Court of Appeal Supreme Court New South Wales Medium Neutral Citation: Tomasetti v Brailey [2012] NSWCA 399 Hearing dates: 15, 16, 17, 18, 19 October 2012 Decision date: 11 December 2012 Before: McColl JA at [1] Campbell JA at [2] Macfarlan JA at [3] Decision: (1) The appeals of Mr Tomasetti and Tomasetti Investments Pty Ltd are dismissed. (2) The appeal by Ms Cordony in relation to her claims against the first and fourth respondents is allowed. (3) Set aside the judgment for the first and fourth respondents entered on 17 November 2011 in relation to the claims of Ms Cordony. (4) Set aside the order made on 17 November 2011 that Ms Cordony pay the first and fourth respondents' costs at first instance as agreed or assessed. (5) Remit the proceedings to the primary judge, so far as they relate to Ms Cordony's claims against the first and fourth respondents, for the purpose of: (a) Determining the issue of whether Ms Cordony's loss was caused by the first and fourth respondents' conduct. (b) Making such orders (including as to the costs of the proceedings at first instance) as he considers appropriate having regard to his determination of that issue and these reasons for judgment. (6) Order Mr Tomasetti and Tomasetti Investments Pty Ltd to pay 90 per cent of the respondents' costs of the appellants' appeals. (7) Order the first and fourth respondents to pay Ms Cordony's costs of her appeal so far as it relates to them. (8) The first and fourth respondents to have a certificate under the Suitors' Fund Act 1951, if qualified, in relation to their costs of Ms Cordony's appeal. [Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.] Catchwords: TRADE AND COMMERCE - misleading or deceptive conduct - s 42 Fair Trading Act 1987 (NSW) - first respondent financial adviser made representations as to present and future matters regarding managed agricultural investment schemes - whether adviser adequately apprised appellants of investment risks - whether provision of prospectus and product disclosure statements was sufficient to convey risk - whether appellants proved content of conversations with adviser - obligation of a claimant to prove the whole of a defendant's relevant conduct - whether primary judge paid adequate regard to concessions made in cross-examination - reliability of concessions against interest - whether respondent had reasonable grounds for making representations as to future matters - causation - whether appellants would have proceeded with investments despite knowledge of risks - whether causation issue should be remitted to primary judge for determination TORTS - negligence - breach of duty - financial advice concerning investments in managed agricultural investment schemes - clients' instructions to avoid 'speculative' investments - whether respondent failed to apprise appellants of investment risks - whether respondent negligently recommended investments as suitable for second appellant's personal circumstances - causation - whether appellants would have proceeded with investments despite knowledge of risks - whether causation issue should be remitted to primary judge for determination TORTS - defences - proportionate liability - first respondent's acts were corporate acts of fourth respondent - whether first and fourth respondents were 'concurrent wrongdoers' within Part 4 Civil Liability Act 2002 - whether liability of either party is limited by s 35(1) APPEAL - issues other than causation determined by primary judge after lengthy hearing - credit findings made - whether determination of causation issue should be remitted to primary judge LIMITATIONS - whether first and third appellants' claims were statute-barred - whether causes of action arose upon entry into investments or when the fact that the investments were loss-making became ascertainable PARTNERSHIP - interpretation of partnership agreement - whether agreement manifested intention that first and second respondents be partners in accountancy firm - whether first respondent's conduct occurred in ordinary course of business of partnership - s 10(1) Partnership Act 1892 DAMAGES - whether damages awarded to appellants were taxable in their hands - whether damages should be 'grossed-up' to compensate appellants for income tax payable - s 20-20 Income Tax Assessment Act 1997 (Cth) INCOME TAX - whether damages award assessable as a recoupment of losses or outgoings - s 20-20 Income Tax Assessment Act 1997 (Cth) Legislation Cited: Civil Liability Act 2002 Civil Procedure Act 2005 Fair Trading Act 1987 Fair Trading Amendment Act 2003 Income Tax Assessment Act 1997 (Cth) Limitation Act 1969 Partnership Act 1892 Suitors' Fund Act 1951 Supreme Court Act 1970 Cases Cited: Allsop v Federal Commissioner of Taxation [1965] HCA 48; 113 CLR 341 Amalgamated Television Services Pty Ltd v Marsden (No 2) [2003] NSWCA 186; 57 NSWLR 338 Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411 Awad v Twin Creeks Properties Pty Limited [2012] NSWCA 200 Baulkham Hills Shire Council v Basemount Pty Ltd [2003] NSWCA 189; 126 LGERA 339 Be Financial Pty Ltd v Das [2012] NSWCA 164 Brackenreg v Comcare Australia [1995] FCA 1129; 56 FCR 335 Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; 218 CLR 592 Campbell v Backoffice Investments [2009] HCA 25; 238 CLR 304 Castle Constructions Pty Ltd v North Sydney Council [2007] NSWCA 164; 155 LGERA 52 Dib Group Pty Ltd v Ventouris Enterprises Pty Ltd [2011] NSWCA 300; 284 ALR 601 Dillon v Gosford City Council [2011] NSWCA 328; 284 ALR 619 Gould v Vaggelas [1985] HCA 75; 157 CLR 215 Hall v van der Poel [2009] NSWCA 436 House v R [1936] HCA 40; 55 CLR 499 HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; 217 CLR 640 Hungerfords v Walker [1989] HCA 8; 171 CLR 125 Jacfun Pty Ltd v Sydney Harbour Foreshore Authority [2012] NSWCA 218 Jobbins v Capel Court Corporation Ltd [1989] FCA 538; 25 FCR 226 Jones v Dunkel [1959] HCA 8; 101 CLR 298 Lahoud v Lahoud [2006] NSWSC 126 Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705 Maritime Inc [2004] FCA 1211; 140 FCR 445 McLaurin v Federal Commissioner of Taxation [1961] HCA 9; 104 CLR 381 Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd [2010] HCA 31; 241 CLR 357 Murphy v Overton Investments Pty Ltd [2004] HCA 3; 216 CLR 388 Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; 149 CLR 191 Pateman v Higgin [1957] HCA 62; 97 CLR 521 Perpetual Trustee Company Ltd v Milanex Pty Ltd (in liq) [2011] NSWCA 367 Port Kembla Coal Terminal Ltd v Braverus Magman International Pty Ltd v Westpac Banking Corporation [1991] FCA 41; 32 FCR 1 Rosenberg v Percival [2001] HCA 18; 205 CLR 434 Smith v New South Wales Bar Association [1992] HCA 36; 176 CLR 256 Tomasetti v Brailey [2011] NSWSC 1446 Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2009] NSWCA 178; 168 LGERA 1 Toteff v Antonas [1952] HCA 16; 87 CLR 647 Wardley Australia Ltd v State of Western Australia [1992] HCA 55; 175 CLR 514 Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816 Whitaker v Federal Commissioner of Taxation [1996] FCA 1716; 63 FCR 1 and [1998] FCA 262; 82 FCR 261 Winnote Pty Ltd v Page [2006] NSWCA 287; 68 NSWLR 531 Texts Cited: Macquarie Dictionary, 5th ed (2009) R P Balkin and J L R Davis, Law of Torts, 4th ed (2009) LexisNexis Butterworths Category: Principal judgment Parties: Peter Charles Tomasetti (First Appellant) Sandra Cordony (Second Appellant) Tomasetti Investments Pty Ltd as trustee for the Tomasetti Superannuation Fund (Third Appellant) Edmund Francis Brailey (First Respondent) John Clifford Fenton (Second Respondent) Christopher Campbell Lane (Third Respondent) TJC Financial Planning Pty Ltd (Fourth Respondent) Representation: Counsel: A J Sullivan QC/I D Faulkner SC/A Maroya (Appellants) T G R Parker SC/C G Carroll (Respondents) Solicitors: Heckenberg & Koops (Appellants) Holman Webb (Respondents) File Number(s): CA 2009/297599 Decision under appeal Jurisdiction: 9111 Citation: Tomasetti v Brailey [2011] NSWSC 1446; Tomasetti v Brailey [2012] NSWSC 120 Before: R A Hulme J File Number(s): 2009/297599 Judgment 1McCOLL JA: I agree with Macfarlan JA's reasons and the orders his Honour proposes. 2CAMPBELL JA: I agree with Macfarlan JA. 3MACFARLAN JA: Table of Contents Summary of case and conclusions [4] The managed investment schemes [13] The prospectuses and product disclosure statements [14] The representations relied upon [20] The judgment at first instance [24] Mr Tomasetti's Fair Trading Act claims [37] Mr Brailey's concessions in cross-examination [42] The available inferences [50] Representations as to future matters [53] Reliance and causation [58] Mr Tomasetti's negligence claim [66] Reliance and causation [73] Contributory negligence [74] Ms Cordony's claims [75] Reliance and causation [89] Contributory negligence [91] Whether claims statute barred [92] The partnership claims [119] The partnership agreement [122] The judgment at first instance [125] The identity of the partners [128] Whether conduct in the ordinary course of the partnership business [132] Liability of damages to tax [141] Proportionate liability [150] Costs order made at first instance [158] Interest on costs [163] Conclusion and orders [166] SUMMARY OF CASE AND CONCLUSIONS 4In 1998 Mr Peter Tomasetti, who is the first appellant and a practising barrister, engaged Mr Edmund Brailey, the first respondent, to act as his tax agent, accountant and financial adviser. Mr Tomasetti contends that Mr Brailey subsequently recommended to him nine investments in managed investment schemes that Mr Tomasetti (twice in conjunction with his self-managed superannuation fund, the third appellant "TSF") made in the financial years ended 30 June 2000 to 2004. Six of the schemes related to timber plantations and three related to almond orchards. Payment of the initial expenses under the schemes, sourced largely from borrowed funds, generated substantial tax deductions for Mr Tomasetti. 5Ms Sandra Cordony, the second appellant and wife of Mr Tomasetti, claims that Mr Brailey recommended to her two investments that she made in the year ended 30 June 2005: one in a scheme for growing citrus trees and the other in a scheme for growing wine grapes. 6For a variety of reasons, these 11 schemes have been unsuccessful, resulting in loss to the appellants allegedly exceeding $4,000,000. They assert that that loss was caused by Mr Brailey's conduct. 7On 15 June 2009 the appellants commenced proceedings in the Common Law Division of the Supreme Court claiming damages from the present respondents, and other entities. As now confined, the claims of Mr Tomasetti and TSF are, first, that Mr Brailey engaged in misleading and deceptive conduct in contravention of s 42 of the Fair Trading Act 1987 by representing to them that the investments were sound, prudent and sensible commercial investments and by making representations as to certain future matters, including that the investments would provide reasonable commercial returns over time. Secondly, they claim that in recommending the investments to them, Mr Brailey acted negligently and in breach of a duty of care that he owed to them. Ms Cordony claims that Mr Brailey contravened s 42, and was negligent, in recommending the 2005 investments to her as prudent and suitable for her personal circumstances. 8The appellants further claim that, in recommending the investments, Mr Brailey acted in the ordinary course of the business of a partnership, Brailey, Fenton, Lane & Co constituted by himself, Mr John Fenton (the second respondent), Mr Christopher Lane (the third respondent) and Brailey & Fenton Pty Ltd ("BF") and/or acted on behalf of TJC Financial Planning Pty Ltd ("TJC") (the fourth respondent). The shares in TJC were owned by Messrs Brailey, Fenton and Lane. It conducted a financial planning business. 9By his decision dated 17 November 2011, R A Hulme J rejected the appellants' claims and directed judgment for the respondents (Tomasetti v Brailey [2011] NSWSC 1446). In essence, his Honour found that the respondents were not liable to Mr Tomasetti and TSF because Mr Brailey apprised Mr Tomasetti of the risks associated with the investments by providing him with the relevant prospectuses or (as they later became known) product disclosure statements ("PDS") (see particularly Judgment [412]). The principal basis for his Honour's rejection of Ms Cordony's claim appears to have been her inability to recall the terms of the conversations that she had with Mr Brailey (see particularly Judgment [530]). 10In case he erred in these conclusions, his Honour made the following findings about the other principal issues between the parties: (a) Mr Fenton and Mr Lane would not, as partners or otherwise, have been jointly and severally liable with Mr Brailey to the appellants (TJC accepted that, to the extent of the claim made against it, it was vicariously liable for Mr Brailey's conduct). (b) The appellants' claims were not in any respect statute barred. (c) Any damages awarded to the appellants would have been taxable in their hands. Accordingly, damages would have had to have been "grossed-up" to compensate the appellants for the income tax payable on those damages. (d) For the purposes of their negligence claim, Mr Tomasetti and Ms Cordony were contributorily negligent. (e) In apportioning responsibility between Mr Brailey and TJC under Part 4 of the Civil Liability Act 2002, the former would have had to bear the "lion's share" of responsibility. 11The appellants appealed against the rejection of their claims and the respondents filed a Notice of Contention challenging the primary judge's conclusions that were adverse to them. The hearing of the appeal occupied five days. The appellants did not challenge the primary judge's adverse findings concerning the reliability of Mr Tomasetti's and Ms Cordony's evidence. 12My conclusions on the issues before the Court on appeal are as follows: (a) Mr Tomasetti and TSF's Fair Trading Act claims fail because they did not prove that Mr Brailey engaged in misleading and deceptive conduct ([37] - [57]). (b) Their claims in negligence also fail because they did not prove that Mr Brailey acted negligently ([66] - [72]). (c) If Mr Tomasetti and TSF's claims had otherwise succeeded, it would have been necessary to remit the issue of causation to the primary judge for determination ([58] - [65] and [73]). (d) Ms Cordony proved that Mr Brailey engaged in misleading and deceptive conduct and was negligent ([75] - [88]). (e) The issue of causation concerning both Ms Cordony's Fair Trading Act and negligence claims against Mr Brailey and TJC should be remitted to the primary judge for determination ([90]). (f) In light of these findings, it is unnecessary to express a view as to whether the appellants were contributorily negligent ([74] and [91]). (g) The primary judge correctly concluded that Mr Fenton and Mr Lane would not have been jointly and severally liable with Mr Brailey, that the appellants' claims were not statute barred and that any damages awarded to the appellants would have been taxable in their hands (see [10(a), (b) and (c)] above). (h) Mr Brailey and TJC are not entitled to limit liability under Part 4 of the Civil Liability Act ([150] - [157]). (i) The primary judge did not err in ordering Ms Cordony and TSF to pay the costs of the proceedings at first instance jointly and severally with Mr Tomasetti ([158] - [165]) although Ms Cordony will not have any liability for those costs, so far as they relate to her claims against Mr Brailey and TJC, if those claims ultimately succeed following the primary judge's resolution of the issue of causation on the remitter. THE MANAGED INVESTMENT SCHEMES 13The primary judge gave the following summary of the investments made by the appellants: "9 The plaintiffs' first investments, which were made by Mr Tomasetti in the financial year concluding 2000, related to timber plantations known as 'woodlots' or 'timberlots'. Further investments in timber plantations were made in financial years 2001, 2002 and 2003. Each project was constituted as a managed investment scheme. 10 Each scheme had a similar structure. The investor ('grower') would be granted a lease (or sublease) by the promoter of a specified parcel of land per timberlot. The grower would also enter into a management agreement with the promoter whereby the promoter would establish, maintain and ultimately harvest and sell the timber. The proceeds of sale would be pooled and distributed to the growers. 11 There were to be no returns in respect of the timber plantations until the trees were at sufficient maturity to be harvested. For example, the Timbercorp Eucalypts 2000 prospectus suggested a harvest at least 8 years after planting. The Gunns Woodlot 2002 product disclosure statement ('PDS') spoke of 13 years. 12 Under the management agreement, an initial fee was payable to cover the cost of establishing the plantation and for initial rent of the land. There were ongoing expenses for the grower. Depending upon the project, these comprised rent, maintenance, licence fees, insurance, and pruning services. 13 Each of the promoters of the schemes in question also offered (on a subject to approval basis) finance for the initial payment and, in some cases, later payments. To obtain finance, the grower would enter into a separate loan agreement with the promoter (or associate) under which the grower would agree to repay the amount financed according to a particular loan schedule, paying interest on the outstanding balance in the meantime. In some schemes, a choice of repayment periods (at different rates of interest) was available. 14 Under this structure, the grower himself or herself would be carrying on a timber plantation business on his or her timberlots. The grower was entitled to a tax deduction for the amounts of the initial payment and ongoing rent and management expenses, together with interest on any associated borrowings. Each of the schemes had the benefit of product rulings from the Australian Taxation Office ('ATO') which, if they were complied with, confirmed the grower's entitlements to such deductions. Of course, any net income ultimately derived from the harvest and sale of the timber would be treated as assessable income of the grower. 15 The promoters of each of the schemes published a prospectus or PDS in accordance with the laws governing managed investment schemes. Investment was effected by signing an application (provided as part of the prospectus) in the form of a power of attorney which required the promoter thereafter to execute the sublease and management agreement on the grower's behalf. The application would be accompanied by a cheque or credit card authorisation for the amount of the initial payment which was not being financed; a separate application would also have to be made for the finance requested. 16 If the application was accepted, the promoter would present the cheque or process the credit card authority, as the case might be, for the initial cash payment, and establish the loan account for the balance. 17 In financial year 2003, investments were also made in schemes which involved the cultivation of orchard land for the purpose of growing almonds ('almondlots'). The almondlot scheme was structurally similar to the timberlot schemes but there were two significant differences. First, although the lots were identified as specific orchard areas, the grower did not hold a lease over the land in question, but rather a licence and joint venture agreement with a company which owned the land called 'Almond Land Pty Limited'. Secondly, the almonds required more intensive management and the management agreement provided that after the first year (in which the cost was fixed) the grower was required to pay the actual cost of managing the relevant lots, whatever it was. This was unlike the timberlots where, in general, the ongoing costs were either fixed or indexed to inflation. As against this, the almond trees were expected to produce crops, the sale of which could then be used to defray the costs, within 5 or 6 years of plantation rather than the longer periods of time associated with the timberlots. 18 Further almondlot investments were made in 2004. In 2005, investments similar to the almondlot investments were made by Ms Cordony in the growing of citrus fruit ('citruslots') and grapes ("grapelots"). 19 The Tomasetti Superannuation Fund ('TSF') was involved in investments in timberlots in 2001 and almondlots in 2004 in joint ventures with Mr Tomasetti. 