Supreme Court New South Wales Medium Neutral Citation: Westpac Banking Corporation v Billgate Pty Ltd [2013] NSWSC 1304 Hearing dates: 17, 18, 19 & 20 June; 29, 30 & 31 July; 1, 2, 12 & 13 August 2013; further written submissions 20, 22 and 23 August 2013 Decision date: 11 September 2013 Jurisdiction: Equity Division - Commercial List Before: Stevenson J Decision: Plaintiff entitled to judgment for debt and possession Catchwords: BANKING AND FINANCE - banker and customer - loan facilities to property development companies - guarantees and mortgages to secure corporate debt - whether guarantor received independent legal and financial advice - whether Bank misled customer as to the availability of funds - whether Bank acted without authority in clearing customers' excesses - whether alleged misleading representations caused a funding crisis which caused cessation of building work and financial loss in the sale of property development - whether alleged misleading representations caused loss in that properties would have been sold in more favourable market conditions TRADE PRACTICES -- misleading or deceptive conduct - Trade Practices Act 1975 - Fair Trading Act 1987 - Australian Securities and Investments Commission Act 2001 - whether representations by Bank in contravention of CONTRACT - Contracts Review Act 1980 - whether deed liable to be set aside - whether deed is an "unjust" contract within the meaning of the Contracts Review Act 1980 - whether Bank engaged in unconscionable conduct or exerted economic duress in connection with the deed CONTRACT - terms and conditions - deed of settlement and release - proper construction of deed - whether terms of deed are limited to "known" causes of action at the time of settlement - whether causes of action were sufficiently "known" in any case EQUITY - whether guarantee and deed ought to be set aside - undue influence EQUITY -- whether guarantee ought to be set aside - unconscionable conduct -- husband and wife - lack of independent advice EQUITY - trusts - whether properties held on constructive trust REMEDIES - statutory remedies - Trade Practices Act 1975 - damages - misleading or deceptive conduct - unconscionable conduct REMEDIES - statutory remedies - Contracts Review Act 1980 - damages - unjust contract - whether guarantee and deed are unjust DAMAGES - personal injuries - non-economic loss - anxiety and distress Legislation Cited: Australian Securities and Investments Commission Act 2001 (Cth) Contracts Review Act 1980 Evidence Act 1995 Fair Trading Act 1987 Trade Practices Act 1974 (Cth) Cases Cited: A v N [2012] NSWSC 354 Attorney-General (NSW) v World Best Holdings Ltd [2005] NSWCA 261; (2005) 223 ALR 346 Australia & New Zealand Banking Group Ltd v Karam [2005] NSWCA 344; 64 NSWLR 149 Australian Competition & Consumer Commission v 4WD Systems Pty Ltd (2003) 200 ALR 491 Bank of Credit and Commerce International SA (in liquidation) v Ali [2001] 1 All ER 961 Bathurst City Council v PWC Properties Pty Ltd [1998] HCA 59; (1998) 195 CLR 566 Cameron v Qantas Airways Ltd (1995) 55 FRC 147 Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101 Grant v John Grant and Sons (1954) 91 CLR 112 Demagogue Pty Ltd v Ramensky (1992) 39 FCR 31 Kakavas v Crown Melbourne Ltd [2013] HCA 25 Karam v ANZ Banking Group Limited [2001] NSWSC 709 Kowalczuk v Accom Finance Pty Ltd [2008] NSWCA 343; (2008) 77 NSWLR 205 London and South Western Ply Co v Blackmore (1870) LR 4 HL 610 Lyall v Edwards (1861) 158 ER 139 Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583 Perpetual Trustee Co Ltd v Khoshaba [2006] NSWCA 41 Salkeld v Vernon (1758) 1 Eden 64 The Owners Corporation of Strata Plan 61390 v Multiplex Corporate Agency Pty Limited (No 2) [2012] NSWSC 322 Watson v Foxman (1995) 49 NSWLR 315 Category: Principal judgment Parties: Westpac Banking Corporation (plaintiff) Billgate Pty Limited (first defendant) 101A Darling Point Road Pty Limited (second defendant) William John Jamieson (third defendant) Jennifer Robyn Jamieson (fourth defendant) Louis William Le Compte (interested party) Representation: Counsel: J B Simpkins SC with J M White (plaintiff) W G Muddle SC with R A Parsons (first to third defendants) D L Williams SC with J D Little (fourth defendant) Solicitors: Gadens Lawyers (plaintiff) Ian Congdon (first to third defendants) CLS Legal (fourth defendant) File Number(s): SC 2012/312312 Publication restriction: Nil Judgment Introduction 1The plaintiff, Westpac Banking Corporation, brings these proceedings as successor in law to St George Bank Limited (together, "the Bank"). 2The Bank provided facilities to the first defendant, Billgate Pty Limited and the second defendant, 101A Darling Point Road Pty Limited ("the Billgate Facility" and "the 101A Darling Point Facility" respectively). 3The facilities were what the parties described as "BBSY" facilities. This was a synthetic bill product that emulated a conventional bill acceptance facility (where bills are discounted in the bill market). Funds were generated by drawdowns and rollovers on a one or two month cycle. Draw downs occurring between rollover dates were generally subject to a maturity date which coincided with the next rollover date for the principal bill and allowed the lesser amounts to be rolled into the next rollover of the larger amount. 4When drawn down, funds were generally paid by the Bank to a conventional cheque account of the borrower and, in the case of 101A Darling Point, then paid to the builder or other recipient appropriate to the purposes of the draw down. Fees and charges included a discount fee and an acceptance fee, both of which were expressed as a percentage of the amount being drawn down or rolled over. 5Billgate used the Billgate Facility to complete a development in Roslyndale Avenue, Woollahra. That development is now complete, the property sold and the proceeds paid to the Bank. 6101A Darling Point used the 101A Darling Point Facility to complete a development of three apartments at a property it owns at Darling Point ("the Darling Point Project"). That development is also complete. The facilities were separate but, ultimately, cross-collateralised. 7The sole director and secretary of Billgate and of 101A Darling Point is the third defendant, Mr William Jamieson. 8There has been default under each of the Billgate and 101A Darling Point Facilities. 9The Bank seeks judgment for an amount in excess of $28 million from Billgate, 101A Darling Point, and from Mr Jamieson pursuant to the facilities and guarantees each of them has executed in favour of the Bank. 10The Bank also claims, pursuant to mortgages executed in its favour, possession of the Darling Point property, and another property at Joadja (of which Mr Jamieson is the registered proprietor). 11The fourth defendant, Mrs Jennifer Jamieson, is the wife of Mr Jamieson. Mr and Mrs Jamieson separated in February 2011. 12Mrs Jamieson operates a farm stay business at the Joadja property. That business is Mrs Jamieson's only source of income. 13Mrs Jamieson is not a shareholder in either Billgate or 101A Darling Point. She is a shareholder of Jamcart Pty Ltd (which holds shares in Billgate). However, she holds those shares in trust for Mr Jamieson. Mrs Jamieson has no interest in 101A Darling Point. 14From 2005, Mrs Jamieson was the registered proprietor of a property in Vaucluse. That property was the Jamieson family home. On 31 October 2005, the Bank advanced $3.5 million to Mrs Jamieson ("the Portfolio Loan"), secured by a mortgage over the Vaucluse property, to refinance a loan Mrs Jamieson had earlier taken out with Perpetual Trustee Company Limited to purchase the property. The limit of the Portfolio Loan was subsequently increased. 15On 18 June 2009, Mrs Jamieson signed a guarantee (limited to $1 million) in respect of the indebtedness of 101A Darling Point to the Bank, and a mortgage over the Vaucluse property as security for that guarantee. The events of 18 June 2009 are central to the dispute between the parties. 16Some 10 months later, on 15 April 2010, Mrs Jamieson signed a guarantee (limited to $1.3 million) in respect of the indebtedness of Billgate to the Bank. That guarantee was also secured over the Vaucluse property. 17Prior to signing the documents referred to at [15] and [16], Mrs Jamieson had no liability to the Bank in respect of either 101A Darling Point or Billgate. Her only liability had been under the Portfolio Loan. 18Mrs Jamieson exchanged contracts to sell the Vaucluse property in March 2011. Settlement occurred in June 2011. The net proceeds of sale, after payment of the monies owing by Mrs Jamieson to the Bank on her own account, in the order of $1.4 million, were placed on deposit with the Bank. The Bank has since purported to appropriate that sum in the circumstances described below. 19Mrs Jamieson now lives in one of the three apartments at the Darling Point property with two of Mr and Mrs Jamieson's three children and with Mrs Jamieson's aged mother. Mr Jamieson lives in another of the apartments. There is no evidence as to who, if anyone, occupies the third apartment. 20On 16 August 2012, the Bank and each of the defendants entered into a Deed of Settlement and Release ("the Deed") in which the defendants agreed to pay the Bank $23 million (by two instalments; $10 million by 17 August 2012, and $13 million by 21 September 2012) in full satisfaction of the Bank's claims. At the date of the Deed, the amount owing to the Bank was in the order of $37 million. 21By the Deed, the defendants acknowledged default under the various facilities and agreed that, upon payment of the first instalment of $10 million, they would release the Bank from all claims. They also agreed that, if they defaulted under the terms of the Deed, they would, among other things, consent to judgment in favour of the Bank for: - (a)possession of the Darling Point and Joadja properties; and (b)the whole of the indebtedness to the Bank of 101A Darling Point and Billgate. 22The first payment ($10 million) was paid on time. The second payment ($13 million) was not paid at all. 23In addition to seeking possession of the Darling Point and Joadja properties, the Bank seeks to recover the full amount of the companies' indebtedness to it from Mr Jamieson pursuant to guarantees he has executed, as well as under the Deed. 24The Bank does not seek monetary compensation from Mrs Jamieson. The only relief the Bank seeks against Mrs Jamieson is possession of the Darling Point and Joadja properties. The Bank's case in chief 25The Bank's case in chief is documentary and formal. 26The Bank relies upon the security documents executed by the parties and, in particular, the Deed. 27It is common ground that the Bank has made out, in its case in chief, its entitlement to the relief it seeks. 28Whether or not, at the end of the day, the Bank is entitled to that relief depends upon the determination of the claims made by Mr and Mrs Jamieson in relation to, amongst other matters, the Deed. The claims made by 101A Darling Point, Billgate and Mr Jamieson 101A Darling Point 29The Bank and 101A Darling Point entered the 101A Darling Point Facility in December 2007 to fund the Darling Point Project. At that time, the Senior Relationship Manager at the Bank with whom Mr Jamieson was dealing was Mr Andrew Allan. In about May 2008, Mr Jamieson informed Mr Allan that the amount then available for construction under the 101A Darling Point Facility was inadequate. 101A Darling Point contends that, in response, Mr Allan represented to Mr Jamieson, and thus to it, that it should commence construction and that the Bank "would make available sufficient funds to complete the construction of the Development as such funds were required". 30Mr Muddle SC, who appeared with Mr Parsons for 101A Darling Point (as well as for Mr Jamieson and Billgate), accepted that this statement could not be relied on by 101A Darling Point as a "blank cheque" and stated that 101A Darling Point did not rely upon it as a stand alone representation. Rather, it was relied on as background for the representations said to have been made in 2009. 31101A Darling Point contends that the Bank represented, by a letter of offer of 9 June 2009 sent by the Bank to 101A Darling Point ("the 9 June 2009 letter of offer"), and by representations alleged to have been made by Mr Allan at a meeting at the Jamieson home at Vaucluse on 18 June 2009, that the following sums (which were set out in the 9 June 2009 letter of offer) would "stand as available funds" within the 101A Darling Point Facility upon entry into the facility amendment offered in the 9 June 2009 letter of offer: - (a)$4,076,000 for construction; (b)a further sum of $1 million for drawings by Mr Jamieson for the purposes of Mr Jamieson and Mrs Jamieson as follows: - (i)an "equity redraw" of $350,000; (ii)"professional fees" of $300,000; (iii)"contingency" of $200,000; and (iv)$150,000 comprising "previously unexpended funds" approved in an earlier facility letter. 32101A Darling Point also contends that, at the same time, the Bank represented that the "existing debt" under the 101A Darling Point Facility was $8.222 million. 33101A Darling Point contends that these representations were false because, first, the $1 million did not stand as available funds under the 101A Darling Point Facility as amended by the 9 June 2009 letter of offer and, second, because the "existing debt" under the 101A Darling Point Facility as at 9 June 2009 was $9.261 million, not $8.222 million. 34101A Darling Point alleges that it was told by Mr Allan, in August 2009, that the $1 million was not available, and had been substantially expended before 9 June 2009. 35101A Darling Point also asserts that, on 6 August 2009, Mr Allan, without its authority, transferred from 101A Darling Point's account "approximately $600,000" (it was, in fact, $629,150 - see [396] below), being funds which were the proceeds of a draw down on the 101A Darling Point Facility for the payment of progress claim number 13 to the builder engaged by 101A Darling Point to construct the development. 101A Darling Point alleges that, as a result, it was unable to pay progress claim 13 to the builder. 36101A Darling Point claims that this caused what was described in submissions as an "immediate funding crisis" for 101A Darling Point and the construction of the Darling Point Project, deprived 101A Darling Point of funds to pay the builder's progress claims, placed the Project in jeopardy and caused the builder, temporarily, to cease work. 37The builder issued a notice of default in November 2009, before suspending works in February 2010 until August 2010. This is alleged to have had the practical effect that completion of the construction of the Darling Point Project was delayed until February 2011. 101A Darling Point claims that, by this time, the market for units in the development had fallen such that the "obtainable price" for the units in the development was in the order of $12 million. Had the Darling Point Project been completed in late 2009 or early 2010, 101A Darling Point alleges the price that would have been "obtainable" was in the order of $21 million. 38101A Darling Point claims damages for this alleged loss. 39101A Darling Point, Billgate and Mr Jamieson seek to set aside the Deed on the basis that it is an unjust contract within the meaning of the Contracts Review Act 1980 and on the basis of the allegedly unconscionable conduct of the Bank leading up to the execution of the Deed. 40101A Darling Point, Billgate and Mr Jamieson also claim that, because the releases in the Deed do not, in terms, release the Bank from claims "whether known or not known", the Deed is not effective to prevent them bringing claims against the Bank of which they were ignorant when entering the Deed (relying on Salkeld v Vernon (1758) 1 Eden 64 at [67] - [68]). Billgate 41Billgate makes a claim for relief that is consequential upon that claimed by 101A Darling Point. Billgate alleges that, "as a consequence of the matters pleaded" by 101A Darling Point, Billgate has or will suffer damage referrable to: - (a)additional "holding costs" and the "cost of performing the renovation works" at the Woollahra property; (b)disruption, from about August 2009, in Billgate's contractual relations with its contractors; and (c)delay in "the execution of the renovation works" which, as the Woollahra development was completed in November 2010 rather than mid 2010, resulted in Billgate "missing the market" in relation to the sale of the Woollahra property. Mr Jamieson 42Mr Jamieson's claim is also consequential upon that made against the Bank by 101A Darling Point. 43Mr Jamieson alleges that, but for the matters pleaded by 101A Darling Point, he would have sold the Darling Point property in a more favourable market permitting discharge of the securities that he has given to the Bank. Mrs Jamieson's claims 44Mrs Jamieson seeks monetary relief, relief in contract and proprietary relief. Monetary relief 45Mrs Jamieson claims that she executed the guarantee and mortgage referred to at [15] in reliance upon representations made by the Bank that the funds to be advanced to 101A Darling Point would be made available to Mr Jamieson to: - (a)make payments when due and payable on the Portfolio Loan; (b)to finalise the Darling Point Project; and (c)to meet family living expenses. 46Mrs Jamieson also claims that, but for her execution of the mortgage over the Vaucluse property, she would have, in mid 2009, sold the Vaucluse property into what she claims to have been a favourable market. 47Mrs Jamieson claims that, contrary to its representations, the Bank set-off the relevant increase in the 101A Darling Point Facility granted by the Bank to 101A Darling Point against other loans, with the result that there were no funds available to service the Portfolio Loan or for any other purpose. 48Mrs Jamieson claims that as a result, the Portfolio Loan fell into arrears. On 2 March 2011, the Bank demanded repayment of those arrears. Mrs Jamieson claims that this forced her to sell the Vaucluse property in a depressed market. 49Mrs Jamieson sold the Vaucluse property for $7.5 million by a contract exchanged on 25 March 2011 and settled on 24 June 2011. As I have mentioned, the net proceeds of sale were in the order of $1.4 million. The Bank retained this sum in a term deposit, and has appropriated it pursuant to the provisions of the Deed. 50Mrs Jamieson claims damages for the loss she claims to have suffered by reason of the fact that she sold the Vaucluse property in 2011, rather than in 2009. 51She also claims damages for anxiety and distress Relief in contract 52Mrs Jamieson seeks to have the guarantees she executed in relation to 101A Darling Point and Billgate, and the Deed, declared void or set aside on the basis that the circumstances in which she entered those transactions were unfair, unconscionable and procured by misrepresentations by the Bank. So far as concerns the guarantee that Mrs Jamieson executed in relation to Billgate, Mrs Jamieson alleges that she understood the document merely to be an extension of her potential liability (by $300,000) under her existing guarantee to 101A Darling Point, and relies upon the defence of non est factum. In relation to the Deed, Mrs Jamieson alleges that the Bank exercised economic duress in procuring her execution of that document. 53Although the Bank seeks no relief against Mrs Jamieson under either of the guarantees she has executed, Mrs Jamieson seeks to have them set aside. 54As an alternative for having lost the opportunity to sell the Vaucluse property in 2009 (see above), Mrs Jamieson claims damages in respect of the Bank's appropriation of the interest bearing deposit representing the net proceeds of sale of the Vaucluse property. Proprietary relief 55Mrs Jamieson also claims, under general law, or alternatively under statute that: - (a)101A Darling Point holds the Darling Point property wholly on constructive trust in her favour; (b)Mr Jamieson holds the Joadja property wholly on constructive trust in her favour; (c)her interests in the Darling Point and Joadja properties are held in priority to any interest of the Bank; and (d)alternatively, she is entitled to a life estate of each of the Darling Point and Joadja properties. 