Reported Decision : (2001) NSW ConvR 55-990 New South Wales Supreme Court CITATION : Teachers v Julian [2001] NSWSC 231 FILE NUMBER(S) : SC 20762/97 HEARING DATE(S) : 13/11/00, 14/11/00, 15/11/00, 16/11/00, 17/11/00 JUDGMENT DATE : 5 April 2001 PARTIES : Teachers Health Investments Pty Ltd v John Alan Julian & Ors JUDGMENT OF : James J at 1 D Officer QC/A Ogborne - Plaintiff COUNSEL : G Curtin/G Gemmell 1and 2 Defendants G Inatey SC/J Gooley - 3 and 5 Defendants Bailey Meadows - Plaintiff SOLICITORS : Corrs Chambers Westgarth - 1 and 2 Defendants Phillips Fox - 3 and 5 Defendants CATCHWORDS : Professional negligence - contributory negligence - Limitation Act - when cause of action accrued - interest on damages. DECISION : Verdict for the plaintiff against all defendants THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION JAMES J Thursday 5 April 2001 20762/97 - Teachers Health Investments Pty Limited - v - Julian & Ors JUDGMENT 1 HIS HONOUR: In these proceedings the plaintiff Teachers Health Investments Pty Limited sued five defendants, John Alan Julian (the first defendant), Mark Gregory Squire (the second defendant), Marc Richard Bruce (the third defendant), Robert Meredith (the fourth defendant) and Ian Richard Bruce (the fifth defendant). 2 The plaintiff is the present trustee of the New South Wales Teachers Federation Health Society ("the Society). On 8 August 1991 the then trustees of the Society advanced the sum of $450,000 to Peter Gordon Wynne ("Mr Wynne"), on the security of a mortgage ("the mortgage") for a term of three years over a property known as 34 Charleroi Road, Belrose ("the property") granted to the trustees by Mr Wynne's wife, Mrs Kerry Anne Wynne. On 16 December 1991 the plaintiff became the trustee of the Society and on 20 August 1992 the mortgage was transferred to the plaintiff. It will be convenient sometimes in this judgment to refer to the trustees or trustee for the time being of the Society simply as "the Society". No payment was ever made of any money due under the mortgage. On 18 March 1993 court proceedings were brought by the plaintiff claiming possession of the property and on 29 March 1993 other court proceedings were brought by Mrs Wynne seeking to set aside the mortgage. Both sets of court proceedings were heard by Hunter J, who on 15 September 1994 held that the mortgage should be conditionally set aside. An appeal was brought by the plaintiff from Hunter J's decision and Mrs Wynne cross-appealed. Ultimately, on 16 July 1996 the Court of Appeal dismissed the appeal and allowed the cross-appeal and made orders setting aside the mortgage unconditionally and dismissing the proceedings for possession. 3 On 8 August 1997 the plaintiff commenced the present proceedings in which the plaintiff claims damages against the various defendants in relation to the transaction in which the advance was made and the mortgage was taken ("the mortgage loan transaction"). 4 The first defendant is a solicitor who acted as solicitor for the Society in the mortgage loan transaction. The second defendant was Mr Julian's partner at the time of the mortgage loan transaction, Mr Julian and Mr Squire then practising under the firm name of Boulton Rex Julian. It will be convenient sometimes in this judgment to refer to Mr Julian and Mr Squire as "the solicitors". 5 At the time of the mortgage loan transaction the third defendant was an accountant practicing in partnership with the fifth defendant, who is his father. The third defendant was the author of a letter dated 7 June 1991 in which a representation was made about the amount of Mr Wynne's income. It will be convenient sometimes in this judgment to refer to the third defendant and the fifth defendant as "the accountants". 6 At the time of the mortgage loan transaction the fourth defendant was a valuer. On 26 June 1991 the fourth defendant made a valuation report valuing the property at $750,000. It will be convenient sometimes in this judgment to refer to the fourth defendant as "the valuer". 7 Each of the three groups of defendants, that is the solicitors, the accountants and the valuer brought cross-claims against the other two groups, claiming contribution or indemnity in respect of any verdict obtained by the plaintiff. 8 At the hearing the evidence for the plaintiff consisted of two witness statements and oral evidence by Mr Frank Gehrmann, who since 1982 has been the financial manager of the Society and the secretary of the plaintiff; a witness statement and oral evidence by Mr Dudley James Wrigley, the general manager of the Society; an affidavit by the plaintiff's solicitor largely concerned with the costs incurred or ordered to be paid by the plaintiff in the litigation with Mrs Wynne; a report by a firm of accountants BDO Nelson Parkhill (Mr Mentzalis), commenting on the conduct of the third defendant and the fifth defendant in relation to the mortgage loan transaction; a witness statement and a report by a valuer Mr Whealing commenting on the fourth defendant's valuation of the property; some answers by some of the defendants to certain interrogatories administered by the plaintiff; and a number of documents. 9 A witness statement by Mr Julian on behalf of the first and second defendants was initially admitted into evidence at the hearing but was then, on the application of counsel for the first and second defendants, withdrawn from evidence. The only evidence ultimately adduced by the first defendant and the second defendant in their own case consisted of some documents. 10 A witness statement by the third defendant was admitted into evidence and the third defendant also gave oral evidence. 11 There was no appearance at the hearing by or for the fourth defendant. At the commencement of the hearing a solicitor informed me that he had been acting for the fourth defendant, that the fourth defendant was aware of the hearing date but that the solicitor had not received any instructions from the fourth defendant to appear at the hearing. There was no evidence adduced on behalf of the fourth defendant. 12 At the hearing there was no dispute about any of the following matters. 13 In 1991 the Society was a registered health insurance fund, whose principal function was to provide health insurance services to its members. The Society held a considerable amount of accumulated assets and members' funds, which needed to be securely invested. Most of the Society's investments were in secure short term investments. However, some of the Society's investments were in first mortgages of real estate. 14 From about May 1984 Mr Gehrmann was responsible for managing all investments made by the Society, including mortgage investments. Mr Julian, the first defendant, acted for the Society on every real estate mortgage taken by the Society from May 1984. 15 In paragraph 8 of his first statement Mr Gehrmann said:- "My dealings with Mr Julian in relation to the taking of mortgages by the NSWTF Health Society between about May 1984 and June 1991 usually followed the same pattern. Almost invariably, the first contact the NSWTF Health Society had with any prospective borrower was that it would receive through Mr Julian an application for monies to be advanced to the applicant on the security of a mortgage being taken over real property. Almost invariably, such applications were received under cover of a letter from Mr Julian outlining the basic details of the application. On the occasions that any enquiries about loans were received from any other source, I would invite the prospective borrower to contact Mr Julian and make any application through him. I was aware from my dealings with Mr Julian that, due to the longstanding relationship between Mr Julian and the NSWTF Health Society, Mr Julian knew the criteria which the NSWTF Health Society applied in considering loan applications and would not send on applications which he considered would not meet those criteria. On the NSWTF Health Society approving an application, I would inform Mr Julian, almost invariably by letter, that such approval had been given. On Mr Julian being informed that the NSWTF Health Society had approved of a particular application, Mr Julian then acted for the NSWTF Health Society in preparing the mortgage, in dealing with the mortgagor and on the execution and registration of the mortgage". 16 Principles which had been applied for a number of years by the Society in deciding whether applications for mortgage finance should be approved had been reduced to writing in August 1990 in a document prepared by Mr Wrigley. Part of this document was in the following terms:- "a) No more than 60% of current valuation to be loaned. b) Term to be 3 years, at going interest rate or better. c) 1% penalty interest for late payment. d) Minimum loan $50,000. e) No more than 40% of Health Society investments to be in first mortgage loans. f) Only first mortgages to be approved". 17 In pars 17 and 18 of his first statement Mr Gehrmann said that, in addition to these general principles, he would also take into consideration whether the property to be mortgaged was the family home of the applicant, whether the property was within the Sydney metropolitan area and whether the person who would be liable to repay the loan appeared to have sufficient income from which to meet his or her obligations to repay the loan. 18 In par 18 of his first witness statement Mr Gehrmann said:- "In relation to this last consideration, it was usual for the application to include information or a statement about the income of the applicant from an independent party, usually an accountant. Other than basic statements of personal assets and liabilities, it was not a requirement that, or usual for, financial statements, tax returns or financial source records to be provided to the NSWTF Health Society as part of an application. It would not conduct an analysis of applicant's financial position or seek to verify any income information provided on behalf of an applicant by his or her accountant. If the information provided on behalf of an applicant by his or her accountant indicated that the applicant's income was sufficient from which to meet his or her obligations to repay the loan, then I would be satisfied for the purpose of approving the application, that the applicant did have sufficient income from which to meet his or her obligations". 19 After an application for a mortgage advance had been received, Mr Gehrmann would form his own view about whether the application should be approved and would then discuss the application with Mr Wrigley, who would make the final decision about whether the application should be approved. If a current valuation of the property to be mortgaged had not yet been received, any approval of an application was made subject to the receipt of a satisfactory valuation. 20 On or about 18 June 1991 the Society received a letter from Mr Julian dated 18 June 1991, enclosing four applications for mortgage advances. One of these applications was an application which Mr Julian described in his letter as an application by "PG Wynne". The relevant part of Mr Julian's letter was in the following terms:- "Application of PG Wynne for a first mortgage advance of $450,000.00 for a term of 3 years at an interest rate of 14.25% per annum payable quarterly in arrears over property 34 Charleroi Road, Belrose. Again, any approval would be subject to the provision of a satisfactory valuation". 