20 In all, the plaintiffs made the following investments: Financial Year Investor Project Initial investment 2000 Tomasetti Norgard Clohessy $25,750 Australian Blue Gum 2000 2000 Tomasetti Timbercorp Eucalypts 2000 $196,000 2000 Tomasetti Great Southern Blue Gum Plantations 2000 $51,000 2001 Tomasetti/TSF ITC Solidwood 2001 $48,863 2002 Tomasetti Gunns Woodlot 2002 $108,625 2003 Tomasetti Timbercorp Early Almond 2003 $218,340 2003 Tomasetti Gunns Woodlot 2003 $96,800 2004 Tomasetti Timbercorp Almond - Post June 2003 $97,040 2004 Tomasetti/TSF Timbercorp Early Almond 2004 $407,500 2005 Cordony Timbercorp Citrus 2005 $49,000 2005 Cordony Gunns Winegrape 2005 $34,650 21 Each of the investments involved borrowings ranging from 75 per cent to 100 per cent of the initial investment, most commonly 90 per cent. In addition to the repayments of these loans there were further costs to be paid. The Timbercorp Early Almond projects and the Timbercorp Citrus project involved payments for subsequent stages which totalled many hundreds of thousands of dollars. In all, the plaintiffs' claim for past loss exceeds $4 million". THE PROSPECTUSES AND PRODUCT DISCLOSURE STATEMENTS 14The prospectuses and PDS for the investments were fully described by the primary judge between Judgment [58] and [315]. It is sufficient for present purposes to refer in detail only to the prospectus for the first investment listed above. Great Southern Blue Gum Plantations 2000 15The general nature of this investment was described as follows in the Prospectus dated 3 February 2000 which related to a "2000 Project" and a "2001 Project": "Applicants in respect of each Project will enter into a lease with the Responsible Entity for one or more Leased Areas for a period of approximately 11 years. Simultaneously the Applicants contract with the Responsible Entity to establish the Eucalyptus globulus plantation and carry on the future management and maintenance of their plantation until the trees are mature. Leased Areas allocated in respect of the 2000 Project will be included in the June 2000 planting season. Leased Areas allocated in respect of the 2001 Project will be included in the June 2001 planting season. Eucalyptus globulus is a fast growing species and it is anticipated that each plantation will be ready for harvest after approximately 10 years growth (if not sooner). The Application Price is paid to the Responsible Entity for the establishment, management and maintenance carried out in respect of each Lease and Management Agreement for the relevant period ('Initial Services'). The relevant period for each Project commences from the date of execution of the Lease and Management Agreement and ends on 30 June 2000 for the 2000 Project and on 30 June 2001 for the 2001 Project. After this period, the Responsible Entity is responsible for the costs of maintenance, other than insurance premiums payable by the Grower and for management of the ongoing Project. The Responsible Entity is paid 3.0% of the net harvest proceeds of each Project as remuneration for its ongoing services. The Responsible Entity will also be responsible for the ongoing rental until harvest and will receive a payment for these costs of a further 2.5% of net harvest proceeds of each Project. The Responsible Entity will be entitled to receive from the Grower, as additional consideration for its on-going services and rental, any GST that is payable by the Responsible Entity in respect of the services and rental. Other than annual insurance premiums the Grower has no further financial obligations to contribute to the management or maintenance of the plantations". 16The Prospectus included the following further, presently relevant statements: "Participation in the Project is considered speculative and prospective Growers should read the Prospectus in its entirety and seek professional advice that an investment of this type is appropriate for their particular circumstances. The Projects are for a fixed term, likely to be 10 years from the year of planting. GSMAL has no obligation to purchase Growers' interests in the Project. No securities will be allocated or issued on the basis of this Prospectus later than 12 months after the date of issue of this Prospectus ... RISKS Participation in the Projects is intended to be of a long term nature in commercial forestry and is therefore subject to attendant risks and should be considered as speculative. These risks include fire, drought, other acts of God, disease, pests, technological advances, failure to achieve expected timber yields, reduced demand for hardwood woodchips, failure to achieve economic prices because of supply and other issues, changes in prices and costs particularly adverse price movements for the costs of harvesting, chipping, transport and ship loading, currency movements, government imposts and regulations and general economic and international issues. BUYBACK AND SECONDARY MARKET Growers should also be aware that the Responsible Entity is under no obligation to purchase Lease and Management Agreements and that no secondary market currently exists for the Lease and Management Agreements. ... PROJECTED RETURNS As the Projects are of medium term duration and there are a high number of variables involved in the calculation of returns to Growers, the ability to project returns is extremely limited. Fluctuations in demand for woodchips, changes in woodchip selling prices, fluctuations in the costs of harvesting, chipping, transport and ship loading and variations in prevailing inflation, exchange and taxation rates as well as fluctuating growth rates will affect returns. Incorporated on pages 21 and 40 are further details on some of the risk inherent in the Projects. ... Any change between actual outcomes and the assumptions used can have a significant impact on the results. In making their assessment of likely returns, Growers must recognise this difficulty and make whatever adjustments they consider necessary. To assist, the Responsible Entity has identified some of the assumptions which, if altered, would impact on projected returns. An indication of how changes in certain assumptions could affect returns, calculated on the basis of possible cash flows over the life of the Projects is shown in the sensitivity table on page 30." 17The prospectus also contained a report by a forestry expert which discussed at length the risks associated with the cultivation of eucalyptus trees, including climatic conditions, soil suitability, fire, government environmental policies and competitor products. 18The following was stated on the form of application attached to the Prospectus (and later signed by Mr Tomasetti): "Before signing the Application Form, Applicants should read the Prospectus dated 3 February 2000 to which this Application relates. ... By signing this Application Form, I/We acknowledge and agree to be bound by the statements on the reverse side of this Application. [On the reverse side of the Application form:] 6 The Project is intended to be of a long term nature in commercial forestry and I/we acknowledge the risks of the project as set out on page 21 of the Prospectus". 19The risks of other investments were disclosed in a similar fashion in their respective prospectuses or product disclosure statements, save that the word "speculative", appearing in the prospectus described above (see [16]), was used in those relating to only two of the 2000 and one of the 2001 investments. Each of the application forms signed by Mr Tomasetti directed him to read the prospectus or PDS, and three of the forms contained an express acknowledgement that he had done so (Respondents' Written Submissions [15]). THE REPRESENTATIONS RELIED UPON 20Mr Tomasetti and TSF alleged in the Statement of Claim that Mr Brailey represented to them that the investments were sound, prudent and sensible commercial investments. Mr Brailey and TJC admitted this allegation. Whilst Mr Fenton and Mr Lane did not do so, it can readily be concluded that Mr Brailey, at least impliedly, communicated a statement to this effect to Mr Tomasetti as Mr Brailey, acting as their financial adviser, recommended or, as he ultimately put it in his evidence, "proposed" each of the investments to the appellants (see Judgment [472] - [473]). 21The appellants' "Roadmap" of alleged representations also referred to the following representations as to future matters made by Mr Brailey to Mr Tomasetti and TSF: (1) The projects will produce reasonable commercial returns with time. (2) The projects are agricultural investments which will provide "you" with income in a lump sum when the forests mature. (3) "You" will get a lump sum at the end of the project. (4) "You" will get a return of approximately 10 per cent per annum compounding. (5) The investments will provide future income. 22The making of the first, fourth and fifth of these representations was admitted by Mr Brailey in his Defence and the appellants asserted that Mr Brailey admitted to making the second and third representations in his oral evidence. 23Ms Cordony alleged in her claim that Mr Brailey had impliedly represented to her that the investments he recommended were "prudent and suitable for her personal circumstances". As Mr Brailey admitted in his oral evidence that he had "highly recommended" that Ms Cordony make the relevant investments, there is no difficulty in making the implication contended for. THE JUDGMENT AT FIRST INSTANCE Mr Tomasetti and Ms Cordony 24The primary judge made the following observations concerning the circumstances of Mr Tomasetti and Ms Cordony: "23 Peter Tomasetti was admitted to practice as a barrister in 1979. He was appointed senior counsel in 2007. His principal area of practice has been in the Land and Environment Court. He described himself as a "specialist environmental lawyer and compulsory acquisition lawyer" (T340.11). He also said that he had expertise in property, equity and commercial law (T397.15). 24 Mr Tomasetti derived very substantial income from his work. In the period in which the investments were made (2000 - 2005), he generated an average of $954,000 in professional fees per year. Expenses, and the arrangement of his financial affairs generally, resulted in him paying an average of $91,000 in tax (and Medicare levy) per year. It is unnecessary to delve into the detail of how this was achieved except to note that the payment of substantial costs in relation to the agribusiness investments was a significant part of the explanation for Mr Tomasetti's liability for tax being so relatively low. 25 Ms Cordony has been in a permanent relationship with Mr Tomasetti since 1993. They married in 2003. She commenced working part-time for him as his personal assistant in about May 2002, taking over this role from Ms Janet Sucur. From that time, she became familiar with his financial affairs. Although Mr Tomasetti had a very busy practice, it was Ms Cordony's evidence that he was "incredibly self-sufficient" in terms of typing and office administration. She said that he would prepare his own advices and letters and that when she was absent he would sort through correspondence and take whatever action was required or leave it out for filing (T594)." The inception of the relationship between Mr Tomasetti and Mr Brailey 25The primary judge referred in this context to the following evidence of Mr Tomasetti in relation to his initial meeting with Mr Brailey in 1998: 35 Mr Brailey asked if there were any types of investments that he did not want to be in and he replied: 'I don't want anything risky Ted. My farming experience was good fun and the kids enjoyed it but it was very costly. I want nothing speculative. I'd like to increase my share portfolio if I am able to and I want to reinvest the dividends. I want a blue chip portfolio but I might be prepared to consider a small section of that pie for what I think they call 'green chips'.' (Emphasis in judgment at [35]). Mr Brailey confirmed in cross-examination that Mr Tomasetti had said at that meeting "I wouldn't want to do anything speculative". This reflected a note that Mr Brailey had made at the time in his 'Personal Financial Profile' of Mr Tomasetti (Judgment [40] - [42]). Mr Tomasetti's evidence concerning the 2000 investments 26The primary judge referred to Mr Tomasetti's affidavit evidence of the representation of existing fact referred to in [20] above. His evidence was that Mr Brailey added "[t]hese are the prospectuses and I can leave them with you to read through if you like", to which Mr Tomasetti responded: "PT: 'Ted, I have no time to read this documentation and I expect you to be thoroughly familiar with it so that you can make a proper recommendation to me. I am assuming that you have read it all and that having read it all you're content with the investment that you are recommending that we make. You know my financial position now. You know my cash flows and how my practice works. If you think that it is a sound and sensible investment and that we can afford it, then I am prepared to go with your advice'" (Judgment [61]). 27Mr Tomasetti said that it was "probable" that Mr Brailey left a copy of the prospectus for each project with him (Judgment [63]). 28The primary judge's observations concerning Mr Tomasetti's cross-examination included the following: "89 Mr Tomasetti said that his understanding, based on the discussions he had with Mr Brailey, was that for the projects entered into in 2000, he would have to make an 'upfront payment' and then not be required to pay anything more until the trees were eventually cut down and he received a return. Although there is nothing in his affidavit account of the conversation with Mr Brailey to this effect, he maintained that this was part of Mr Brailey's explanation (T249). He was not told that there would be ongoing maintenance costs (T250.45). Later, he said that his understanding in April 2000 was that he was required to make an 'upfront payment', and pay for insurance 'along the way', and that at the end of the project he would receive a lump sum after deduction of expenses and costs (T331.20). The latter included rent in respect of the land for which he was a lessee (T331.30). He derived that understanding from his discussions with Mr Brailey (T331.42). He did not, however, recall Mr Brailey telling him about deferral of rent payments (T332.10). 90 As to risks relating to forestry projects, Mr Tomasetti was aware of fire, and asked Mr Brailey about it (T251). He was aware of drought but did not appreciate that it could be a risk to the trees developing to their full potential. He was not aware of any risk that plantation timbers could get diseases of any kind (T252). He did not turn his mind to there being any risk from drought, disease, pests or changes in pricing (T261). ... 93 Whilst he appreciated that Timbercorp were not guaranteeing any particular level of return (T261.48), he thought the level of return Mr Brailey spoke of was 'approximate' and that the risk he was taking was that it could be 'slightly more, slightly less' (T262.8). He was interested to insure against a catastrophic loss to him in the event of fire (T262.43), but he never turned his mind to other risks (T263). If there had been a 'substantial risk' that he would not get his money back he would not have invested (T264.37). He was not interested in investing in these projects unless they fitted with the instructions he had given to Mr Brailey (T264.48) and they had been presented to him as conforming to those instructions (T265.3). ... 107 Towards the end of the cross-examination he confirmed an awareness that the investments (generally) carried a degree of speculation and risk: 'Q. In fact you had been well aware at the time you had entered into these particular transactions that the investments were ones which were not as safe as other investments? A. I've agreed with that. Q. And I suggest you were well aware at the time you entered into the transaction that the investments were speculative? A. Speculative, yes. Speculative no. I have difficulty with that. These investments are highly speculative, high risk, high danger investments. I had no knowledge of those matters but of course in the matters that we've discussed with the attendant risks that applied there were of course some degree of speculation, but nothing of the kind that I understood.' (T567.34) ... 109 His understanding in 2000 was that he would obtain an immediate tax deduction for the full amount of the investment. He was told that this would make a very significant reduction in the tax he would pay for the 2000 financial year; he would get an immediate cash tax benefit (T300). He saw an advantage in this, but said that it was not the primary consideration (T301). 110 In the 2000 tax year, Mr Tomasetti paid tax of some $70,000 against gross professional fees in the order of $850,000. He declared a loss on primary production from his investment in forestry schemes of $328,000. He had paid out a sum significantly less than the tax credit he received because the balance of his obligation had been deferred by substantial borrowings (T307 - 309). ... 112 In cross-examination, he said that he deliberately and consciously made a decision never to read prospectuses (T343.16). He added, while maintaining that he never read them, 'I'm not denying that I would have leafed through the documents from time to time' (T343.25). But then, in contrast to his affidavit evidence about the first meeting in April 2000: 'Q. ... But you do accept, don't you, that you did read bits of them? A. Yes, I accept that. Of course I did. Not all of them. And I can't say - don't ask me now which bits or of what prospectuses, but while Mr Brailey came to see me - for instance, in our first meeting when he had documents like that, I would have flicked through. I had never seen these things before. I was completely unfamiliar with the product. So it's highly likely that I would have picked one of them up and leafed through it while he spoke to me.' (T344.1)" Mr Brailey's evidence concerning the 2000 investments 29The primary judge's observations concerning Mr Brailey's evidence on this topic included the following: "73 By way of background to the making of agribusiness investments, Mr Brailey referred (at [90]ff) to investments made in the two preceding years by Mr Tomasetti in infrastructure bonds. He was able to claim a deduction of $307,127 in 1998 and $308,908 in 1999. The relevant provisions of the Income Tax Assessment Act 1936 (Cth) were repealed such that investment in these bonds was not available in the 2000 financial year and beyond. ... 79 Mr Brailey said that Mr Tomasetti had the prospectuses while he was explaining the projects to him and appeared to be leafing through them. He continued: EB: 'Peter, the approximate rate of return predicted by the prospectus is around 10% per annum but each investment will have its own return which will depend on many variables. Also, forestry is similar to all types of farming and there are many things which can go wrong including the failure of the plantation. There is the danger of fire for example but you can insure against that risk. Also the exact value of the crop when it's harvested is largely unknown. Because you are selling to a Japanese buyer the value of the Australian dollar is also a risk.' 80 Mr Brailey said that at various times during his explanation of the projects, he made direct reference to the relevant prospectus. He also said: EB: 'You should read the whole prospectus before you make any decision. You should especially read the section on risk which expands on the matters I have been speaking about today. If you are to take advantage of the tax deduction for this financial year you will need to put the application in before 30 June. There is also a fair bit of demand for these investments. I have faith in the projects and am investing in them myself.' 81 Mr Brailey said that Mr Tomasetti replied, 'I will have a think about it.' 82 Mr Brailey claimed (at [127]) that at the end of the meeting, he left the prospectuses and the finance documents with Mr Tomasetti for him to read. He denied that the application forms were signed there and then by Mr Tomasetti. ... 119 Mr Brailey maintained that the application forms were not already filled out, ready to sign, when he came to the meeting. He also maintained that his memory was that he did take Mr Tomasetti through the prospectuses. He did that for the purpose of telling him 'what the investment was ... what the risks were and what the project was' (T886). He agreed that he did not take Mr Tomasetti to pages concerned with 'risk' that indicated that the investment was 'speculative' (T887)." Mr Tomasetti's later investments 30The evidence concerning Mr Tomasetti's later investments, and those of the TSF, is fully described in the primary judgment. It is sufficient for present purposes to note that the evidence concerning those investments was substantially to the same effect as that relating to the 2000 investments. Ms Cordony's investments 31The primary judge's observations concerning the evidence relating to these investments included the following: "261 Ms Cordony frankly conceded in her affidavit (at [41]) that she did not have any recollection of discussions with Mr Brailey about her making the two agribusiness investments in 2005. She said, however, that she did not initiate any such discussion. Ms Cordony also could not recall completing the application forms (at [45]). She assumed that they were completed by Mr Brailey and that she received them ready for her to sign. 262 Ms Cordony gave the following account of her reasons for making the two investments ([45]): 'My reason for investing in the two projects was that I trusted Mr Brailey and was guided by his suggestions with respect to financial planning. I assumed that Mr Brailey was advising me to invest in these projects because he believed that they were prudent investments.' ... 