56Mrs Jamieson submits: - (a)she has lost her Vaucluse home by reason of the Bank's conduct; (b)she now lives in one of the units at 101A Darling Point and has done so since moving out of the Vaucluse home; (c)having regard to the conduct of the Bank by which Mrs Jamieson lost her property and home, it would be unconscionable for the Bank to rely upon its legal interest in the 101A Darling Point property or the Joadja property without giving effect to Mrs Jamieson's interest in those properties by way of the imposition of a constructive trust. Claim against Mr Jamieson 57Mrs Jamieson also makes claims against Mr Jamieson based on misrepresentations she alleges he made to her. 58Ultimately, the only relief Mrs Jamieson sought against Mr Jamieson was that he transfer to her his interest in the 101A Darling Point and Joadja properties. Mr Jamieson does not oppose this. However, in light of the conclusions to which I have come concerning the claims made by Mrs Jamieson and the other defendants against the Bank, there remains no basis on which Mrs Jamieson could obtain such relief against Mr Jamieson. I shall make no further mention of it. Decision 59Ultimately, the conclusion to which I have come is that the attacks made by the defendants on the Deed, both as to its status and its construction, fail. 60The consequence of that finding is that the Bank has the benefit of the releases given by the defendants to it under the Deed, and is entitled to the relief it seeks: judgment for possession of the Darling Point and Joadja properties, and judgment against 101A Darling Point, Billgate and Mr Jamieson for the debt claimed. 61It follows that it is not necessary for me to make findings as to the other issues that arose in these proceedings. However, as these proceedings took place over eleven hearing days, and in deference to the detailed arguments advanced on behalf of the defendants, I will endeavour to deal with all that was put to me, albeit, in some cases, more briefly than would be the case had I not found that the Bank is entitled to the protection of the Deed. The Facilities 62The 101A Darling Point and Billgate Facilities were established in December 2007. Originally, the 101A Darling Point Facility was for $11.74 million, and the Billgate Facility was for $6.45 million. 63The purpose of the facilities was to fund the developments in Woollahra and Darling Point to which I have referred. The 2008 Representations 64Mr Jamieson alleges that in about May 2008, prior to the commencement of construction of the Darling Point Project, he had the following conversation with Mr Allan: - "Mr Jamieson: This building costing we have in the existing approval is not enough. This project cannot be built for that much money. In my opinion it would be more like $4.8 million. Mr Allan: We will not make any changes to the facility just yet. I don't want to go back to Credit with a different number at present. Start the building and as you move it along we'll get you the rest of the money in a few months. We'll get a new valuation at that time." 65In substance, Mr Allan did not dispute this conversation, although he said that what he had said about "Credit" was that he could not go back to the Bank's Credit area without sufficient information to assess the situation. 66As I have said, Mr Muddle accepted that Mr Jamieson did not understand from Mr Allan's words that he had a "blank cheque". This representation was relied upon as background to the representations said to have been made in 2009. 67The builders on the developments made progress claims from time to time. A quantity surveyor, Mr David Thomson, of Quantum Construction Consultants ("the Quantity Surveyor"), assessed those progress claims. Once the progress claims were certified, they were paid by progressive draw downs under the facilities. Those draw downs were effected by acceptance and discounting by the Bank of bills drawn under the two facilities. 68It was the Bank's practice to send to 101A Darling Point and to Billgate a letter headed "Confirmation of Rollover Under Bill Acceptance/Discount Facility" each time a further bill was negotiated (the "Confirmation of Rollover Letters"). Each of the Confirmation of Rollover Letters specified, amongst other things, the face value of the maturing bill and of the new bill drawn in its stead. 69An issue arises in the proceedings as to the extent to which Mr Jamieson read the Confirmation of Rollover Letters. The critical Confirmation of Rollover Letters were sent to 101A Darling Point and Billgate care of Mr Jamieson at the then Jamieson family home at Vaucluse. Mr Jamieson's evidence was that he did not open such letters but delivered them to his bookkeeper, Ms Erminia Cotaru, who would process the relevant details into the records of the company in question. Whether or not Mr Jamieson actually saw the Confirmation of Rollover Letters, the fact is the Bank sent them to the companies at Mr Jamieson's then address. The details were available for Mr Jamieson to see both in the letters themselves and, following Ms Cotaru's processing of the details, in the companies' records. I will return to this subject later in these reasons. 70In early 2009, it became clear to Mr Jamieson that he required further funding in order to complete the Darling Point and Woollahra developments. At that time, Mr Jamieson had liquidated the majority of the group's share portfolio, so as to inject equity into the developments in the amount of approximately $1.1 million, and also exhausted his personal funds. 71On 13 February 2009, the Bank sent 101A Darling Point a Confirmation of Rollover Letter that stated that the discounted proceeds of the bill drawn that day and payable to 101A Darling Point was $8,191,247.85 and that the face value of that bill (to mature on 13 March 2009) was $8,221,840.70. 72On 16 February 2009, the Quantity Surveyor produced a report stating that the estimated development cost of the Darling Point Project was $5.75 million and that the value of work completed was in the order of $1.44 million. Thus, in February 2009, the value of work on the Darling Point Project to be funded was in the order of $4.3 million. 73A "Project Summary" prepared by the Bank dated 20 February 2009 specified that the cost of work to complete the Darling Point Project was in the order of $4.1 million; some $200,000 less than the amount stated by the Quantity Surveyor. 74An "Advance Application" prepared by Ms Joanne Yammine (who worked with Mr Allan at the Bank) sought an increase in the 101A Darling Point Facility from $11.74 million to $13.7 million and the Billgate Facility from $9.435 million to $10.435 million. 75That document recorded the "current balance" of the Billgate Facility to be $8.062 million and the current balance of the 101A Darling Point Facility to be $8.222 million. As will emerge below, the latter figure assumes importance in this case. 76A Credit Approval Memorandum also dated 20 February 2009 stated that the Billgate Facility was to be increased to $10.54 million and the 101A Darling Point Facility to $14.16 million. 77That document also recorded: - "To date, the client has injected some $1.1m equity via personal funds to assist with these cost increases. The client has requested that some ($738k) of this funding be re-imbursed in the proposed facilities to return sufficient cashflow for the group to ensure the completion of the projects (& cover living expenses)." 78This was the first reference to what was later described as an "Equity Redraw" under the Billgate and 101A Darling Point Facilities. 79101A Darling Point continued to draw down funds under its existing facility. On 12 March 2009, Mr Jamieson, as director of 101A Darling Point, wrote to the Bank authorising payment of a progress claim in the sum of $189,150.05. The Bank advanced those funds by accepting and discounting a further bill. On 13 March 2009, the Bank sent 101A Darling Point a further Confirmation of Rollover Letter that stated that $189,150.05 had been credited to 101A Darling Point's account and that the face value of the new bill was $8,476,921.98, to mature on 12 May 2009. 80On 23 March 2009, Mr Guy Howes, an Executive Credit Manager of the Bank (to whom the Relationship Manager, Mr Andrew Allan, reported) made a note: - "This is a difficult proposition as in both instances the [loan construction ratio] and [loan value ratio] increase, on the back of Nil equity and given adverse [gross realisation] movements in the current market. However, on both projects the additional funding for variations to the proposed construction is supported given failure to do so would lead to a more adverse outcome... Notwithstanding my support for the increases, I have recommended watchlisting the group as they have no more cash or liquid assets to put into the projects and are seeking reimbursement of funds invested to date to assist with GST and living expenses going forward, so we are increasing our proportional investment as well as dealing with a borrower with no ability to meet further variations or overruns." A guarantee from Mrs Jamieson? 81In April 2009, the question arose, for the first time, of the possibility of Mrs Jamieson providing a guarantee, supported by a mortgage over her Vaucluse property, in support of the proposed increased facilities. 82According to Mr Jamieson, Mr Allan raised the matter by saying "we may need some more security". 83By 6 April 2009, Mr Allan reported to Mr Howes that Mrs Jamieson would give such a guarantee: - "Living expenses are detailed at $718k p.a (or $60k per month) with the remainder of equity being to facilitate project costs... The living expenses include servicing the [Portfolio Loan] for [Mrs Jamieson] - this payment is in compensation for providing the guarantee from the security property... Additional comfort is taken from the commitment of the client - as evidenced by the willingness to add equity (even after re-draw), cross [collateralise] all securities and finally to include Mrs Jamieson and the family home into the transaction." 84Mr Jamieson was reluctant to ask Mrs Jamieson to give such a guarantee. He did not raise the topic with Mrs Jamieson until the evening on which she signed the guarantee: 18 June 2009. In the meantime, Mr Jamieson sought to take the matter to a more senior level within the Bank and sought a meeting with the Bank's then General Manager, Mr Gregory Kenny. 85By 8 April 2009, the current balance of the indebtedness of 101A Darling Point had increased to $8.477 million and the indebtedness of Billgate had increased to $8.161 million. 86On 15 April 2009, Mr Allan reported to a more senior officer of the Bank, Mr Robert Collier: - "Mr Jamieson has escalated a complaint through the usual channels [that is to Mr Kenny] regarding the current submission for the cost over-runs for Darling Point Road, Darling Point & Roslyndale Avenue, Woollahra. It appears that he is trying to see if he can avoid putting additional security into the transaction (the wife's property if you recall)". 87The meeting with Mr Kenny took place on 22 April 2009. Mr Jamieson attended with his solicitor, Mr Louis Le Compte. Mr Collier also attended the meeting. 88According to Mr Jamieson the following conversation took place at the meeting: - "Mr Collier: You will need your wife to be part of this. Mr Jamieson: No. She keeps her things separately from me. Mr Collier: Well you're going to need it. Mr Jamieson: No I don't think that will happen." 89Mr Jamieson gave evidence that he had the following conversation with Mr Allan after the meeting: - "Mr Jamieson: Jenny won't give her guarantee for something she's not involved in. Mr Allan: We're going to need it. Mr Jamieson: She'll have to have her mortgage payments covered out of the facility. Well I'll need some money for myself. Mr Allan: We'll put some equity draws in to cover that. You've put in a lot of consultant's fees and expenses. Mr Jamieson: Yes. It's about seven hundred or eight hundred thousand. I've spent double the amount in the original facility. It needs to be that much again to reimburse me. We haven't used up all the amounts for consultants and contingency in the original approval. If we've got what's left over there, move it across to the new facility with three hundred thousand extra. Mr Allan: Can you get me an updated statement of assets and liabilities. I also need a full update of your anticipated expenses for yourself and [Mrs Jamieson] so we can be sure we've covered everything." 90On 24 April 2009, Mr Howes wrote to Mr Collier: - "We are yet to hear back from Mr Jamieson concerning his discussion with his wife, however I would like to get on the front foot with this one if possible". 91On 4 May 2009, the Bank sent 101A Darling Point a letter offering a new Commercial Bill Acceptance/Discount facility of $14.16 million to replace the then existing Commercial Bill Acceptance/Discount facility of $11.74 million. 92The letter stated that the new facility was to be applied for the purposes described in a funding table in the following terms: - 101A Darling Point funding table Purpose Funding Land (Existing debt) $8,222,000 Equity Redraw $350,000 Professional Fees $300,000 Council Contributions - Construction $4,076,000 Contingency (5%) $200,000 Interest Capitalisation $887,000 Holding Costs $25,000 Marketing Costs $100,000 Total $14,160,000 93It is common ground that $8.222 million was not the "existing debt" at 4 May 2009 but was, rather, the "existing debt" as at 20 February 2009 (see [71] to [75] above). The Bank has offered no explanation in these proceedings as to why the Bank described $8.222 million in this letter (and in the letter of offer of 9 June 2009 referred to below) as the "Land (Existing debt)". 94Despite Mr Jamieson's statements to Bank representatives that he doubted that Mrs Jamieson would agree to give a guarantee, the letter stated that the security of the new facility was to include a guarantee from Mrs Jamieson limited to $1 million supported by a mortgage over the Vaucluse property. The evidence did not reveal how this came about. 95Mr Jamieson did not tell Mrs Jamieson about this letter of offer or of the Bank's requirement that she provide a secured guarantee. He said he "avoided" doing so. 96On 4 May 2009, the Bank also sent Billgate a letter offering a new Commercial Bill Acceptance/Discount facility for $10.54 million to replace the existing facility of $9.435 million. 97The letter stated that this facility was to be applied for the purposes described in a funding table as follows: - Billgate funding table Purpose Funding Land (Existing debt) $8,062,000 Equity Redraw $388,000 Remaining Professional Fees $100,000 Remaining Construction $1,176,000 Contingency (5%) $24,000 Council Contributions - Holding Costs $50,000 Marketing Costs $40,000 Remaining Interest $700,000 Total $10,540,000 98It is common ground that $8.062 million was not the "existing debt" at 4 May 2009 but was, rather, the "existing debt" as at 20 February 2009. Again, the Bank has offered no explanation as to why the Bank described $8.062 million in this letter as the "Land (Existing debt)". 99Each company's debt had increased since 20 February 2009 as a result of further drawings under the facilities. 100The May letters of offer did not proceed as the Bank decided that the proposed increases in facilities should be subject to further conditions. The additional conditions included that there be evidence that each guarantor, and specifically Mrs Jamieson, receive independent financial and legal advice. Proposed clearance of "excesses" 101On 8 May 2009, Mr Allan's assistant sent a memorandum to Mr Howes: - "Just wanted to seek clarification on the Jamieson Group's current excess position. As you're aware we hold approval now to increase both the Billgate & 101A Darling Point Road facilities. [Letters of Offer] were delivered personally on [6 May 2009] so the settlement process has begun. The client has a number of excesses in his accounts (as detailed below). Some of which will be cleared with the progress claim I have submitted today but the majority to be cleared once the increase in funding settles. Account Name Account No. Amount Billgate [XXXXXXX] $323,033 W J Jamieson [XXXXXXX] $130,514 Jenny Jamieson [XXXXXXX] $16,792 Total $470,339". 102Thus the position was, as at 8 May 2009, that accounts associated with Billgate and with Mr and Mrs Jamieson were in excess of their current limits to the extent of $470,339 and that the Bank proposed to clear these excesses from the increased funding referred to in the letters of offer of 4 May 2009. This proposal was referred to by Mr Muddle, and Mr Williams SC, who appeared with Ms Little for Mrs Jamieson, as the Bank's "plan" to clear these excesses from the proceeds of the increased 101A Darling Point Facility. 103On 12 May 2009, the Bank sent 101A Darling Point a Confirmation of Rollover Letter stating that the face value of the "new bill" was then in the order of $9.261 million, to mature on 10 July 2009. 104On 26 May 2009, Mr Allan and his assistant made a diary note recording that the "excesses" in the accounts of Billgate, 101A Darling Point and Mr and Mrs Jamieson were then $584,981.17 and that those excesses would be cleared from the proposed increase in funds. 105On 9 June 2009, the Bank sent further letters of offer to Billgate and 101A Darling Point. The letters were, relevantly, in the same form as the 4 May 2009 letters and, in particular, repeated the funding tables in those letters. 106The letter to 101A Darling Point thus stated that "Land (Existing debt)" was $8.222 million, whereas the Confirmation of Rollover Letter of 12 May 2009 stated that the discounted proceeds of the bill drawn that day and payable to 101A Darling Point was $9,191,531.96 and that the face value of that bill (to mature on 10 July 2009) was $9,261,321.59. 107Similarly, the letter to Billgate stated that "Land (Existing debt)" was $8.062 million, whereas a Confirmation of Rollover Letter sent on the same day stated that the discounted proceeds of the bill drawn that day and payable to Billgate was $8,398,164.83 and that the face value of that bill (to mature on 7 September 2009) was $8,502,064.84. 108As I have mentioned, the Bank offered no explanation, in these proceedings, as to why the figures of $8.222 million and $8.062 million were described as being "Land (Existing debt)" in the 101A Darling Point and Billgate letters of offer. 18 June 2009 meeting at Vaucluse - 101A Darling Point guarantee and mortgage over Vaucluse signed by Mrs Jamieson 109Mrs Jamieson executed a guarantee in favour of the Bank in respect of the indebtedness to the Bank of 101A Darling Point and the mortgage over the Vaucluse property on the evening of 18 June 2009 at the Vaucluse home. 110Present at Vaucluse on that occasion were Mr and Mrs Jamieson together with, from approximately 7.00pm, Mr Le Compte and, from approximately 8.00pm, Mr Allan. 111Each of Mr Jamieson, Mrs Jamieson, Mr Le Compte and Mr Allan gave an account as to what occurred, and what was said at Vaucluse on the evening of 18 June 2009. Each witness had a recollection of events that differed from that of the other participants at the meeting. To some extent, the course of cross-examination revealed that those differences were not as sharp as the affidavit evidence of the witnesses suggested. 112The witnesses were giving evidence of a conversation that occurred over four years ago. In those circumstances, Mr Simpkins SC, who appeared with Mr White for the Bank, drew attention to the familiar words of McLelland CJ in Eq in Watson v Foxman (1995) 49 NSWLR 315 at 318 - 9: - "Where, in civil proceedings, a party alleges that the conduct of another was misleading or deceptive, or likely to mislead or deceive (which I will compendiously describe as "misleading")... it is ordinarily necessary for that party to prove to the reasonable satisfaction of the court: (1) what the alleged conduct was; and (2) circumstances which rendered the conduct misleading. Where the conduct is the speaking of words in the course of a conversation, it is necessary that the words spoken be proved with a degree of precision sufficient to enable the court to be reasonably satisfied that they were in fact misleading in the proved circumstances. In many cases (but not all) the question whether spoken words were misleading may depend upon what, if examined at the time, may have been seen to be relatively subtle nuances flowing from the use of one word, phrase or grammatical construction rather than another, or the presence or absence of some qualifying word or phrase, or condition. Furthermore, human 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. All this is a matter of ordinary human experience." 