21 With the letter from Mr Julian was enclosed a letter dated 17 June 1991 from First Liberty Corporation Pty Limited, a company carrying on the business of mortgage brokers, which was signed by Mr Victor Moody. This letter was in the following terms:- "Re: PG & K Wynne Dear Sir, The above wish to make application for a loan of $450,000 details as set out below: Applicants: Peter Gordon & Kerry Wynne 34 Charleroi Road, Belrose NSW Amount Required: $450,000.00 Term: 3 years Rate: 14.25% payable quarterly in arrears Purpose of Loan: Refinance existing encumbrances with Barklays (sic) Bank. Security Offered: 1st Registered Mortgage over Residence 34 Charleroi Road, Belrose NSW Valuation: Estimated value $800,000.00 Ratio of Loan: 56% of value Financials: Accountants advise personal income of client is $235,000 p.a. Accountants balance sheets/profit & loss 89/90 show a nett profit after add backs i.e. Depreciation 55,981.00 Part interest 63,200.00 Borrowings costs 2,658.00 Personal motor vehicles 43,526.00 165,365.00 Less Loss 39,650.00 Total Nett 125,715.00 On accountants advice: Total income Personal - 235,000 Company 125,715 360,715 Information on interim figures shows there will be a similar or better result in the full 90/91 period. Enclosures: Copy application Asset & Liabilities Balance Sheet/Profit & Loss Accountant's letter Your early advice would be greatly appreciated". 22 The enclosed application was on a First Liberty Corporation form. In the boxes for "occupation" and "employer's name" were written the words "company director" and "Banksia Settlements P/L". In the box for solicitor was written "Freehill Hollingdale and Page" and in the box for accountant was written "Bruce & Partners". 23 In an enclosed "confidential statement of personal position" assets were shown as totalling $2,637,000 and liabilities as totalling $458,000. The assets included the property at 34 Charleroi Road, Belrose said to be worth $800,000 and an equity in a business said to be worth $1,700,000. 24 Also enclosed with the application from First Liberty Corporation was a document headed "Banksia Settlements Pty Limited - assets and liabilities" which was not dated or signed; a document headed "balance sheet as at 31/12/1990", not identifying the entity whose balance sheet it was; and a document being consolidated profit and loss statement for the period ended 31 December 1990, which was headed with the words "as trustee for the Peter & Kerry Wynne Family Trust", not identifying who the trustee was. 25 Enclosed with the First Liberty Corporation letter was a letter dated 7 June 1991 from Bruce & Partner, Chartered Accountants, signed by the third defendant, which was addressed to Mr V Moody of First Liberty Corporation Pty Limited. This letter was in the following terms:- "Re: Peter G Wynne We act for Mr Wynne and his Company Banksia Settlements Pty Limited. Mr Wynne is seeking $400,000 secured over his residence at 34 Charleroi Road, Belrose. We understand the property has a value of approximately $800,000. The loan is required for a term of 3 years on an interest only basis, preferably at a fixed rate. The purpose of the loan is to refinance an overdraft facility with Barclays Bank Australia. Mr Wynne's income is $235,000 per annum comprised of a salary of $35,000 per annum and drawings from his business of $200,000 per annum We have already provided you with Mr Wynne's assets and liabilities statement. Should you require any further information, please do not hesitate to contact us. Your urgent attention to this matter would be greatly appreciated". 26 After reading Mr Julian's letter of 18 June 1991 and the enclosures with that letter, Mr Gehrmann formed the view that the application for mortgage finance should be approved. Mr Gehrmann had a meeting with Mr Wrigley and Mr Wrigley agreed that the application should be conditionally approved. On 20 June 1991 Mr Gehrmann wrote a letter to Mr Julian, informing him that the application had been approved, subject to a satisfactory valuation being received. 27 On 21 June 1991 Mr Julian wrote a letter to First Liberty Corporation Pty Ltd, advising that the application had been approved "subject to our being satisfied as to title and to the provision of a satisfactory valuation showing the amount to be advanced as not exceeding 60% of the amount of the valuation. We look forward to receiving the relevant valuation". 28 On 1 July 1991 Mr Julian wrote a letter to the Society, enclosing a valuation of the property 34 Charleroi Road, Belrose by the fourth defendant dated 26 June 1991, which Mr Julian had received and in which the fourth defendant stated that he considered that the market value of the property as at 26 June 1991 was $750,000. 29 On 2 July 1991 Mr Julian wrote a letter to Messrs Freehill Hollingdale and Page. The opening paragraph of the letter read "We act for the mortgagees herein and understand that you act for the mortgagors Mr and Mrs P G Wynne". In the letter Mr Julian suggested that particulars of title to the property might be supplied "in order that the matter may be expedited when the anticipated confirmation of the approval is received". 30 On 9 July 1991 Mr Gehrmann wrote to Mr Julian, advising that a mortgage advance of $450,000 had been approved "after sighting the relevant valuation". $450,000 is, of course, 60 per cent of $750,000. 31 On 10 July 1991 Freehill Hollingdale and Page wrote a letter to Mr Julian, supplying particulars of title. In the particulars the "present registered proprietors" of the property were stated to be Mr and Mrs Wynne but the "mortgagor" was stated to be Mrs Wynne alone. In the letter Freehill Hollingdale and Page said "It is proposed that, prior to, or simultaneously with, drawndown of funds Peter Gordon Wynne will transfer his half interest to his wife, Kerry Anne Wynne… as we would understand the position, your client is lending $450,000 to Mr Peter Gordon Wynne, on the security of what will now be a third party mortgage". 32 Some time on or soon after 10 July 1991, Mr Gehrmann received a telephone call from Mr Julian. Mr Gehrmann and Mr Julian gave somewhat differing accounts in their respective witness statements of what was said in this conversation. However, as I have already stated, Mr Julian's witness statement, after initially being admitted into evidence, was subsequently withdrawn from evidence, so that, finally, the only evidence of what was said in the conversation was Mr Gehrmann's evidence. The account of the conversation given by Mr Gehrmann in his witness statement was as follows:- "Julian: Frank, this is John Julian. There has been somewhat of a change in the way in which they want to structure the Wynne mortgage. Apparently his wife is now going to own the property outright and Peter Wynne will be the principal debtor. Do you have any reservations about this change?' Gehrmann: Well I've no experience in these things, so we would best be advised by you. Are there any risks to us in taking the mortgage from his wife?' Julian: I suppose it will be all right. There have been some recent changes to the law, but the case has not been reported yet.' Gehrmann: Well, so long as our position is not going to be affected by these changes, then we will proceed.' Julian: Okay, I'll let them know'". 33 Mr Gehrmann did not have any further conversation with Mr Julian about the proposed mortgage to be taken from Mrs Wynne, at any time before the mortgage was entered into on 8 August 1991. 34 Mr Gehrmann had not had any previous experience of a third party mortgage and had no understanding of any additional risks a lender may incur by taking a mortgage from a person other than the borrower. 35 At some time after 11 July and before 18 July, and I infer after the telephone conversation between Mr Julian and Mr Gehrmann, Mr Julian received title searches to the property, which disclosed inter alia that in January 1991 Mr Wynne had lodged a caveat against the property. 36 On 8 August 1991 the then trustees of the Society lent the sum of $450,000 to Mr Wynne and Mrs Wynne mortgaged the property to the then trustees of the Society. The first payment of interest under the mortgage was due on 8 November 1991, with subsequent payments becoming due on the eighth day of February, May, August and November in each year. 37 No payments whatever were made by Mr Wynne (or Mrs Wynne) under the mortgage. 38 On 29 November 1991 Mrs Wynne telephoned Mr Gehrmann. Amongst other things, she told Mr Gehrmann that she and her husband were estranged and that the property was worth only $440,000. 39 As I have already indicated earlier in this judgment, proceedings for possession of the property were brought on behalf of the Society and Mrs Wynne commenced proceedings seeking to set aside the mortgage. 40 The two sets of proceedings were heard together by Hunter J. Hunter J held that Mrs Wynne was entitled to relief under the principles stated in Yerkey v Jones (1940) 63 CLR 649 but that there had not been any contravention of the Trade Practices Act or any unconscionable conduct within the principles stated in Commercial Bank of Australia v Amadio (1983) 151 CLR 44 and that no relief should be granted to Mrs Wynne pursuant to the Contracts Review Act. His Honour made an order conditionally setting aside the mortgage. 41 An appeal and a cross appeal were brought from Hunter J's decision. The Court of Appeal dismissed the appeal, allowed the cross appeal and set aside the mortgage unconditionally. The Court of Appeal held that Yerkey v Jones no longer represented the law in New South Wales. However, the Court of Appeal held that Mrs Wynne was entitled to relief, both in accordance with the principles of unconscionability stated in Commercial Bank of Australia v Amadio and pursuant to the Contracts Review Act. The decision of the Court of Appeal is reported (1996) Aust Contracts Reports 90-071. Claims by the Plaintiff against the First and Second Defendants 42 The plaintiff relied on three causes of action against the first and second defendants, namely:- 43 1. A cause of action in contract for breach of a term of the retainer of the first defendant to advise and act for the Society in the mortgage loan transaction. It was alleged that Mr Julian had breached an implied term of his retainer that he would exercise reasonable care and skill in advising and acting in the mortgage loan transaction, in that he did not properly advise Mr Gehrmann of the risks for the Society involved in the mortgage loan transaction in his conversation with Mr Gehrmann on or shortly after 10 July 1991 and continued to fail to properly advise Mr Gehrmann of the risks involved in the transaction down to the time at which the advance was made and the mortgage was taken, on 8 August 1991. 44 2. A cause of action in tort for breach of a duty to exercise reasonable care and skill in advising Mr Gehrmann, after Mr Gehrmann in the telephone conversation on or shortly after 10 July 1991 had sought advice. 45 3. A cause of action for breach of s 42 of the Fair Trading Act. The plaintiff alleged that Mr Julian had engaged in misleading or deceptive conduct, by impliedly misrepresenting to Mr Gehrmann that the advice he gave Mr Gehrmann that there was no significant risk to the Society in taking a mortgage from Mrs Wynne to secure a loan to Mr Wynne was based on reasonable grounds and was the product of a careful exercise of his expertise as a lawyer. 46 It was submitted by the plaintiff, and not disputed by counsel for the first defendant and the second defendant, that, as Mr Julian in acting as solicitor for the Society in the mortgage loan transaction had been acting in the ordinary course of the business of the firm Boulton Rex Julian, then, by virtue of s 10 of the Partnership Act, Mr Squire, as Mr Julian's partner, would be subject to the same liability as Mr Julian. 47 Counsel for the solicitors did not dispute that Mr Julian had been retained by the Society to advise and act as its solicitor in the mortgage loan transaction or that it was an implied term of the retainer that Mr Julian would exercise reasonable care and skill in advising and acting as solicitor for the Society in the mortgage loan transaction or that, independently of the contract of retainer, Mr Julian became subject to a duty to exercise reasonable care and skill in advising the Society, after Mr Gehrmann on behalf of the Society had sought his advice. However, it was disputed that there had been a breach of the retainer or a breach of the duty of care or that Mr Julian had engaged in conduct which was misleading or deceptive. 