264 Ms Cordony said in her affidavit of 1 November 2010 that she would not have entered into the investments if she had been aware that they were 'highly risky'; that they were long-term and could not be sold; or that a reasonably competent financial planner would not have recommended them to her for those reasons. ... 270 Mr Brailey recalled a conversation by telephone with Ms Cordony 'in or around early 2005' (at [326]): EB: 'Hi Sassi. I am recommending that you go into agribusiness this year. This is how it works: You are an employee of Tomasetti Trust and therefore Tomasetti Trust gets a tax deduction for superannuation contributions for you. The maximum that can be contributed for you this year is $95,980. Normally the fund will pay 15% contributions tax on that amount. However at the moment there is an extra tax of 15% called Superannuation Contributions surcharge which is payable by the fund if your taxable income plus Fringe Benefits plus superannuation contributions exceeds $105,000 odd. So, to largely eliminate your taxable income you need a tax deduction. And investment in agribusiness fulfils this requirement. In addition to that Peter will get a tax deduction for the amounts he pays the trust to provide your services and this will help him with his tax. On top of all that he will also be able to claim a spouse rebate for you with a bit of luck. Don't worry I'll confirm all this in a letter to you and Peter.' SC: 'Ok, Ted. That sounds good. I'll read your letter when it comes in.' ... 278 Mr Brailey claimed that product disclosure statements for both projects were provided to Ms Cordony ([350] - [351]). He could not recall the precise circumstances apart from the fact that it was in Mr Tomasetti's chambers. He thought this might have been on the occasion of the meeting on 23 May 2005. He claimed to have gone through them with her and advised her to read the whole document herself. He said that he referred to risks and to ongoing costs. ... 281 Ms Cordony did not recall the conversation that Mr Brailey said occurred 'in or around early 2005' when he recommended that she 'go into agribusiness this year' (her affidavit of 14 July 2010 at [5]). She did not recall being provided with research material from Australian Agribusiness Group and added that she did not read any such material ([6]). She did not recall receiving either of the Statements of Advice ([7] - [8]) or the product disclosure statements ([9]). She denied that Mr Brailey told her about risks associated with the projects. If he had, 'alarm bells would have rung' for her and she would have spoken to Mr Tomasetti about it. She added that it was 'not in [her] nature to take risks about these kinds of things' ([9]). ... 289 As she had indicated in her affidavit, Ms Cordony really had no recollection of the circumstances and the discussions pertaining to her making the investments. It follows that she was not in any real position to dispute Mr Brailey's account ... ... 300 Ms Cordony agreed with the following propositions (T648): She did not recall anything about what Mr Brailey may or may not have told her about the investments before she decided to go into them. She could not remember what her reasoning process was based on, what Mr Brailey may or may not have told her, or what she knew from other sources. She could not remember what the nature of the arrangement was between her and her husband which saw him paying for investments in her name. 301 As a result, she agreed that she could not legitimately blame Mr Brailey for her having made the investments on the ground that she was ill-advised (T648.34). ... 304 Ms Cordony said that she had been told by Mr Brailey at some stage that she and Mr Tomasetti would 'break even' in relation to the investments generally in 2010 and 2011 (T651 - 652). She realised, however, that prices fluctuate (T652.46). She knew that the costs were not capped (T653.9). For the latter reason, she knew that there could be events over which the investor had no control which might cause the expenses to be higher than they would otherwise be (T653.14). She also knew that there could be events which could have the effect of reducing or even eliminating crop or forest yields (T653.25). She realised that in such an event, the investor who had borrowed would still be required to repay the loan (T653.30) ... " Credit findings 32The primary judge reached the following conclusions concerning the reliability of Mr Tomasetti and Ms Cordony's evidence: "385 I have no hesitation in saying that I am not satisfied that Mr Tomasetti has set out to be dishonest. I am also mindful of the need for caution in the assessment of the credibility of witnesses. ... 386 Reference has been made during the course of my review of the evidence concerning each investment, and in this portion of the judgment, to a number of aspects of the evidence of Mr Tomasetti which lead me to conclude that I have very real doubts about its accuracy and reliability. 387 His recollection was shown to be faulty in many respects. There were conflicts between his evidence and irrefutable documentary evidence. The manner in which he gave his evidence was, on occasions, unimpressive. His accounts of the substance and effect of conversations were often unrealistically dressed up to make them sound like a verbatim account to suit the pleadings. One of many examples is his claim that he said to Mr Brailey at their first meeting when agribusiness investments were discussed: 'Well Ted, I know nothing about these products, I've never heard of them before and I can only rely on you. Do you think these are sound, prudent, sensible investments as I know nothing about them?' 388 In the end, it is not possible to have any confidence in Mr Tomasetti's recollection of significant events, particularly of conversations. It often appeared to be a reconstruction of what he would like to think occurred, rather than what in fact occurred. Mr Tomasetti found himself in a terrible financial plight in 2009. I am satisfied, as he conceded (T382), that his evidence has been 'coloured' by 'the catastrophic loss [he has] suffered'. 389 I have come to the view that Mr Tomasetti's evidence should not be accepted where it is in issue and not independently supported. 390 Ms Cordony was unable to recall the detail of important conversations and made a number of significant concessions. Her evidence does not advance the plaintiffs' case in respect of the investments made in 2000 to 2004 and lacks the cogency to establish the case in respect of the investments made in her own name in 2005." 33Earlier, the primary judge had said that in light of "strident criticism by the plaintiffs of the evidence of Mr Brailey, in assessing the reliability of their [Mr Tomasetti and Ms Cordony's] evidence I have not had regard to anything he [Mr Brailey] said unless it is corroborated by documents" ([375]). His Honour proceeded to say: "391 There are many frailties in the evidence of each of Mr Brailey as well [as the evidence of Mr Tomasetti and Ms Cordony]. ... 409 The plaintiffs' submission was, in part, that there was 'complete certainty of the requirement to pay all outgoings for the life of the project' (PWS at [34(d)]). In the case of the almond projects which were to have a 'life' of 20 years, that would appear to be an alarming prospect. Mr Parker's submission was that this was an overstatement (T1350). There were provisions for the unit holders or the manager to wind up projects. Mr Parker cited the example of the ITC Solidwood 2001 project which was wound up following it becoming commercially unviable. It does not seem to be realistic that in the event that something occurred which severely compromised the viability of a project, that the unit holders would sit by and pay ongoing expenses for the entire balance of the project with the prospect of no or little income coming their way. ... 472 There were a number of features of Mr Brailey's evidence which were submitted to have been unsatisfactory. One was the issue as to whether he 'proposed' the investments to the plaintiffs, or 'recommended' them. He had made the admission in the first version of his pleaded defence that he had made recommendations. That changed in the subsequent defence that was filed to 'proposed'. He explained that to 'propose' is to, in effect, say 'this is what is available - if you want to do it, then, we'll discuss it further, if you don't want to do it, that's okay'. It was a better word than 'recommend' because 'propose' denoted that there was no pressure from him for Mr Tomasetti to do anything (T925). 473 It is unnecessary to explore the detail of Mr Brailey's explanations on this subject further. It suffices to say that I accept that his evidence on this rather semantic point was unimpressive and gave the impression that he was seeking to downplay any force or authority with which he put the various investments to Mr Tomasetti and, later, Ms Cordony. The most remarkable feature of Mr Brailey's evidence in this respect came in the course of his cross-examination about the provision of statements of advice to Mr Tomasetti and Ms Cordony in 2004 and 2005. On a number of occasions (for example, T803) he gave the explanation that he 'proposed' the investments and once the client had made a decision, he then 'recommended' them. Mr Faulkner's submission was, in effect, that this was nonsense, absurd and unbelievable. I accept that submission." The Fair Trading Act claims 34The primary judge reached the following conclusions on these claims: "392 While he was critical of Mr Brailey's evidence, Mr Faulkner [counsel for the appellants] did place reliance upon certain things that had been said which were characterised as concessions (see, for example, T1397). Even if such a characterisation was correct, where the subject matter concerned whether a word was used, or a statement was made, in conversations that occurred years earlier, there are very real questions as to whether what was conceded was accurate and reliable. 393 I find myself left in the position of having real doubt about the terms of the conversations concerning each and every one of the investments where there is no reliable confirmatory documentary evidence. This case has provided a perfect example of one of the matters to which [McLelland] CJ in Eq referred in the extract from his judgment in Watson v Foxman set out earlier: '[H]uman memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions or self interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed.' 394 That leaves the FTA claim to be determined on the basis of the documents and what has been admitted by Mr Brailey. 395 Mr Brailey claimed that he offered a prospectus or PDS to Mr Tomasetti and Ms Cordony in relation to each of their respective investments. The testimonial evidence is insufficiently reliable to establish that this occurred on every occasion, but it is clearly the case that it occurred on some, and probably most. Each of these documents provided a description of the potential benefits and risks of the investments in a manner that the plaintiffs have not sought to establish was in any respect erroneous. Each of the application forms that Mr Tomasetti and Ms Cordony signed contained either an acknowledgement that the prospectus/PDS had been read, or, in the case of the Gunns investments, a direction that the investor should read that document in its entirety before deciding to invest. ... 397 ... Three of the representations pleaded in respect of the investments made in the financial years 2000 to 2004 inclusive are potentially of significance. They are included in what counsel for the plaintiffs referred to as 'the principal representations' (PWS at [22]). They are that the investments were 'sound prudent and sensible commercial investments', that they would produce reasonable commercial returns with time, and that they would provide future income. Some of the other pleaded representations were admitted with qualification. It is not possible to reject any of the qualifications because of the lack of cogent and reliable evidence to justify doing so. 398 As to the second and third of the admitted representations, the submission for the plaintiffs was that they 'did not produce reasonable commercial returns with time' and they 'did not provide future income' (PWS [34]). That is a submission made with the benefit of hindsight. It does not establish that this is something that was reasonably foreseeable at the time the representation was made. It was submitted on behalf of the defendants, correctly in my respectful view, that 'the mere fact that a prediction or opinion as to future events is not ultimately fulfilled does not make that prediction or opinion misleading or deceptive' (DWS [140]). 399 As to the first admitted representation, what is 'sound, prudent and sensible' as an investment is a question of relativity and would depend upon factors such as the circumstances of the investor and the purpose [of] the investment it is designed to serve. The word 'speculative' that has been used so much in these proceedings is also relative. A retiree investing all of his or her funds in a start-up mineral exploration company could be regarded as making a speculative investment that was not sound, prudent and sensible. In the case of a very wealthy person with a substantial annual income, investing a modest sum in such a way might also be speculative, but would not be regarded as unsound, imprudent or unwise. ... 408 There is no evidence from which a conclusion could be drawn as to how an assessment could have been made in 2004 of the prospect that this investment would not have generated for its growers the income anticipated. In investments of this type, anything might be possible, but the question is how realistic the possibilities are, and how such possibilities should have been foreseen and assessed by a person in Mr Brailey's position. ... 410 Each of the admitted representations must be seen in the context in which they were made. The investments were being proposed or recommended in order to achieve a number of purposes, a significant one of which was to legitimately minimise the tax payable upon a large income. I accept that Mr Tomasetti said 'nothing speculative' to Mr Brailey in December 1998 when they had a discussion about his investment strategy. However, that was in the context of Mr Tomasetti having Commonwealth infrastructure bonds available to him for tax minimisation purposes. They were no longer available and some alternative investment approach needed to be considered for the 2000 tax year and beyond. 411 The context also includes the sort of person who Mr Tomasetti is. I have earlier described a number of his personal attributes and experiences. He was far from being a person who was unintelligent, naive, poorly educated and inexperienced in investment and financial matters. He certainly had the capacity to understand the cautionary statements in the prospectuses. 412 It must be borne in mind that in respect of future matters, the onus is upon the maker to establish that there were reasonable grounds for making the representation: Fair Trading Act, s 41 . Whether or not Mr Brailey orally informed Mr Tomasetti of the risks associated with the projects, he at least conveyed that information in the form of providing the prospectuses. His representations should be understood as being, in effect, 'the investments have these attributes' (the three admitted representations), 'subject to what you must also understand about them' (the qualifications and warnings in the prospectuses). 413 I am not satisfied that Mr Brailey engaged in misleading or deceptive conduct in respect of the three admitted representations or, for what it is worth, in relation to his dealings with Mr Tomasetti and Ms Cordony in relation to the investments generally." The negligence claims 35The primary judge's reasoning in rejecting these claims included the following, although I note that Judgment [475] and [478] quoted below appeared in the judgment under the heading "Submissions for the plaintiffs," creating some doubt as to whether the views expressed in those paragraphs were those of the judge or merely a recitation of the appellants' submissions. However, given the content of the views and the judge's conclusions expressed elsewhere in his judgment, it seems to me that the views can safely be regarded as his own. "475 There was lengthy cross-examination about the content of some of the prospectuses and whether Mr Brailey had read parts of them, such as reports by independent experts. For example, Mr Brailey said that he did not read the expert reports concerning the Norgard Clohessy Australian Blue Gum 2000 project 'in detail'. He was asked whether he had read them at all and he could not remember. That applied to the forester's report and the accountant's report. He could not remember reading the expert reports in the prospectus for the Great Southern Blue Gum Plantations 2000 project either (T845). The important point about this is that it was not established that there was anything significant in the expert reports or otherwise in the prospectuses or product disclosure statements of which Mr Brailey was not aware. In other words, doubts about whether Mr Brailey had read something might be significant if there was something of importance that he had neglected to read and of which he was otherwise unaware. However, that was not shown to be the case. ... 478 It was suggested to [Mr Brailey] that nothing had occurred between his first meeting with Mr Tomasetti in 1998 and June 2003 that led him in any way to form a view that Mr Tomasetti's comment that he wanted 'nothing speculative' had changed, but he replied, 'I think it did' (T864.20). He thought that by June 2003, Mr Tomasetti was prepared to invest in speculative investments if they had tax minimisation characteristics (T864.24). What had led him to this view was that Mr Tomasetti had invested in almonds and the forestry projects in the preceding years. He agreed that he had earlier said that he regarded each of those projects as 'non-speculative' (T864.30). 'Q. And so the fact that Mr Tomasetti invested in projects that were non-speculative is the reason you have just given as to why you thought he would be now prepared in June 2003 to invest in speculative investments? A. The risk is that was changing, he was prepared to take more risk.' (T864.35). 479 Mr Faulkner submitted that this was 'nonsense evidence' (T1150.40). There is force in that submission. ... 525 There is no evidence that anything in the prospectuses, product disclosure statements or in the independent research analyses that Mr Brailey had recourse to, was either inaccurate, misleading or incomplete. The plaintiffs' case, including the [expert] evidence of Mr Wall, does not involve any criticism of that material at all. There were also suggestions that Mr Brailey should have gone beyond that material, but there is no evidence as to what exactly he should have done, or what further inquiries he should have made, let alone any suggestion that if he had done so he would have become aware of additional and material information. 526 In relation to the other research material to which Mr Brailey had recourse, although there was an objection taken to his description of it being 'independent', it was not established that this was not apt. ... 528 I am not persuaded that it has been established that the investments were not sound, prudent and sensible in the circumstances and for the purposes for which Mr Brailey recommended them to the plaintiffs. They were not inherently unsatisfactory. They certainly carried elements of risk, but they also brought with them specific advantages that were capable of meeting important needs and desires of the plaintiffs, particularly Mr Tomasetti. 529 The "what should have been done" question posed by the defendants involves consideration of whether the investments were suitable for the plaintiffs and whether they were alerted to the risks. Having regard to the plaintiffs' circumstances, particularly those of Mr Tomasetti, I am not persuaded that the investments were not suitable for them. Although it is not critical to that conclusion, it is of some significance that it has not been established that there was some viable and realistic alternative course of action that should have been taken. 