113Before dealing with the events of 18 June 2009, I shall make some observations about my assessment of the four witnesses. The evidence of Mr Le Compte 114The only document purporting to be a contemporaneous record of what occurred that evening is a three-page manuscript document headed "File Note" prepared by Mr Le Compte. Mr Le Compte produced that note to the Court in response to a subpoena issued in late March 2013 at the request of the Bank. 115That file note was in the following terms: - "Attg Jennifer Jamieson at XXXXXX, Vaucluse in dining room area. Bill Jamieson was in another room. Jenny [Mrs Jamieson] gave me a bundle of docs which she said she had rec'd that day fr Bill [Mr Jamieson]. On perusing the docs I said that they related to a loan to 101A of $14.6M and included a Fac Offer ltr dated 9 June 2009. Jenny joined me at the dining table at 7.15PM and I explained to her, her obligations as gtor if she executed the docs as follows: 1. Her gtee was limited to $1M + interest + costs & expenses + restoring the Bank to its former position if any transaction was declared void for any insolvency reason + any amount lost by STG if J breach her obligations to the Bk. 2. STG can sue J for moneys owed and take possession of J's ppty & other assets on default by the borrower and sell those assets to recover amts due to STG. 3. STG does not need to sue the Borrower before suing Jenny. 4. LLeC can't give J financial advice - J sd she was receiving fin advice from Michael Twomey who did her tax returns. 5. LLeC is acting for Jenny, Bill, 101A and Billgate (100% owned by Jenny) but will cease to do so if any conflict of interest arises. Jenny sd she had no objection to LLeC acting for her & the others as all of their affairs were linked. 6. J sd she preferred not to have to give STG a guarantee plus 2nd Mge over the house but she felt she had no choice as her fortunes & income depended on Bill's income and all of it could be lost if she refused to gtee & mtge the house. She felt this was the best way to look after her family. 7. Jenny then signed all of the docs & I witnessed her signatures. 8. J then instructed me to get the loan transaction settled urgently so that moneys could be released to her & Bill. 9. LLeC sd he would copy the security docs & send her & Bill a copy with the originals going to STG via its solicitors. J sd she did not need a copy of the docs & LLeC shd just give Bill a copy as he kept all of the records on behalf of her & him. LLeC sd he would post her a copy of the ltr he would be sending to the Bank's solr tomorrow. This way JRJ would have a list of the various docs. Note About 8PM Andrew Allan fr STG turned up at [the Vaucluse property] & Bill entertained Andrew in a room next to the dining area where the 2 of them had a discussion which did no disturb either Jenny or LLeC as their voices were inaudible. LLeC finished these notes abt 8.15PM & he and Andrew departed at abt 8.30PM." 116Mr Le Compte created a further "File Note", dated 19 June 2009 in the following terms: - "Engaged placing copy of ltr dated 19/6/09 fr LeC/Davey to Herbert Geer in stamped enveloped [sic] addressed to Jennifer Jamieson at Vaucluse and depositing it into Aust Post letterbox at Mosman Post Office at 6PM." 117It is quite clear, from the form of these documents, that they purport to have been created on the dates they bear and contemporaneously with the events they record. Thus, each document contains abbreviations, for example, "STG" for "St George Bank", "Sd" for "said", "LLeC" for "Lou Le Compte" and "J" for "Jenny", suggestive of the notes being made within constrained time limits and shortly after the events they describe. The last sentence of the note dated 18 June 2009 actually states that Mr Le Compte "finished these notes" at approximately 8.15pm before Mr Le Compte's departure, with Mr Allan, from the Vaucluse property. 118In fact, Mr Le Compte created the document (as well as the 19 June 2009 "File Note") on 10 April 2013, after he was served with a subpoena issued by the Bank to produce his file. 119To put that fact in context, it is necessary to examine the events leading up to the production of the document. 120On 24 October 2012, Mrs Jamieson's solicitors wrote to Mr Le Compte enclosing Mrs Jamieson's authority and direction that Mr Le Compte transfer his files relating to Mrs Jamieson to them. 121On 25 October 2012, Mr Le Compte sent an email to Mrs Jamieson's solicitors stating, relevantly: - "In 2001 we acted on the exchange of contracts...for the sale of... Vaucluse... We did not on the completion of this matter because on 15 June 2011 we ceased to act for Mrs Jamieson and handed our file to Garland Hawthorne Brahe (reference Brenden Miller) who attended to completion. The only other matter that we appear to have acted for Mrs Jamieson in your time frame is in connection with a guarantee and indemnity given to her by St George Bank in June 2009 and we will be able to retrieve our file from storage late this afternoon and have it available for you to collect at 9am tomorrow." 122Later that day Mr Le Compte wrote to Mrs Jamieson's solicitors: - "We refer to our email of today's date (copy attached) and enclose Mrs Jamieson's file as requested. The file consists of the following: - 1. A copy of our letter dated 19 June 2009 to Herbert Geer (2 pages) who acted for St George Bank Ltd. 2. Copies of the documents numbered 1 to 7 referred to in our letter to Herbert Geer. Kindly acknowledge safe receipt." 123The letter to Herbert Geer of 19 June 2009, to which Mr Le Compte referred, enclosed 11 documents executed on 18 June 2009 at Vaucluse including the guarantee and mortgage executed by Mrs Jamieson together with five other documents executed by Mrs Jamieson, as well as the guarantee executed by Mr Jamieson and three other documents executed by Mr Jamieson. 124Mr Le Compte's letter makes no reference to any file notes. In cross-examination, Mr Le Compte agreed that he understood that Mrs Jamieson's solicitor wished to obtain any file notes that Mr Le Compte had made concerning any meetings Mrs Jamieson attended. He said: - "Meetings with the Bank was what I understood he was after." 125In cross-examination, Mr Le Compte gave the following evidence: - "Q. If the file had consisted also file notes, you would have said so, wouldn't you? A. I should have, that's for sure. Q. If there had, in fact, been file notes of the events of 18 and 19 June you would have provided them to Mr Jamieson's new solicitors, wouldn't you? A. Yes, I would." 126The cross-examination continued: - "Q. The fact of the matter is there were no contemporaneous file notes in existence for 18 and 19 June, were there? A. There were because I saw them later myself." 127In late March 2013, Mr Le Compte was served with a subpoena issued by the Bank calling for production of his file concerning Mrs Jamieson. The subpoena was returnable on 4 April 2013. Mr Le Compte produced no documents that day. The subpoena was adjourned to 10 April 2013. Mr Le Compte produced no documents that day. 128At 12.21 am on 11 April 2013, Mr Le Compte sent an email to Mrs Jamieson's solicitors: - "Apologies for missing Court but I had sudden illness which prevented me from being there by 9am. I understand that the matter is listed for 9am this morning and I propose to attend then and produce the documents called for in the subpoena. 129On 11 April 2013, Mr Le Compte wrote to the Registrar of the Court enclosing the subpoena served on him by the Bank and the file notes bearing the dates 18 June 2009 and 19 June 2009 (which Mr Le Compte now admits he created on 10 April 2013). 130Mr Le Compte was served with a further subpoena by the Bank which required him to attend Court to give evidence on 17 June 2013; the first hearing day of these proceedings. 131On that date Mr Le Compte produced a note addressed "To Whom it May Concern" in the following terms: - "The File Notes dated 18 June 2009 concerning a meeting with Jennifer Jamieson & ors at her Vaucluse residence and 19 June 2009 concerning the posting of a letter to Jennifer Jamieson both headed "101A & St George" were made by me on 10 April 2013 when I discovered that my original file notes made on 18/6/09 and 19/6/09 had been lost after I took them from my paper file for scanning to my electronic file. The File Notes made on 10/4/13 were made to the best of my recollection of events that took place on 18/6/09 and 19/6/09 respectively." (emphasis added) 132Mr Le Compte referred to this document as his "side note". 133Mr Le Compte claimed that the side note was a typed copy, word for word, of a manuscript note that he created on 10 April 2013, at the same time as the file note bearing the date 18 June 2009. Mr Le Compte was not able to explain why he did not include that manuscript version of the side note in the documents produced to the Court in response to the subpoena from the Bank. 134Mr Le Compte gave this evidence in chief: - "Q. I think you accepted, when the file was produced, there was no side note that went to the Court [on 11 April 2013] with the produced filed? A. Yes, I didn't release when I was doing it that that was the case, but I later found out that was the case, yes." 135Mr Le Compte gave this further evidence in response to questions from me: - "Q. [The] handwritten side note was sitting somewhere for typing between 10 April 2013 and 17 June 2013, was it? A. Yes, it was. It was on the front of the file which was under a few other files by then, but that's where it was. Q. The person who was to type it up was your wife, was she? A. Yes. Mr Williams: Did you instruct her to destroy it? A. No. Q. Did you destroy? A. No, she did. No I didn't destroy it." 136Mr Le Compte was scheduled to give evidence in these proceedings on 20 June 2013. 137Only on that date did Mr Le Compte's solicitors, Colin Biggers & Paisley, provide the typescript "side note" to Mrs Jamieson's solicitors. 138Colin Biggers & Paisley were the solicitors for Mr Le Compte's professional indemnity insurers. Several weeks earlier, on 31 May 2013, Mr Le Compte had notified those insurers of circumstances likely to give rise to a claim against him by Mrs Jamieson. Mr Le Compte's notification to those insurers was as follows: - "[The Bank's solicitor] phoned Louis Le Compte and said Jennifer Jamieson had made allegations against him in a cross claim and affidavit in the proceedings (to which Louis Le Compte is not a party)..." 139Mr Le Compte's explanation for these events is that, when he received the subpoena to produce documents issued at the request of the Bank, there were, on Mrs Jamieson's file, notes to the effect of those bearing dates 18 June 2009 and 19 June 2009 that he produced to the Court on 11 April 2013 in response to the subpoena. Mr Le Compte claims that he arranged for his wife, who was also his secretary, to scan copies of those file notes into Mr Le Compte's computer system before producing the originals to the Court; but that, somehow, after service of the subpoena, the original file notes were lost. Mr Le Compte said that, faced with that circumstance, he created what he called his "recollection version" of the file notes together with a manuscript version of the "side note"; but that he only included what he described as the "recollection version" file notes (and not the manuscript "side note") in response to the subpoena. 140Mr Le Compte gave the following evidence in response to my questions concerning the form of the "recollection version" side note: - "Q. What were you seeking to do in terms of recording your recollection or otherwise [in] this file note? A. I was doing two things. I was putting - putting together pieces of paper for my recollection if I needed later on to refer to it, but I also wanted everybody else to know what I thought had happened on that particular evening. And I couldn't be sure that that would happen because I didn't know whether I was going to be called as a witness or on subpoena. I was issued a subpoena which didn't tell me they are going to call on us to keep everyone on the right track as to put my version in with the produced papers. Q. You were intending, were you, to create a document which appears to have been created on 18 June 2009? A. It was my recollections what happened on 2009. Q. Listen to the question. When you created the three page [18 June 2009 document]... were you intending to create a document which looked as if it had been made by you at about 8.15pm on 18 June 2009? A. No, no I wasn't it. Q. Go to the third page of the note...Look at the last sentence? A. Yes. Q. You see you referred to you having 'finished these notes' at 8.15pm? A. Yes, yes, your Honour. Q. Were you not intending, by using those words, to convey to any person who read this document it has been created at around 8.15pm on 18 June 2009? A. No, I was just trying to record the events that happened on 18 June. Q. Can you assist me to understand why you used the words "finished these notes" in the last sentence if you weren't trying to create a document which looked as if it had been created on 18 June? A. I must say I was in a rush to finish this because I was in trouble in not having complied with the subpoena by the due date. I was scribbling my notes down with some speed. I didn't have any intent at any time to mislead anyone, but I can appreciate when I look at it now you might be misled. It certainly was not my intention. I was just trying to get all the details down on a piece of paper to let everyone know what happened on this night." 141I do not accept this evidence. It is obvious from the form and wording of the file note, including the last sentence, that Mr Le Compte intended to pass the document off as a note created on 18 June 2009. 142Similarly, it is clear from the form of the file note bearing the date 19 June 2009 that Mr Le Compte was seeking to pass that off as a note made on 19 June 2009 and, according to its terms, evidencing the posting by Mr Le Compte of a letter to Mrs Jamieson enclosing a copy of Mr Le Compte's letter to Herbert Geer of 19 June 2009, referred to above. 143I do not accept Mr Le Compte's evidence that, when he received the subpoena issued at the request of the Bank, he had in his possession, on Mrs Jamieson's file, notes he actually made on 18 and 19 June 2009. If such notes existed, Mr Le Compte would have produced them to Mrs Jamieson's solicitors on 25 October 2012. 144I also do not accept Mr Le Compte's evidence that, when he created his "recollection version" of the 18 and 19 June 2009 file notes, he also created a manuscript version of the typed "side note" dated 17 June 2013 produced by his solicitors on 20 June 2013. Mr Le Compte said that the language of the manuscript "side note" was identical to that of the 17 June 2013 typescript. In my opinion, the wording of that document is impossible to reconcile with the proposition that it was created on 10 April 2013. The document refers to files notes that "were made by me on 10 April 2013" (see [131] above). If, as Mr Le Compte claimed, the "side notes" were originally made contemporaneously with his "recollection version" and "file notes", such language would not have been used. 145If it is necessary to identify what motivated Mr Le Compte to behave this way, my conclusion is two fold. First, Mr Le Compte had been provided with a copy of Mrs Jamieson's affidavit and, as his notification to his professional indemnity insurer indicates, apprehended that Mrs Jamieson might bring legal proceedings against him. Therefore, Mr Le Compte, not having any contemporaneous record as to what happened on 18 June 2009, created a document that purported to be such a record and which was, at least to some extent, exonerative of Mr Le Compte's position. Second, having been served with a subpoena to produce documents, Mr Le Compte sought to create a document that would deter Mrs Jamieson's legal representatives from calling him to give evidence in the proceedings. 146I should make clear that I accept, without reservation, that until 20 June 2013, the Bank and those advising it, believed that the 18 and 19 June 2009 file notes were, as they appeared to be, documents produced contemporaneously with events on those days. It was only on revelation of the matters in Colin Biggers & Paisley's letter of 20 June 2013 that the Bank, and the other parties to the proceedings, learned the true position. 147The truth only emerged because Mrs Jamieson's legal advisors served on the Bank a notice pursuant to s 167 of the Evidence Act 1995 requiring the Bank to produce Mr Le Compte as a witness to prove the file notes. But for that, the true position may never have emerged. 148It follows that I do not accept Mr Le Compte's "recollection version" file notes as providing reliable evidence as to what occurred on those days. Further, I accept the submission made on behalf of both Mr and Mrs Jamieson that it is also likely that Mr Le Compte tailored his oral evidence to match the version of events in his "recollection version" files notes and that I should treat his evidence about those matters with the upmost caution. 149The conclusion to which I have come is that I should not accept Mr Le Compte's evidence about these matters unless other reliable evidence corroborates that evidence, or it is, for some other reason, inherently probable. The evidence of Mr Allan 150Besides Mr and Mrs Jamieson, the other witness to give evidence about the events of 18 June 2009 was Mr Allan. 151The impression I had of Mr Allan was that he gave his evidence openly and honestly, and endeavoured to give the best of his recollection. 152However, on 18 June 2009, Mr Allan had been on a work related harbour cruise during the course of which, from around lunchtime, he was consuming alcohol. Mr Allan accepted that he was drinking beer throughout the afternoon and that, after the vessel docked at around 5.00pm, he spent several more hours drinking at a hotel in Woolloomooloo. Mrs Jamieson said that when Mr Allan arrived at the Vaucluse home at 8.00pm, he was "noticeably intoxicated", "smelt strongly of alcohol and was slurring his words". Even Mr Le Compte accepted that it appeared that Mr Allan had "had a fair bit to drink". Mr Le Compte said that "there was a bit of slurring" (but that "he was not falling over"). 153Mr Allan left the Bank in February 2010. He pointed to no contemporaneous note of the events of 18 June 2009 from which he could refresh his recollection. 154That combination of circumstances leads me to exercise great caution in accepting Mr Allan's evidence as to the detail of what happened on 18 June 2009. 155Mr Allan did not claim to have a recollection of everything said on 18 June 2009. But he did claim to have a recollection of saying a number of things about which there is controversy. The evidence of Mr and Mrs Jamieson 156Both Mr and Mrs Jamieson have, for obvious reasons, a keen interest in the outcome of these proceedings. The proceedings, and the events leading up to them, must have been stressful and upsetting in the extreme for both of them. Having enjoyed, with their children, what may well have been a most comfortable life in the Vaucluse premises, with the promise of the successful development of both the Darling Point and Woollahra properties, they have endured the stress and upset of the sale of Vaucluse, the exigencies and uncertainties of the two developments, what they evidently now see as being the Bank's failure to provide promised funding, the negotiations over 18 months leading up to the execution of the Deed and the pressures of this litigation. 157In those circumstances, I do bear in mind the sage observations and warnings of McLelland CJ in Eq in Watson v Foxman, set out at [112] above. 