48 It was also submitted by counsel for the solicitors that, in relation to all three causes of action, the plaintiff's claims were statute-barred, either under the Limitation Act or by reason of s 68 of the Fair Trading Act. 49 A further argument put by counsel for the solicitors was that the Society had been guilty of contributory negligence. 50 Counsel for the first and second defendants also raised one matter concerning the plaintiff's claim for damages. 51 Before turning to the submissions made by counsel, it is necessary to make findings of fact about what was said in the conversation between Mr Julian and Mr Gehrmann in July 1991. 52 As I have already stated earlier in this judgment, Mr Julian's witness statement, after initially being admitted into evidence, was subsequently withdrawn from evidence, so that, finally, there was no evidence from Mr Julian of what was said in the conversation. I have already set out earlier in this judgment the account of the conversation given by Mr Gehrmann in his witness statement. 53 In cross-examination by counsel for the solicitors Mr Gehrmann agreed that it was "a fair summary" of the conversation that Mr Julian had said that the property was to be transferred to Mrs Wynne, that Mr Gehrmann had asked "what do we have to do, to make sure this is all right?" and that Mr Julian had replied, "why worry? If the result is fine and they have solicitors acting for them, there should be no special problems". 54 In re-examination Mr Gehrmann said that there were "other matters" which were discussed in the conversation and that these other matters had been included in the account of the conversation he had given in his witness statement. 55 I consider that I should find, particularly in the absence of any evidence from Mr Julian, that the conversation between Mr Julian and Mr Gehrmann included the matters stated by Mr Gehrmann in his witness statement. 56 Substantially the same submissions were made, on the one hand, by counsel for the plaintiff and, on the other hand, by counsel for the solicitors on the related questions of whether the plaintiff had established a breach of the implied term of the retainer, whether the plaintiff had established a breach of the duty of care and whether the plaintiff had established that Mr Julian had engaged in misleading or deceptive conduct. 57 The principal submission made by counsel for the first and second defendants commenced with the proposition, which I accept, that, even if a solicitor gives advice which is erroneous, a solicitor will not have breached his retainer, will not be liable in negligence and will not have engaged in conduct which is misleading or deceptive, if the state of the law at the time the solicitor gives his advice is unclear and the advice the solicitor gives is reasonable (see Jackson & Powell on Professional Negligence 4th ed 1997 par(4-115)). 58 It was then submitted by counsel for the first and second defendants that the present case was to be characterised as a case in which a mortgage had been set aside, because the mortgagor had not received independent financial advice. It was submitted that Beneficial Finance Corporation Ltd v Karavas (1991) 23 NSWLR 256 had been the first case in New South Wales under the Contracts Review Act in which a mortgage had been set aside on this ground; that the judgment of the trial judge in Karavas, although it had been given on 19 May 1989, that is before Mr Julian advised Mr Gehrmann, had not been reported; and that the decision of the Court of Appeal in Karavas, although delivered on 17 May 1991, had not been reported until some time later. It was suggested that Karavas was the recent case, as yet unreported, which Mr Julian was referring to in his conversation with Mr Gehrmann in July 1991. 59 It was also submitted that at the time Mr Julian gave his advice it was unclear whether the principles stated by Dixon J in Yerkey v Jones (1939) 63 CLR 649 especially at 676 were part of the law of New South Wales. The Court of Appeal, on the appeal from the decision of Hunter J, held that the principles stated in Yerkey v Jones should no longer be regarded as part of the law of New South Wales. 60 Counsel for the plaintiff submitted that I should find that, in advising Mr Gehrmann, Mr Julian had breached the implied term of his retainer, had been negligent and had engaged in conduct which was misleading and deceptive. 61 It was submitted by counsel for the plaintiff, and I accept, that it had been established that Mr Julian, through having acted as solicitor for the Society for a number of years, knew that the principal activity of the Society was providing health insurance services to its members; that the Society was a small, relatively unsophisticated lender; that the Society's investment policy was conservative; that it made investments only in authorised trustee investments; and that it had stringent criteria for lending money on the security of a mortgage; and that, apart perhaps from occasionally taking a mortgage from a director of a company when an advance was being made to that company, had no experience of making a loan and taking a mortgage, when the borrower and the mortgagor were different persons. It was submitted by counsel for the plaintiff, and I accept, that in these circumstances a reasonably careful solicitor would have appreciated a particular need to exercise care in advising his client of possible risks. 62 It was further submitted by counsel for the plaintiff, and I accept, that, in regard to this particular transaction, Mr Julian knew, as a result of receiving the letter of 17 June 1991 from First Liberty Corporation with its enclosures, that it was Mr Wynne who was applying for the loan; that Banksia Settlements was "his" (that is Mr Wynne's) company; that the loan was required to re-finance an existing overdraft facility of Banksia Settlements with Barclays Bank; and that the property being offered as security was the residence of Mr Wynne and, presumably, Mrs Wynne. 63 In his letter of 2 July 1991 to Messrs Freehill Hollingdale and Page Mr Julian stated his understanding that Freehill Hollingdale and Page acted for both Mr and Mrs Wynne, that is that Mrs Wynne did not have separate legal representation in the transaction. By Freehill Hollingdale and Page's letter of 10 July 1991 Mr Julian was informed that, while Mr Wynne and Mrs Wynne were the current registered proprietors, it was proposed that Mr Wynne should transfer his half interest to Mrs Wynne and that the Society should lend $450,000 to Mr Wynne on the security of what would be a third party mortgage. He was also informed that "Mr Wynne is anxious to draw down funds as soon as possible" and that the matter was urgent. The title searches Mr Julian received disclosed that in January 1991 Mr Wynne had lodged a caveat against the property. 64 It was further submitted by counsel for the plaintiff, and I accept, that Mr Julian did not know, and had no grounds for assuming, that Mrs Wynne had a proper understanding of the proposed transaction, that she had received any independent legal advice, that her will had not been overborne by her husband, that she was not under some special disability of which her husband was unconscientiously taking advantage or that the principles stated by Dixon J in Yerkey v Jones might not be applicable. 65 I do not accept the submission made by counsel for the first and second defendants that, at the time Mr Julian gave his advice, the state of the law was unclear to such an extent that the advice given by Mr Julian was reasonable. 66 Yerkey v Jones had been decided and reported as long ago as 1939. In Yerkey v Jones Dixon J stated at p676 an equitable presumption:- "… the position of strangers who deal through the husband with the wife in a transaction operating to the husband's advantage may, by that fact alone, be affected by any equity which as between the wife and the husband might arise from his conduct… (a presumption which) must have a special importance when the transaction in question is one of suretyship and the wife without any recompense, except the advantage of her husband, saddles herself or her separate property with a liability for his debt or debts". 67 It is true that, subsequently to Mr Julian advising the plaintiff, the New South Wales Court of Appeal in National Australia Bank Limited v Garcia (1995) 39 NSWLR 577 especially at 598 per Sheller JA, following what had earlier been said by Clarke JA in Akins v National Australia Bank (1994) 34 NSWLR 155 especially at 170, held that "the so called principle in Yerkey v Jones should no longer be applied in New South Wales" and that in the present case the Court of Appeal held that it should follow the previous decision of the Court in National Australia Bank v Garcia and consequently held that Hunter J's decision, based as it was on the principles in Yerkey v Jones could not stand, even though a conclusion favourable to Mrs Wynne should be reached on other grounds. 68 However, all of the decisions of the Court of Appeal I have just referred to were given after Mr Julian gave his advice in July 1991. At the time Mr Julian gave his advice the Court of Appeal had recently held in Warburton v Whiteley (1989) NSW ConR 55-453 that the principles in Yerkey v Jones should continue to be applied. 69 Of course, the High Court ultimately held on the appeal to the High Court from the decision of the Court of Appeal in National Australia Bank v Garcia (Garcia v National Australia Bank (1998) 194 CLR 395) that the Court of Appeal had erred in holding that the equitable principles stated by Dixon J in Yerkey v Jones were no longer part of the law of New South Wales and that they had continued to be part of the law in New South Wales. 70 A reasonably careful solicitor advising the Society in July and August 1991 would have given advice, on the basis that the equitable principles stated by Dixon J in Yerkey v Jones were part of the law to which he should have regard in advising. 71 Commercial Bank of Australia Limited v Amadio had been decided by the High Court some years before Mr Julian gave his advice and had been reported (1982-1983) 151 CLR 437. The principles on which a transaction can be set aside as unconscionable had been stated in Amadio by Mason J at 461-463 and by Deane J at 474-5. An application of these principles was one basis on which the Court of Appeal, on the appeal from Hunter J, held that the mortgage should be set aside unconditionally. 72 It is true that the Court of Appeal held that it was incumbent on the Society to advise Mrs Wynne to obtain advice relating to the providence or propriety of the transaction from her point of view (see especially per Beazley JA at 90, 489). However, as her Honour observed, "the requirement that adequate advice extends this far is not novel" and "there are clear indications in Amadio that adequate advice may need to include advice as to the financial circumstances of the principal debtor or the principal debtor's business". 73 A reasonably careful solicitor advising the Society in July and August 1991 would have had regard to Commercial Bank of Australia Limited v Amadio. 74 The Contracts Review Act had been enacted in 1980 and had come into force in 1981. In s 9(2) matters to which a court is directed to have regard in determining whether a contract is unjust in the circumstances relating to the contract at the time it was made are set out. Particularly relevant are the matters in paragraphs (a), (e), (f), (g), (h), (i) and (j). 75 In the present case the Court of Appeal held that the contract of mortgage was unjust in the circumstances in which it was made, not by the application of anything novel that may have been decided in Beneficial Finance v Karavas, but by an application of the principles for applying the Contracts Review Act stated by McHugh JA in the leading case of West v AGC (Advances) Limited (1986) 5 NSWLR 610. 