530 It is clear enough that it would have been a breach of Mr Brailey's duty to have put the investments forward without his clients being aware of the risks. I am not persuaded, however, that this occurred. There is a dispute between Mr Tomasetti and Mr Brailey as to the extent of discussions they had about risks. I have indicated my view of the reliability of the evidence of each of them. I am not satisfied that Mr Brailey did not sufficiently convey to Mr Tomasetti the risks in relation to each investment. As for Ms Cordony, she was unable to reliably say what was said by Mr Brailey, and what was not said, because of her inability to recall. I accept that prospectuses and product disclosure statements were usually provided. If Mr Tomasetti and Ms Cordony never read any prospectus, PDS or application form (which I very much doubt), that was not Mr Brailey's fault. 531 I conclude that the plaintiffs have failed to discharge their onus of establishing that there was a breach of the duty of care that was undoubtedly owed to them." Findings in relation to other issues 36Reference to the primary judge's findings concerning other issues is made where those issues are discussed below. MR TOMASETTI'S FAIR TRADING ACT CLAIMS 37On appeal, the ambit of the dispute between the parties concerning these claims was relatively narrow. Neither party challenged the primary judge's finding that, at least when account was taken of Mr Tomasetti's circumstances, the investments that Mr Brailey recommended to him were not inherently unsound (Judgment [528] quoted in [35] above; see also Judgment [399] quoted in [34] above). Investment in them was however unsound if made without knowledge of the associated risks. As the primary judge said, "[t]hey certainly carried elements of risk, but they also brought with them specific advantages that were capable of meeting important needs and desires of the plaintiffs, particularly Mr Tomasetti" (ibid). As a result, whether the representations made by Mr Brailey to Mr Tomasetti that the investments were "sound, prudent and sensible" constituted misleading and deceptive conduct turned upon whether Mr Brailey apprised Mr Tomasetti of the risks associated with the investments. On appeal the parties accepted, as the primary judge held (see Judgment [525] quoted in [35] above), that those risks were adequately described in the prospectuses and PDS relating to the investments. 38Mr Tomasetti's evidence was to the effect that Mr Brailey did not orally apprise him of those risks despite being informed by Mr Tomasetti that he would not be reading the prospectuses and PDS, but would rely instead upon Mr Brailey's recommendations of the investments (see [26] above). On the other hand, the effect of Mr Brailey's evidence was that he told Mr Tomasetti of the existence of risks in relation to the investments, directed him to the prospectuses and PDS for details and left copies of these documents with Mr Tomasetti (see Mr Brailey's affidavit of 17 June 2010, [121] - [127] and [29] above). However, the primary judge found that he was unable to rely upon either version of the conversations between Mr Tomasetti and Mr Brailey, although he did find that "prospectuses and product disclosure statements were usually provided" (Judgment [393], [394], [395], [412] and [530] quoted in [34] - [35] above). 39In these circumstances, whilst it was established (by admission) that Mr Brailey recommended the investments as sound, prudent and sensible and (by finding) that the prospectuses and PDS were (at least usually) handed to Mr Tomasetti by Mr Brailey (see Judgment [395] and Mr Tomasetti's evidence referred to in [26] above), the appellants failed to prove what was said in the conversations between Mr Tomasetti and Mr Brailey when the latter made the representations and handed over the prospectuses and PDS. In my view, commonsense indicates that such conversations must have occurred: it would be absurd to contemplate the prospectuses and PDS being handed over in silence, apart from a one sentence representation as to the soundness of the investment being made. In any event, although their evidence differed as to their content, it was common ground between Mr Tomasetti and Mr Brailey that conversations did occur. 40In these circumstances, it cannot be found that Mr Tomasetti discharged his onus of proving that Mr Brailey's conduct was misleading and deceptive unless he can fill the apparent lacuna in his case concerning the content of the conversations. In this regard, my view accords with that of the primary judge (see Judgment [530] quoted in [35] above). 41Whether conduct is misleading or deceptive is to be determined by an examination of the course of conduct as a whole (Campbell v Backoffice Investments [2009] HCA 25; 238 CLR 304 at [102]). If (as here) it is apparent from the evidence that representations relied on by a plaintiff were made in the course of conversations dealing with the same subject matter, the plaintiff cannot succeed unless he or she establishes that those conversations did not deprive the representations of an otherwise misleading or deceptive character. This is not to inappropriately reverse the onus of proof. It simply requires the plaintiff to prove the context in which the relevant representations relied upon were made and therefore that the defendant's conduct, taken as a whole, was misleading or deceptive. Mr Brailey's concessions in cross-examination 42At the appeal hearing Mr Tomasetti sought to fill the apparent lacuna in his case by relying upon concessions made by Mr Brailey in cross-examination, as to what was, or was not, said in the conversations between them. 43On appeal, Mr Tomasetti did not challenge the primary judge's finding (see [32] - [33] above) that his evidence should not be accepted in relation to a matter in issue if it was not independently supported. However he submitted that the primary judge erred in concluding, in light of a finding to similar effect in relation to Mr Brailey's evidence, that his Fair Trading Act claim was "to be determined on the basis of the documents and what has been admitted by Mr Brailey" (Judgment [394] quoted in [34] above). Mr Tomasetti submitted that, as the primary judge's reference to "what has been admitted by Mr Brailey" appeared to refer only to formal admissions made by Mr Brailey in his Defence, his Honour erroneously excluded from consideration important concessions made by Mr Brailey in cross-examination. More generally, Mr Tomasetti submitted that the primary judge failed to consider the inherent likelihood of Mr Tomasetti's version of events being correct. These matters, he submitted, should have led the primary judge to conclude that Mr Brailey recommended the subject investments without referring to their risks and without suggesting that Mr Tomasetti read the prospectuses and PDS to enable him to appreciate those risks. 44I accept that, in reaching his conclusions, the primary judge should have had regard to concessions made by Mr Brailey in cross-examination, but does not appear to have done so. Contrary to what is implicit in his Honour's judgment, the concessions did not constitute evidence of the type described by McLelland CJ in Eq in Watson v Foxman (see [34] above). His Honour was referring in that case to oral evidence of disputed conversations, unaided by documents. As his Honour pointed out, when the passage of time is combined with the inevitable self-interest of party witnesses, such evidence has a high degree of fallibility. The position is otherwise where a witness makes concessions in cross-examination against his or her own interests. If not relevantly qualified, such concessions usually have a high degree of reliability due to the absence of the self-interest factor referred to by McLelland CJ. 45This approach accords with that of Hely J in Port Kembla Coal Terminal Ltd v Braverus Maritime Inc [2004] FCA 1211; 140 FCR 445. In that case, after referring to the adverse effect of "a conscious or unconscious instinct of self-preservation or loyalty" on the reliability of hindsight, Hely J said: "40 I agree with the plaintiff's submission that in this very difficult context, the court should, where possible, base its fact findings on the objective or contemporaneous documentary evidence augmented by the testimony of the relevant witnesses to the extent that these witnesses are not in conflict. Where there is conflict the court should, where possible, seek to resolve it by determining, on the objective evidence, what is inherently probable supplemented by admissions against interests made by the crew, on the one hand, or the pilot on the other." 46The concessions of potential significance made by Mr Brailey in cross-examination were, first, that he did not inform Mr Tomasetti that some of the prospectuses and PDS (including those relating to two of the three investments in 2000, the first of the relevant investment years) described their respective investment schemes as "speculative" (Transcript p 1065.22; Judgment [494] compare [469] see [33] above). Secondly, that Mr Tomasetti's instructions in 1998 were to avoid investment in anything speculative and that those instructions did not change at least until 2003 (Judgment [478] quoted in [35] above). Thirdly, Mr Brailey conceded that investments would not be sound, prudent and sensible if they were aptly described as speculative (Transcript p 844.1). 47The effect of Mr Tomasetti's submissions was that these concessions proved that Mr Brailey recommended the investments in an unqualified fashion, without informing Mr Tomasetti that they did not conform with his earlier instructions. 48In my view this submission errs in attaching importance to the label "speculative", rather than to the concept to which that word refers. 49Adopting its ordinary meaning relevant to the present context, the word "speculative" refers to a commercial business or venture "involving considerable risk or the chance of large gains" (see the definitions of "speculate", "speculation" and "speculative" in the Macquarie Dictionary, 5th ed (2009)). There was no need for Mr Brailey to use the word "speculative" in his conversations with Mr Tomasetti if he conveyed to Mr Tomasetti the same concept by using different words. If he informed Mr Tomasetti that there were considerable risks associated with the investments, that was as good as describing them as "speculative". Mr Brailey did not concede that he did not apprise Mr Tomasetti of the risks associated with the investments. Indeed, he consistently maintained the contrary. Accordingly, his concession that he did not tell Mr Tomasetti that the investments were "speculative" did not remedy the deficiency in proof in Mr Tomasetti's case referred to earlier (see [40] above). The available inferences 50As a result, I consider that Mr Tomasetti has failed to prove that Mr Brailey's representation that the investments were sound, prudent and sensible constituted misleading and deceptive conduct. Contrary to Mr Tomasetti's further submission, no commonsense inference could be drawn to fill the gap. There were no inherent probabilities that pointed to non-disclosure, as opposed to disclosure, of the risks. Mr Brailey's evidence that he disclosed the risks was not inherently improbable. Accordingly Mr Tomasetti failed to prove that it was more probable than not that in recommending investments to him and providing him with the prospectuses and PDS, Mr Brailey did not apprise him of the relevant risks (see Jones v Dunkel [1959] HCA 8; 101 CLR 298 at 304 - 305). 51Whilst this view accords with the primary judge's conclusion that he was "not satisfied that Mr Brailey did not sufficiently convey to Mr Tomasetti the risks in relation to each investment" (Judgment [530]), his Honour appeared to go further and find that it was enough that Mr Brailey provided the prospectuses and PDS to Mr Tomasetti, even if Mr Brailey did not tell Mr Tomasetti to read them, or have any basis for thinking that he would (see the last sentence of [530] quoted in [35] above). With respect, I cannot agree with this conclusion. Whether the provision of a document by the representor to the representee at the time a representation is made deprives the representation of an otherwise misleading character will usually depend upon whether a reasonable person in the position of the representor would have expected the representee to read the document and thereby apprise himself or herself of an appropriate qualification to the representation (see generally Parkdale Custom Built Furniture Pty Ltd v Puxu Pty Ltd [1982] HCA 44; 149 CLR 191 at 209 especially at 209 - 11 and Butcher v Lachlan Elder Realty Pty Ltd [2004] HCA 60; 218 CLR 592 at [50] and Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Ltd [2010] HCA 31; 241 CLR 357 at [20] - [21]). Contrary to what seems implicit in the primary judge's reasoning, the representee is not fixed with constructive notice of the document provided by the representor. Whether the document deprives the representor's conduct of its otherwise misleading and deceptive character must be considered having regard to the whole of the circumstances (Campbell v Backoffice Investments at [302]), including any reasonable expectation that the representee will read any documents provided by the representor. 52The conclusion that, given the rejection of his version of events, Mr Tomasetti failed to prove that Mr Brailey engaged in misleading and deceptive conduct is reinforced by evidence of acknowledgements signed by Mr Tomasetti that he had read the relevant prospectuses and PDS (see [19] above). These acknowledgements incorporated detailed descriptions of the risks associated with the investments and, in some cases, descriptions of the investments as "speculative". As well, in relation to the Australian Blue Gum 2000 investment, the first in the list referred to in [13] above, Mr Tomasetti signed an acknowledgement that the investment "is considered to be speculative" and an investment adviser, Mr Tony Snape, certified that he had explained the project to Mr Tomasetti. These documents constituted significant evidence against Mr Tomasetti's case which, in the circumstances of the case, could only be overcome by acceptance of his evidence. Representations as to future matters 53Mr Tomasetti relied upon five representations as to future matters (see [21] above). The respondents submitted that Mr Tomasetti was not able to rely upon the second and third of these as they were not pleaded. However, in my view, those representations do not add anything of significance to the three that were pleaded in the Statement of Claim and admitted in Mr Brailey's Defence. In fact, save for the fact that the fourth has greater specificity, in referring to a return of approximately 10 per cent per annum, all of the alleged representations were relevantly to the same effect: that Mr Tomasetti would receive a reasonable level of income from the investments. Mr Tomasetti submitted that, as representations to this effect were admitted, s 41 of the Fair Trading Act 1987, as it stood at the relevant times, cast an onus upon Mr Brailey to show that he had reasonable grounds for making the representations (see Dib Group Pty Ltd v Ventouris Enterprises Pty Ltd [2011] NSWCA 300; 284 ALR 601 particularly at [20], [21] and [35]) without which the representations would be deemed to be misleading and deceptive. Section 41 was then in the following terms: "(1) For the purposes of this Part [concerned with Fair Trading], where a person makes a representation with respect to any future matter (including the doing of, or the refusing to do, any act) and the person does not have reasonable grounds for making the representation, the representation shall be taken to be misleading. (2) The onus of establishing that a person had reasonable grounds for making a representation referred to in subsection (1) is on the person. (3) Subsection (1) shall not be taken to limit by implication the meaning of a reference in this Part to a misleading representation, a representation that is misleading in a material particular or conduct that is misleading or is likely or liable to mislead." 54Mr Brailey responded to this argument by submitting that the first step in applying s 41 must be to identify the representations to which the section may apply. Mr Brailey asserted that the representations alleged in the present case were qualified ones, or at least had not been shown to be unqualified. Mr Tomasetti replied that this argument was not open to Mr Brailey in light of the terms of his Defence, to which I now turn. 55The relevant Defence of Mr Brailey and TJC (their Amended Defence to the Second Amended Statement of Claim) admitted, without relevant qualification, the first and fifth of the representations as to future matters described in [21] above. (The second and third of those representations were not alleged in the Statement of Claim although Mr Tomasetti submitted that they had nevertheless been litigated). The Defence stated in relation to the fourth of those representations (alleged in paragraph 20(e) of the Second Amended Statement of Claim): "20.d. [The first and fourth defendants] [d]eny sub-paragraph (e) and say that Brailey told Tomasetti in relation to the said forestry projects that: i. 10% per annum was an approximate rate of return or 'round figure'; ii. That each investment had its own internal rate of return which would depend upon many variables including fluctuations in foreign currency, pricing and yield at harvest time; iii. In the event the figures contained in the respective Product Disclosure Statements were realised then the projects were a good investment". 56Mr Tomasetti contended that this paragraph of the Defence only applied to the fourth representation and not to the others. The paragraph is not well-worded and, if the Defence is read strictly, what Mr Tomasetti submits is arguably correct. However, the paragraph clearly asserts that Mr Brailey qualified his advice to Mr Tomasetti "in relation to the said forestry projects". That positive assertion was applicable by its terms to each of the representations concerning future matters. It is unfortunate that the assertion appeared in a subparagraph dealing with only one of those representations but, interpreting the Defence with common sense, I consider that the nature of Mr Brailey's intended response to the relevant representations was sufficiently clear. I would therefore reject Mr Tomasetti's point based upon the terms of Mr Brailey's Defence. In any event, it would be highly artificial to treat Mr Brailey as having "admitted" that he made unqualified representations as to future matters when it was clearly part of his case, advanced through his affidavit evidence and submissions, that his conduct was not misleading and deceptive because he had suitably qualified his recommendations. 57In these circumstances, Mr Tomasetti's case concerning the representations as to future matters fails for the same reason that his existing representation case did: Mr Tomasetti did not prove that Mr Brailey recommended the investments in an unqualified fashion, that is, without apprising Mr Tomasetti of the risks associated with them. Mr Tomasetti did not, and could not reasonably, submit that there was no reasonable basis for Mr Brailey's advice concerning the prospects of the investments if that advice was qualified by reference to the risks identified in the prospectuses and PDS. In other words, as noted earlier (see [37]), Mr Tomasetti did not contend that the investments were inherently unsound. Rather he accepted, at least implicitly, that there was a reasonable basis for the representations as to future income, provided that the qualifications contained in the prospectuses and PDS were made known. Accordingly once it is recognised that Mr Tomasetti did not prove that the representations were unqualified, it is clear that s 41 does not assist him as, on the evidence and the case conducted by the parties, Mr Brailey had reasonable grounds for making qualified representations. Reliance and causation 58For the reasons that I have given, Mr Tomasetti's challenge to the primary judge's rejection of his Fair Trading Act claims fails. If it had not, issues of reliance and causation would have required consideration. Whilst these issues overlap, they are not co-extensive (Campbell v Backoffice Investments Pty Ltd at [143]). In the present case it should be concluded that, at least in one sense, reliance is shown by the fact that Mr Brailey, acting as Mr Tomasetti's financial adviser, recommended that he make the investments and Mr Tomasetti did so in response to that advice (see Gould v Vaggelas [1985] HCA 75; 157 CLR 215 at 236). 