158So far as concerns their evidence before me, I do not have the impression that either Mr or Mrs Jamieson set out to do otherwise than give the best of their recollection of events which, over the years, no doubt troubled them deeply. There were times, however, when each of them gave evidence which, on the probabilities, and having regard to other circumstances surrounding the events in question, I have been unable to accept; including in relation to the events of 18 June 2009. The funding table 159Much of what was said on 18 June 2009 concerned the 101A Darling Point funding table in the 9 June 2009 letter of offer. To assist understanding that evidence, I set out a further version of the funding table, to which I have added a column numbering the nine items in the table. I shall return to the items in the funding table by references to those numbers: - 101A Darling Point funding table Purpose Funding 1 Land (Existing debt) $8,222,000 2 Equity Redraw $350,000 3 Professional Fees $300,000 4 Council Contributions - 5 Construction $4,076,000 6 Contingency (5%) $200,000 7 Interest Capitalisation $887,000 8 Holding Costs $25,000 9 Marketing Costs $100,000 Total $14,160,000 The order of events on 18 June 2009 Before Mr Jamieson arrived home 160At around 4.00pm on 18 June 2009 Mr Jamieson was at his office at Double Bay. He had in his possession a form of guarantee for Mrs Jamieson in favour of the Bank in respect of the indebtedness to the Bank of 101A Darling Point (with a limit of $1 million) and a form of mortgage by Mrs Jamieson over the Vaucluse property in favour of the Bank. Mr Le Compte was also at Mr Jamieson's office that afternoon between approximately 4.30pm and 6.00pm. 161At around 4.00pm Mr Jamieson telephoned Mrs Jamieson and said: - "I've got some documents from the Bank for you to sign". 162According to Mrs Jamieson, Mr Jamieson also said that "Lou [Mr Le Compte] is coming over tonight, and so is someone from the Bank". 163Mr Jamieson had certainly arranged for Mr Le Compte to attend at Vaucluse on the evening of 18 June 2009 to witness Mrs Jamieson's execution of the guarantee and mortgage. 164It is less clear, on the evidence, whether Mr Jamieson knew, at around 4.00pm on 18 June 2009, that Mr Allan would attend the Vaucluse premises later in the evening. According to Mr Allan, he had not planned to attend the Vaucluse premises until, whilst he was at the Woolloomooloo Hotel, Mr Le Compte suggested that he and Mr Allan meet at the Vaucluse premises with a view to going somewhere for a drink. I think it unlikely that Mr Jamieson told Mrs Jamieson that "someone from the Bank" was to come to Vaucluse that evening. 165Mrs Jamieson said, and I accept, that Mr Jamieson did not tell her what "documents" he wanted her to sign. After Mr Jamieson arrived home (before Mr Le Compte and Mr Allan arrived) 166Mr Jamieson did not dispute that when he arrived home the following conversation took place: - "Mr Jamieson: The Bank has put me in a real bind but I think it's all worked out. I've given them figures for the mortgage [the Portfolio Loan], living expenses and the money that I am due back from the project [the Equity Redraw]. I've also given them an estimate for finishing Darling Point. I've organised further finance from St George but they will only provide it if you agree to give a personal guarantee. I'm really sorry about this. I've tried to keep you out of it. Mrs Jamieson: We both agreed a long time ago that I wouldn't sign a guarantee for your developments. Mr Jamieson: I'm really sorry and I'm not happy about it but there is no other way. We have to do it. The Bank has put me in a corner and there is no time to arrange alternative finance elsewhere. I will work my arse off to finish by Christmas." 167This was the first Mrs Jamieson knew of the Bank's requirement that she give a guarantee for the 101A Darling Point debt. 168Mr Jamieson showed Mrs Jamieson the 9 June 2009 letter of offer and, in particular, the funding table on that letter and said: - "The increased bank facility will give us enough to pay your mortgage [the Portfolio Loan] and the mortgage payments on the farm [the Joadja property] until Darling Point is finished, as well as our day to day living expenses including school fees and your American Express. There is enough for me to complete Darling Point and I will get cash back for the consultants I paid. The figures have all been done." 169Mrs Jamieson said, and I accept, that she was very upset and angry about: - "...being drawn into his business affairs and being forced to sign a guarantee, which I had refused to do since the proceedings between Bill and Custom Credit." 170Although the matter was not explored in cross-examination, the latter comment suggests that Mrs Jamieson had earlier given a guarantee in relation to Mr Jamieson's arrangements with Custom Credit Corporation Limited with less than satisfactory results, from Mrs Jamieson's point of view. Mr Le Compte arrives 171At approximately 7.00pm Mr Le Compte arrived at the Vaucluse premises. 172I accept Mrs Jamieson's evidence that the following conversation then took place: - "Mr Le Comtpe: Bill and I have been negotiating with the Bank. The Bank is taking a hard line and I don't see any choice but for Bill and you to agree to the Bank's terms for this facility. You don't really have any choice but to get the project finished. Your mortgage and expenses will be covered for the future. There's plenty of profit in the project. Mr Jamieson: We need to get our lives together. We just need to get over this last hurdle and get the properties finished before Christmas. Your mortgage will be paid and you'll get the farm outright when Darling Point is finished. The facility will provide us enough money to live on and to complete Darling Point. I have done all the figures and the Bank said there will be enough for everything. The Bank is prepared to make draw downs available and this will take care of our immediate problems. Mrs Jamieson: Lou [Mr Le Compte], I'm really angry. I can't believe its come to this. I am being forced to give a guarantee. Mr Le Compte: I'm sorry but unless you sign the guarantee the Bank will pull the rug out from under Bill. It's a good project and this is the only way forward and there's a lot of profit to be made still." 173Mrs Jamieson said the following conversation also occurred: - "Mr Jamieson: Don't worry, it will be over by Christmas... and we wont have the pressure we currently have on our finances. Mrs Jamieson: If we have to sell the house I want to do it now. I don't want it to be a fire sale. You know people have left letters asking if we are interested in selling." Mr Jamieson: No, we don't want to do that, I'm sure this will be finished by Christmas and the pressure will be off us. The money is in the Bank's figures, and I have already explained the figures to you." 174Mr Le Compte denied that he told Mrs Jamieson that she did not "have any choice" but to sign the guarantee. He agreed, however, that that was his view. I do not accept Mr Le Compte's evidence. He said he believed that Mrs Jamieson did not have a choice but to sign and I accept Mrs Jamieson's evidence that that is what he told her. 175Mr Le Compte said he gave Mrs Jamieson an explanation concerning the documents she was to sign to the effect set forth in his "recollection version" file note, and did so before Mr Allan arrived (although he said he was just finishing up with Mrs Jamieson when Mr Allan came to the door). 176However, Mrs Jamieson's evidence, which I accept, was that it was only after Mr Allan arrived, in an inebriated state, that she executed the guarantee and mortgage; after a cursory explanation from Mr Le Compte. Mr Allan arrives 177Mr Allan arrived at Vaucluse at around 8.00pm. He said he was not intending to come into the house but did so on the invitation of either Mr Jamieson or Mr Le Compte. 178Mr Allan apologised to Mrs Jamieson for the intrusion. He agreed that Mrs Jamieson appeared to be agitated and most reluctant to sign the guarantee. 179He gave evidence, not disputed by Mrs Jamieson, of the following conversation: - "Mrs Jamieson: I don't want to give a guarantee. Will the Bank give us the money without it? Mr Allan: No. It's a requirement of the Bank." What was said about the availability of funds? 180According to Mrs Jamieson, after Mr Allan arrived the following conversation took place concerning availability of funds: - "Mr Jamieson: You've got one very unhappy lady here. Mrs Jamieson: Yes, I am a very unhappy lady that is for sure. I always said I would never get involved in Bill's business affairs again." 181Mr Allan did not dispute that these words were said. He said "I can't recall" and that "it is possible". 182According to Mrs Jamieson, the conversation continued as follows: - "Mr Jamieson: I've shown Jenny the figures and explained that there is sufficient money to cover the mortgages for the home and the farm, money to live on and to complete Darling Point. Mr Allan: Yeah, it is all there. Don't worry about it." (emphasis added) 183Mr Allan said he did not recall this aspect of the conversation, but did not deny it occurred. 184Mrs Jamieson said the conversation continued: - "Mr Allan: You [that is Mrs Jamieson] don't need to worry about it. It is just one of those formalities the Bank has. It will probably never be used as this is a fantastic project. It is not very far off being completed. The project is on the home run. Mrs Jamieson: I am not happy, lets just get it done." 185Mr Allan denied, with some vigour, that he said that "it is just one of those formalities the Bank has", and suggested that he would have described the project as "reasonable" rather than "fantastic". He did not, in substance, dispute the balance of the conversation. 186Mr Jamieson gave a less comprehensive account of what occurred in this part of the conversation but said that, at one point, he drew attention to the figure of $8.222 million in the 9 June 2009 letter of offer and asked Mr Allan "is this figure correct" to which Mr Allan replied "yes". 187Mr Allan denied these words were said. However, I am satisfied this is what occurred. Mr Leon Bovaird, a finance consultant who knew Mr Jamieson as a client and later as a friend, gave evidence of a meeting he attended on 8 September 2009 (over two months later) with Mr Jamieson and Mr Allan. Mr Jamieson had arranged for Mr Bovaird to meet Mr Allan because of Mr Jamieson's then lack of understanding of the current funding position. Mr Bovaird said that the following conversation then took place: - "Mr Jamieson: This spreadsheet that you emailed me last week shows that the existing debt for this facility is $8.222 million. Mr Allan: Yes. Mr Jamieson: This was the same figure you said was the Darling Point debt when you came to my home in June to get Jenny to give her guarantee. Mr Allan: Yes that's the figure all the figures are correct. Mr Bovaird: So the "Land" amount of $8.222 million shown in this document [the spreadsheet referred to] is the same as the 9 June 2009 'Facility Offer' was and still is today, the Land (existing debt)? Mr Allan: Yes. But let's focus on what Bill needs to get the project completed rather than the existing debt." 188Mr Allan agreed that he had said these words in Mr Bovaird's presence, and that what he said was true. As Mr Allan confirmed to Mr Bovaird in September 2009 that the $8.222 million was the "Land (Existing debt)", it is probable he did the same on 18 June 2009. 189For that reason I accept Mr Jamieson's evidence that Mr Allan said that the $8.222 million figure in the 9 June 2009 letter of offer was "correct". 190What Mr Jamieson made of that conversation is a different matter, to which I shall return. 191Mr Jamieson said that the following further conversation took place concerning the "remaining line items" in the funding table (i.e. items 2 to 9 in the version of the funding table at [159] above): - "Mr Jamieson: Because I'm convincing Jenny here to put a guarantee up. Are these figures here [referring to the remaining figures in the funding table] now available? Mr Allan: Yes they are." (emphasis added) And later (in reference to items 2, 3 and 6; "Equity Redraw" of $350,000, "Professional Fees" of $300,000 and "Contingency" of $200,000): - "Mr Jamieson: Have you covered everything we need in this facility Andrew? Mr Allan: Yes it's all there." (emphasis added) 192Mr Allan initially denied that Mr Jamieson enquired about these figures. However, he later said that although he did not recall such an enquiry, it was possible that a conversation to this effect took place. I find that he said the words attributed to him by Mr Jamieson. 193Mr Jamieson said that the following exchange took place, in Mrs Jamieson's absence: - "Mr Jamieson: You're getting a million dollar guarantee from Jen, but we're also getting a million back in cash we can use. Mr Allan: That's right". (emphasis added) 194Mr Jamieson said that Mrs Jamieson then came back into the room and that, in Mr Allan's presence, the following conversation took place: - "Mrs Jamieson: I don't want to do this. Mr Jamieson: Look. We're getting a million dollars out of this. There is enough to cover your mortgage on Vaucluse and our expenses till the properties sell and to top up the project costs. We get three hundred and fifty thousand redraw, three hundred for consultants which I've already paid from my money so I'll be reimbursed and two hundred on the contingency as well as another one fifty from the existing approval. So we're getting a million of funds for the million guarantee. Mrs Jamieson: I'm still not happy, but as long as the mortgage on Vaucluse and the expenses are covered I suppose it's alright." (emphasis added) 195Concerning this conversation, Mr Allan gave this evidence in cross-examination: - "Q. Mr Jamieson said to you, with Mrs Jamieson present: 'You're getting a million dollar guarantee from Jen, but we're also getting a million back in cash we can use'? A. No, I don't recall that. Q. Do you deny he said that to you at any time? A. I believe he had that viewpoint. I don't know whether that was stated to me that evening. He may have said that at another time, yes. Q. And he may have said it on this evening? A. I don't recall it specifically on that evening. Q. You understood him to have that viewpoint? A. He raised it to me, yes. Q. And what I am suggesting to you is that you replied on that night: 'That's right'. A. No." 196Thus, Mr Allan agreed that he understood that Mr Jamieson believed he was "getting a million back in cash" and said that Mr Jamieson had said as much "at another time". However, he was unable to say whether Mr Jamieson expressed this opinion on 18 June 2009. He denied that he said "that's right". 197In her affidavits, Mrs Jamieson made no reference to any statement by Mr Jamieson concerning "getting a million dollars out of this". 198In cross-examination, Mrs Jamieson said that, prior to Mr Le Compte and Mr Allan arriving, Mr Jamieson had said to her: - "I've come up with the figures but the only thing is that the Bank want you sign a guarantee...it's about a million dollars... I'm really sorry Jen, it comes to a million dollars and they're going to need a guarantee for a million dollars from you." 199I asked Mrs Jamieson whether Mr Jamieson said that the "million dollars" would come from the "increased bank facility" to which she said Mr Jamieson referred (see [168] above). Mrs Jamieson said she could not recall "those technical words" and gave this evidence: - "Q. I'm just trying to see whether you have any recollection of any connection that Bill was making on that evening about what you have said [in Mrs Jamieson's affidavit] as "the increased bank facility" and what you just mentioned to me earlier about a million dollars being mentioned? A. It was all the same time. He was talking about the... the funds had been all organised and there would be sufficient money made available by the Bank to cover Darling Point to completion, cover our mortgages and cover my living expenses. Q. Was he telling you, can you remember, that it was the increased bank facility which would be about a million dollars? A. I can't recall if he said, the Bank facility. I just know it was, the facility. The bank facility that he and the Bank had organised and it was going to be sufficient funding." 200Later in the cross-examination, Mr Simpkins asked Mrs Jamieson whether she could recall the "million dollars" being mentioned after Mr Le Compte and Mr Allan arrived. Mrs Jamieson said "I can't recall if he said it again". 201Mr Le Compte said that he did not hear Mr Jamieson say to Mr Allan in Mrs Jamieson's presence anything to the effect "you're getting a million dollar guarantee from Jen, but we're also getting a million back in cash we can use" or Mr Allan replying "that's right". 202In all those circumstances, my conclusion is that Mr Jamieson may have said to Mrs Jamieson, before Mr Le Compte and Mr Allan arrived, something about a "million dollars". I am not, however, satisfied that there was any discussion about this matter while Mr Allan was present. I am not able to accept Mr Jamieson's evidence to the contrary. It is not supported by the evidence of either Mrs Jamieson or Mr Le Compte. And despite my misgivings about the general reliability of Mr Allan's recollection of events that night, he did seem confident in his denial that he agreed with anything said by Mr Jamieson about a "million dollars" (notwithstanding his acknowledgment that Mr Jamieson may have said something similar on another occasion). 203My doubts as to the reliability of Mr Jamieson's recollection about this aspect of the matter is confirmed by the following evidence Mr Jamieson gave in cross-examination: - "Q. On the occasion of this meeting on 18 June with Mr Allan, you never said, did you, in Mr Allan's presence words to the effect of 'You are getting a million dollar guarantee from Jen but we are also getting a million back in cash we can use'? A. It was said in front of Jen, yes. Q. Where do you say the million dollars was? Let me go back to the 9 June 2009 letter... You told his Honour you were discussing the equity redraw of $350,000, professional fees of $300,000 and the contingency of $200,000; that is $850,000? A. Yes. Q. Where do you say the missing $150,000 was? A. That is where I thought that was coming out of the $8.222 million. Q. So by what process of analysis did you regard there ever being an amount of $150,000 or thereabouts coming out of the $8.222 million? A. I didn't have a process. I understood that. Mr Allan did the numbers up and I just trusted Mr Allan. Q. There is no reference to a million dollars in the 9 June 2009 ... A. I agree it is $850,000. Q. When you were think about a million dollars coming back in cash you could use, what do you say you said? A. Yes. Q. You were thinking it was a $150,000 available from the $8.222 million? A. From the earlier facility, that is correct. Q. You thought it was coming out of the $8.222 million? A. Yes. Q. But that amount, you told his Honour in your evidence earlier, you thought would be the existing debt? A. Yes, I do, still is the existing debt. That is the existing debt. Q. So there could not be $150,000 coming back in cash out of that? A. I don't know how the bank was going to do it. I was going to draw it out and put it into our working account. I asked him [that is Mr Allan] is 8.22 - I pointed to it. 'Is it correct?' And he said 'Yes, it is'. 'Is the 350, is it there?' He said 'Yes.' 'Is the 300 there?' 'Yes, it is'. 'Is the 200 there?' 'Yes, it is.' It was close enough to a million dollars as far as I was concerned and Jenny was putting up a million dollars guarantee. That's how I was convinced of it. Q. Do you agree that you could not possibly have thought on 18 June that there was $150,000 cash coming back from what was described as existing debt of $8.222 million? A. I was not sure how they were going to do it. I didn't do the numbers up. Mr Allan did the numbers up. Q. He did the numbers up in a way that doesn't refer to an amount of $1 million, correct? A. Correct. Q. There is nothing in the letter of offer of 9 June 2009 that refers to or which might be taken to refer to a million dollars coming back in cash? Agree? A. I agree." (emphasis added) 204To my mind, this evidence casts doubt on whether, while Mr Allan was present, Mr Jamieson said anything about a "million dollars". It also reveals, in my opinion, Mr Jamieson's confused state of mind concerning, and the inherent improbability of, the central element of his case; namely whether he believed that the $8.222 million referred to in the 9 June 2009 letter of offer as "(Land (Existing debt)" in fact represented the "existing debt" of 101A Darling Point at that time. 205Mr Jamieson did not suggest that Mr Allan ever told him, in terms, that he was "getting a million back in cash". What he said was that Mr Allan had agreed that items 2, 3 and 6 in the funding table ("Equity Redraw" of $350,000, "Professional Fees" of $300,000 and "Contingency" of $200,000) were "all there" (see [182] above). This was the same confirmation that Mr Jamieson said he received to his question "have you covered everything we need in this facility" (see [191] above). Those three figures total $850,000. 