76 A reasonably careful solicitor advising the Society in July and August 1991 would have had regard to the Contracts Review Act. 77 In my opinion, a reasonably careful solicitor advising the Society in July and August 1991 would have advised that, if the Society proceeded with the proposed mortgage loan transaction under which an advance would be made to Mr Wynne and a mortgage taken from Mrs Wynne, there would be risks of the mortgage being set aside or varied on such grounds as the principles in Yerkey v Jones or the principles of unconscionability stated in Commercial Bank of Australia Limited v Amadio or under the Contracts Review Act. I am, accordingly, of the opinion that in not advising the Society of these risks, there was a breach by Mr Julian of the implied term in the contract of retainer, a breach of the duty of care owed by Mr Julian and that Mr Julian engaged in conduct which was misleading or deceptive. 78 It was submitted by counsel for the solicitors that all three causes of action were statute-barred. 79 Under s 14 of the Limitation Act the limitation period for each of the first two causes of action, being a cause of action founded on a contract and a cause of action founded on a tort, was six years running from the date on which the cause of action first accrued. Under s 68 of the Fair Trading Act an action to recover damages for loss or damage suffered by conduct in contravention of s 42 of the Act must be commenced within three years after the date on which the cause of action accrued. 80 The critical issue in relation to all three causes of action is, when did the cause of action (first) accrue. 81 As regards the cause of action in contract, the cause of action would have been complete, as soon as a breach occurred. It was submitted by counsel for the solicitors that any cause of action in contract had accrued when, in the course of their conversation in July 1991, Mr Gehrmann requested that Mr Julian give him advice and Mr Julian gave Mr Gehrmann advice. It was further submitted that Mr Julian was not, after that conversation had concluded, subject to any continuing obligation to give advice, the non-performance of which by him would have given rise to a continuing breach of contract. 82 As regards the causes of action in tort and under the Fair Trading Act it was accepted by counsel for the solicitors that the incurring of damage by the Society was an element of each cause of action and that neither of these causes of action would have accrued until the Society first suffered actual damage as a result of Mr Julian's negligence or his conduct in contravention of s 42. However, it was submitted that the Society had first suffered actual damage:- (i) At the time the Society entered into the mortgage on 8 August 1991 or (ii) At the time Mrs Wynne first claimed to be entitled to relief from her obligations under the mortgage or (iii) At the time the Society first incurred costs in defending Mrs Wynne's claim to be entitled to relief from her obligations under the mortgage. 83 In my opinion, none of the plaintiff's causes of action were statute-barred. 84 As regards the cause of action in contract, I accept that a breach of contract occurred in July 1991, at the time of the conversation between Mr Julian and Mr Gehrmann. However, I consider, as was submitted by counsel for the plaintiff, that Mr Julian had been retained by the Society to advise and act for the Society in the matter of the making of an advance to Mr Wynne which was to be secured by a mortgage; that this retainer endured up to 8 August 1991 when the Society made the advance to Mr Wynne and entered into the mortgage with Mrs Wynne; and that throughout the duration of the retainer Mr Julian was subject to a continuing obligation to exercise reasonable care and skill in advising and acting for the Society in the matter of the making of the advance and the taking of the mortgage. This continuing obligation included an obligation to exercise reasonable care to correct any earlier advice he had given which was incorrect and an obligation to modify any earlier advice he had given, in the light of information he had subsequently acquired. After giving his advice in the telephone conversation Mr Julian ascertained that Mr Wynne had lodged a caveat against the property, which indicated that there could be dissension between himself and the other joint registered proprietor, Mrs Wynne 85 The obligation to which Mr Julian was subject, to advise his client about whether there was any risk to his client in taking a mortgage from Mrs Wynne, was not an obligation under a separate specific retainer, which was performed, or breached, once and for all, on the occasion of the telephone conversation in July 1991 but was an obligation under his general retainer which endured up until the actual making of the advance and the taking of the mortgage. 86 That the retainer of Mr Julian was such a general, continuing retainer is indicated by his own conduct in himself initiating the telephone conversation with Mr Gehrmann in July and by his subsequently rendering a lump sum bill for his scale costs for acting for the Society on the mortgage, without making any separate charge for the advice given in the telephone conversation with Mr Gehrmann. 87 I conclude that there was a continuing breach of the implied term of the retainer up to 8 August 1991, so that the cause of action for breach of the implied term had not become statute-barred by the time these proceedings were commenced. 88 The cause of action in tort was not statute-barred. Even if the Society had first suffered actual damage, as soon as it entered into the mortgage on 8 August 1991, then these proceedings were commenced within (although only just within) six years of the Society entering into the mortgage. 89 As regards the cause of action founded on the Fair Trading Act, it is necessary to inquire whether the Society first suffered actual damage, as a result of Mr Julian's conduct in contravention of s 42, more than three years before these proceedings were commenced. 90 In Wardley Australia Limited v Western Australia (1992) 175 CLR 514 at 532 Mason CJ, Dawson J, Gaudron J and McHugh J in their joint judgment said:- "If contrary to the view which we have just expressed, the English decisions properly understood support the proposition that where, as a result of the defendant's negligent misrepresentation, the plaintiff enters into a contract which exposes him or her to a contingent loss or liability, the plaintiff first suffers loss or damage on entry into the contract, we do not agree with them. In our opinion, in such a case, the plaintiff sustains no actual damage until the contingency is fulfilled and the loss becomes actual; until that happens the loss is prospective and may never be incurred. A deferred liability may stand in a different position but there is no occasion here to discuss that matter". 91 In my opinion, in the present case the Society did not suffer any actual damage at the time it entered into the mortgage. At the time the Society entered into the mortgage it became subject to a contingent loss, in that there was a risk that the mortgage might be set aside or varied on the application of Mrs Wynne. However, it was not certain that that contingent loss would ever become an actual loss. Mrs Wynne might never have sought to set aside or vary the mortgage or, if she did, her proceedings might have been terminated before a court made an order setting aside or varying the mortgage. Mrs Wynne might never have brought proceedings to set aside or vary the mortgage or proceedings she had brought might have been terminated before any order was made setting aside or varying the mortgage, for any one of a number of reasons, including that she had reached some compromise with her estranged husband. It was not until the mortgage was actually ordered to be set aside that the contingent loss which the Society had incurred by entering into the mortgage became an actual loss. The order made by Hunter J conditionally setting aside the mortgage was made on 15 September 1994, that is within three years of the commencement of these proceedings. 92 Some reliance was sought to be placed by counsel for the solicitors on the decision of the English Court of Appeal in Forster v Outred & Co (1982) 1 WLR 86, where it was held that a party to a mortgage had incurred actual damage, so that a limitation period commenced to run, as soon as she had entered into the mortgage. However, Forster v Outred is clearly distinguishable, because in that case the solicitor's client was the mortgagor under the mortgage and by entering into the mortgage the client had clearly incurred immediate actual damage by encumbering her property. 93 Nor do I consider that the Society suffered actual damage at the time Mrs Wynne first claimed to be entitled to relief from her obligations under the mortgage. No actual damage was suffered by the Society until Mrs Wynne had pursued her claim to the point where a court had made an order setting aside the mortgage. 94 Nor do I consider that the Society suffered actual damage at the time the Society first incurred costs in defending Mrs Wynne's claim to be entitled to relief from her obligations under the mortgage. Such costs first took on the character of a loss or damage incurred by the plaintiff which had been caused by Mr Julian's breach of duty or contravention of s 42, only when the mortgage had been set aside by the Court order made by Hunter J. 95 A further submission put by counsel for the solicitors was that the Society had been guilty of contributory negligence. 96 This submission had its origin in a passage in the judgment of Beazley JA in the Court of Appeal at p 90, 488, in which her Honour said:- "The loan transaction was approved within 2 days of receipt. The only qualification to the approval was that it was subject to a satisfactory valuation. There was no evidence as to whether any, and if so what, consideration the appellant gave to the financial information supplied in support of the loan application. No requisitions were raised by the appellant in respect of the principal debtor's or Banksia's financial affairs. However, even a cursory consideration of the financial information provided would have demonstrated that the principal debtor had no ability to service the interest on the loan. His annual salary was $35,000. His only other stated source of cash flow was from purported drawings of $200,000 from Banksia. However, not only were such drawings not reflected in Banksia's accounts, its accounts revealed that it could not have supported such drawings. Further, the obvious inconsistencies in the financial material would have alerted a reasonable, careful lender that the financial position of the principal debtor and Banksia was suspect. In the circumstances, the appellant should have been on notice that the transaction was perilous from the principal debtor's point of view and improvident from the respondent's point of view". 97 It was submitted by counsel for the solicitors that the Society, having been put on notice that the principal debtor Mr Wynne lacked the means to pay the interest on the proposed loan and that "the transaction was perilous from the principal debtor's point of view and improvident from (Mrs Wynne's) point of view", had failed to take reasonable steps to protect its own interests. 98 It was conceded by counsel for the solicitors that the letter from First Liberty Corporation with its enclosures, including the letter of 7 June 1991 from the accountants, had been received by Mr Julian, before being forwarded by Mr Julian to the Society. However, it was submitted that Mr Julian, as a solicitor, had not been retained by the Society to examine financial documents or to give financial advice and had not made any claim to having any financial expertise. 