59However a more difficult question is whether Mr Tomasetti would have refrained from making the investments if Mr Brailey's advice had been suitably qualified (Mr Tomasetti said it was not). If he would have proceeded with the investments despite the qualifications, his loss could not be said to have been caused by Mr Brailey's conduct (see generally Awad v Twin Creeks Properties Pty Limited [2012] NSWCA 200 at [43] - [46]; Jacfun Pty Ltd v Sydney Harbour Foreshore Authority [2012] NSWCA 218 at [55]). Mr Tomasetti swore an affidavit saying that he would not have made the investments in those circumstances, and he was cross-examined on it. That evidence may have been of limited weight (see Rosenberg v Percival [2001] HCA 18; 205 CLR 434 at [26] and [89]; compare the Civil Liability Act s 5D(3) in relation to actions in negligence) but there was much other evidence relevant to this issue, for example, that relating to the importance to Mr Tomasetti of obtaining tax deductions, a matter which the primary judge accepted as a major factor in Mr Tomasetti's thinking (Judgment [372]). Relevant in this context is the primary judge's finding (challenged on appeal) that Mr Tomasetti would not have been able to meet a tax debt of $400,000 which would have been due for the 2003-4 year if it had not been for the almond and forestry investments he made that year (Judgment [521]). The parties were at issue as to whether this point had been squarely raised at first instance. On appeal Mr Tomasetti contended that he had sufficient unencumbered assets to enable him to borrow to meet his tax liabilities. However, Mr Brailey disputed this, pointing to the inclusion in Mr Tomasetti's list of assets of a house price not supported by valuation evidence and the inclusion of his forestry investments at cost. 60As the primary judge did not make a finding on the issue of causation, I would have favoured the remission of the proceedings to the primary judge for the determination of that issue if Mr Tomasetti had succeeded on his appeal on the basis of the concessions made by Mr Brailey in cross-examination. It is not one that this Court could have determined, as Mr Tomasetti's credit was relevant to it and in any event this Court would not have been in a position to assess the wealth of evidence that was before the primary judge (much of which was not included in the Appeal Books) and to make the relevant factual finding. 61Mr Tomasetti opposed a remission to the primary judge for this purpose. He submitted that in light of R A Hulme J's credit and other findings there would be "the appearance of pre-judgment" (Appellants' Written Submissions dated 19 October 2012), resulting in a lack of procedural fairness. He submitted that if remission were required, it should be to a different judge. However, in my view, remission to a different judge for determination of the limited issue of causation would not have been practical. That judge would have needed to consider a broad range of evidence covering much of what was already before R A Hulme J. Accordingly, remission to a different judge would probably have to have been for redetermination of the whole proceedings (see generally Pateman v Higgin [1957] HCA 62; 97 CLR 521, particularly at 527). This would clearly have been an undesirable outcome. 62A limited remission to R A Hulme J would have saved considerable time and expense and would not in my opinion have been unfair to Mr Tomasetti. The position would have resembled that which would have obtained if, after the primary judge's delivery of judgment on 17 November 2011, the parties had requested him to determine the issue with which he had not dealt. His Honour could, and should, have then proceeded to determine that issue, without further evidence and, subject to his discretion, without further argument. Mr Tomasetti's position would be no worse now if a limited remitter were made to the primary judge. 63If this Court had held that Mr Brailey's concessions in cross-examination filled the lacuna in Mr Tomasetti's proof of his case, its decision would not have involved any interference with the primary judge's credit findings. Therefore, to use the language of Amalgamated Television Services Pty Ltd v Marsden (No 2) [2003] NSWCA 186; 57 NSWLR 338 at [46], it would have been possible "for his Honour to take up where he had left off" (the complexities that prevented that occurring in that case do not arise in the present). Nor would the difficulties identified in Waterways Authority v Fitzgibbon [2005] HCA 57; 79 ALJR 1816 have been present. In that case the Court of Appeal had ordered a new trial on the limited basis of what the High Court later described as "an artificially isolated assumption" (at [20]) as to a factual matter constituting only one of a number of facts to be found on the retrial. Further, unlike the position in Smith v New South Wales Bar Association [1992] HCA 36; 176 CLR 256, no credit findings of the primary judge would have been found to be flawed, nor would there have been "stringent criticism" of the primary judge by the Court of Appeal (see Walker Corporation Pty Ltd v Sydney Harbour Foreshore Authority [2009] NSWCA 178; 168 LGERA 1 at [121] citing Brackenreg v Comcare Australia [1995] FCA 1129; 56 FCR 335 at 352). Moreover, unlike Hall v van der Poel [2009] NSWCA 436 at [63], remission would not have required the primary judge to make credibility findings which his Honour had earlier eschewed. Although, as in Hall v van der Poel, it would have required his Honour "to have an open mind as to the ultimate outcome, in circumstances where [he] has already formed a firm judgment in that regard" (at [63]), I would not have regarded this factor as decisive as the issue of causation was not considered by the primary judge. 64The appellants submitted that remission of the issue of causation to the primary judge for determination would have given "the appearance of pre-judgment". The decisions they relied upon included Baulkham Hills Shire Council v Basemount Pty Ltd [2003] NSWCA 189; 126 LGERA 339 at [19] - [21]; Castle Constructions Pty Ltd v North Sydney Council [2007] NSWCA 164; 155 LGERA 52 at 70 and Australian National Industries Ltd v Spedley Securities Ltd (in liq) (1992) 26 NSWLR 411. However, in those cases the Land and Environment Court Commissioner or Supreme Court judge had earlier decided the same point that would arise on the further hearing. That is not the case here as the primary judge has not yet considered the issue of causation. Certainly the primary judge will have regard to the views he has formed and expressed as to Mr Tomasetti's credit (which arguably, but not necessarily, extend to his evidence on causation) but that presents no unfairness to Mr Tomasetti because those views are unchallenged on appeal and the primary judge would simply be asked to complete, without relitigation of the issues, the task that remained incomplete. 65The respondents did not, at least with any clarity, submit to the primary judge that the appellants had failed to prove causation. Nevertheless causation was expressly pleaded in the Statement of Claim ([61A]) and the appellants accepted on appeal that the respondents had put it in issue notwithstanding that a Defence to the final version of the Statement of Claim, which added [61A], was not filed. They accepted that the Defence to the penultimate version of the Statement of Claim was sufficient to put the paragraph in issue. As the appellants could not point to any clear concession by the respondents at first instance that causation was no longer in issue, I do not consider that the respondents are precluded from pursuing it on appeal. MR TOMASETTI'S NEGLIGENCE CLAIM 66Mr Brailey did not challenge the primary judge's conclusion that "it would have been a breach of Mr Brailey's duty to have put the investments forward without his clients being aware of the risks" (Judgment [530] quoted in [35] above). As a result, Mr Brailey's liability on the negligence claim turns, like that on the Fair Trading Act claims, on whether Mr Tomasetti proved that Mr Brailey did not apprise him of the risks associated with the investments. 67In some cases it may suffice for a plaintiff in a negligence action to prove that a single statement was made to him or her by an adviser, leaving the adviser with the evidentiary onus of showing that the statement was qualified by the context in which it was made. In my view the present is not such a case because it is clear that the statements alleged (being the representations referred to in [21] above) were made in the course of conversations concerning the investments, and that prospectuses and PDS were provided to Mr Tomasetti by Mr Brailey. In these circumstances Mr Tomasetti's onus (to prove the advice that was given to him) could not be discharged by extracting isolated statements from conversations that were not otherwise proved (see the earlier discussion to the same effect in relation to the Fair Trading Act claims at [39] - [41]). 68As for his Fair Trading Act claims, Mr Tomasetti relied in this context upon Mr Brailey's concession that he did not tell Mr Tomasetti that the investments were "speculative". He submitted that "[p]erhaps the most important matter [concerning the negligence claim] is the evidence of Mr Brailey where he accepted that an investment could not be sound, prudent and sensible, if it was speculative: T-844" (Appellants' Written Submissions dated 13 March 2012, [140]). 69This submission is answered by the same reasoning that applied to the Fair Trading Act claims (see [49]): Mr Brailey did not have to use the word "speculative" if he otherwise advised Mr Tomasetti of the risks, and Mr Tomasetti did not prove that such advice was not given. 70Mr Tomasetti's 1998 instructions that he wanted "nothing speculative" (see [25] above) do not assist Mr Tomasetti's case. As noted earlier, the concept of speculation concerns risks. The type and degree of risks that render a transaction speculative can vary greatly depending upon the transaction and the proposed investor. Different people could well have different views about whether the risks associated with the present investments justified their description as "speculative". Mr Brailey did not think that they did (Transcript p 1065). The authors of some of the prospectuses and PDS did, because they so described the investments, while other authors may not have, because they did not so describe the investments. What is presently important, however, is not who attached the label "speculative" to the investments but whether Mr Tomasetti was apprised of the risks involved. As he did not prove that he was not, his claims fail. 71Mr Tomasetti also pointed out that Mr Brailey conceded that he did not read all of the prospectuses and PDS, and in particular did not read all of the expert reports contained in them. Whilst this criticism has force given that Mr Brailey recommended the investments, it does not assist Mr Tomasetti's case as the primary judge made the following unchallenged findings about Mr Brailey's selective reading: "The important point about this is that it was not established that there was anything significant in the expert reports or otherwise in the prospectuses or product disclosure statements of which Mr Brailey was not aware. In other words, doubts about whether Mr Brailey had read something might be significant if there was something of importance that he had neglected to read and of which he was otherwise unaware. However, that was not shown to be the case" (Judgment [475] quoted in [35] above). In other words, Mr Brailey was sufficiently aware of the risks associated with the investments at the time he recommended them, notwithstanding his failure to read every document. 72For these reasons, Mr Tomasetti's challenge to the primary judge's rejection of his negligence claim fails. Reliance and causation 73The comments made in [58] - [65] above concerning Mr Tomasetti's Fair Trading Act claims apply equally to his negligence claim. Contributory negligence 74Mr Tomasetti accepted that he was guilty of contributory negligence but contended, in my view correctly, that if he succeeded under both his Fair Trading Act and negligence claims this was of no significance because contributory negligence was not available as a defence under the Fair Trading Act and a plaintiff is entitled to rely upon that cause of action which produces the most favourable results for him or her (Perpetual Trustee Company Ltd v Milanex Pty Ltd (in liq) [2011] NSWCA 367 at [84] - [89]). However in my view as he fails on both causes of action, the question of contributory negligence does not arise. MS CORDONY'S CLAIMS 75Ms Cordony invested in two managed investment schemes shortly prior to 30 June 2005 (see the Table at [13] above). She alleged in the Statement of Claim that Mr Brailey "recommended, encouraged and advised [her] to make [these] investments ... thus representing to her that these were prudent investments suitable for her personal circumstances" ([34]). The primary judge did not make a finding as to whether this representation was, as alleged, implicit in Mr Brailey's recommendation of the investments to Ms Cordony but in my view it obviously was. 76Mr Brailey gave evidence that he "highly recommended" that Ms Cordony make the investments (Transcript p 1047.21). In his affidavit he recounted a conversation with Ms Cordony in which he described superannuation and taxation advantages that would flow to Ms Cordony from the investments and also tax and spouse rebate advantages that would accrue to Mr Tomasetti (see [31] above). Neither his affidavit nor his oral evidence suggests that he otherwise considered, or advised Ms Cordony on, the suitability of the investments for her circumstances. 77Unlike Mr Tomasetti's case against Mr Brailey, which predicates the unsuitability of the investments upon Mr Tomasetti's ignorance of the risks which they entailed, Ms Cordony's case is that the investments recommended by Mr Brailey were inherently unsuitable for her personal circumstances, irrespective of her knowledge of the risks involved. 78As the primary judge noted (see [24] above), Ms Cordony began a long-term relationship with Mr Tomasetti in 1993 and married him in 2003. She commenced part-time work with Mr Tomasetti, as his personal assistant, in about May 2002, from which time she became familiar with his financial affairs. Ms Cordony's evidence however was that her husband was "incredibly self-sufficient" in terms of typing and office administration (Judgment [25]). 79Ms Cordony's gross income before tax was about $60,000 for the 2003 - 4 financial year and about $68,000 the following year. Ms Cordony was aged 55 in 2005. Until early 2005 she was not a client of Mr Brailey and contact with him occurred only on an administrative basis in relation to Mr Tomasetti's financial affairs. She had no investments until she made those recommended by Mr Brailey. 80Ms Cordony gave evidence that since 1980 she has suffered from a chronic upper and lower respiratory disease, requiring hospitalisation on a number of occasions and adversely affecting her quality of life. She said that the side-effects of taking cortisone have been "devastating particularly on my state of mind" (Ms Cordony's affidavit of 17 November 2009, [3]). Mr Brailey was aware that Ms Cordony had serious health problems (Mr Brailey's affidavit 17 June 2010 [491]). 81Ms Cordony made the Timbercorp Citrus investment at an initial cost of $49,000, of which $44,100 was financed through Timbercorp Finance Pty Ltd. It was for a project term of 22 years. The investment in the Gunns Winegrape project was for a term of 20 years, at an initial cost of $34,650, with $27,720 borrowed. Both investments required the payment of ongoing fees and charges as well as interest on the borrowings. 82Mr Tomasetti must have had some involvement in Ms Cordony's investments as he signed authorities in relation to both investments for the debit of expenses to his credit card and was one of the addressees of a letter dated 3 May 2005 from Mr Brailey referring to his advice to Ms Cordony regarding the Timbercorp Citrus investment. 83The primary judge rejected Ms Cordony's Fair Trading Act and negligence claim, saying: "364 ... [Ms Cordony] made a number of significant concessions in the course of cross-examination, culminating in her agreement that she could not legitimately blame Mr Brailey on the ground that she was ill-advised (T648.34). In the light of those concessions, it is difficult to conclude that he engaged in some form of misleading or deceptive conduct in relation to her investments. ... 413 I am not satisfied that Mr Brailey engaged in misleading or deceptive conduct in respect of the three admitted representations or, for what it is worth, in relation to his dealings with Mr Tomasetti and Ms Cordony in relation to the investments generally. ... 530 ... As for Ms Cordony, she was unable to reliably say what was said by Mr Brailey, and what was not said, because of her inability to recall. I accept that prospectuses and product disclosure statements were usually provided. If Mr Tomasetti and Ms Cordony never read any prospectus, PDS or application form (which I very much doubt), that was not Mr Brailey's fault". See also Judgment [390] quoted in [32] above and Judgment [326]. 84The concessions referred to by the primary judge fell into two categories: first, that Ms Cordony could not recall what Mr Brailey said to her and secondly that she was aware of some of the risks and ongoing obligations associated with the investments. 85I do not consider the concessions in the first category to be particularly significant as there is no doubt that Mr Brailey recommended the investments to Ms Cordony and the only representation she relies upon is one which was implicit in the recommendation. Furthermore, in these circumstances it is not fatal to Ms Cordony's claim that the primary judge appears not to have accepted such evidence of her dealings with Mr Brailey as she was able to give. Mr Brailey did not give evidence of anything that he said which would have contradicted the implication referred to in [75] above. Unlike the position concerning Mr Tomasetti's claims, the evidence did not therefore suggest that there was some relevant part of the context (which may have negated or qualified the alleged representation) which Ms Cordony did not prove. 86Likewise, the concessions in the second category are of limited significance. Essentially, Ms Cordony complains not that she was advised to make the investments without being apprised of the risks, but that in light of her health issues, age, limited income, and the long-term nature of the investment projects, rendering her liable for ongoing expenses irrespective of income, Mr Brailey was not justified in recommending them to her at all. 87In my view Ms Cordony is entitled to succeed on her claims against Mr Brailey and TJC for contravention of the Fair Trading Act and negligence. Both raise the same issue as to whether a prudent adviser could reasonably have taken the view that the investments were suitable for Ms Cordony. When deciding to recommend the investments, Mr Brailey does not appear to have paid any regard to Ms Cordony's health and age despite the long-term nature of the projects and the financial commitments they involved. However, these were essential matters for him to consider. It may be that he formulated his advice on the assumption that Mr Tomasetti and Ms Cordony acted as one financial unit and that Mr Tomasetti's present and future resources were, and would be, available to meet any financial obligations that Ms Cordony undertook. This assumption was unwarranted in the absence of a firm basis for making it and instructions from Ms Cordony to act upon it. Ms Cordony was entitled to receive advice based upon her individual circumstances. The view that the investments were suitable for her in the absence of any right of indemnity from Mr Tomasetti, or any other source, was not reasonable, given her health issues and the fact that the subject projects would continue until she was aged 75, in the case of one, and 77 in the case of the other. 88In these circumstances, Mr Brailey's implicit representation to Ms Cordony that the investments he recommended were prudent and suitable for her personal circumstances constituted misleading and deceptive conduct on his part, in contravention of s 42 of the Fair Trading Act. Similarly, his advice was negligent and in breach of the duty of care that he owed her as her financial adviser in relation to the subject investments. Ms Cordony's claims against Mr Fenton and Mr Lane do not succeed because, in light of my conclusions below on the partnership issues, they do not have any liability as partners (or otherwise) for Mr Brailey's conduct. Reliance and causation 89As with Mr Tomasetti, it can readily be concluded that Mr Brailey's recommendation of the investments was a factor relevant to Ms Cordony's decision to proceed, and thus, in this sense, she relied upon Mr Brailey's advice. 