206In his affidavit evidence (see [194] above) Mr Jamieson claimed he said, concerning the difference between the three items totalling $850,000 and a "million dollars" ($150,000): - "We get ... as well another one fifty left over from the existing approval". (emphasis added) 207If Mr Jamieson's reference to the "existing approval" was to the approval evidenced by the 9 June 2009 letter of offer (an increase in the 101A Darling Point Facility from $11.74 million to $14.16 million; an increase of $2.42 million), his statement would make some sense; namely that $150,000 might be available from funds as yet undrawn under the increased facility. In my opinion, this was likely to have been Mr Jamieson's state of mind at the time. 208But that is not what he said in cross-examination. Instead, he maintained that he thought the $150,000 would come from the $8.222 million which, he said, he thought was the "existing debt"; that is the amount already drawn down. When asked to explain how he could possibly have come to this conclusion, he resorted to saying that he "was not sure how they were going to do it" and that Mr Allan "did the numbers up". I do not accept this evidence. It defies credulity that a property developer of Mr Jamieson's sophistication and experience could truly have had this point of view. Despite the terms of the 9 June 2009 letter of offer, and Mr Allan's statement referred to above, I do not accept that Mr Jamieson believed, in June 2009, that the "existing debt" of 101A Darling Point was $8.222 million. I will return to this topic when I deal with the question of reliance below. 209I do not accept Mr Jamieson's evidence that there was any discussion about a "million dollars" while Mr Allan was present. "Not a clean loan"? 210According to Mr Allan, he said something to the effect that: - "Its not a clean loan. You don't get these amounts. You get less than that amount." And: - "Some of these amounts have been drawn. It is not clean. It's a bit messy. You'll have to clear your excesses." 211There was vigorous debate before me as to whether Mr Allan had said these words. Mr Allan said he made the observation about the loan not being a "clean loan" "spontaneously". That evidence was relied upon to cast doubt on the probability of Mr Allan's recollection being correct. 212I am prepared to accept that Mr Allan now genuinely believes that he said something to this effect, as it is consistent with the true state of affairs from the Bank's point of view. The "existing debt" figure of $8.222 million referred to in the funding table in the 9 June 2009 letter of offer was, as Mr Allan knew, the debt level on 20 February 2009. Mr Allan knew that there had been significant drawings between then and June 2009. He was also aware of the Bank's intention to seek to have the excesses in the accounts of Mr Jamieson, Mrs Jamieson and Billgate cleared from the increased funding referred to in the 9 June 2009 letter of offer. 213However, I am not prepared to accept that Mr Allan actually mentioned these matters on the night of 18 June 2009. His recollection of matters, occurring four years ago, and on an evening when his ability to remember must have been affected by his consumption of alcohol, cannot, in my opinion, be reliable. The explanation given to Mrs Jamieson concerning the guarantee and mortgage 214I am satisfied that such explanation as Mr Le Compte gave Mrs Jamieson about the guarantee and mortgage took place after Mr Allan arrived at Vaucluse. 215Mr Le Compte asserted that his explanation to Mrs Jamieson of the nature of the guarantee and mortgage and her signature of those documents took place over a period of 45 minutes. Mrs Jamieson said the entire process took no more than 10 minutes. For the reasons I have outlined above, I am not prepared to accept Mr Le Compte's evidence about this matter. 216I accept Mrs Jamieson's evidence that the only explanation that Mr Le Compte gave her was to say: - "These [provisions in the 9 June 2009 letter of offer] are the conditions on which St George will make the money available to Bill. You are required to give a $1 million guarantee as a condition for St George making the money available. You will be responsible for the $1 million if 101A Darling Point Pty Limited does not meet its obligations. You are required to provide a Second Mortgage over your home to support the guarantee." 217Otherwise, all Mr Le Compte did was to show Mrs Jamieson where she needed to sign. Certificate of financial advice 218There is in evidence a document called "Financial Advice Certificate", dated 18 June 2009, purportedly signed by a Mr Michael Twomey, in which it is stated: - "We explained to the Guarantor the financial risks inherent in entering into the Documents. Our advice included, but not limited to: (a) the nature and likely worth of the Borrower, and of any security to be provided by the Borrower or any other security provider to St George, the likelihood that St George could realise that security upon default by the Borrower or the security provider and the possibility that the proceeds of realisation may not be sufficient to repay the guaranteed money; (b) the ability of the Borrower to service St George's loan and to make scheduled principal repayments, and the possible effect of fluctuating interest rates (if applicable) on the Borrower's ability to meet its payment obligations; (c) the possibility of the Borrower's income generation capacity (and therefore its ability to service St George's loan) being adversely affected by external matters; and (d) the ability of the Guarantor to pay to St George the amount of the loan (plus interest and costs) if called upon to do so under the Guarantee described in the Schedule." 219Mrs Jamieson said that in fact she received no advice from Mr Twomey and did not speak to him about this matter. 220Mr Twomey is an accountant from HMA Twomey Patterson, accountants in Cootamundra, who were the accountants for 101A Darling Point. Mr Twomey is Mr Jamieson's former brother-in-law. The certificate of independent advice was sent to Mr Twomey by Mr Jamieson's bookkeeper, Ms Cotaru, at around 5.00pm on 18 June 2009 with a note: - "Would you please attend to this as soon as you can as Bill is waiting extremely impatiently!" 221The document, signed and dated 18 June 2009, was returned under cover of a letter dated 22 June 2009, and purporting to be from Mr Twomey. 222I accept Mrs Jamieson's evidence that she did not speak to Mr Twomey and received no advice from him at all. What was said on 18 June 2009 and what representations were thereby made? Representations by Mr Jamieson to Mrs Jamieson 223I have found that, on 18 June 2009, Mr Jamieson made three statements to Mrs Jamieson. 224In the first of those statements (referred to at [166] above: commencing with "the Bank has put me in a real bind but I think it's all worked out"), Mr Jamieson was not, in my opinion, making any representation as to what Mr Allan, or anyone else at the Bank had said to him. Mr Jamieson was telling Mrs Jamieson that he had provided the Bank with "figures" for the amounts needed to meet "the mortgage" (which I would understand to be a reference to the Portfolio Loan), living expenses, the money "that I am due back from the project" (which I understand would be the amount of the Equity Redraw) and "an estimate for finishing Darling Point". That is, Mr Jamieson was telling Mrs Jamieson what he had told the Bank he had assessed was required. 225In the second conversation (at [168] above: commencing "the increased bank facility will give us enough to pay your mortgage...") Mr Jamieson was, in my opinion, again, telling Mrs Jamieson what he told the Bank he had assessed as being required to meet the commitments he nominated (the Portfolio Loan, the Joadja mortgage, the cost to complete 101A Darling Point, and day to day living expenses, school fees and Mrs Jamieson's American Express debt). He said "the figures have all been done"; that is, that he had prepared and given to the Bank the figures that he thought were necessary to meet the nominated expenses. By saying that the increased Bank facility "will give us enough" to pay those expenses, Mr Jamieson was not, in my opinion, representing that the Bank had told him that it had represented that the advance was sufficient to meet the expenses. All Mr Jamieson was saying was that, having told the Bank the amount required, the Bank had agreed to advance that amount. 226In the third conversation (at [172] above: commencing "we need to get our lives together"), Mr Jamieson was repeating that he had given the Bank the figures that he calculated were necessary to meet the expenses nominated and that the Bank had told him, based on those figures, that the amount it had agreed to advance was "enough"; that is, that the Bank had allowed, in the amount it had agreed to advance to 101A Darling Point, for Mr Jamieson's figures. 227It is necessary to bear these matters in mind when assessing what was conveyed by statements that Mr Allan made, later in the evening. Representations by Mr Allan (1) The figure $8.222 million "is correct" 228First, I am satisfied that the Bank, through Mr Allan, told Mr Jamieson, in Mrs Jamieson's presence, that the figure of $8.222 million described in the 9 June 2009 letter of offer as "Land (Existing debt)" was "correct". 229Mr Simpkins accepted that the words "Land (Existing debt)", taken "as a stand alone communication" constituted a representation that $8.222 million was the "existing debt". So much was, in my opinion, confirmed by Mr Allan's statement that the figure was "correct". 230The 9 June 2009 letter of offer was not, however, the only communication the Bank sent to 101A Darling Point, and thus to Mr Jamieson, about the level of 101A Darling Point's indebtedness to the Bank. The Bank sent 101A Darling Point at least three Confirmation of Rollover Letters (see [71], [79] and [103] above) which made quite clear that the "existing debt" as at 9 June 2009 was considerably more than $8.222 million. The 9 June 2009 letter of offer must be seen in its commercial context, which includes the earlier letters. 231However, Mr Allan's statement on 18 June 2009, that the figure of $8.222 million was "correct", carries the matter further and satisfies me that, taking all the circumstances into account (including the earlier letters), the proper characterisation of the Bank's conduct on 18 June 2009 was that, through Mr Allan, it did represent that the "existing debt" of 101A Darling Point was $8.222 million. It was, of course, false, and thus misleading or deceptive, of the Bank to do so. 232What Mr and Mrs Jamieson made of this representation is another matter, to which I will return. (2) That the money "is all there" 233I have also found that Mr Allan said "yeah, it is all there" in response to Mr Jamieson's statement that he had shown Mrs Jamieson "the figures" and explained to her that (in his view) there was "sufficient money" to: - "...cover the mortgages for the home and the farm, money to live on, and to complete Darling Point." 234In my opinion, Mr Allan's statement was not a representation by him that any of the figures in the 9 June 2009 letter of offer were, in fact, sufficient to cover the various expenses to which Mr Jamieson referred. Rather, my opinion is that all that Mr Allan was confirming, and thereby representing, was that the money that Mr Jamieson had sought from the Bank referrable to those expenses was included in the overall facility of $14.16 million and, in particular, in the increase of the facility to that level from its previous limit of $11.74 million (an increase of $2.42 million). 235There is no evidence of what "figures" Mr Jamieson gave the Bank in relation to those expenses and there is no evidence that the amounts stated in the 9 June 2009 letter of offer, whether individually or together, were not "sufficient" for that purpose. 236Accordingly, my conclusion is that it has not been established that Mr Allan's statement was a misrepresentation. (3) That the "remaining line items" in the funding table (items 2 to 9) are "now available" 237I am also satisfied that Mr Allan told Mr and Mrs Jamieson that the remaining items in the funding table were "now available". 238What representation thereby arose must be considered in the context of the structure of the 9 June 2009 letter of offer as a whole. The words immediately preceding the funding table are:- "This Commercial Bill Acceptance/Discount limit is subject to being applied for the purposes described in the funding table below". 239Mr Simpkins submitted that, in that context, the funding table comprised a description of the sub-limits of the facility, identifying the maximum amount that could be drawn for the purposes identified in the sub-limits. So much may be accepted, although I would add that the letter was also making clear that the facility was subject to a condition that the identified sub-limits be used for the purposes specified. 240Mr Allan said that each of the sub-limit amounts were "now available". Mr Allan was thereby making a statement about the undrawn amounts under the facility; he was representing that the amounts in items 2 to 9 of the funding table (that is, all those apart from the $8.222 million) were amounts that could be drawn or used under the facility for the purposes stated. 241It follows from the misstatement of $8.222 million as being the "existing debt" of 101A Darling Point as at 9 June 2009 (when it was in fact in the order of $9.261 million) that one, or more, of the other figures in the funding table must have been overstated by the difference between those two figures; that is, by something in the order of $1.039 million. 242Thus, the total amount of items 2 to 9 of the funding table ($5.938 million) was not "now available". The amount "now available" was some $1.039 million less than this; that is, something in the order of $4.899 million. 243In that sense, Mr Allan's statement that items 2 to 9 were "now available" was misleading or deceptive. 244Again, what Mr and Mrs Jamieson made of this is another matter. 245So far as concerns completion of the Darling Point Project, the critical figure was that allocated for "Construction" - $4.076 million. If that is the figure that was overstated, the true amount "now available" for construction was in the order of $3.037 million ($4.076 million less $1.039 million). As we shall see, that sum was in fact just sufficient. 246However, by saying that the various figures in the funding table were "now available", Mr Allan was not, in my opinion, representing that such funding would be available at 101A Darling Point's request unconditionally, no matter what else transpired between the parties. 247I accept Mr Simpkins' submission that there were some implied qualifications to Mr Allan's representation. One was that any drawing under the facility was subject to its terms and conditions. That was unstated, but it is, in my opinion, so obvious it went without saying. 248It was a term of the 101A Darling Point Facility that, before any drawing for construction, the Quantity Surveyor must certify that the value of work the subject of the relevant progress claim from the builder matched the amount sought to be drawn, and that the cost to complete the project remained equal to or less than the undrawn amount of the facility. 249A further implied qualification was that the availability of the funds was subject to Mr Jamieson, as the authorised signatory under the facility, consenting, on 101A Darling Point's behalf, to the funds being used for some purpose other than that or those specified in the funding table. 250On behalf of Mr and Mrs Jamieson, it was submitted that Mr Allan's statement that these funds were "now available" was rendered misleading or deceptive because of the Bank's "plan" to clear excesses in the accounts of Mr Jamieson, Mrs Jamieson and Billgate from the increased 101A Darling Point Facility (see [101] to [108] above). 251Before me, there was vigorous debate as to whether this complaint was outside the pleaded case of Mr and Mrs Jamieson (particularly Mr Jamieson). In view of the conclusion to which I have come on this issue, it is not necessary for me to decide that question. 252The Bank could not implement any such "plan" unless 101A Darling Point (through Mr Jamieson) agreed. As I describe below, Mr Allan sought Mr Jamieson's consent to the clearance of the excesses from the proceeds of a draw down referable to progress claim 13 made by the builder of the Darling Point Project. Mr Jamieson gave that consent willingly, and speedily. 253Had Mr Jamieson refused to give that consent, then, as Mr Simpkins submitted, "the Bank would have been left to consider its rights against the account holders, without recourse to 101A funds". That situation did not arise. 254In those circumstances, the fact that the Bank had a "plan" (which it could only implement with Mr Jamieson's consent) did not, in my opinion, itself render Mr Allan's "now available" representation misleading or deceptive. (4) The statement that "it's all there" 255Mr Allan also said, in response to Mr Jamieson's question (asked in respect of items 2, 3 and 6 in the funding table; Equity Redraw, Professional Fees and Contingency) "have you covered everything we need in this facility?", that "yes, it's all there". 256In my opinion, this statement took the matter no further. In making this statement, Mr Allan was representing no more than the funding which Mr Jamieson had sought in the facility concerning those line items was available to be drawn (albeit, implicitly, subject to the terms and conditions of the facility, and subject to any contrary instructions from Mr Jamieson). (5) Mr Jamieson's statement to Mrs Jamieson that "we're getting a million of funds for the million guarantee" 257As I have discussed above, I do not accept Mr Jamieson's evidence that, in Mr Allan's presence, he made any reference to getting a "million dollars". Thus, I do not accept that Mr Allan, by silence, indicated agreement to any such proposition. 18 June 2009 representations - summary 258For these reasons, my conclusion is that, on 18 June 2009, the Bank, through Mr Allan (by his words or silence), represented to Mr and Mrs Jamieson that: - (a)the "existing debt" of 101A Darling Point on 18 June 2009 was $8.222 million. This was not true; (b)the funding offered in the 9 June 2009 letter of offer was "all there" for the amount that Mr Jamieson had specified to the Bank as being necessary to "cover the mortgages for the home and the farm, money to live on, and to complete Darling Point". There is no evidence that this was not true; (c)items 2 to 9 in the funding table were "now available"; that is, could be drawn down under the facility subject to the terms and conditions of the facility and any contrary direction from Mr Jamieson. That was not true in that some $1.039 million less than the total of those items was "now available"; and (d)items 2, 3 and 6 in the funding table were "all there"; that is, could be drawn down on the same basis. That was also not true, for the same reason as in (c). Did Mr and Mrs Jamieson rely on representations made on 18 June 2009? Mr Jamieson 259Mr Muddle accepted that, as at 18 June 2009, there was material readily available to Mr Jamieson which, had he read it, would have revealed to him that $8.222 million was not the "existing debt" of the 101A Darling Point Facility on that day. 260The Bank sent to 101A Darling Point (and Billgate) Confirmation of Rollover Letters on the occasion of each bill rollover. Most recently, on 12 May 2009, the Bank sent to 101A Darling Point a Confirmation of Rollover Letter which showed that the proceeds of the most recent bill, paid to 101A Darling Point that day, was some $9.191 million and that the face value of that bill, to mature on 10 July 2009, was $9.261 million (see [103] above). 