99 It is clear that any contributory negligence by the Society could be a defence only to the cause of action founded on the tort of negligence. 100 Contributory negligence is not a defence to an action in contract, even when the defendant is sued on concurrent liabilities in contract and tort. See Astley v Austrust Limited (1999) 197 CLR 1, especially per Gleeson CJ, McHugh J, Gummow J and Hayne J at 33-34. The present proceedings are not affected by the Law Reform (Miscellaneous Provisions) Amendment Act 2000 No 111 (see sch 1 Savings and Transitional Provisions Pt 1 cl 4). 101 Furthermore, contributory negligence is not a defence to an action for damages based on conduct in contravention of s 42 of the Fair Trading Act. Section 42 of the Fair Trading Act corresponds to s 52 of the Trade Practices Act and it is well established that contributory negligence is not available as a defence to a claim for damages based on a contravention of s 52. See for example Sykes v Reserve Bank of Australia (1998) 158 ALR 710 at 715 per Heerey J. 102 In any event, I do not consider that the Society should be found to have been guilty of contributory negligence. There is a clear distinction between the position of the Society vis-a-vis Mrs Wynne, which was what Beazley JA was concerned with in the passage quoted from her judgment in the Court of Appeal decision, and the position of the Society vis-a-vis the professional persons who supplied information or advice to it. 103 In my opinion, Mr Gehrmann acted reasonably in accepting, without any further inquiry, the representation about Mr Wynne's income made in the letter of 7 June 1991 from the accountants. The accountants held themselves out as being, as they were, chartered accountants. Their letter of 7 June 1991 was addressed to Mr Moody of First Liberty Corporation Pty Limited, Mortgage Brokers. In their letter the accountants stated that they acted for Mr Wynne and Banksia Settlements Pty Limited. Their letter conveyed that they were familiar with the affairs of Mr Wynne and Banksia Settlements Pty Limited. Their letter contained unequivocal statements about Mr Wynne's income and how it was made up. The letter from First Liberty Corporation Pty Limited of 17 June 1991, a copy of which Mr Gehrmann received, repeated the assertion about the level of Mr Wynne's income and contained a purported analysis by the mortgage broker of the accounts of Banksia Settlements Pty Limited, producing an income of Banksia Settlements Pty Limited, after "add backs", of more than $125,000. 104 The application for a mortgage advance was submitted to the Society by Mr Julian. In the years since May 1984 all applications to the Society for mortgage advances had been submitted by Mr Julian and Mr Julian had taken it upon himself not to pass on to the Society applications which Mr Julian considered would not be acceptable. The role played by Mr Julian in applications to the Society for mortgage advances exceeded the role ordinarily played by a solicitor acting for a prospective mortgagee. 105 In my opinion, the plaintiff is entitled to a verdict against the first and second defendants, without any finding of contributory negligence. Claims by the Plaintiff against the Third and Fifth Defendants 106 The plaintiff relied on two causes of action against the third and fifth defendants, both of which were based on the statement about Mr Wynne's income in the letter of 7 June 1991. These causes of action were:- 107 1. A cause of action in tort for breach of a duty owed to the Society, as a member of a class of prospective mortgagees, to exercise reasonable care and skill in representing the amount of the income of the proposed borrower Mr Wynne. 108 2. A cause of action for breach of s 42 of the Fair Trading Act. The plaintiff alleged that the accountants had engaged in misleading or deceptive conduct, by misrepresenting that Mr Wynne's income was $235,000 per annum, comprised of a salary of $35,000 per annum and drawings from his business of $200,000 per annum, and/or by misrepresenting that their misrepresentation about Mr Wynne's income was based on reasonable grounds and was the product of a careful exercise of their accounting expertise. 109 The third defendant was the author of the letter of 7 June 1991. However, it was not disputed by counsel for the accountants that in writing the letter the third defendant had been acting in the ordinary course of the business of the firm of chartered accountants and, accordingly, the fifth defendant would be subject to the same liability as the third defendant. 110 No attempt was made by counsel for the accountants to dispute that the accountants owed a duty of care to the Society or that they had been negligent or to justify the representation about Mr Wynne's income made in the letter of 7 June 1991 or to dispute that the accountants had engaged in misleading or deceptive conduct. Among much evidence showing that the representation about Mr Wynne's income was untrue was a copy of Mr Wynne's income tax return for the year ended 30 June 1991, which had been prepared by the third and fifth defendants and which showed Mr Wynne's income for that year as $35,880. 111 Certain amounts had been withdrawn by Mr Wynne from a beneficiary loan account he had with Banksia Settlements Pty Limited. However, Banksia Settlements Pty Limited was insolvent and Mr Mentzalis in his report expressed the opinion that, based on the standards and practices of the accounting profession as at 7 June 1991, none of the amounts which had been withdrawn by Mr Wynne from the beneficiary loan account could be considered to be income of Mr Wynne. 112 A submission which was made by counsel for the third and fifth defendants was that the plaintiff had not established that the Society had relied on the misrepresentation by the accountants about the amount of Mr Wynne's income in deciding to enter into the mortgage loan transaction. Alternatively, it was submitted that any reliance by the Society on the misrepresentation had been unreasonable. 113 In support of these general submissions, it was contended that the representation about Mr Wynne's income, that his gross income was $235,000 per annum, did not convey any useful information about his capacity to service a loan, because it said nothing about what outgoings Mr Wynne had or what his disposable or nett income was. 114 It was pointed out by counsel for the accountants that a condition that a proposed borrower should have any particular level of income was not included in the document prepared by Mr Wrigley in August 1990, as one of the principles to be applied in deciding whether applications to the Society for mortgage finance should be approved. On the other hand, the first principle set out by Mr Wrigley, "no more than 60% of current valuation to be loaned", showed that the value of the security being offered by the proposed borrower was more important to the Society in deciding whether an application for mortgage finance should be approved, than was the amount of the borrower's income or his capacity to service a loan. 115 It was pointed out by counsel for the accountants that, after the Society had received the letter of 7 June 1991, the Society had not made any inquiry about what Mr Wynne's income was. It was submitted that the fact that the Society had not made any inquiry showed that the amount of Mr Wynne's income was not a material matter for the Society in deciding whether to approve Mr Wynne's application for mortgage finance. It was said that the absence of any inquiry was particularly significant, because Mr Gehrmann had received other documentary information, which was inconsistent with the representation in the accountant's letter about Mr Wynne's income. 116 I do not consider that the submission by counsel for the accountants that the plaintiff had not established that the Society had relied on the misrepresentation by the accountants about the amount of Mr Wynne's income in deciding to enter into the mortgage loan transaction, should be upheld. 117 In respect of both of the plaintiff's causes of action, the plaintiff is entitled to succeed on the issue of reliance or inducement, if it establishes that the Society in fact relied on the misrepresentation about Mr Wynne's income in deciding to enter into the mortgage loan transaction, even if the misrepresentation was not the sole or even the principal inducement and even if it was unreasonable for the Society to place any reliance on the misrepresentation. See Gould v Vaggelas (1985) 157 CLR 215 at 236 per Wilson J. A passage in the judgment of Heerey J in Sykes v Reserve Bank of Australia at 715, which I referred to earlier in this judgment, is worth setting out in full:- "The present case is one alleging direct reliance by representees on statements by the representor. The Act (that is, the Trade Practices Act) does not in such circumstances erect any precondition that such reliance be 'reasonable'. Any argument to the contrary would be inconsistent with the well-established principle that contributory negligence is not available as a defence to a claim for damages based on a contravention of s 52. In Henjo Investments Pty Ltd v Collins Marrickville Pty Lt (1988) 39 FCR 546; 79 ALR 83 Lockhart J, with whom Burchett and Foster JJ relevantly agreed, said (at FCT 558; ALR 96) after referring to a number of decisions: 'These decisions support the view that recovery under s 52 is founded by the applicant's factual reliance upon the misleading or deceptive conduct of the respondent, although that conduct was not the only factor in the applicant's decision to enter a particular agreement, and although the applicant did not seek to verify the representations or did so inadequately and so failed to discover their falsity' Also in Sutton v AJ Thompson Pty Ltd (in liq) (1987) 73 ALR 233 at 240-1 another Full Court said: 'But there is nothing in the principle cited, or in any other authority which has been brought to our attention, to suggest that a person who has been misled into entering a contract, by false representations of a type which were likely to produce that result, and in fact did so, can be deprived of his remedy because of his failure to check the accuracy of those representations'. The possibility remains that the representee's own carelessness may be so dominant as to break the chain of causation.. However the present case is far removed from any such situation". 118 Mr Gehrmann gave evidence in his witness statement that he read the letter of 7 June 1991 from the accountants, that as a result of reading the letter he believed that Mr Wynne would have sufficient income from which to meet his obligations under the proposed loan and that one of his reasons for forming the view that the application for a loan should be approved was his belief that Mr Wynne would have sufficient income from which to meet his obligations under the proposed loan. I accept this evidence from Mr Gehrmann. 119 When asked in cross-examination what he had done to satisfy himself that Mr Wynne would have the capacity to repay the loan he was applying for, Mr Gehrmann said, "I relied on the letter from Bruce and Partner which said that he had an income of $235,000 per annum". Mr Gehrmann gave further oral evidence that, although he had not received any information about Mr Wynne's outgoings, a gross income of $235,000 was "in excess of the income that most of our borrowers had and it appeared to me that $235,000 as an income was well sufficient to service the loan…. When I see someone with $235,000 as an income, I believe that is extraordinary and they would normally meet their obligations". I accept the oral evidence by Mr Gehrmann which I have quoted. 