90The further question concerns causation, namely, whether Ms Cordony would have proceeded even if Mr Brailey had not recommended the investments to her. The primary judge did not express a view on this issue and in my opinion, for reasons that I gave when dealing with Mr Tomasetti's claims, it should be remitted to the primary judge for determination. Contributory negligence 91As Ms Cordony succeeds on both her Fair Trading Act and negligence claims, whether she was guilty of any contributory negligence is not of significance for the reasons given in [74] above. WHETHER CLAIMS STATUTE BARRED 92Consideration of the respondents' defence that Mr Tomasetti and TSF's claims are statute barred is strictly unnecessary as their claims have failed for other reasons. Nevertheless I express my views concerning that defence as far as it would apply to them as follows. The defence is not relevant to Ms Cordony's claims as her causes of action arose, if at all, after the dates referred to in the next paragraph. 93The appellants filed their Statement of Claim on 14 June 2009. It was common ground both at first instance and on appeal that to the extent that any of the appellants' alleged causes of action in negligence or under the Fair Trading Act arose prior to 15 June 2003 or 23 August 2003 respectively, those causes of action were statute barred (see Limitation Act 1969 s 14, Fair Trading Act s 68(2) and the transitional provisions in Clause 11D, Schedule 5 to the Fair Trading Amendment Act 2003). 94The respondents alleged that both categories of cause of action were complete upon payment by Mr Tomasetti and TSF of the initial costs of the investments recommended by Mr Brailey and/or upon their assumption at substantially the same times of an obligation to pay the balance. The suffering of damage, and therefore completion of their causes of action, prior to the limitation dates referred to above would have resulted in their claims in respect of the 2000, 2001, 2002 and, so far as the Fair Trading Act claims were concerned, 2003 investments being statute barred. 95After careful analysis of relevant authorities, the primary judge rejected the respondents' limitations defence, stating: "721 The submission for the plaintiffs that there is no evidence of loss at the time of entering into the investments is significant. No attempt has been made to value the interests they acquired at the time of acquisition or at any later time until recent years. It is certainly the case that there is no evidence that what they acquired had any lesser value than the amount paid. In other words, there is no evidence of loss being occasioned at any time before the relevant limitation dates. ... 723 ... I am not satisfied that damage has been shown to have arisen prior to the relevant limitation dates. There has been no contention that at any time in 2003 or before the agribusiness investment schemes were performing in a way anything other than anticipated. There has been no contention that forecast returns were any less, and the timing of returns was any later, at any time in 2003 or prior. There is evidence of such matters subsequent to 2003". 96On appeal, the respondents emphasised that Mr Tomasetti claimed immediate tax deductions for the initial payments for the investments and that "the appellants' claims were structured on the basis that they were entitled to recover damages, and interest, from the time of the initial payment for each investment" (Respondents' Written Submissions [67]). They proceeded to say: "... The deductions in question were claimed, and allowed, on the basis that they were losses suffered by the taxpayer in the relevant financial year as a result of the taxpayer carrying on business as a grower. It might be that in later years the profits to be gained from the forestry operations would ultimately have exceeded the losses suffered, but that does not make the loss suffered in the first year any less of a loss. It would also be wrong in principle if the appellants could claim damages and interest from the inception of the investment if at that time their cause of action had not arisen" (Respondents' Written Submissions [71]). 97The respondents contended that these submissions were supported by the High Court's decision in Wardley Australia Ltd v State of Western Australia [1992] HCA 55; 175 CLR 514, particularly observations in that case about the Full Federal Court decision in Jobbins v Capel Court Corporation Ltd [1989] FCA 538; 25; FCR 226. 98In Wardley, the respondent was induced by the appellants' misleading and deceptive conduct to grant an indemnity to National Australia Bank Ltd in relation to a facility granted by the bank to Rothwells Ltd. The High Court held that the respondent first suffered loss, not when it granted the indemnity, but subsequently, when it was first obliged to make a payment under the indemnity. As a result, the respondent's claim against the appellants was held not to be statute barred. The plurality (Mason CJ and Dawson, Gaudron and McHugh JJ) observed: "When a plaintiff is induced by a misrepresentation to enter into an agreement which is, or proves to be, to his or her disadvantage, the plaintiff sustains a detriment in a general sense on entry into the agreement. That is because the agreement subjects the plaintiff to obligations and liabilities which exceed the value or worth of the rights and benefits which it confers upon the plaintiff. But, as will appear shortly, detriment in this general sense has not universally been equated with the legal concept of 'loss or damage'. And that is just as well. In many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent and, by then, the relevant limitation period may have expired. To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust. Moreover, it would increase the possibility that the courts would be forced to estimate damages on the basis of likelihood or probability instead of assessing damages by reference to established events. In such a situation, there would be an ever-present risk of undercompensation or overcompensation, the risk of the former being the greater" (at 527). 99Their Honours then referred to Jobbins, in which the applicant had been induced by misrepresentation to enter into an agreement to invest in a film. They noted that in the view of the Full Federal Court "the investment from its inception lacked the qualities which it had been represented as having and was therefore less valuable than it would have been if the representations had been true" (at 528). 100Having also referred to Forster v Outred & Co [1982] 1 WLR 86, the plurality then said: "Jobbins is not explained quite so easily. That is because the Full Court of the Federal Court failed to specify whether the applicant first suffered loss or damage on entry into the agreement on or about 24 March 1986 or on payment on 9 April 1986 pursuant to the agreement of the sum of $60,000, each of which occurred more than three years prior to the filing of the applicant's statement of claim. The decision itself may be supported by reference to the payment alone. What is more, the applicant's loss and damage, as pleaded in the statement of claim, consisted in the payment of $60,000 on 9 April 1986. But we have difficulty in accepting that the applicant suffered loss or damage on entry into the agreement merely because the investment was alleged to lack the represented qualities. On this aspect of the case, the question was whether the investment was worth less than the applicant contracted to pay for it and, if so, when the applicant first sustained loss or damage. How that question could be answered in the absence of evidence is not evident to us. Although the investment lacked the represented qualities, it may have been worth no less than the consideration provided by the applicant" (at 529). 101Their Honours concluded that where a plaintiff enters into a contract which exposes him or her to a contingent loss or liability: "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" (at 532). 102The respondents in the present case submitted that the plurality's statement in Wardley that the decision in Jobbins "may be supported by reference to the payment alone" supported their submissions because that payment was analogous to the initial payments made in the present case. 103The plurality's observation is not, in my view, determinative of the present case first, because it was neither fully explained nor essential to the reasoning in the case. One would have thought that the plurality's reasoning denying the character of a loss to the entry into the agreement (that is, the absence of evidence as to the value of the investment) would have applied equally to the payment made soon after because until the value of the investment was known, it presumably could not be determined whether the payment constituted a loss by exceeding the consideration provided for it and the value of the obligations assumed by the applicant. Secondly, Jobbins was a very different case from the present. As noted in Magman International Pty Ltd v Westpac Banking Corporation [1991] FCA 41; 32 FCR 1, Jobbins involved "a once and for all dealing" (at [18]), as distinct from the present case in which the parties were involved in an ongoing relationship over a substantial period of time and the success or failure of the venture was unlikely to be discernable until the venture was well advanced. 104Apart from the comment about Jobbins, Wardley is against the respondents' limitations defence. There, the fact that the loss was contingent meant that it was not suffered until the contingency occurred, notwithstanding that there was a "likelihood, perhaps the virtual certainty, that there would be a loss, in the light of Rothwells' actual financial position as it stood when the indemnity was executed" (at 524 - 5). The primary judge's findings (see [95] above) suggested that there was no such likelihood here. The present transactions were of the type envisaged by the Wardley plurality when it observed that "[i]n many instances the disadvantageous character or effect of the agreement cannot be ascertained until some future date when its impact upon events as they unfold becomes known or apparent" (at 527). 105As the High Court noted in Murphy v Overton Investments Pty Ltd [2004] HCA 3; 216 CLR 388, the "risk of loss is not itself a category of loss ... if a plaintiff enters a contract which exposes the plaintiff to a contingent loss or liability, that plaintiff 'sustains no actual damage until the contingency is fulfilled and the loss becomes actual'" (at [46], quoting Wardley at 532). In Murphy, the appellants leased a unit in a retirement village owned by the respondent. Prior to signing the lease, the respondent gave the appellants a misleading estimate of the amount of outgoings they would be required to meet. The court held that the appellants suffered loss, not when they entered into the lease (there being no evidence that the price exceeded the market value), but when the respondent began to charge the higher amount of outgoings. Accordingly, "the appellants suffered no loss as a result of undertaking the obligations ... unless and until the contingency which the representation hid (that items other than those used to form the estimate were then being incurred and could be charged as outgoings) was first realised ... Wardley requires the conclusion ... that it was only when the contingency came to pass that the appellants sustained loss or damage" (at [55]). 106The High Court's decision in HTW Valuers (Central Qld) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; 217 CLR 640 is also against the respondents' limitations defence. In that case, a valuer failed to advise the purchaser of a shopping arcade ("the Plaza") of the effect on its market value of the construction of competing premises nearby. The Court held that the plaintiff suffered loss when it contracted to purchase the Plaza, not merely when it was reasonably ascertainable what effect the competing premises would have ([25]). The Court considered that "the risk of the catastrophic effect on rent levels of the Plaza after March 1999, to which the defendant had not alerted the plaintiff, had already had an impact on the value of the Plaza by April 1997 [when the plaintiff agreed to purchase it]" (at [30]). Unlike the appellants in the present case, "[t]he plaintiff could have found out at once that it had bought something which was worth less than that which it had agreed to pay and did pay" (at [28]). 107The respondents in the present case noted that many of the recommended investments were still on foot at the date of the trial and submitted in relation to those: "Admittedly the projected returns as at [the date of trial] were less than had been expected and were unlikely to exceed the appellants' expenditures on the projects. But it is difficult to see this fluctuation in expected future profit as a category of damage at all, and even if it were a category of damage it is not damage which was caused in any real or practical sense by any advice from Mr Brailey" (Respondents' Written Submissions [73]). 108The respondents gave as an example of damage not attributable "in any real or practical sense" to Mr Brailey's recommendations, the failure of one of the investment projects because of a pest infestation, which they described as "a rare and perhaps even unforeseeable event" (ibid). 109I do not accept these submissions. First, there is no reason why the primary judge could not, as he purported to do, determine whether the investments were loss-making as at the date of trial. Courts are commonly required to undertake such assessments. By the time of trial, the investment projects were well advanced and their prospects could be sensibly assessed. The position was otherwise at the date the investments were made. As the primary judge pointed out, there was "no contention that at any time in 2003 or before [that] the agribusiness investment schemes were performing in a way anything other than anticipated" (Judgment [723]). 110Secondly, it is no answer to a claim for damages for inducing entry into a transaction by misrepresentation for the defendant to say that an investment the subject of the transaction failed for reasons unrelated to the matters misrepresented (Toteff v Antonas [1952] HCA 16; 87 CLR 647). In any event, it is by no means clear that for such reasons the investments in the present case failed to achieve their expected value. The appellants claimed that Mr Brailey failed to apprise them of multifarious risks associated with the investment projects, including their speculative nature. Arguably, it was the materialization of risks falling within the ambit of those broadly described risks that prevented the expected value from being realised. 111In their Supplementary Written Submissions of 22 October 2012, the respondents relied upon Winnote Pty Ltd v Page [2006] NSWCA 287; 68 NSWLR 531 at [61] - [62] to contend that payment of the initial investment costs and interest on borrowings to fund the investments constituted losses because they produced no commensurable benefits. 112In Winnote, a client entered into a lease of land in order to extract peat, relying on advice from solicitors who failed to advise that peat extraction required a mining licence. A third party subsequently obtained a mining licence over the peat deposit. The Court held by majority (Basten JA dissenting) that the client first suffered damage when it entered into the lease and received a bundle of rights inferior to those it would otherwise have received absent the firm's conduct. In the view of the majority: "From the outset, Winnote [the client] got significantly less than it should have, in consequence of the solicitors' 1988 negligence. The 'goods were damaged' to use Lord Walker's terms. This is demonstrable when one compares the rights secured under the real property lease with the rights that ought to have been secured under mining tenements from the outset" (at [60]). 113The majority then referred to various expenses that were incurred in obtaining, and under, the lease and observed that "[a]ll of these were items of wasted expenditure that did not produce any proven commensurable value" (at [61]). 114The majority's reference to wasted expenditure not producing "any proven commensurable value" must be read in the context of its view that by entering into the lease the client suffered an "immediate actual loss of a measurable kind" (at [59]). No such loss was found to have been suffered in the present case and initial payments were not intended to produce immediate benefits. Whether benefits flowing from them ultimately matched (or exceeded) their amount could only be ascertained as the investment projects progressed. The situation was as envisaged by Brennan J in Wardley: "A transaction in which there are benefits and burdens results in loss or damage only if an adverse balance is struck. If the balance cannot be struck until certain events occur, no loss is suffered until those events occur" (at 536). 115Contrary to the respondents' submission (see [96] above), I do not consider that the appellants' inclusion in their claims of amounts calculated by reference to initial and other payments made by them prior to the relevant limitation dates indicates that their causes of action must have arisen prior to those dates. Their causes of action arose when it became ascertainable that they had suffered an overall loss on each investment. When that occurred it became clear for the first time that the earlier payments constituted losses. Those payments were thereafter properly included in the appellants' calculations of loss. 116The respondents pointed out that the identification of the dates upon which it became apparent that the appellants had suffered losses on each investment was a difficult exercise, with room for widely differing views. Whilst true, this does not assist the respondents because it is clear that such losses were not ascertainable prior to the limitation dates in 2003 yet were ascertainable at the date of the hearing at first instance. Further, there was no basis for concluding that if those losses were ascertainable at the date of the hearing, they were not also ascertainable when the appellants commenced their proceedings in 2009, with the consequence that the appellants had complete causes of action at that time. It is unnecessary for these proceedings to determine when in the period between 2003 and 2009 the losses became ascertainable. 117The respondents also submitted that it was significant that the appellants claimed interest at the rates applicable to awards of interest under s 100 of the Civil Procedure Act 2005 on amounts expended prior to the relevant limitation dates. They submitted that as the Court's power to award interest under s 100 is confined to the period commencing when the relevant cause of action arose, the formulation of the appellants' claims demonstrated that their causes of action had arisen prior to the relevant limitation dates. However, as the appellants assert, their use of those rates did not indicate that s 100 was necessarily the basis of their claim for interest. Rather, the appellants were arguably entitled under the general law to interest by way of damages on the basis of the principles stated in Hungerfords v Walker [1989] HCA 8; 171 CLR 125, using the rates applicable to s 100 awards as a convenient reference point. Thus, the nature of the appellants' claims was not inconsistent with their causes of action arising after the limitation dates. 118For these reasons I consider that if the appellants otherwise had viable causes of action, they would not be statute barred. THE PARTNERSHIP CLAIMS 119The appellants contended that Mr Fenton and Mr Lane were vicariously liable to them, pursuant to the provisions of s 5 or s 10 of the Partnership Act 1892, for loss suffered as a result of Mr Brailey's conduct. As I have concluded that Mr Brailey did not incur liability to Mr Tomasetti or TSF, no question of the vicarious liability of Mr Fenton or Mr Lane to them arises. Nevertheless, depending on the primary judge's conclusion on the remitter, the question may be significant in relation to Ms Cordony's claims. It is appropriate that I express my views as to whether Messrs Fenton and Lane would have been liable if any of the appellants' claims against Mr Brailey succeeded. 