261Earlier, on 13 February 2009, the Bank sent 101A Darling Point a Confirmation of Rollover Letter which showed that the proceeds of the bill payable that day was $8.191 million and that the face value of the new bill, to mature on 13 March 2009, was $8.222 million; the figure stated to be "Land (Existing debt)" in the 9 June 2009 letter of offer. On 13 March 2009, the Bank sent 101A Darling Point a Confirmation of Rollover Letter that confirmed that the maturing face value of the Bill due that day was $8.222 million. 262Mr Jamieson maintained that he did not open those letters, but gave them to his bookkeeper, Ms Cotaru, who processed the relevant details into the company's records. 263Had Mr Jamieson seen any of these Confirmation of Rollover Letters, it would have been clear to him that the figure of $8.222 million in the 9 June 2009 letter of offer did not correctly state the "existing debt". 264By 2009, Mr Jamieson had been a property developer for over 30 years. He had been involved in many developments, including four multimillion-dollar developments during that time. He agreed that it was his practice from time to time, in relation to all of these developments, to monitor the amounts which had been drawn down from the relevant financial institution so that he had an appreciation, at any point, of what amounts had been drawn down and what future amounts might be drawn down; although he qualified his agreement by adding "but not at every point". He agreed that an experienced property developer such as he would be interested to know what relationship there was between the likely future cost of the project and the likely future availability of funds from the lender. 265Mr Jamieson agreed that he knew, by early 2009, that if he wanted to know what his company's indebtedness to the Bank was, he could find that information in the Confirmation of Rollover Letters. He agreed that he was interested to know what 101A Darling Point owed the Bank in 2008 and 2009. He agreed that, in 2008, he had a good understanding of the amount that 101A Darling Point had actually drawn down under the 101A Darling Point Facility, and thus what was still available to complete the Darling Point Project. 266Mr Jamieson gave the following evidence: - "Q. But in March 2009 you had been speaking to Mr Allan since some time in 2008 about getting an increase to the 101A facility, hadn't you? A. Yes. Q. And weren't you interested in March 2009 in maintaining current knowledge of the amounts that had been drawn down under the arrangements that you then had with the St George Bank for 101A? A. Yes. Q. You're not really telling his Honour, are you, that you never actually saw confirmation of rollover documents anywhere in your Double Bay office relating to 101A Darling Point Road, ever, ever, are you? A. I'm not saying ever, ever, no. Q. So it is clear, isn't it, that there were occasions when you were looking at documentation in your Double Bay office and you saw confirmations of rollover related to 101A? A. I was not concentrating on rollovers. Q. I am not asking you that. It is clear, isn't it, that when you were in your office at Double Bay from time to time when you were looking at your files you saw confirmation of rollovers relating to 101A? A. No. Q. You tell his Honour, do you, that you have no memory at all at any time during the 101A project of ever seeing in any file at Double Bay a confirmation of rollover? A. I am not saying that. Q. You agree, don't you, that you saw such documents? Don't you? A. I didn't take care of these particulars documents. Q. Do you agree you saw such documents? A. Yes. Q. You saw them, didn't you, because they were put into files that you were readily looking at for the purposes of your management of the 101A project? A. I didn't regularly look at them." 267Later, Mr Jamieson gave this, internally contradictory, evidence: - "Q. Are you telling his Honour seriously Mr Jamieson that in 2008 and 2009 you actually just didn't know what amount you owed the St George Bank from time to time? You had no idea? Is that what you are saying? A. Yes. Q. Are you telling his Honour as an experienced property developer, who had been developing since the 1970s, that in relation to the 101A project in 2008 and 2009 you were just ignorant, were you, or what the amount was that you owed to the Bank in relation to 101A? A. No, I would have had a rough figure. I have never used these particular systems until 2008. I have never used confirmation of bank rollovers. I had normal accounts. Q. Well, when you say you had a rough figure, what documents did you look at, if any, to arrive at your rough figure say in early 2009? A. I didn't, I didn't look at the accounts in 2009. Q. So this rough - did you have a rough figure in your head in early 2009? A. No. Q. You had no figure in your head in early 2009, is that right? A. That's right. Q. You did not have the faintest idea, is that what you tell his Honour, did not have the faintest understanding of what amount you owed to the St George Bank for the 101A project in early 2009? A. On 101A Darling Point Road, no." (emphasis added) 268Ms Cotaru still works for Mr Jamieson and was available to give evidence. She was not called, notwithstanding the fact that Mr Jamieson was challenged about his contention that he did not read the Confirmation of Rollover Letters. I infer that Ms Cotaru was not able to give evidence that would have assisted Mr Jamieson's case. 269I do not accept Mr Jamieson's evidence about this matter. It is inherently improbable that a property developer of Mr Jamieson's experience, who held the opinions I have set out above as to the need to monitor drawings under a bank facility, would not keep a close eye on current levels of borrowing and, in this case, would not read correspondence received from the Bank which revealed those details or confer with his bookkeeper or peruse the records she created. Mr Jamieson must have known that 101A Darling Point was drawing down funds between February and June 2009 so that the level of indebtedness of 101A Darling Point to the Bank was increasing during that period. 270That Mr Jamieson did in fact know the true position is revealed by evidence given in cross-examination by Mr Bovaird. As I have mentioned (see [187] above), Mr Jamieson asked Mr Bovaird to attend a meeting with Mr Allan on 8 September 2009 because of Mr Jamieson's then lack of understanding of the current funding position. Mr Bovaird gave the following evidence: - "Q. When Mr Jamieson showed you the letter of 9 June 2009 relating to the 101A project, you discussed with him, didn't you, whether that letter ought to be raised at a meeting with Mr Allan? A. That's correct. Q. And you decided, didn't you, in conversation with Mr Jamieson that what Mr Allan should be asked is whether the figure in that letter of $8.222 million was correct? A. That's correct. Q. And are you telling his Honour that you decided to raise that at a meeting with Mr Allan without making any investigation at all of Mr Jamieson's own records to understand whether the $8.222 million was correct? A. I accepted the bank's representation of the figure. I thought there are a lot more series of administration, have a lot of more series of administration department than Bill Jamieson did, so I had no reason to doubt. I very rarely found discrepancies in major financial institutions figures. Q. Be that as it may, are you telling his Honour that you made no inquiry at all of either Mr Jamieson or his bookkeeper to ascertain whether the $8.222 million figure was correct? A. That's correct. Q. But what you decided was to, without any investigation of any kind, that you would go to a meeting with Mr Allan and ask him whether that figure was correct? A. That's correct. Q. And was that because you thought that figure might be incorrect? A. Bill believed it was incorrect. Q. Did he tell you that? A. He told me that. Q. What did he say the correct figure was? A. He didn't. Q. What did he say to you was the basis of him thinking the figure was incorrect? A. He believed it was a figure that was a figure some months ago and wasn't the figure at the time of the letter. Q. Did he tell you he thought that figure was a figure from about February 2009 and not June 2009? A. It was earlier that year. I think it was around about January, February." (emphasis added) 271Thus, prior to the meeting with Mr Allan on 8 September 2009, Mr Jamieson told Mr Bovaird that the $8.222 million figure in the 9 June 2009 letter of offer was "incorrect" and that it was a figure from "around about January, February" 2009. 272There is no suggestion in the evidence that, somehow, Mr Jamieson came to know that the figure of $8.222 million was "incorrect" between 18 June 2009 and his meeting with Mr Bovaird in September 2009. That Mr Jamieson told Mr Bovaird, in early September 2009, that the figure was "incorrect" makes clear, in my opinion, that he knew full well, on 18 June 2009, that the $8.222 million was not then the "existing debt" of 101A Darling Point. 273In those circumstances, my conclusion is that despite the terms of the 9 June 2009 letter of offer, and despite what Mr Allan said on the evening of 18 June 2009, Mr Jamieson did not believe that the "existing debt" of 101A Darling Point was $8.222 million on 9 June 2009. He must therefore have known that one or more of the other figures referred to in the funding table in that letter was understated, and that, to that extent, the items in the funding table were not "now available". 274In any event, such reliance as Mr Jamieson (and indeed Mrs Jamieson) placed on any statement made on 18 June 2009 as to the availability of funding must have ended in the middle of August 2009 because, by then, Mr Jamieson had come to a view that both he and Mrs Jamieson had been "dudded" by the Bank. 275Mr Jamieson gave this evidence: - "Q. If I understand your evidence correctly, you tell his Honour that on the 18 June meeting at your home you said to Mr Allan that in effect you understood the facility to mean that [there] was a million dollars in cash that would be coming back and you got a response from him to the effect that that was right? A. That's right. Q. As I understand your evidence, you tell his Honour that this was critically important to you in that it was one of the things you had regard to in deciding that you would speak to your wife about her providing the guarantee? A. Absolutely. Q. Do you accept that if this conversation took place with Mr Allan on the evening of 18 June that what you say you discovered in August 2009 meant that what you had been told by Mr Allan on 18 June was untrue? A. Yes. Q. And do you tell his Honour that your state of mind in August 2009 was that you had been told an untruth by Mr Allan about the million dollars coming back in cash? A. Yes." 276Furthermore, as I discuss below, Mr Jamieson must have been aware that the authority that he gave to the Bank on 6 August 2009 to transfer funds from the 101A Darling Point account to clear excesses in his accounts, and those of Mrs Jamieson and Billgate, played a role in what followed. Mrs Jamieson 277Mrs Jamieson may well have been induced to sign the guarantee and mortgage on 18 June 2009 by the representation made to her by Mr Jamieson that "we're getting a million back in cash". However, I have found that no such statement was made when Mr Allan was present at Vaucluse. 278So far as concerns Mr Allan's statement that it was "correct" that $8.222 million was "Land (Existing debt)", Mrs Jamieson gave no evidence that she was aware of, or had any view about, the significance of 101A Darling Point's "existing debt" on 18 June 2009. Nor did Mrs Jamieson suggest that she was aware of, or had any views about, the significance of the remaining items in the 9 June 2009 funding table. There is also no evidence that Mrs Jamieson was influenced in any way by the fact that one or more of those items was overstated (by reason of the "existing debt" figure being understated). 279For those reasons, my conclusion is that Mrs Jamieson did not execute the guarantee or mortgage on 18 June 2009 relying on any misrepresentation made by Mr Allan. 280In any event, just as Mr Jamieson realised, by mid-August 2009, that what Mr Allan had said on 18 June 2009 was untrue, so must Mrs Jamieson. Of course, by then it was too late for Mrs Jamieson to take any step to reverse the critical events, so far as she is concerned, of 18 June 2009. She remained liable under the guarantee and mortgage documents she signed that night. Execution by Mrs Jamieson of the 101A Darling Point guarantee and the Vaucluse mortgage 281Mrs Jamieson claims that she executed the mortgage and guarantee on 18 June 2009: - (a)relying on misleading or deceptive representations made by the Bank, through Mr Allan; (b)in circumstances which were "unjust" within the meaning of the Contracts Review Act; and (c)in circumstances where the Bank had engaged in unconscionable conduct. 282For the reasons I have set out above, I do not accept that Mrs Jamieson signed the guarantee or the mortgage relying on any misleading or deceptive representations made by the Bank. I am, however, satisfied that, in the circumstances prevailing when Mrs Jamieson signed the guarantee and mortgage, those documents were "unjust". 283By reason of s 7 of the Contracts Review Act, if a court finds that a contract or a provision in a contract is unjust in the circumstances relating to the contract when it was made, the court may take such steps as are necessary "for the purpose of avoiding as far as practicable an unjust consequence or result". 284For the reasons which I set out below, the conclusion to which I have come is that, by the Deed, Mrs Jamieson has now released the Bank from any claims she may otherwise have in respect of the guarantee. 285In any event, as I have mentioned, the Bank does not seek to enforce the guarantee against Mrs Jamieson. 286In final written submissions, Mr Simpkins stated: - "The Bank has made it plain in earlier submissions that it has no intention of making any further claim against Mrs Jamieson otherwise arising out of the guarantees or the Deed of Settlement (except to the extent that the Deed operates to release the Bank from any of the claims she now makes against the Bank). The Bank is prepared to make an undertaking - by way of acknowledgment that no further claim exists, or release of any such claim that may exist, as the case may require. The precise formulation of that undertaking should abide the determination of the Court of the substantive matters now before it." 287So far as the mortgage is concerned, the Vaucluse property has been sold, and the mortgage discharged. The conclusion to which I have come is that, by the Deed, Mrs Jamieson has released the Bank from any claims she might otherwise have for the net proceeds of sale of the Vaucluse property, which the Bank initially held on deposit and has now appropriated pursuant to its rights under the Deed. 288Accordingly, there is no order that I would propose to make in regard to those monies. 289Nonetheless, and for completeness, I set out my findings as to the circumstances in which the mortgage and guarantee were executed. No prior notice 290Although the Bank raised with Mr Jamieson the prospect of Mrs Jamieson giving a guarantee to support the proposed increase in the 101A Darling Point Facility in April 2009, and although both the 4 May 2009 and 9 June 2009 letters of offer specified, as a condition of the increase in the Facility, that Mrs Jamieson give that guarantee, neither the Bank nor Mr Jamieson gave Mrs Jamieson any notice, prior to the evening of 18 June 2009, that she would be asked to give the guarantee. The first that Mrs Jamieson heard about the question of her giving a guarantee was when Mr Jamieson arrived home on the evening on 18 June 2009. Mrs Jamieson was, in effect, ambushed. 291She was given no sensible opportunity to consider her position; on the contrary, she was told by both Mr Jamieson and Mr Le Compte that she had "no choice" but to sign. 292Those facts, alone, point strongly to the conclusion that the contracts comprised by the guarantee and mortgage were unjust in the circumstances in which they were made. Reluctant guarantor 293It is clear that Mrs Jamieson was a reluctant guarantor. The Bank knew that Mr Jamieson was reluctant to approach Mrs Jamieson to give a guarantee because, as Mr Jamieson explained to Mr Collier and Mr Allan on 22 April 2009, Mrs Jamieson kept "her things separately from me" and "won't give her guarantee for something she is not involved in". It was obvious to Mr Allan, when he was at the Jamieson home on 18 June 2009, that Mrs Jamieson was very unhappy about being asked to provide a guarantee. 294Later records of the Bank confirmed this. For example, in an internal email that Mr Allan sent on 12 August 2009 he said: - "In short, we recently approved additional funding for Mr Jamieson subject to crossing his full security position and (very reluctantly) adding a personal guarantee (limited to $1m) from his wife Jennifer Jamieson which was secured by the family home in Vaucluse." Pressure from Mr Jamieson 295Mr Jamieson placed great pressure on Mrs Jamieson to sign the guarantee. He knew that she would be reluctant to do so and could plainly see, from her reaction, that she was reluctant to do so. Ultimately, Mr Jamieson's pressure and persuasion overcame Mrs Jamieson's reluctance and she signed. Lack of independent legal advice 296Mrs Jamieson obtained no independent legal advice before executing the guarantee and mortgage. Mr Le Compte was not independent of the Bank or of Mr Jamieson. He was acting for Mr Jamieson, and 101A Darling Point, in relation to the very transaction in respect of which Mrs Jamieson was asked to sign a guarantee and mortgage, as the Bank well knew. 297Mr Allan said that, prior to 18 June 2009, Mr Le Compte spoke to him and said: - "I can act for Jennifer on this matter because I have not been acting for 101A for Bill." 298Mr Allan gave this evidence in answer to questions from me: - "Q. What did you make of that because you knew he had been acting for 101A? A. To be honest, I hadn't given it a whole lot of thought at the time. I knew Lou was acting for Bill, and as Bill's, sort of, family solicitor, I didn't give it thought to whether he's acting for 101A or not, any thought at all to be honest. Q. He had come to the meeting with Mr Kenny in April? A. Yes. Q. Where Mr Jamieson was seeking to escalate his complaint about what the Bank was doing vis-á-vis, amongst other things, the 101A facility? A. That's right. Q. In those circumstances, weren't you surprised when Mr Le Compte said: 'I can advise Mrs Jamieson because I have not been doing any work for 101A'? A. I was a little surprised at the volunteering of information, but haven't given a whole lot of thought around it." 299It should have been obvious to Mr Allan that Mr Le Compte was in no way independent of Mr Jamieson or 101A Darling Point. 300In any event, the only advice Mr Le Compte gave Mrs Jamieson was that "you will be responsible for the $1 million if 101A Darling Point Pty Ltd does not meet its obligations"; and that followed Mr Le Compte's statement that signing the guarantee "is the only way forward" and that Mrs Jamieson didn't "really have any choice". 301Mrs Jamieson did not suggest that she did not understand the nature of a guarantee or a mortgage. Indeed, her reluctance to sign the documents bespeaks an acute understanding of the potential burden of those documents. 