120 One of the principles stated by Wilson J in Gould v Vaggelas at p 236 was:- "If a material representation is made which is calculated to induce the representee to enter into a contract and that person in fact enters into the contract there arises a fair inference of fact that he was induced to do so by the representation". 121 In the present case the representation in the letter of 7 June 1991 was calculated to induce, and was intended by the third defendant to induce, a lender to make a loan to Mr Wynne. The letter was addressed to a mortgage broker. In his verified answer to interrogatory 21 the third defendant admitted on or before 7 June 1991 he knew or believed that "lenders/mortgagees rely on information concerning the income of potential borrowers provided to it by mortgage brokers as part of an overall assessment of factors which are relevant in deciding whether to make a proposed mortgage advance". In par 42 of his witness statement the third defendant said that he assumed that Mr Moody might use the letter of 7 June 1991 to complete loan application forms or provide to a lender, if necessary. In oral evidence the third defendant admitted that the purpose of providing a figure for Mr Wynne's income was to demonstrate Mr Wynne's capacity to make interest payments under the proposed mortgage advance. 122 In my opinion, given the evidence I have referred to, the principle stated by Wilson J in Gould v Vaggelas is applicable and furnishes an additional reason for holding that the representation made by the accountants operated as an inducement to the Society to enter into the mortgage loan transaction. 123 I am satisfied that I should hold that the plaintiff has established that the Society relied on the misrepresentation made by the third and fifth defendants in deciding to enter into the mortgage loan transaction. Even if it would have been unreasonable for the Society to rely on the misrepresentation, that would be immaterial to whether the Society in fact relied on the misrepresentation. 124 It was submitted by counsel for the accountants that the plaintiff had not established a causal connection between the representation made by the accountants and the losses the plaintiff had suffered. It was further submitted that, if the solicitors had not breached the implied term in their retainer and had not been negligent, the losses the plaintiff had suffered would not have been incurred. 125 In March v E & M.H. Stramare Pty Limited (1990-91) 171 CLR 506 it was held by the High Court that causation is a question of fact to be answered by reference to common sense and experience and one into which considerations of policy and value judgments necessarily enter. It is not necessary, in order that an alleged cause should be found to be a cause, that it should have been the only cause or even the principal cause of the event or loss under consideration. 126 In my opinion, the misrepresentation by the accountants was a cause of the Society entering into the mortgage loan transaction. If the Society had known that the income of the proposed borrower was not $235,000 per annum but only about $35,000 per annum or even less, the Society would not have entered into the mortgage and if the Society had not entered into the mortgage it would not have suffered any loss. 127 Furthermore, the misrepresentation by the accountants was, even more directly, a cause of the losses suffered by the plaintiff. A matter relied on by the Court of Appeal in deciding that the mortgage should be set aside was that the Society had received accounts of Banksia Settlements Pty Limited which should have put it on notice of the poor financial position of Mr Wynne and Banksia Settlements Pty Limited and accordingly on notice that the proposed transaction was perilous from Mr Wynne's point of view and improvident from Mrs Wynne's point of view. 128 Mr Gehrmann gave evidence in the present proceedings that after he had received Mr Julian's letter of 18 June 1991 he had looked at the accounts of Banksia Settlements Pty Limited. However, in the case of any apparent inconsistency between the accounts and the letter of 7 June 1991 from the accountants, he had preferred to rely on the letter from the accountants, who were acting for Mr Wynne and Banksia Settlements Pty Limited and who, Mr Gehrmann reasoned, would have been familiar with the financial affairs of Mr Wynne and Banksia Settlements Pty Limited, including what tax planning had been put in place on behalf of Mr Wynne. Mr Gehrmann said in his evidence that "the primary consideration with regard to serviceability was the letter from the accountants." He said, "because of the amount of income given by the chartered accountant at $235,000 to Mr Wynne - and he was the one who made the application - it appeared that no further inquiries were needed". Later in his evidence Mr Gehrmann said:- "If it was stated that his income was $235,000 per annum and that was given by his accountant who knew the tax planning behind it all, no further inquiries I thought were necessary". 129 In short, it was because of the representation by the accountants, coming as it did from an apparently skilled and knowledgable source, that Mr Gehrmann did not appreciate the true financial position of Mr Wynne and Banksia Settlements Pty Limited and decided that no further inquiries about capacity to service the loan were required. 130 As to the submission that, if the solicitors had not been in breach and had not been negligent, the plaintiff's losses would not have been incurred; even accepting (as I do) that, if the solicitors had not defaulted in their obligations, the losses the plaintiff suffered would not have been incurred, that does not exonerate the accountants from liability. As stated in Fleming the Law of Torts (8th ed 1992) at 200:- "The law does not excuse a defendant from liability for a consequence merely because other causal factors for which he was not responsible were also necessary to produce it… Usually the interaction of several, though independent, wrongful acts produces a single indivisible result… The resulting harm (to which both contributed) being indivisible, each will be answerable for all the damage…". 131 In the present case I consider that the losses suffered by the plaintiff are indivisible. 132 It was submitted by counsel for the accountants that, even if the losses incurred by the Society had been caused by the accountants' misrepresentation as to Mr Wynne's income, nevertheless those losses (or damages) were too remote to be recoverable. It was submitted that under the principle governing remoteness of damage in tort, a tortfeasor is liable only for damages of a kind which it was reasonably foreseeable might occur in consequence of the tortfeasor's tortious conduct. It was then submitted that the kind of damages which it was reasonably foreseeable the Society might suffer as a consequence of the accountants' misrepresentation as to Mr Wynne's income would have been the costs of realising the mortgage security, it not being reasonably foreseeable that the Society would suffer the total loss of the monies advanced, together with the costs incurred by the Society or ordered to be paid by the Society in court proceedings between the Society and the mortgagee. 133 In my opinion, the losses claimed by the Society, namely the loss of the principal sum lent to Mr Wynne, the loss of interest on this principal sum and the court costs incurred and ordered to be paid in the court proceedings with the mortgagee Mrs Wynne were damages of a kind which it was reasonably foreseeable might flow from the accountants' misrepresentation and were, therefore, not too remote from the accountants' misrepresentation to be recoverable from the accountants. 134 The test for remoteness of damage in actions in tort has been described as "undemanding" (Habib v The Nominal Defendant (1995) 2 MVR 454 at 463 per Kirby P, Priestley JA concurring). In Commonwealth of Australia v McLean (1996) 41 NSWLR 389 Handley JA and Beazley JA in their joint judgment said at 403:- "A wrongdoer is responsible for all damage of the same type or kind as that which was reasonably foreseeable, even if the particular damage, or its extent, were not reasonably foreseeable or the damage occurred in an unexpected and unforeseeable manner". 135 Examples of how undemanding the test of remoteness of damage in actions in tort is, include such cases as Habib v The Nominal Defendant, Commonwealth of Australia v McLean, Hughes v Lord Advocate (1963) AC 837, Nader v Urban Transit Authority (NSW) (1985) 2 NSWLR 501, Kavanagh v Akhtar (1998) 45 NSWLR 588. 136 In my opinion, the losses incurred by the Society consisting of the loss of the monies advanced, the loss of interest on the monies advanced and the costs of the court proceedings with Mrs Wynne were losses of a kind which it was reasonably foreseeable that the Society as the mortgagee might suffer, in consequence of a misrepresentation made by the accountants as to the income of Mr Wynne, which was made by the accountants to a mortgage broker for the purpose of inducing a member of the class of potential lenders to lend monies to Mr Wynne on the security of a mortgage over property in which Mrs Wynne had an interest. 137 In any event, as I have already sought to demonstrate, the misrepresentation by the accountants was a cause, not merely of the Society entering into the mortgage loan transaction, but was, quite directly, a cause of the security for the advance being lost, in that Mr Gehrmann was induced by the misrepresentation by the accountants to disregard other information, which the Court of Appeal considered should have put the Society on notice of the financial position of Mr Wynne and Banksia Settlements Pty Limited and that the proposed transaction was improvident from Mrs Wynne's point of view. On this basis, the damages claimed by the Society are clearly not too remote. On this basis also, a submission made on behalf of the accountants that the damages claimed by the plaintiff were divisible and that the accountants should be liable only for a part of the damages claimed by the plaintiff, also fails. 138 It was submitted by counsel for the accountants that the two causes of action against the accountants were statute-barred. It was accepted by counsel for the accountants that the incurring of actual damage by the Society was an essential element of each cause of action. It was contended that any cause of action against the accountants had accrued, when the letter of 7 June 1991 was received by the Society. 139 The submission that the causes of action against the accountants accrued when the Society received the accountants' letter of 7 June 1991 is clearly wrong. No actual damage, indeed not even any contingent loss, was incurred by the Society upon its receiving this letter. 140 Even if actual damage was incurred by the Society when it entered into the mortgage loan transaction (which I do not consider to be the case), the cause of action for the tort of negligence would not be statute-barred, as the present proceedings were commenced within six years of the date of the mortgage. 141 As regards the cause of action based on s 42 of the Fair Trading Act, for reasons similar to the reasons I have already given in rejecting a submission made by counsel for the solicitors that the cause of action against the solicitors under the Fair Trading Act was statute-barred, I do not consider that any actual damage caused by the accountants' misrepresentation, as distinct from a contingent loss, was incurred by the Society, until a Court order was made setting aside the mortgage. The first Court order setting aside the mortgage was the order made by Hunter J on 15 September 1994, that is less than three years before these proceedings were commenced. 