120Section 5(1) of the Partnership Act relevantly provides that "the acts of every partner who does any act for carrying on in the usual way business of the kind carried on by the firm of which the partner is a member" bind the other partners (subject to a presently irrelevant qualification). Section 10(1) of the Partnership Act renders partners of a firm liable in respect of "any wrongful act or omission of any partner ... acting in the ordinary course of the business of the firm". Whilst the appellants relied on both ss 5(1) and 10(1) at first instance it appears that their cases on appeal were confined to s 10(1). I shall therefore focus only on s 10(1) but the reasons I give for rejecting the appellants' case on s 10(1) apply equally to s 5(1). 121The appellants contended that Mr Brailey's conduct occurred in the ordinary course of the business of a partnership trading under the firm name of Brailey Fenton Lane & Co, comprised of Mr Brailey, Mr Fenton, Mr Lane and Brailey & Fenton Pty Ltd (Fourth Amended Statement of Claim [3]). Alternatively the appellants claimed that that conduct comprised acts of Mr Brailey "for carrying on in the usual way business of the kind carried on by" the firm. The respondents accepted that Mr Lane and Brailey & Fenton Pty Ltd were partners of the firm but denied that Mr Fenton was. The respondents argued that Mr Fenton was not liable to the appellants as he was not a partner of the firm and even if he was, Mr Brailey's acts were not in the course of the firm's business. As he admitted that he was a partner, Mr Lane could only escape liability on the latter basis. The appellants no longer seek to hold Brailey & Fenton Pty Ltd liable. The partnership agreement 122The appellants' case on the identity of the partners of the firm issue was largely dependent upon the proper construction of a written Partnership Agreement dated 23 October 1991 to which Brailey & Fenton Pty Ltd ("BF") and Messrs Lane, Brailey and Fenton were parties. 123The Agreement stated at its outset that BF and Mr Lane are "hereinafter ... referred to collectively as 'the partners' and individually as 'partner'" and then recited the following: "A. Brailey and Fenton are directors of BF. B. BF and Lane propose to carry on the business of accounting, taxation and associated services in partnership and at the request of Brailey and Fenton have agreed to record in writing the following terms and conditions of the partnership ('the Partnership')" (p 2). 124Presently relevant terms of the Agreement were as follows: "1. Brailey and Fenton acknowledge that Lane has entered into this Agreement with BF at their request and in consideration thereof each of them agrees to be bound by the terms of this Agreement and to observe and fulfil the covenants and obligations on their part herein expressed or implied. 2. The Partnership shall carry on the said business and such other business as the partners may from time to time determine under the style or business name of 'Brailey, Fenton, Lane & Co.' ... 4. Brailey and Fenton on behalf of BF and Lane shall each devote such time to the conduct of the business of the Partnership as will result in an equitable distribution of the professional accounting and administrative workload of the Partnership such that neither partner shall be disadvantaged. ... 6. The initial capital of the Partnership shall be six hundred and sixty thousand dollars ($660,000.00) which will be provided as to four hundred and forty thousand dollars ($440,000.00) by BF and as to two hundred and twenty thousand dollars ($220,000.00) by Lane and any additional capital required shall be provided by the partners in the same proportions as the initial capital unless otherwise agreed from time to time. 7. The partners shall be entitled to share profits of the Partnership in the same proportions as they shall contribute the initial capital and the profits for each year shall be credited to that partner's capital account when the balance sheet and profit and loss statement for the period ending 30 June in each year are prepared. Losses including losses of capital shall be borne by the partners in the same proportions as they shall have contributed the initial capital. 8. Neither partner nor Brailey nor Fenton shall enter into or engage in any other employment, occupation or business without the prior consent of the others of them. ... 17. Each partner and Brailey and Fenton shall punctually pay and discharge his present and future separate debts, engagements and undertakings and shall at all times keep indemnified the other partner or the partners as the case may be and the property of the Partnership against the same and against all actions, proceedings, costs, claims and demands in respect thereof. ... 21. In meetings of the Partnership:- (a) BF shall have two votes. BF hereby irrevocably appoints Brailey to exercise one of such votes and Fenton to exercise the other and acknowledges and agrees that Brailey and Fenton shall exercise such votes independently of each other. BF shall not otherwise exercise its votes. (b) Lane shall have one vote. The aforesaid votes of Brailey, Fenton and Lane shall be exercised personally or in the case of their death or legal disability by their respective legal personal representative. In order to be carried all resolutions must be passed unanimously. 22. If any of Brailey, Fenton or Lane shall:- (a) absent himself from the business of the Partnership for more than four (4) weeks (consecutive or otherwise) in any period of one (1) year except in accordance with Clause 18 hereof; or (b) have his membership of the Institute of Chartered Accountants in Australia forfeited or suspended; then notice of dissolution of the Partnership may be given by the non-offending partner effective on the date the notice is given to the other. The partner giving the notice shall thereupon purchase the share of the Partnership property of the other partner at a price determined in accordance with and payable as provided in Clause 11 of this Agreement." The judgment at first instance 125In relation to the identity of the partners in the firm, the primary judge concluded as follows: "587 The four party partnership agreement of 23 October 1991 makes it abundantly clear that it was the intention of the three men to create a partnership between Brailey & Fenton Pty Limited and Mr Lane. The words used in the document are expressly and unambiguously to that effect. 588 It was necessary to include Messrs Brailey and Fenton as parties to this agreement because it was necessary to assimilate them to the same position as Mr Lane. The business depended upon the work of all three individuals and so it was appropriate to provide that Messrs Brailey and Fenton had rights and obligations similar to those granted to, or imposed upon, Mr Lane. Thus, it was appropriate that there were provisions in the agreement such as that the men devote themselves to the business equally; that they be afforded an equal period for holidays; and that they each be prohibited from competing with the business if they were to leave. 589 Aside from specifying these individual rights and obligations, the agreement consistently asserted that the partners were Brailey & Fenton Pty Limited and Mr Lane. It was those two parties who were to contribute capital, not Messrs Brailey and Fenton. It was those two parties who were entitled to share profits, or were liable to bear losses, not Messrs Brailey and Fenton. Provisions relating to the dissolution of the partnership referred to the rights in that respect of 'the partners', previously identified as being Brailey & Fenton Pty Limited and Mr Lane. Messrs Brailey and Fenton were not afforded rights, as individuals, to initiate a dissolution. 590 Clause 22 is problematic. It provides for notice of dissolution to be given by the 'non-offending partner' if any of Messrs Brailey, Fenton or Lane absented themselves from the business for a certain period, or lost their membership of the Institute of Chartered Accountants of Australia. Assuming the partnership had just the two parties, if one of those things occurred in relation to either Mr Brailey or Mr Fenton, the 'non-offending partner' would be both partners. In my view, however, the wording of this clause is probably a matter of poor drafting. I cannot see how it could prevail over the balance of the agreement which quite clearly evinces an intention that Brailey & Fenton Pty Limited and Mr Lane, and only those two parties, be the partnership to be known as Brailey Fenton Lane & Co. ... 593 I accept the submission of Mr Parker to the effect that the source of the authority for the acts of Messrs Brailey and Fenton was their position as officers of Brailey & Fenton Pty Limited. They were authorised to do certain things on behalf of the partnership by virtue of a partnership agreement that rendered the company of which they were directors a partner. Their authority did not derive from the agreement making them partners in their own right. 594 The subsequent conduct of the parties does not warrant a conclusion that their intention was other than that which was expressed in writing ... 595 Even if it was the subjective belief of Messrs Brailey and Fenton that they were partners, that does not transform their legal position to conform with such description: see, for example, Salib v Gakas [2010] NSWSC 505 per Ward J at [233]. The significant point is that whenever it was necessary to describe the true situation with precision for regulatory or taxation purposes, it was consistently maintained that the partners were only Brailey & Fenton Pty Limited and Mr Lane. 596 I am satisfied that Mr Brailey and Mr Fenton were not partners of Brailey Fenton Lane & Co." 126His Honour's conclusions as to whether Mr Brailey's conduct occurred in the ordinary course of the partnership business were as follows: "628 In summary, despite some references in the documents that might suggest otherwise, throughout the period in which Mr Brailey provided investment advice to the plaintiffs, he was doing so as an entity that was not Brailey Fenton Lane & Co. At first, he was trading as No Frills Financial Services and was an authorised representative of Morgans. In September - October 2001, he commenced to trade as BFL Financial Planning and became the authorised representative of Garvan Financial Planning. Then in June 2003, he commenced to act as the authorised representative of BFL Financial Planning Pty Limited. ... 629 Apart from the separate business name and separate legal structure, there are other matters which support the proposition that the financial planning business was not part of the business of Brailey Fenton Lane & Co." [The primary judge then referred to various documents in evidence]. ... 641 Much, but by no means all, of the foregoing tends to support the proposition that the financial planning business was not a part of the business of Brailey Fenton Lane & Co. However, there are quite a number of matters within the documentary evidence relating to the plaintiffs' investments that indicate that a distinction between the two businesses was not always recognised and maintained. ... 657 The foregoing review of the documentary evidence demonstrates that there was a degree of inconsistency as to whether the financial planning business was treated as separate to, or a part of, the business of Brailey Fenton Lane & Co. Such inconsistency is apparent from Mr Brailey's evidence itself." 127Having referred to the evidence of Messrs Brailey, Fenton, Lane, Tomasetti and two former employees of BFL Financial Planning, the primary judge concluded that, although the distinction was not always maintained by Mr Brailey, and Mr Tomasetti "may, at least for a time, have been unaware of the distinction" (Judgment [692]), Mr Brailey's conduct was, "viewed objectively, not part of the business of Brailey Fenton Lane & Co but was part of the business of another entity" (ibid [691]) (namely, the financial planning company associated with the firm, at most relevant times being TJC, the fourth respondent). His Honour relied in this respect particularly on the following matters: * "at all relevant times there was a separate legal entity which existed for the purpose of conducting the 'brokerage' [that is, the financial planning] business; * this entity had its own bank account and ABN; * financial benefits accruing from the brokerage business went to the accounts of Desly Pty Limited [the predecessor of TJC] and BFL Financial Planning Pty Limited [later named TJC], not Brailey Fenton Lane & Co; * a distinction was generally made in terms of premises and signage; and * Messrs Clynes and Marksteiner were employed as financial planners (or similar) between late 2002 and 2007 by BFL Financial Planning Pty Limited, not by Brailey Fenton Lane & Co" (Judgment [687]). The identity of the partners 128In my view the primary judge's analysis and interpretation of the Partnership Agreement was correct. The Agreement manifested a clear intention that the partners of the firm Brailey Fenton Lane & Co be Mr Lane and BF only. Mr Brailey and Mr Fenton had indirect interests in the partnership as directors and shareholders of BF. It is understandable that Mr Lane would have been reluctant to contract solely with BF and would have wanted to secure, by contract, the involvement of Mr Brailey and Mr Fenton in the partnership business. This was achieved by the joinder of Mr Brailey and Mr Fenton as parties to the Partnership Agreement and the inclusion of personal covenants by them. Their role in the business was as officers and/or employees of BF, not as partners. 129The appellants submitted on appeal that in asking himself whether Messrs Brailey and Fenton were partners in the firm Brailey Fenton Lane & Co, the primary judge misunderstood the appellants' pleaded claim. I do not accept that this was so because their Statement of Claim (see [121] above) alleged that Messrs Brailey, Fenton and Lane, with BF, carried on "an accountancy partnership trading under the name Brailey Fenton Lane & Co" (it appears to have been common ground that a reference to "Chartered Accountants" in this part of the Statement of Claim was an irrelevant error). 130The appellants contended that Brailey Fenton Lane & Co was a sub-partnership of a four person partnership constituted by Mr Brailey, Mr Fenton, Mr Lane and BF, and that all four persons were "carrying on" that sub-partnership even though only two of them were partners in it (Appellants' Written Submissions dated 13 March 2012, [162] and [163]). This submission is not supported by the terms of the Partnership Agreement which provided for a single partnership constituted by Mr Lane and BF. As I have noted, Messrs Brailey and Fenton were not partners of that firm and as such, they were not in my opinion "carrying on" the business of Brailey Fenton Lane & Co: they were involved only as officers or employees of BF. 131The appellants also relied on evidence of conduct subsequent to the date of the Partnership Agreement to support their case concerning the identity of the partners of the firm. However that evidence did not establish that there was any express or implied variation of the Partnership Agreement and, even if it had been admissible for that purpose, it did not assist in the proper construction of the Partnership Agreement which was in my view not in doubt. Whether conduct in the ordinary course of the partnership business 132On this issue also, I agree with the primary judge's analysis and conclusions (see [126] above). Whilst there were inconsistencies, which his Honour recognised and took into account, the evidence on balance supported his Honour's view that Mr Brailey's recommendations of the subject investments were made in the course of the financial planning businesses (at most relevant times that of BFL Financial Planning Pty Ltd, now TJC, the fourth respondent) and not in the course of the business of Brailey Fenton Lane & Co. I agree with his Honour that the most significant matters in this respect were those that are set out in [127] above. 133The appellants provided a lengthy written summary of possibly relevant documents, incorporating the respondents' reply submissions in the summary. In my view, none of the matters identified in it cast doubt on the primary judge's conclusion. 134The appellants submitted that the primary judge's reasoning was flawed because his Honour regarded it as sufficient that there was some evidence to support the respondents' case on this issue without considering and weighing all of the evidence. The appellants referred in this regard to Judgment [691]: "691 In the end it is unnecessary to consider in any detail the questions posed under s 5 and s 10 of the Partnership Act. That is because in this case there is evidence that Mr Brailey's work in relation to the investments made by the plaintiffs was, viewed objectively, not part of the business of Brailey Fenton Lane & Co but was part of the business of another entity" (emphasis added). 135I do not consider that the primary judge made such an error. When considered as a whole, his lengthy examination of this issue indicated that he considered and weighed the evidence for and against the appellants' case and found, on balance, against them. 136The appellants also submitted that the primary judge erred by not taking into account the terms of Mr Tomasetti's 1998 retainer of Brailey Fenton Lane & Co to act as his "tax agent, accountant and financial adviser" (Appellants' Written Submissions [192]). The terms of the retainer would have been directly relevant if the appellants had pursued on appeal a challenge to the primary judge's rejection of their claims in contract against the members of the partnership. Although their Notice of Appeal included such a challenge, neither their written nor their oral submissions pursued it, no doubt because of the difficulty of challenging the primary judge's conclusion that their contractual claims were statute barred (Judgment [724]). 137Accordingly, the retainer, such as it may have been, was only one of many matters of arguable relevance to the issue of whether Mr Brailey's conduct occurred whilst he was "acting in the ordinary course of the business of the firm" (Partnership Act s 10). As the appellants' "Outline of Plaintiffs' Final Submissions" provided to the primary judge did not refer to the retainer (compare [115] - [131]), it is difficult to see the basis for the appellants' criticism that his Honour made a "quite fundamental error" in allegedly not taking it into account. In any event, his Honour did in fact refer in this context to Mr Tomasetti's evidence that he engaged Mr Brailey to act as his accountant and noted that Mr Tomasetti understood that the retainer contemplated the provision of financial advice (Judgment [683]). Moreover, the retainer was of limited significance because, even on the appellants' case, it did not explicitly embrace financial planning and was agreed some years before Mr Brailey's relevant conduct commenced. In these circumstances, I do not consider that the appellants' submission has any substance. 138Another point that must be made about the appellants' submissions on this topic is that they focussed on the question of whether Mr Brailey's recommendations to Mr Tomasetti and Ms Cordony were made on behalf of the firm Brailey Fenton Lane & Co or on behalf of TJC Financial Planning Pty Ltd. They did not directly address the question, relevant to s 10 of the Partnership Act, of whether the recommendations, if they were made on behalf of the firm, were made "in the ordinary course of the business of the firm". For the appellants to succeed in their partnership claims, they needed to satisfy the Court that recommendations of the type made by Mr Brailey were part of the ordinary business of the firm (as distinct from that of TJC) and thus that Mr Brailey's conduct was not an isolated instance of a partner of the firm giving financial planning advice. This was neither addressed nor established. 139For these reasons, the appellants' challenge to the primary judge's rejection of their claims against Messrs Fenton and Lane must be rejected. 