302However, independent advice would have no doubt included advice that one thing that Mr Jamieson and Mr Le Compte said to Mrs Jamieson was wrong: she did have a choice; she could refuse to give the guarantee, and explore the possibility of selling the Vaucluse property and seek to resolve the family's financial problems that way. Lack of any financial advice 303Mrs Jamieson received no advice whatsoever as to the financial implications of signing the guarantee. The certificate signed by Mr Twomey did not reflect any advice he gave Mrs Jamieson. So far as the evidence reveals, Mrs Jamieson was given no advice, and had no knowledge of any of the matters referred to in the certificate that Mr Twomey gave (such as the nature and likely worth of 101A Darling Point, the ability of 101A Darling Point to service the Portfolio Loan, and the possibility of 101A Darling Point's income generation capacity to be adversely affected by external matters). Mr Twomey did not speak to Mrs Jamieson at all. Failure of Bank to deal directly with Mrs Jamieson 304The Bank left it to Mr Jamieson to arrange for Mrs Jamieson to execute the guarantee and the mortgage. The only Bank representative present when Mrs Jamieson executed those documents was Mr Allan, and he was affected by alcohol. He made no enquiry to satisfy himself that Mrs Jamieson properly understood what was occurring. It was obvious to him that Mrs Jamieson was reluctant to sign the guarantee and was unhappy at being pressured to do so. It should also have been obvious to Mr Allan that Mrs Jamieson was not receiving any independent legal advice, indeed hardly any legal advice at all. At no time was there any private meeting between a representative of the Bank and Mrs Jamieson. As Mr Williams submitted, Mrs Jamieson was treated simply as an extension of her husband. Lack of enquiry as to Mrs Jamieson's ability to meet any demand 305The Bank made no enquiry as to whether or not Mrs Jamieson could meet any demand for payment under the guarantee. It knew that Mrs Jamieson had, from time to time, defaulted under the Portfolio Loan. It must have been obvious to the Bank that the only means by which Mrs Jamieson could meet any call under the guarantee was by selling the Vaucluse property, over which the Bank was to obtain a mortgage. Not reasonably practicable for Mrs Jamieson to negotiate 306Mrs Jamieson's enquiry of Mr Allan as to whether the loan would be made to 101A Darling Point without a guarantee was met with an emphatic "no". In the circumstances that prevailed on 18 June 2009, Mrs Jamieson had no practical opportunity to negotiate or reject any particular term in the guarantee or mortgage. She was told repeatedly that she had no choice but to sign. Code of Banking Practice 307The Code of Banking Practice is a voluntary code of conduct which binds banks, who have agreed to adopt it. By 1 June 2004, the Bank had adopted the Code. The terms of the guarantee that Mrs Jamieson executed on 18 June 2009 incorporated the Code. 308Paragraphs 28.4 to 28.5 of the Code are in the following terms: - "28.4 We will do the following things before we take a Guarantee from you: (a) we will give you a prominent notice that: (i) you should seek independent legal and financial advice on the effect of the Guarantee; (ii) you can refuse to enter into the Guarantee; (iii) there are financial risks involved; (iv) you have a right to limit your liability in accordance with this Code and as allowed by law; and (v) you can request information about the transaction or facility to be guaranteed ("Facility") (including any facility with us to be refinanced by the Facility); (b) from 1 June 2004 we will tell you: (i) about any notice of demand made by us on the debtor, and any dishonour on any facility the debtor has (or has had) with us, which has occurred within 12 months before we tell you this, and from 1 June 2005 within 2 years before we tell you this; (ii) if there has been an excess or overdrawing of $100 or more on any facility the debtor has (or has had) with us which has occurred within 6 months before we tell you this, and from 1 February 2005 we will give you a list showing the extent of each of those excesses or overdrawings; (c) we will tell you if any facility we have given the debtor will be cancelled, or if the Facility will not be provided, if the Guarantee is not provided; (d) we will provide you with a copy of: (i) any related credit contract together with a list of any related security contracts which will include a description of the type of each related security contract and of the property subject to, or proposed to be subject to, the security contract to the extent to which that property is ascertainable and we will also give you a copy of any related security contract that you request; (ii) the final letter of offer provided to the debtor by us together with details of any conditions in an earlier version of that letter of offer that were satisfied before the final letter of offer was issued; (iii) any related credit report from a credit reporting agency; (iv) any current credit-related insurance contract in our possession; (v) any financial accounts or statement of financial position given to us by the debtor for the purposes of the Facility within 2 years prior to the day we provide you with this information; (vi) the latest statement of account relating to the Facility (and any other statement of account for a period during which a notice of demand was made by us, or a dishonour occurred, in relation to which we are required to give you information under clause 28.4(b)(i)); and (viii) any unsatisfied notice of demand made by us on the debtor in relation to the Facility where the notice was given within 2 years prior to the day we provide you with this information; and (e) we will give you other information we have about the Facility (including any facility with us to be refinanced by the Facility) that you reasonably request but we do not have to give you our own internal opinions. 28.5 We will not ask you to sign a Guarantee, or accept it, unless we have: (a) provided you with the information described in clause 28.4 to the extent that that information is required by this Code to be given to you; and (b) allowed you until the next day to consider that information. We do not have to allow you the period referred to in clause 28.5(b) if you have obtained independent legal advice after having received the information required by clause 28.4." 309The Bank did not comply with any of those terms. Bank's internal requirements 310The Bank's internal guidelines provided: - "Whenever a person... provides a guarantee..., the Bank requires that the guarantor obtain independent legal advice from a legal practitioner independent of those solicitors acting for both/either of the Bank or the borrower in the loan transaction." 311A similar procedure is mandated in respect of independent financial advice. 312The Bank did not comply with these requirements on this occasion. Conclusion about the guarantee and mortgage 313Consideration of an applicant's case for relief under the Contracts Review Act involves a two-stage process. 314The first stage is to determine whether the contract was "unjust". That is the conclusion to which I have come in respect of the guarantee and the mortgage. 315The second stage is to consider what relief is to be granted, and if so, on what terms: see, for example, Perpetual Trustee Co Ltd v Khoshaba [2006] NSWCA 41 at [34] - [36] and [109] and Kowalczuk v Accom Finance Pty Ltd [2008] NSWCA 343; (2008) 77 NSWLR 205 at [87]. 316But for the conclusions to which I have come concerning the Deed, I would have been inclined to make an order, under the Contracts Review Act, that the Bank repay to Mrs Jamieson the $1.4 million from the proceeds of sale of the Vaucluse property. 317Alternatively, and again, but for my conclusion concerning the effect of the Deed, I would have been inclined to consider Mrs Jamieson's loss of the $1.4 million as a component in her claim for damages, which I discuss further below. 318So far as the guarantee is concerned, as I have mentioned, the Bank submits that there is no utility in making any order setting aside the guarantee, as the Bank does not seek to enforce any rights under it and will give an appropriate undertaking or release to that effect. Mrs Jamieson's claims for damages 319Arising out of her execution of the mortgage and guarantee on 18 June 2009, Mrs Jamieson claims damages on two bases. 320First, she claims that, but for her execution of the Vaucluse mortgage on 18 June 2009, she would have placed the Vaucluse property on the market in mid 2009 and effected a sale in a more favourable market than existed in 2011, when the property was sold. 321Second, she claims damages for the anxiety and distress she suffered as a result of her execution of the guarantee and mortgage on 18 June 2009. 322The conclusion to which I have come is that Mrs Jamieson's execution of the Deed precludes her from making either claim against the Bank. However, as detailed submissions were made on her behalf about both matters, I shall deal with them at this point in the judgment (although this will involve me looking ahead at later events). Sale of the Vaucluse property 323Mr Williams submitted that it was Mrs Jamieson's unchallenged evidence that, while she did not wish to do so, but for the representations made on 18 June 2009, she would have sold the Vaucluse property "at that time". I understand Mr Williams' submission to be that, but for the making of the representations, Mrs Jamieson would have placed the Vaucluse property on the market in or shortly after June 2009. 324In my opinion, the evidence Mrs Jamieson gave does not justify that submission. She did not, in terms, give evidence as to what she would have done, in or around June 2009, had the events of 18 June 2009 not occurred. 325Rather, she said that in early June 2009 she was "minded" to sell the Vaucluse property and gave evidence of conversations that she had had with Mr Jamieson at around that time. It is true that that evidence was not challenged. However, in my opinion, it does not follow from acceptance of that evidence that any conclusion can be drawn as to what Mrs Jamieson would have done. 326In her affidavit evidence, Mrs Jamieson said that, in early June 2009, she had the following conversation with Mr Jamieson: - "Mr Jamieson: I'm still working things out with the Bank but the Bank's not too concerned about your mortgage [the Portfolio Loan]. Mrs Jamieson: What are we going to do if we can't pay the mortgage? What does that mean? Mr Jamieson: Don't panic, I'll take care of it. Mrs Jamieson: Does this mean we will have to sell the house? Mr Jamieson: The Bank won't do anything for a while. I'm negotiating with them at the moment. I think they will let it go for a while but we will have to see what happens. I'm still trying to organise things. Mrs Jamieson: Bill, I don't want to do this but if we have to sell, let's sell now. Mr Jamieson: Let's not panic." 327Mrs Jamieson gave similar evidence in cross-examination when she said that the conversation was in the following terms: - "Mrs Jamieson: What [is] happening with the school fees? Mr Jamieson: Don't worry. [I'm] working on it. Mrs Jamieson: Have you paid the school fees? Mr Jamieson: Yes. I'm going to have trouble with the mortgage. Mrs Jamieson: You might not be able to pay the mortgage? Holy shit. What does that mean? Does that mean we have to sell the house? Mr Jamieson: No. Don't worry about it. I'm working on it with the Bank. It'll be fine. Don't panic. I'm working on it." 328Mrs Jamieson also gave evidence of the conversation which took place on 18 June 2009 after Mr Le Compte arrived, but before Mr Allan arrived. 329In her affidavit, Mrs Jamieson gave this account of the conversation: - "Mr Jamieson: Don't worry, it [completion of the Darling Point Project] will be over by Christmas and we won't have the pressure we currently have on our finances. Mrs Jamieson: If we have to sell the house I want to do it now. I don't want it to be a fire sale. You know people have left letters asking if we are interested in selling. Mr Jamieson: No, we don't want to do that, I am sure this will be finished by Christmas and the pressure will be off us. The money is in the Bank's figures, I have already explained the figures to you." 330In my opinion, this evidence falls far short of evidence from Mrs Jamieson that, as a matter of fact, she would have placed the Vaucluse property on the market in around June 2009, but for the representations. 331In any event, further evidence given by Mrs Jamieson makes quite clear, in my opinion, that any thoughts she may have had about placing the Vaucluse property on the market were not associated with whatever was said to her on 18 June 2009. This is because, after she learned of Mr Jamieson's opinion that funds that the Bank had promised would be available were not available, she was still inclined to sell the house; but was persuaded not to by Mr Jamieson. 332Mrs Jamieson said that, in mid July, she was in Mr Jamieson's office and overheard a telephone conversation between Mr Jamieson and Mr Le Compte as follows: - "Mr Jamieson: I would not have let Jenny sign the guarantee if I wasn't sure that I would have access to the draw down facility." Mr Le Compte: And I would not have let Jenny sign it if I was aware that the facility was already exhausted." 333Mrs Jamieson said that this was the first time she became aware: - "...that no moneys were available from the facility for which I provided my Guarantee and Mortgage." 334She said that immediately after Mr Jamieson's telephone call to Mr Le Compte she had this conversation with Mr Jamieson: - "Mr Jamieson: This is a big stuff-up by the bank but Lou and I will fix it. Mrs Jamieson: If it makes life any easier let's just sell the bloody house. Mr Jamieson: No, it would be a mistake, the bank's stuffing it up but don't worry, Lou and I will get it sorted out Jenny. It's not necessary to sell the house. We will get over this bank's mistake and finish the Darling Point property by Christmas. Don't panic, there's no need to sell. It's not necessary, we will work it out." 335Mrs Jamieson also said that, on or about 20 August 2009, she had a further conversation with Mr Jamieson about the sale of the Vaucluse property. By this time, Mr Jamieson had formed the view that he had been "dudded" by the Bank and had formed the opinion that what Mr Allan had said on 18 June 2009 was untrue (see [274] and [275] above). Mrs Jamieson said her conversation with Mr Jamieson was in the following terms: - "Mrs Jamieson: We have three grown up children and my mother, it's not the end of the world if we have to move to Paddington. The kids are old enough. If we need to do it, we should do it now so we can get organised. We made year 12 smooth for our daughter and we can it for Tommy if we do this now." Mr Jamieson: We have gone over this. We are not going to sell the house. Mrs Jamieson: If we are going to sell, let's do it now. I need to get it ready for sale before Christmas, everyone goes away at that time of year and there is no point doing anything over December/January. Mr Jamieson: It's not necessary, I said we will work it out. Mrs Jamieson: Bill, there's not much that needs to be done to the house to get it ready to market. We need to find an agent and organise the sales campaign. Mr Jamieson: We don't need to worry about doing that. At the end of all this, you will have your house unencumbered. You are pissing me off. I have enough worries with the project. I don't need to keep talking about this. I've got the Bank on my back and I've got the builders who I am trying to keep on the job. Surely that's enough. Mrs Jamieson: We are running out of bloody time if we are going to sell. Mr Jamieson: I'm sorting it out Jenny." 336Mrs Jamieson gave evidence of a further conversation that she said took place in November 2009 (at which time the Bank had made an offer to provide further funds, to which I refer below). Mrs Jamieson said she had this conversation with Mr Jamieson: - "Mrs Jamieson: What does this all mean for my mortgage and the farm [Joadja]? Are we going to keep this property and the farm? Let's put this property on the market. You keep telling me its ok, but this thing still keeps going on. What's really happening? Mr Jamieson: The Bank's happy to let this roll. The last thing the Bank wants is to sell us up. Mrs Jamieson: It's too late now to sell. We've lost the window for selling this year. What sort of fucking Christmas are we going to have now?" 337This evidence shows that, following the events of 18 June 2009, and after Mr Jamieson came to believe that he had been "dudded" by the Bank and that Mr Allan had, on 18 June 2009, misrepresented the position concerning the availability of funds, Mrs Jamieson raised with Mr Jamieson, on a number of occasions, her desire to sell the Vaucluse property. On each occasion she was persuaded by her husband not to take this course. The conclusion I draw from this evidence is that the reason she did not place the Vaucluse property on the market was not some misapprehension she entertained as to the availability of funds born of misrepresentations made by Mr Allan on 18 June 2009. Rather, it was Mr Jamieson's insistence that, despite his belief that the Bank had misrepresented the position on 18 June 2009 (which belief he made known to Mrs Jamieson), he did not want Mrs Jamieson to place the Vaucluse property on the market because he was "sorting it out" with the Bank. 338Those findings are, in my opinion, sufficient to dispose of Mrs Jamieson's claim for damages. 339In any event, I have real doubt that Mrs Jamieson would be in any different position now, had she taken steps to place the Vaucluse property on the market in June 2009. 340Mrs Jamieson and the Bank led expert evidence as to when, assuming the Vaucluse property was placed on the market in June 2009, it was likely that the property would be sold. 341Mrs Jamieson's expert was a registered property valuer, Mr Stuart Rowan. Mr Rowan expressed the opinion that if the Vaucluse property was placed on the market in June 2009, a selling agent would reasonably commence a sales campaign in early August 2009, and an auction could reasonably be held six to eight weeks later. Based on this, Mr Rowan opined that a sales agreement could have been concluded and exchanged by October or November 2009 (assuming, of course, that a purchaser was available). 342The Bank called evidence from Mr Danny Sukkar, also a registered property valuer. Mr Sukkar accepted that the selling period suggested by Mr Rowan was "fairly reasonable" for "lower priced prestige properties" (selling between $3 million and $7 million) but that for "higher priced properties" (that is, over $7 million), such as the Vaucluse property, "selling periods are usually extended, given the shallow depth of buyers". In those circumstances, Mr Sukkar opined that, were the Vaucluse property placed on the market in around June 2009, a sale might reasonably be concluded and exchanged anywhere between November 2009 and February 2010. 343Both Mr Williams and Mr Simpkins offered criticisms of the expert called by the other. Mr Rowan has more extensive experience than Mr Sukkar (some 40 years as opposed to some 11 years) and has had more experience in the Eastern suburbs market than Mr Sukkar. However, the fact is that both witnesses were giving hypothetical evidence which, by its nature, necessarily involved a degree of speculation. I heard the evidence of Mr Rowan and Mr Sukkar concurrently and both witnesses impressed me as thoughtful, professional men of experience doing the best they could in the hypothetical circumstances in which they found themselves. Having given this aspect of the evidence careful attention, I am not able to reach any firm conclusion as to when, assuming the Vaucluse property was placed on the market in June 2009, it is likely that a sale would have been effected save to say that it is likely to have been in the range of November 2009 to February 2010. 344What in fact happened was that, in December 2009, a real estate agent came to the Vaucluse property with a prospective purchaser, and asked for permission to allow that prospective purchaser to inspect the property. Mrs Jamieson gave that permission and the inspection took place. 345Following the inspection Mrs Jamieson had this conversation with the agent: - "The agent: The client is not interested. The house is not suitable. Mrs Jamieson: Do you have anyone else interested in the house? The agent: Not currently but it's a fabulous property and I have had good sales in the area and I could get a result for you if it was listed with me." 346In mid January 2010, Mrs Jamieson listed the property for sale with two agents. An auction was scheduled for 11 March 2010. 