142 It was submitted by counsel for the accountants that the Society had been guilty of contributory negligence. It was submitted that the Society had been negligent in relying on the statement by the accountants about Mr Wynne's income, when the statement did not disclose what Mr Wynne's disposable income was. It was further submitted that, having received information in the form of accounts of Banksia Settlements Pty Limited and statements of assets and liabilities which showed that the representation in the letter of 7 June 1991 about Mr Wynne's income could not be true or might not be true, the Society had been negligent in entering into the mortgage loan transaction, without making any further inquiry about Mr Wynne's income. 143 As I have already held in the case of the claims against the solicitors, contributory negligence is not available as a defence to a cause of action based on a contravention of s 42 of the Fair Trading Act. On the other hand, contributory negligence is available as a defence to a cause of action founded on the tort of negligence. 144 It is, of course, a curious submission to be made on behalf of two chartered accountants, that a statement made by them in their capacity as chartered accountants about the income of a client, that is a statement made on a matter within the area of their professional expertise, which was addressed by them to a mortgage broker and which was intended by them to be relied on by members of a class of prospective mortgagees which included the Society, ought not to have been relied on by the Society. 145 In any event, I do not consider that the Society was guilty of contributory negligence. 146 The Society was an unsophisticated lender and most applicants to it for mortgage advances had much smaller gross incomes than $235,000 per annum. I consider that Mr Gehrmann was entitled to take the view that a prospective borrower who, in July 1991, had a gross income of $235,000 per annum would be able to meet his obligations under the proposed mortgage. 147 I am also of the opinion that the Society, without making any further inquiry and notwithstanding that it had received apparently inconsistent information, was entitled to rely on an unequivocal written representation about Mr Wynne's income made by a firm of chartered accountants, who acted for Mr Wynne and his company and who were familiar with the financial affairs of Mr Wynne and his company, including any tax planning for Mr Wynne, which might not be reflected or fully reflected in the financial statements which had been provided to the Society. 148 As I have previously remarked in this judgment, there is, in my opinion, a distinction between the question of whether, vis-a-vis Mrs Wynne, the Society should have made further inquiry and the question of whether, vis-a-vis a firm of chartered accountants who had provided information about the income of a prospective borrower, the Society should have made further inquiries. 149 In my opinion, the plaintiff is entitled to a verdict against the third and fifth defendants, without any finding of contributory negligence. Claims by the plaintiff against the fourth defendant 150 The plaintiff relied on two causes of action against the fourth defendant, namely:- 151 1. A cause of action in negligence. The plaintiff alleged that the fourth defendant had breached a duty of care he owed to the Society, as a member of the class of potential mortgagees, to exercise reasonable care, skill and diligence in valuing the property. 152 2. A cause of action for breach of s 42 of the Fair Trading Act. The plaintiff alleged that the fourth defendant engaged in misleading or deceptive conduct by impliedly misrepresenting that his valuation was based on reasonable grounds, was the product of a careful exercise of his expertise as a valuer and was within the range of allowable latitude for a valuation. 153 Both causes of action against the fourth defendant were based on the written valuation of the property by the fourth defendant dated 26 June 1991, in which he concluded that the market value of the property as at 26 June 1991 was $750,000. 154 In his valuation report the fourth defendant stated that he was a valuer and quoted his Australian Institute of Valuers' registration number. He stated that the valuation was made upon instructions from Mr Wynne on behalf of "an intending mortgagee". In the valuation report he described the land and the improvements on the land in considerable detail. However, the part of the report in which the fourth defendant stated his "approach to valuation" of the property was brief. He stated:- "Direct comparison of the subject property with sales evidence of comparable or near comparable residential holdings. Following analysis of sales evidence and information gleaned from real estate agents active within this general area, current market value of the subject property as being assessed at…..$750,000". 155 No particulars were given by the valuer of any comparable sales or of the information allegedly gleaned from estate agents. 156 In answer to interrogatories administered by the plaintiff the fourth defendant admitted that he had been instructed to inspect the property and to carry out a valuation for mortgage security purposes on behalf of an intending mortgagee and that he had assumed that the valuation would be one of the things relied upon by an intending mortgagee. 157 In his report prepared in 1997 Mr Whealing, the valuer retained by the plaintiff, who was a qualified valuer with thirty years experience, valued the property as at 26 June 1991 at $520,000. In his report Mr Whealing stated that he had adopted a direct comparison approach with sales of similar properties as his primary method of valuation. As a check or secondary method, he had undertaken a "summation" exercise. 158 In his report Mr Whealing set out particulars of seven comparable or nearly comparable sales of properties in Belrose, including two sales in Charleroi Street, in 1990 and 1991. He concluded on the basis of this evidence of comparable sales that the value of the property as at 26 June 1991 was $520,000. By his secondary method Mr Whealing concluded that as at 26 June 1991 the land was worth $185,000 and the depreciated value of the improvements on the land was $314,000, giving a summated value of $499,000, say $500,000. 159 In a witness statement Mr Whealing expressed the opinions that no reasonably competent valuer exercising the relevant expertise could have formed the opinion that the value of the property as at 26 June 1991 was $750,000 on the sales evidence of comparable or near comparable properties available to Mr Whealing, that Mr Whealing was not aware of the existence of any evidence of comparable or near comparable sales which could support a conclusion that the value of the property as at 26 June 1991 was $750,000 and that he was not aware of any basis on which it could reasonably be concluded that the value of the property as at 26 June 1991 was $750,000. 160 As has already been stated earlier in this judgment, the fourth defendant, although he had a solicitor acting for him in the proceedings up until the week before the hearing and although he was aware of the date of the hearing, did not appear at the hearing and did not instruct any lawyer to appear for him at the hearing. 161 In my opinion, both of the causes of action against the fourth defendant are established by the evidence and I would find a verdict for the plaintiff against the fourth defendant. Damages 162 The plaintiff made two alternative claims for damages. 163 Under the first alternative the plaintiff claimed damages as follows:- 164 1. The loss of the principal monies under the mortgage $450,000. 165 2. Loss of interest payable under the mortgage at the rate of 16.25 per cent per annum over the term of the mortgage from 8 August 1991 to 7 August 1994 $219,375. 166 3. Interest on the principal monies lost at the rates in schedule J to the Supreme Court Rules from 8 August 1994 onwards. (in the schedule of damages prepared by the plaintiff's counsel this amount was calculated only up to 13 November 2000). 167 4. The costs which the Society had been ordered to pay, and had paid, Mrs Wynne $63,000. 168 5. Interest on the costs which the Society had been ordered to pay, and had paid, Mrs Wynne, from the date of payment 25 June 1998 (in the schedule of damages prepared by the plaintiff's counsel this amount was calculated only up to 13 November 2000). 169 6. The costs which the Society had itself incurred in the Court proceedings with Mrs Wynne $62,444. 170 7. Interest on the costs which the Society had itself incurred in the Court proceedings with Mrs Wynne, from 11 March 1993 onwards (in the schedule of damages this amount was calculated only up to 13 November 2000). 171 The only difference between the two alternative ways of calculating the plaintiff's damages was that under the second alternative the plaintiff claimed, in respect of the period from 8 August 1991 to 7 August 1994, not the loss of the interest payable under the mortgage but interest at the rates in schedule J to the Supreme Court Rules on the principal sum of $450,000. Hence, the second alternative way in which damages were claimed was as follows:- 172 1. Loss of the principal monies under the mortgage $450,000 173 2. Interest at the rates in schedule J to the Supreme Court Rules on $450,000 from 8 August 1991 onwards (in the schedule of damages prepared by the plaintiff's counsel this amount was calculated only up to 13 November 2000). 174 3. The costs which the Society had been ordered to pay, and had paid, Mrs Wynne $63,000. 175 4. Interest on the costs which the Society had been ordered to pay, and had paid, Mrs Wynne, from the date of payment 25 June 1998 (calculated by plaintiff's counsel only up to 13 November 2000). 176 5. The costs which the Society had itself incurred in the Court proceedings with Mrs Wynne $62,444. 177 6. Interest on the costs which the Society had itself incurred in the Court proceedings with Mrs Wynne from 11 March 1993 onwards (calculated by plaintiff's counsel only up to 13 November 2000). 178 The only submission made by any defendant in written submissions about the damages claimed by the plaintiff was a submission made on behalf of the solicitors relating to the claims for interest. It was submitted that interest should not be allowed automatically, that the plaintiff had to prove by evidence that it would have made a profit, and the amount of any profit, from the monies which had been used to make the advance to Mr Wynne, that no evidence had been led by the plaintiff as to the interest rates that were obtained by the Society on its investments other than mortgage investments and that, in the absence of evidence about those matters, no interest, or at any rate no interest at the rates claimed by the plaintiff, should be allowed. 179 It was submitted on behalf of the plaintiff in written submissions that interest at Supreme Court rates will be allowed, without the necessity of calling specific evidence, and that:- "Where, as here, there is evidence that the monies would have been invested at commercial rates and may have been invested at a rate of return generally higher than the Supreme Court rate, although it may also have gone into investments returning a lower rate, the appropriate order would be to apply the Supreme Court rates. There are no special circumstances to justify a lesser rate". 180 I do not consider that I should accept the submissions made by counsel for the solicitors in their written submissions. The authority cited for the propositions that interest should not be allowed automatically and that a plaintiff has to prove by evidence that it would have made a profit from the use of monies withheld from it and the amount of the profit was Hobartville Stud Pty Limited v Union Insurance Co Limited (1991) 25 NSWLR 358 (Giles J) at 364. However, in his judgment at 364 Giles J was dealing, not with a claim for interest at Supreme Court rates, but with a claim for damages for the loss of the use of money under Hungerfords v Walker (1989) 171 CLR 125. 