140The respondents accepted that Mr Brailey's recommendations were made on behalf of TJC and, to the extent of the appellants' claims against it, TJC was liable to the appellants in respect of any liability Mr Brailey had to the appellants. LIABILITY OF DAMAGES TO TAX 141At first instance, the appellants contended that, save for the small capital amount of $750, any damages paid to them would be taxable income, with the consequence that the awards of damages should be "grossed up" to include the amount payable as tax in order to fully compensate the appellants for their losses. The respondents contended that any awards of damages would not be taxable, save for their interest component. By Notice of Contention filed on appeal, the respondents challenged the primary judge's acceptance of the appellants' argument. This issue remains relevant despite the failure of Mr Tomasetti and TSF's claims as those of Ms Cordony against the first and fourth respondents may succeed, depending upon the primary judge's conclusions on the issue of causation to be remitted to him. 142The appellants submitted that the awards of damages (subject to the limited exception referred to above and to which I will not refer again) would have been income according to ordinary concepts (that is, "ordinary income" - see s 6-5 Income Tax Assessment Act 1997 (Cth)) and, if not that, then "statutory income" (ibid s 6-10) by reason of s 20-20 of that Act. 143Section 20-20 renders certain receipts taxable to the extent that they are not "ordinary income" or otherwise "statutory income". As I have concluded that if the non-interest portions of any damages awards were not taxable as ordinary income, they would be taxable under s 20-20, it is sufficient to confine the discussion below to the application of s 20-20. The respondents accepted that the interest portions would have been taxable. 144Sections 20-20 and 20-25 are relevantly in the following terms: "20-20 Assessable recoupments Exclusion (1) An amount is not an assessable recoupment to the extent that it is *ordinary income, or it is *statutory income because of a provision outside this Subdivision. Insurance or indemnity (2) An amount you have received as *recoupment of a loss or outgoing is an assessable recoupment if: (a) you received the amount by way of insurance or indemnity; and (b) you can deduct an amount for the loss or outgoing for the *current year, or you have deducted or can deduct an amount for it for an earlier income year, under any provision of this Act. ... 20-25 What is recoupment? General (1) Recoupment of a loss or outgoing includes: (a) any kind of recoupment, reimbursement, refund, insurance, indemnity or recovery, however described; and ... " 145The primary judge's conclusion on this issue was as follows: "803 The submissions for the plaintiffs that any damages awarded (aside for the $750 capital loss) would be assessable as ordinary income are persuasive. However, I prefer the view that they would be assessable as statutory income. Such damages comfortably fit the concept of being an assessable recoupment. Any damages should be grossed up to take this fact into account." 146On appeal, the respondents contended: "The damages would represent, not a 'hole' in Mr Tomasetti's profits [a concept relevant to "ordinary income"], or even a recoupment of particular expenditure [a concept relevant to s 20-20], but a sum of money designed to put Mr Tomasetti back in the financial position he would have been in, after tax, had he not entered into the investments. Such an award bears no necessary or direct relationship at all to the amounts of the deductions, which are merely one integer in ... the assessment" (Respondents' Written Submissions [82]). 147The respondents noted that the appellants' claims had originally included a claim for damages for vexation and distress and submitted that if that claim had been successfully pressed, the relevant amount would have had to have been factored into the lump sum ultimately awarded, demonstrating that "there is no direct mathematical relationship between the amount of any ultimate award and the pre-tax cost of the deductions in question" (ibid at [83]). 148I do not accept these submissions. The fact that amounts received by a taxpayer form part of a lump sum award of damages does not preclude those amounts being characterised as assessable recoupments under s 20-20 if that characterisation is otherwise appropriate and the amounts in question can be identified as forming part of the award. The decisions of the High Court in McLaurin v Federal Commissioner of Taxation [1961] HCA 9; 104 CLR 381 and Allsop v Federal Commissioner of Taxation [1965] HCA 48; 113 CLR 341, upon which the respondents relied, were, unlike the present case, concerned with undissected lump sum settlement payments. Here the relevant "recoupments" would have represented components of the damages awards identifiable from the reasons for judgment and thus capable of being taxable income (Whitaker v Federal Commissioner of Taxation [1996] FCA 1716; 63 FCR 1, reversed on other grounds [1998] FCA 262; 82 FCR 261). 149In my view the non-interest portions of the damages awards in this case, if not "ordinary income", would have been assessable income under s 20-20 as recoupments of losses or outgoings that were, or could have been, deducted for income tax purposes. The principal amounts of the damages awards would have compensated the appellants for their deductible losses and outgoings that were expected to be, but were not, recouped by income earned from the investment projects. Instead those losses and outgoings would have been recouped by the damages awards. In these circumstances, the primary judge correctly concluded that the principal amount of any damages to be awarded should be "grossed-up" for tax. PROPORTIONATE LIABILITY 150On appeal, the appellants pursued claims for negligence and for contravention of the Fair Trading Act. Both categories are "apportionable claims" under Part 4 of the Civil Liability Act 2002. The respondents contended that in respect of any of the appellants' causes of action that accrued after 1 December 2004 (the date from which the proportionate liability provisions introduced into the Civil Liability Act in 2004 were operative) Mr Brailey and TJC were "concurrent wrongdoers", with the consequence that Mr Brailey's liability was limited by s 35(1) of that Act to the proportion of the appellants' damage or loss that the Court considered just having regard to the extent of Mr Brailey's responsibility for the damage or loss. 151Sections 34(2) and 35(1), both within Part 4 of the Act, are as follows: "34(2) In this Part, a concurrent wrongdoer, in relation to a claim, is a person who is one of two or more persons whose acts or omissions (or act or omission) caused, independently of each other or jointly, the damage or loss that is the subject of the claim. ... 35(1) In any proceedings involving an apportionable claim: (a) the liability of a defendant who is a concurrent wrongdoer in relation to that claim is limited to an amount reflecting that proportion of the damage or loss claimed that the court considers just having regard to the extent of the defendant's responsibility for the damage or loss, and (b) the court may give judgment against the defendant for not more than that amount." 152It follows from my conclusions concerning the partnership issues that Mr Brailey's conduct occurred when he was acting, in the main, on behalf of TJC. As a result, TJC would be vicariously liable for Mr Brailey's conduct or, alternatively, as the respondents submitted was the preferable view, directly liable on the basis that Mr Brailey's conduct was not simply that of an agent of the company but that of the company itself (see Lennard's Carrying Co Ltd v Asiatic Petroleum Co Ltd [1915] AC 705). For the purpose of determining whether Mr Brailey and TJC were "concurrent wrongdoers", it does not matter which alternative is correct, as on either basis Mr Brailey and TJC would be jointly liable to the appellants (see the discussion of joint tortfeasors in R P Balkin and J L R Davis, Law of Torts, 4th ed (2009) LexisNexis Butterworths [29.25]). 153The primary judge took the view that as between Mr Brailey and TJC, "the former should ... bear 'the lion's share' of responsibility" for the appellants' losses (Judgment [822]). On appeal, the respondents submitted that as TJC was the responsible entity under the Corporations Act 2001 (Cth) and carried on the business and benefited financially from it, TJC should bear more than 50 per cent of the responsibility (Respondents' Written Submissions, as amended on 2 October 2012 [88]). On the other hand the appellants contended that "any apportionment of damage to TJC should be either slight, or nil" (Appellants' Supplementary Submissions dated 25 October 2012 [7]). 154In my view, even if the causes of action all arose after 1 December 2004, neither the liability of Mr Brailey nor that of TJC is limited by s 35(1). As the primary judge said, and as the respondents' submissions recognised, "Mr Brailey was, in effect, BFL Financial Planning Pty Ltd [later named TJC]" (Judgment [821], Respondents' Written Submissions as amended on 2 October 2012 [86]). The acts and omissions of Mr Brailey in advising the appellants were the corporate acts of TJC. Accordingly, they were both responsible for the appellants' losses, their acts and mind being the same. I find nothing in the terms of s 35(1) that requires responsibility for a loss to be apportioned between concurrent wrongdoers of this type so that the total of the percentages for which they are liable is 100 per cent. The section simply limits the liability of the defendant to the proportion of the loss that the Court considers just having regard to the defendant's responsibility for the damage or loss. Here Mr Brailey and TJC were each fully responsible for the losses and it is just that each be liable for 100 per cent of the losses. 155There is no conflict between this conclusion and s 3C of the Act, which is in the following terms: "Any provision of this Act that excludes or limits the civil liability of a person for a tort also operates to exclude or limit the vicarious liability of another person for that tort." 156That section enables a person who is vicariously liable to claim a limitation of liability under s 35(1). In some cases, the vicariously liable defendant may be able to show that he or she was less than fully responsible for the loss and thus entitled to limited liability (compare s 39). That is not the case here. 157For these reasons, I do not consider that any liability owed by Mr Brailey or TJC to Mr Tomasetti, TSF or Ms Cordony would have been or is limited by s 35(1). COSTS ORDER MADE AT FIRST INSTANCE 158At first instance, Ms Cordony and TSF submitted that it would not be just to order them, jointly and severally with Mr Tomasetti, to pay the costs of the proceedings at first instance. In his Judgment of 24 February 2012 the primary judge gave the following reasons for rejecting that submission: "37 The defendants were critical of the plaintiffs' approach in quantifying the proportion of the proceedings devoted to each of the plaintiffs' cases. I accept that counting up paragraphs and transcript pages and the like is not determinative but I do not understand that counsel for the plaintiffs were doing anything more than using such an approach to illustrate the point they sought to make. However, I do not accept that point. 38 There was commonality in the issues and evidence in the cases for each plaintiff to a significant degree. The evidence of Mr Tomasetti was far more extensive than that of Ms Cordony. It was, of course, essential to his own case but it was important for the cases of the other plaintiffs as well. Each of the plaintiffs bore the onus of demonstrating that the conduct of Mr Brailey was negligent, or misleading and deceptive, et cetera (to put it generally). Doing so necessitated extensive evidence from Mr Tomasetti in not only his own case but in the cases of the other plaintiffs as well. It also required a lengthy cross-examination of Mr Brailey. Acceptance of the evidence of Mr Tomasetti and rejection of that of Mr Brailey would have been of substantial benefit to the cases for each of the plaintiffs. 39 While Ms Cordony's investments were both made in 2005, the last of the six years with which the proceedings were concerned, the presentation of her case could not possibly have had any prospect of success without an examination of the history of the dealings between Mr Tomasetti and Mr Brailey beginning at their first meeting in 1998. If there were proceedings brought by Ms Cordony alone, that examination would not have been so extensive, but it would not have been minimal either. The same can be said in relation to the superannuation fund which made two investments (in 2001 and 2004) jointly with Mr Tomasetti. 40 The defendants' point about other issues raised in the proceedings is sound. The partnership claim, also the subject of extensive evidence on both sides, was relevant to each of the plaintiffs. So too was the expert evidence concerning the conduct of a "reasonably competent financial planner" and the issue concerning grossing up damages to account for taxation. 41 The hypothetical situations advanced in order to illustrate the plaintiffs' contention that there should be apportionment do not make good their argument. If Ms Cordony had commenced and prosecuted her claim separately, preparation and presentation time and effort would undoubtedly have been less. However, for the reasons just given, it would not have been substantially so. If she had commenced separately but had been compelled to join there may have been other issues to consider, but that is not what she did. I accept that if Ms Cordony had been successful while the other plaintiffs failed, the defendants would undoubtedly have resisted a claim by her that the defendants pay to her all of the plaintiffs' costs. That would have presented an interesting task in striking the right balance, but it is purely hypothetical and its logic does not provide an answer in all situations in which multiple parties are unsuccessful. 42 Primarily for the reason that there was a significant commonality of evidence and issues, I am not persuaded that sufficient reason has been shown to depart from the usual requirement that the plaintiffs' liability for costs should be joint and several." 159On appeal, the appellants submitted that the emphasis placed by the primary judge on "commonality of evidence and issues" (Judgment [38] and [42]) produced error in the exercise of his discretion because "[i]t distracted attention away from the fact that it could not be just that the Second and Third Appellants be liable for the entirety of the Respondents' costs, given the nature of the proceedings, the way in which they were conducted, and the emphasis placed on the First Appellant's case, in comparison to the time taken with the presentation of the other cases" (Appellants' Submissions on Costs [4]). 160Section 98 of the Civil Procedure Act 2005, pursuant to which the primary judge made his orders for costs, confers a broad discretion. Appellate courts will only interfere with its exercise where an error of the kind identified in House v R [1936] HCA 40; 55 CLR 499 at 505 is established, that is, the judge has acted upon a wrong principle, taken into account irrelevant matters, mistaken the facts, or failed to take into account a material consideration, or where the decision is unreasonable or plainly unjust. The legislature's intent that appellate courts exercise restraint in this area is evident from the requirement in s 101(2)(c) of the Supreme Court Act 1970 for leave to appeal in the case of a challenge to an order for "costs only which are in the discretion of the Court". (As the present appeal contains bona fide grounds concerning issues other than costs, it has not been submitted that the appellants required leave to challenge the primary judge's costs order: see Dillon v Gosford City Council [2011] NSWCA 328; 284 ALR 619 at [53] and Be Financial Pty Ltd v Das [2012] NSWCA 164 at [4] - [24]). 161I do not consider that the appellants have established any basis for interfering with the primary judge's exercise of discretion concerning costs. Contrary to the appellants' submission, I do not consider that his Honour's emphasis on the "commonality of evidence and issues" indicates that he considered that the apportionment of responsibility for costs sought by the appellants was precluded. Rather, the proper inference is that his Honour decided, as a matter of discretion, that apportionment was not appropriate in the circumstances of the case. 162Further, I do not consider that the primary judge's order is "unreasonable or plainly unjust". In my view his Honour's conclusion was open to him in light of the factors which he properly took into account, particularly the fact that had Ms Cordony commenced and prosecuted her claim separately, "preparation and presentation time and effort" would not have been substantially less than what was involved in the hearing that occurred (Judgment [41]). In my view it was within his Honour's discretion to conclude that there was no sufficient reason to depart from the ordinary rule that the losing parties bear joint and several responsibility for the successful parties' costs of the proceedings. Interest on costs 163The appellants also challenged the primary judge's order that interest be paid on costs payable by the appellants to the respondents. This order was made in accordance with the principles stated in Lahoud v Lahoud [2006] NSWSC 126 at [78] - [88]. 164The appellants contended first that the primary judge's exercise of discretion was vitiated because he allowed interest for the substantial period between the reservation and delivery of judgment, a delay for which the appellants were not responsible. I reject this submission as it was appropriate to award interest for the periods that the respondents were out of pocket in respect of costs, that is, for the periods between payment of their lawyers and reimbursement by the appellants. As the purpose of an award of interest is compensatory and not punitive, responsibility for the delay is not relevant. 165The second basis of challenge was that the order made by the primary judge did not appropriately confine the periods for which interest was payable. This is not correct as the order provided for interest to be payable only from the dates of payment by the respondents to their lawyers. CONCLUSION AND ORDERS 166For the reasons that I have given, the claims of Mr Tomasetti and TSF fail. Whilst Ms Cordony's claims against the first and fourth respondents will succeed if the primary judge, on remitter, determines the issue of causation in her favour, her claims against the second and third respondents fail because of my conclusions on the partnership issues. As a result, the orders made at first instance concerning Mr Tomasetti and TSF's claims, and those of Ms Cordony against the second and third respondents, should not be disturbed, whilst those concerning Ms Cordony's claims against the first and fourth respondents should be set aside pending determination of the outstanding issue of causation. On the remitter, the primary judge should make final orders, including as to costs, concerning Ms Cordony's claims against the first and fourth respondents. 167As Mr Tomasetti and TSF have failed on appeal, they should pay the respondents' costs of their appeals. The identification of the respondents' costs attributable to those appeals, as distinct from that of Ms Cordony, would be difficult as the written submissions and hearing overwhelmingly concerned Mr Tomasetti and TSF's appeals. Accordingly, I consider that the appropriate order is that Mr Tomasetti and TSF pay 90 per cent of the respondents' costs of all three appeals. The first and fourth respondents should pay Ms Cordony's costs of her appeal so far as it concerned them, with the costs at first instance in relation to Ms Cordony's claims against the first and fourth respondents being left for determination by the primary judge having regard to his decision on the issue of causation and these reasons for judgment. 168I propose the following orders: (1) The appeals of Mr Tomasetti and Tomasetti Investments Pty Ltd are dismissed. (2) The appeal by Ms Cordony in relation to her claims against the first and fourth respondents is allowed. (3) Set aside the judgment for the first and fourth respondents entered on 17 November 2011 in relation to the claims of Ms Cordony. (4) Set aside the order made on 17 November 2011 that Ms Cordony pay the first and fourth respondents' costs at first instance as agreed or assessed. (5) Remit the proceedings to the primary judge, so far as they relate to Ms Cordony's claims against the first and fourth respondents, for the purpose of: (a) Determining the issue of whether Ms Cordony's loss was caused by the first and fourth respondents' conduct. (b) Making such orders (including as to the costs of the proceedings at first instance) as he considers appropriate having regard to his determination of that issue and these reasons for judgment. (6) Order Mr Tomasetti and Tomasetti Investments Pty Ltd to pay 90 per cent of the respondents' costs of the appellants' appeals. (7) Order the first and fourth respondents to pay Ms Cordony's costs of her appeal so far as it relates to them. (8) The first and fourth respondents to have a certificate under the Suitors' Fund Act 1951, if qualified, in relation to their costs of Ms Cordony's appeal. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 11 December 2012