himself from the transaction and asserted that it was his father Mr Ignatios Hilellis who was going to arrange finance for the purchase of the property in question but "… because we had been slow in getting finance organised, the Second and Third defendants went direct to the bank and sorted it out themselves". The second affidavit went on to assert that the First Defendant would occasionally go to his father's office to help out with filing, banking and general office duties. In my view the First Defendant was, in his second affidavit, seeking to cynically distance himself from his prior involvement in the transaction. The second affidavit asserts that on a date in late July 2005 he was coincidentally in the Plaintiff's Marrickville branch when Lily Stojkovic, who was then an employee of the Plaintiff called upon him to witness the signatures of the Second and Third Defendants, and after sighting identification documents, he did as he was asked. The affidavit concludes by stating: "18. I was never privy to any of the sale negotiations or discussions or anything to do with Contracts other than witnessing the signatures of the borrowers in the offices of the Commonwealth Bank in Marrickville in the presence of Lily Stojkovic." 93. Counsel for the Defendants indicated that he was not relying upon the first affidavit however it was tendered by the Plaintiff during the cross-examination of the First Defendant. 94. The First Defendant was cross-examined about the discrepancies in the differing account of the events that emerge from these two affidavits that were sworn some 16 months apart. The First Defendant proffered various explanations for the glaring discrepancies between the two accounts given. I will review some of those discrepancies in the ensuing paragraphs. 95. In relation to whether the purchasers and their father Mr Sam Elsadir were present at the meeting in late July 2005, in the first affidavit the First Defendant said they were present and in his oral evidence he said he did not know whether they were present: T62.1. I concluded from his answer in cross-examination that the First Defendant was being evasive in his evidence. 96. The First Defendant said that he only skimmed the first affidavit before he signed it at the request of his former solicitor. When questioned about whether or not he had read the first affidavit before signing it he said he read it "vaguely". In cross-examination he acknowledged that he realised when signing it he was attesting to the truth of the contents: T62. I gained the impression from the former of these two answers that he was trying to downplay the significance of the contents of the first affidavit rather than provide a co-operative and truthful account. 97. The First Defendant confirmed that when he had sworn his first affidavit he had read over the contents, confirmed to his former solicitor, who had prepared it on his instructions, that the content was true and correct: T63. Later, at T67.33 said "... he signed it without reading it well enough" - and later at T67.42 he asserted that his former solicitor may have "many times" misunderstood his instructions. The former solicitor was not called to give evidence. I find these latter answers to be disingenuous attempts to distance himself from the consequences of the transaction. Insofar as it is necessary to ascribe to him a motive for such behaviour, I find the desire to assist and protect his grandparents in this litigation a more than sufficient explanation for motive. 98. Contrary to the content of his first affidavit the First Defendant asserted that he did not have a conversation with the Second and Third Defendants about the financial services his firm could offer. I find his assertion that he did not know much other than the banking and the filing to be disingenuous in the extreme given his answers at T72.2 and at T90.44 where he said he had referred the purchasers to the bank for finance and to the solicitors for the conveyancing. At T70.45 – T71.9 he sought to retreat into an explanation that he must have misunderstood and misread the words in the affidavit he had signed and again sought to suggest that the former solicitor had misunderstood his instructions. I reject such explanations as disingenuous contrivances aimed at seeking to downplay his role in these events in an endeavour to assist himself and his grandparents in this litigation. 99. There are other discrepancies in the evidence of the First Defendant which do not require exhaustive analysis. These include whether loan documents were signed at his employer's office or at the bank or both as well as other peripheral matters. It is not necessary for me to further analyse those other issues other than to record my reservations concerning accepting the First Defendant's evidence generally because of the matters I have already identified and in respect of which I have stated my findings. 100. The Plaintiff has submitted that the First Defendant was assigned the project of obtaining finance for the transaction, the aim of which was to obtain for his grandparents the Fourth and Fifth Defendants a price for their property beyond its true worth and to help document the sale of the property at a fictitious price. Whilst the motives of the Second and Third Defendants for participating in such an enterprise are not readily apparent, it is clear from the web of false information that surrounded the transaction that they never intended to comply with the obligations they were taking on with the mortgage obtained from the Plaintiff. Whilst their motives may not be readily apparent, I nevertheless infer from the web of deceit surrounding the transaction that they must have obtained some undisclosed dishonest benefit from the transaction. It is not necessary for me to identify that benefit or to make specific findings in that regard as such findings are not central to the issues calling for decision in the remainder of the proceedings following the discontinuance of the claims against the Second and Third Defendants. 101. In response to the Plaintiff's submissions the First Defendant argues that he was aged only 18 years at the time the events occurred and had no motive for the behaviour he was alleged to have participated in and had no intentional involvement with regard to the circumstances of the representations. For the reasons I have already stated, I reject that submission. These are not criminal proceedings where the standard of proof is higher than the civil standard. Bearing in mind the applicable test I find that the circumstances of the First Defendant's involvement in the various steps in the transaction suggest that it is more probable than not, by reason of the suspicious characteristics of the transaction already identified, the First Defendant had knowledge of the "scam" that was perpetrated against the Plaintiff even though given his young age and limited business acumen at that time he was a relatively minor player in the events in question. I am comfortably satisfied that this was the case. 102. I therefore conclude that the Plaintiff has established that the First Defendant has incurred accessorial liability under the legislation cited. Summary of findings 103. In my view the pleaded representations were made by the Second, Third, Fourth and Fifth Defendants. I find the issue of whether or not the representations were made by the Fourth and Fifth Defendants only in their role as vendors to be an irrelevancy in the proceedings. I am satisfied that the representations were made in trade or commerce. I find that the representations were relevantly conveyed by telephonic services. I find that each of the representations were misleading and deceptive and were likely to mislead or deceive. I find that the Plaintiff acted in reliance on those representations and a consequence has suffered losses which I assess in the liquidated sum of $121,804.54 including interest calculated from the commencement of the hearing on 2 February 2009. I find that the First Defendant has accessorial liability in respect of the representations under both s.75B of the Trade Practices Act, 1974 and s.61 of the Fair Trading Act, 1987. Disposition 104. It follows from the findings that I have outlined above that the Plaintiff's case against the Defendants must succeed for the full amount claimed. Orders 105. I therefore make the following orders:- (a) Verdict and judgment for the Plaintiff against the First, Fourth and Fifth Defendants in the sum of $121,804.54 ; (b) The First, Fourth and Fifth Defendants are ordered to pay the Plaintiff's costs; (c) The exhibits may be returned; (d) Liberty to apply on 7 days notice for any further orders that may be required. 20/02/2009 - Phrase added - Paragraph(s) 29. 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.