181 Practice Note No 73, which counsel for the plaintiff referred to in written submissions, has been rescinded (Practice Note No 92). However, Practice Note No 92 provides in part that:- "When computing interest for the purposes of s 94 of the Supreme Court Act 1970, subject to any evidence adduced, it may be taken that the rate of interest that is appropriate to guide the Court in respect of any period mentioned in column 1 of schedule J of the Supreme Court Rules 1970 is the rate per cent yearly mentioned in column 2 of the schedule beside that period". 182 I consider that I could be guided by the rates of interest in schedule J and could award interest in accordance with the rates of interest in schedule J, without the need for the plaintiff to lead any evidence about the rates of interest it was obtaining on its investments. 183 A rather different submission relating to the plaintiff's claims for interest was made for counsel for the solicitors in his oral submissions. It was submitted that evidence had been led by the plaintiff as to the average interest rates under mortgages entered into by it and as to the interest rates that had been obtained by the plaintiff on all its investments, including investments other than mortgage investments, and that interest should be allowed by me in accordance with the rates of interest shown by that evidence and not in accordance with the rates of interest in schedule J. 184 Counsel for the solicitors referred to two parts of the plaintiff's evidence:- (i) An exhibit to Mr Gehrmann's first witness statement, in which he set out the rates of interest under mortgages entered into by the Society from 1983 to 1997. (ii) An annexure to Mr Gehrmann's second witness statement, in which he set out a calculation of the average annual return received by the Society on all its investments in each year ending 30 June from 1989 to 1999. 185 The rates of interest on the mortgages entered into by the Society were fairly similar to the rates of interest for the same periods in schedule J to the Supreme Court Rules, sometimes being higher and sometimes being lower than the rates in schedule J. The average annual returns received by the Society on all its investments were generally somewhat less than the rates of interest for the same periods in schedule J. 186 It was submitted by counsel for the solicitors that, if interest was awarded to the plaintiff, the evidence of the average annual return received by the Society on all its investments in each year from the year ended 30 June 1992 onwards should be used to determine what rates of interest should be allowed to the plaintiff. 187 I do not consider that I should accept this submission by counsel for the solicitors. If none of the three groups of defendants had breached their obligations to the Society, the Society would not have entered into the mortgage loan transaction and the monies which the Society lent to Mr Wynne would have been used by the Society in making some other investment. It seems to me quite likely that, if the monies had not been used to make a loan to Mr Wynne, the monies would have been used to make another investment by way of a mortgage advance. However, I do not consider that the evidence establishes that the Society would have used the monies to make another mortgage advance or what would have been the rate of interest on any such mortgage advance. On the other hand, I do not consider that the evidence establishes that the Society would have used the monies to make an investment otherwise than by way of a mortgage advance, at a lower rate of interest than would have been obtained on a mortgage advance. In my opinion, such evidence as there is is insufficient to produce the consequence that I should cease to be guided by the rates of interest set out in schedule J and, therefore, I should award interest on the loss of the principal monies and on the other items of damage, at the rates set out in schedule J. 188 As regards the two alternative ways in which the plaintiff propounded its claim for damages, I consider that I should adopt the second way. 189 As I have already indicated, the plaintiff's case against the defendants was that the breaches by the three groups of defendants of their obligations to the Society had caused the Society to enter into the mortgage loan transaction. If the defendants had not committed these breaches, the Society would not have entered into the mortgage loan transaction and would have invested the money it lent to Mr Wynne in some other way. Accordingly, I do not consider that the interest which should be awarded to the plaintiff to compensate it for the loss of the use of the principal monies during the term of the mortgage, that is during the period from 8 August 1991 to 7 August 1994, should be measured by the rates of interest payable under the mortgage from Mrs Wynne and certainly not by the rate of interest of 16.25 per cent, which was the higher rate payable under the mortgage in the event of default by the mortgagor. I do not consider that the plaintiff has established that, if the monies had not been used to lend to Mr Wynne, they would have been used to make some other mortgage advance at the same rate of interest or that the defendant has established that, if the monies had not been used to lend to Mr Wynne, they would have been used to make some other kind of investment, at a lower rate of interest. Accordingly, for the period between 8 August 1991 and 7 August 1994 interest on the principal monies lost should be awarded at Supreme Court rates. Contribution 190 Each of the three groups of defendants, the solicitors, the accountants and the valuer, filed cross-claims against the other two groups claiming contribution or indemnity. 191 In the cross-claims which were filed the claims for contribution or indemnity were based on s 5 of the Law Reform (Miscellaneous Provisions) Act 1946. However, at the hearing counsel for the solicitors and counsel for the accountants both submitted, and I am prepared to accept, that there is a right of contribution under the general law, both at common law and in equity, between persons subject to coordinate obligations and that, even apart from the statutory right to contribution or indemnity under s 5 of the Law Reform (Miscellaneous Provisions) Act, I can make orders for contribution or indemnity under the general law. See Jones v Mortgage Acceptance Nominees Limited (1997) 142 ALR 561. 192 It was submitted by both counsel for the solicitors and counsel for the accountants that the same principles should be applied in determining claims for contribution under s 5 of the Law Reform (Miscellaneous Provisions) Act and claims for contribution under the general law. It was common ground that the principles stated in Podrebersek v Australian Iron and Steel Pty Limited (1985) 59 ALJR 492, although a case on the apportionment of damages between a defendant and a plaintiff guilty of contributory negligence, should be applied in the present case in determining what shares of responsibility for the plaintiff's damage should be apportioned to each group of defendants. In Podrebersek it was stated that the apportionment of shares in responsibility for the damage involves a comparison both of culpability, that is the degree of departure from the standard of care of a reasonable person, and of the relative importance of the acts of the parties in causing the damage. The whole conduct of each of the parties and all of the facts of the case are to be taken into account. 193 I have taken into account all of the evidence and all of the findings I have made in this judgment. 194 The solicitor Mr Julian played a central role in the mortgage loan transaction. His client, the Society, was an unsophisticated lender. Mr Julian had acted as solicitor for the Society on a number of previous mortgage transactions. The application by Mr Wynne for a mortgage loan was forwarded to the Society by Mr Julian, who had received it from the mortgage brokers. Mr Julian was negligent in not advising Mr Gehrmann that there was additional risk to the Society flowing from the proposed change in the mortgage loan transaction to its being a transaction in which the loan would be made to Mr Wynne and the mortgage would be taken from Mrs Wynne. Mr Julian continued to act for the Society throughout the transaction and his negligence continued from the time of the conversation between him and Mr Gehrmann on or about 10 July 1991 up to 8 August 1991, when the Society made the loan and entered into the mortgage. If Mr Julian had expressed any reservation at all about the proposed change in the mortgage loan transaction, then it is clear that the Society would not have entered into the mortgage loan transaction and would not have suffered any loss. 195 The accountants and the valuer played less central roles in the mortgage loan transaction. On the other hand, I consider that the conduct of each of them, that is the conduct of the accountants in writing a letter to the mortgage brokers in which they stated that Mr Wynne's income was $235,000 per annum and the conduct of the valuer in valuing the property "on behalf of an intending mortgagee" at $750,000, represented a greater departure from the standard to be expected of a reasonable professional person than did the conduct of Mr Julian. In my opinion, the conduct of each of the accountants and the valuer can fairly be described as a gross departure from the standard of a reasonable professional person. The conduct of each of the accountants and the valuer was a cause of the Society's loss, in that, if either Mr Wynne's income had been accurately stated or if the property had been properly valued, the Society would not have entered into the mortgage loan transaction. 196 I have taken into account, as a possible ground for distinguishing between the accountants and the valuer, in favour of the former, that a condition that no more than a sum equal to 60 per cent of the current valuation of the property being offered as a security should be lent, was included in the principles reduced to writing by Mr Wrigley in 1990, whereas no condition relating to the level of the borrower's income was included in that written statement of principles. However, Mr Wrigley gave evidence, which I accept, that he regarded the condition limiting the amount which could be lent to 60 per cent of the current valuation of the property being offered as a security and a condition that the borrower should have the financial capacity to service the loan as being equally important. Furthermore, as I have sought to demonstrate earlier in this judgment, the wrongful conduct by the accountants led to the Society disregarding other information it had received, which the Court of Appeal considered should have put the Society on notice that the proposed transaction was improvident from Mrs Wynne's point of view and hence the wrongful conduct by the accountants was closely connected with the loss by the Society of its security. 197 In my opinion, I should apportion the responsibility for the plaintiff's damage equally between the three groups of defendants, so that each of the solicitors, the accountants and the valuer, as between themselves, should bear a one-third share of responsibility for the plaintiff's damage. Conclusion 198 The plaintiff should obtain a verdict against all the defendants for an amount calculated in accordance with the second way in which counsel for the plaintiff set out the plaintiff's claim for damages. As between themselves, the three groups of defendants, that is the first and second defendants, the third and fifth defendants and the fourth defendant, should each bear one-third of the responsibility for the plaintiff's damage. ********** Last Modified: 04/10/2001 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.