347On the day before the auction, 10 March 2010, Mrs Jamieson had this conversation with the agent dealing with the auction: - "The agent: We have one genuine buyer for your property and you don't want it to go to auction with only one buyer in the room. My advice is for you to withdraw the property from the auction. Mrs Jamieson: I agree. Just withdraw it. The agent: We can keep it on the market for you and just list it for sale. Mrs Jamieson: Sure, let's do that." 348The Vaucluse property remained on the market until April 2010 when Mrs Jamieson telephoned the agent and said: - "Mrs Jamieson: I think the house is going to look stale in the marketplace if we keep the For Sale sign up. I think it's time for it to come down. Can you get someone do this?" 349The property was then taken off the market. 350Mrs Jamieson put the property back on the market in November 2010. The property was listed for auction on 15 March 2011. Shortly before the auction date, on 10 March 2011, the agent then handling the matter had this conversation with Mrs Jamieson: - "The agent: I have only one real purchaser for the house. I have as much from him as I can get. He won't go any higher than $7,500,000. He is the only one with the money and I have pushed him as high as I can go." Mrs Jamieson: Is there anyone else interested in the house? The agent: No. This guy is the only genuine purchaser. I really think you and Bill need to take the property off the market. If you leave it on for auction up to 15 March you might lose this guy. You should grab this offer. Mrs Jamieson: When can he exchange contracts? The agent: I will do my best to get it exchanged before the auction date." 351On 25 March 2010, Mrs Jamieson exchanged contracts to sell the property for $7.5 million. The sale settled on 24 June 2011. The net proceeds of sale of just under $1.4 million were placed on term deposit with the Bank. As I mentioned, the Bank has now appropriated that term deposit in purported exercise of its rights under the Deed. 352Both Mr Rowan and Mr Sukkar agreed that the value of the Vaucluse property had fallen in the period from October 2009 to March 2011. The valuers expressed differing opinions as to what the value of the property was in October 2009 as set out in the following table: - Date Mr Rowan Mr Sukkar October 2009 $9.8 / $9.9 million $8.5 million Revised in conclave $9.35 million $8.75 million 353Neither Mr Rowan nor Mr Sukkar contended that the other had made any error of principle in relation to the valuations. Both adopted the direct comparison method whereby they compared the property in question to properties said to be comparable to the subject property. One matter that divided the experts was the comparability of the various properties to which they refer. The other was their view about the value of the land at Vaucluse. Both witnesses agreed that the areas of difference between them were matters of judgment about which minds could legitimately differ. 354In those circumstances, were it necessary for me to form a view as to the value of the property in October 2009, I would assess the value as being in the mid range of the opinions expressed by the witnesses as revised in the conclave; namely, $9.05 million. Conclusion as to Mrs Jamieson's claim for damages in relation to the Vaucluse property 355In my opinion, Mrs Jamieson has not made out her claim for damages for a number of reasons. First, I am not satisfied that, but for the representations made by the Bank on 18 June 2009, she would have placed the Vaucluse property on the market in June 2009. Second, even if Mrs Jamieson had placed the property on the market then, I am not satisfied that she would have achieved a sale prior to January 2010 when, as a matter of fact, she did place the property on the market for sale. 356Mrs Jamieson's claim for damages is, in any event, defeated by the terms of the Deed. Mrs Jamieson's claim for proprietary relief 357Mrs Jamieson seeks the propriety relief referred to at [55], namely declarations that: - (a)101A Darling Point holds the Darling Point property wholly on constructive trust in her favour; (b)Mr Jamieson holds the Joadja property wholly on constructive trust in her favour; (c)her interests in the Darling Point and Joadja properties are held in priority to any interest of the Bank; and (d)alternatively, she is entitled to a life estate of each of the Darling Point and Joadja properties. 358In view of the conclusions to which I have come, my opinion is that Mrs Jamieson has failed to make any basis for such relief. 359I have found that the circumstances in which Mrs Jamieson executed the guarantee and mortgage on 18 June 2009 were unjust. But I have found that Mrs Jamieson did not execute those documents as a result of any misrepresentations made by the Bank on 18 June 2009. I see no other basis upon which Mrs Jamieson could possibly be entitled to the proprietary relief she seeks. 360I accept Mr Simpkins' submissions that even if the underlying basis for Mrs Jamieson's claims were upheld, she could not obtain the proprietary relief she seeks which, on any view of the matter, would substantially exceed her legitimate equitable requirements. This is because: - (a)the imposition of a constructive trust must conform to principle and is not established by resort to general considerations of "fairness": Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583 at 615 per Deane J; (b)a constructive trust is not ordered where there are other available remedies capable of quelling the controversy: see, for example, Bathurst City Council v PWC Properties Pty Ltd [1998] HCA 59; (1998) 195 CLR 566 at [42] per Gaudron, McHugh, Gummow, Hayne and Callinan JJ and Giumelli v Giumelli [1999] HCA 10; (1999) 196 CLR 101 at [10] per Gleeson CJ, McHugh, Gummow and Callinan JJ; (c)in substance, Mrs Jamieson's claim is that she suffered financial loss because of the "forced sale" (by her) of the Vaucluse property and the Bank's improper retention of the net proceeds of sale; (d)Mrs Jamieson can point to no proprietary interest in the Darling Point or Joadja properties; and (e)the loss Mrs Jamieson asserts would, assuming I had found an entitlement to compensation, be readily compensable, without resort to the imposition of a constructive trust. 361In any event, Mrs Jamieson has released the Bank from any such claims by reason of the Deed. 362It also follows that Mrs Jamieson is not entitled to the proprietary relief she seeks from Mr Jamieson (see [58] above). Mrs Jamieson's claim for damages for anxiety and distress 363On behalf of Mrs Jamieson, Mr Williams submitted that "all of Mrs Jamieson's problems stem from the night of 18 June 2009" and that the misleading representations made by the Bank to Mrs Jamieson on 18 June 2009 led to her subsequent execution of the Billgate guarantee in 2010 and were the cause of Mrs Jamieson "losing her home". It was also submitted that the failure of the Bank to provide funds as represented on 18 June 2009 caused significant financial strain on Mr and Mrs Jamieson, which resulted in ongoing arguments and stress between them, and the eventual breakdown of their marriage. 364In cross-examination, Mrs Jamieson gave evidence of her constant concern about finances, her feelings about being defrauded by the Bank and being worried and alarmed about her financial position, which she believed was dire. She said she was very upset at the situation she found herself in and faced the prospect that, if the Bank were to succeed in these proceedings, she would lose her home for a second time, as well as other properties which she said Mr Jamieson had promised to transfer to her, after the breakdown of their marriage. 365In these circumstances, Mr Williams submitted that Mrs Jamieson is entitled to compensation in the order of "hundreds of thousands of dollars" for anxiety and distress. 366I am satisfied that Mrs Jamieson has suffered anxiety and distress arising out of the circumstances of 18 June 2009, the subsequent sale of Vaucluse, the settlement with the Bank represented by her entry into the Deed and the circumstances of this litigation. 367I have rejected Mrs Jamieson's contention that she entered the 101A Darling Point guarantee and mortgage as a result of any misrepresentation made to her, or in her presence, on 18 June 2009. 368I have, however, accepted that the circumstances in which she entered the guarantee and mortgage on 18 June 2009 were unjust. 369Assuming that finding provided a basis upon which I could award damages to Mrs Jamieson for anxiety and distress, I would take into account that the evidence makes clear that a substantial proportion of the distress that Mrs Jamieson has suffered was caused by circumstances not related to any conduct of the Bank. 370Whatever misapprehension Mr Jamieson had about the availability of funds arising from the events of 18 June 2009 were soon dispelled when he formed the view that he had been "dudded" by the Bank and that Mr Allan had misrepresented the position to him. Further, to a very considerable degree, the problems that arose in relation to the Darling Point Project, and which flowed into the Woollahra development, were caused by Mr Jamieson's decision, on 6 August 2009, to authorise Mr Allan to use a significant part of the funds drawn down to meet the builder's progress claim 13 and to clear excesses on the accounts of Mr and Mrs Jamieson and Billgate. I refer to this in more detail below (see [380] to [396]). To the extent that Mrs Jamieson's anxiety and distress arose from the outcome of that decision, that is a matter for which the Bank was not responsible. Further, the evidence reveals that Mr Jamieson continually reassured Mrs Jamieson as to the financial position and his desire and intention to work matters out with the Bank. As I have discussed above, those reassurances explain, to a very large degree, why Mrs Jamieson postponed the sale of the Vaucluse property. 371Further, returning to the events of 18 June 2009, it seems likely that it was Mr Jamieson's assurance to Mrs Jamieson that "we are getting a million dollars out of this" that played a significant role in her decision to execute the guarantee and mortgage. 372In those circumstances, were I inclined to make an award of damages for the anxiety and distress that Mrs Jamieson suffered, it would be a nominal figure, and not the "hundreds of thousands of dollars" the subject of Mr Williams' submissions. 373In any event, for the reasons which emerge later in this judgment, Mrs Jamieson's execution of the Deed precludes any such claim. Availability of funds after 18 June 2009 Progress claim 12 374On 7 July 2009, the Quantity Surveyor recommended payment of progress claim 12 (a matter about which there is no controversy in these proceedings; the amount was paid) and certified that the cost to complete the Darling Point Project was then in the order of $3.1 million. 375Thus, assuming that because the 9 June 2009 letter of offer understated "existing debt" by something in the order of $1.039 million (see [241] above) and that the amount allocated for "Construction" ($4.076 million) was correspondingly overstated (so that, in fact, only $3.077 million was allocated to "Construction") that sum almost exactly matched what the Quantity Surveyor certified to be the cost to complete the Project. Progress claim 13 376On 31 July 2009, the Quantity Surveyor recommended that the builder at Darling Point be paid $621,995.46 in respect of its progress claim 13. On the same day, 101A Darling Point (under the signature of Mr Jamieson) wrote to the Bank authorising that payment and continuing: - "Could you please confirm the transfer of the above amount into our account, as we have issued a cheque for the amount of $621,995.46 to [the builder]." 377In fact, 101A Darling Point did not draw a cheque in favour of the builder until 13 August 2009 (see [400] below). 378On 3 August 2009, Mr Jamieson sent a letter to the Bank requesting that an amount of $681,995.46 (being the amount of progress claim 13 plus $60,000 on account of the Equity Redraw referred to in the 9 June 2009 letter of offer) be transferred to 101A Darling Point's account. 379The Bank complied with that instruction on 4 August 2009. Clearance of excesses 380Mr Jamieson gave the following evidence in cross-examination: - "Q. You became aware, didn't you, in July 2009 that your accounts were overdrawn and that Mr Allan wanted that situation rectified? A. I was already aware of that. Q. You were aware, you say, after acceptance of the June 2009 offer and by no later than July 2009 that your accounts were overdrawn? A. Yes. Q. Mr Allan spoke to you, didn't he, and said the overdraft or the over drawing needed to be fixed up? A. Yes. Q. He said to you, didn't he, that there was money in the 101A Darling Point account that he wanted to use for that purpose? A. No. Q. Didn't he say to you words to the effect of 'at present you have about $600,000 in the 101A [Darling Point] account. I want to use that to pay out all other overdrawn accounts'? A. Yes. Q. At that stage you told him that he would have to wait for you to come back [from the Joadja property]? A. Yes. Q. Was the 101A [Darling Point] account the account that you used to pay the builder for the 101A [Darling Point] project? A. Yes. Q. Was the $600,000 in the 101A [Darling Point] account money that you were in July 2009 hoping to use to pay the builder? A. Yes. Q. You understood from what Mr Allan said in his phone call in July 2009 that his proposal was that that money could be used to fixed up the overdrawn accounts? A. No. Q. Mr Allan said to you, didn't he, words to the effect of 'I want to use that', meaning the $600,000 in the 101A [Darling Point] account 'to pay out all the other overdrawn accounts', remember that? A. This is a conversation? Q. Yes, I am putting to you that at some time in about July 2009 Mr Allan said to you words to the effect of 'at present you have about $600,000 101A [Darling Point] account. I want to use that to pay out all the other overdrawn accounts'? A. That is correct. Q. You told him to wait until you came back [from Joadja]? A. That's correct. Q. But you are aware from that conversation that Mr Allan was at least was using your authority to take out money from the 101A [Darling Point] account? Is that right? A. I asked him not to take it out at that stage... Q. What you said to him was 'You will have to wait for me', meaning that you would come back and talk to him about it? A. Yes. Q. That you would come back and talk him about that proposal? A. Yes." 381This evidence makes clear, in my opinion, that Mr Allan was seeking Mr Jamieson's permission to use part of the $681,995.46 which had been transferred to the 101A Darling Point account on 4 August 2009 to clear excesses on the overdrawn accounts referred to. It also makes clear that both Mr Allan and Mr Jamieson knew that the funds then standing to the credit of 101A Darling Point's account were the funds that Mr Jamieson had instructed the Bank to draw down following the Quantity Surveyor's approval of the builder's progress claim 13. Mr Jamieson did not assert, during this cross-examination, that he refused to give Mr Allan the authority he sought. Rather, Mr Jamieson's evidence was that he did no more than ask Mr Allan to defer action until Mr Jamieson returned to Sydney from Joadja. 382The following exchange of emails then occurred. 383At 3.40pm on 6 August 2009, Mr Allan sent an email to Mr Jamieson as follows: - "As discussed, please authorise the transfer of funds to clear excesses from 101A Darling Point Road Pty Ltd account [XXXXX]: [XXXX] Billgate Pty Ltd $30,000 [XXXX] Jennifer R Jamieson $1920 [XXXX] Jennifer R Jamieson $60,000 [XXXX] William J Jamieson $490,000 [XXXX] William J Jamieson $7230". 384At 3.47pm (seven minutes later) Mr Jamieson replied: - "Could you please fix these accounts up for me. I would like you to email me back when you have completed the transfers. Thank you for your assistance." 385Mr Allan responded: - "Thanks for your email. Transfers have been completed. Note - I transferred $70,000 to Billgate Pty Ltd (not $30,000) as the account balance was actually approximately $50k DR." 386Mr Jamieson made no complaint about the transfer of the additional $40,000. The total transferred was $629,150. 387The alacrity with which Mr Jamieson responded to Mr Allan's email suggests, consistently with the evidence he gave in cross-examination, that he was expecting Mr Allan's request for authority, and had no hesitation giving that authority (his reply to Mr Allan's request was almost immediate). It is also obvious, from the evidence given in cross-examination, that Mr Jamieson knew that Mr Allan was seeking Mr Jamieson's authority to use the "$600,000" presently in 101A Darling Point's account (being the funds transferred on account of progress claim 13) to be used for that purpose. 388In his affidavit sworn on 30 October 2012, very shortly after these proceedings commenced, Mr Jamieson gave evidence that he did not recall "if I noticed" Mr Allan's email of 6 August 2009 at the time and that: - "I did not give the authorisation requested in that email". 389That evidence doubtless explains the allegation made in the Amended Commercial List Cross-Claim Statement filed by Billgate, 101A Darling Point and Mr Jamieson, that the transfer of funds was not authorised by Mr Jamieson. 390Mr Jamieson gave this evidence in cross-examination: - "Q. And is it correct to understand that you had forgotten that you had sent that email when you made your first affidavit? A. That's correct." 391On 13 June 2013, shortly before the commencement of these proceedings on 17 June 2013, Mr Jamieson swore an affidavit in which he explained that: - "On further searching in my computer records I located a record of an email sent by me on 6 August 2009 at 3:47 in the afternoon. That email is obviously a response to Andrew Allan's email of 3:40pm that day." 392In that affidavit, Mr Jamieson stated that he received the telephone call from Mr Allan referred to in the above cross-examination at "about 3.30pm" on 6 August 2009, whilst he was at Joadja, and asserted that Mr Allan: - "... did not say he was planning to use the funds drawn down for payment of the builder's progress claim". 393That evidence is impossible to reconcile with the evidence given by Mr Jamieson in cross-examination, and I do not accept it. 394Further in the affidavit, Mr Jamieson said: - "What I expected [at the time Mr Jamieson sent his 3.47pm email] was that [Mr Allan] would arrange a draw down for me to draw funds from the bill facility to provide for clearing the excesses which he referred to in his email... I expected Andrew Allan would notify me of any further paperwork required to clear the excesses. I did not expect that in clearing the excesses he would leave me without funds to pay the builder's progress claim number 13." 395Again, I find this evidence impossible to reconcile with the evidence given by Mr Jamieson in cross-examination and with the terms of Mr Jamieson's email. Mr Jamieson's email makes clear that he was not expecting any further "paperwork". He asked Mr Allan to "fix these accounts up for me" and sought email confirmation "when you have completed the transfers". It is clear from the cross-examination that Mr Jamieson knew that the funds that Mr Allan was proposing to use to clear the excesses were the same funds that had been recently transferred into the 101A Darling Point account on account of progress claim 13. 396On 6 August 2009, the transfer was effected by a debit totalling $629,150 to the 101A Darling Point account. That transfer left the account in credit in the sum of $883.28. 397The transfer had the result that there was insufficient funds in the 101A Darling Point account to pay progress claim 13. 398On 12 August 2009, Mr Allan reported to his superior: - "Bill has now raised the issue that the initial funding required was not satisfactory and he requires a further approx $610k. Bill's belief is that this variation is the Bank and the QS's fault - from my calculations it appears that Bill is partially correct (to the tune of $150k for Bank error only). Initial feedback from our credit team indicates that we will support $150k (our error) however, we may be willing to support the full transaction on the condition that the limited guarantee from Mrs Jamieson is increased accordingly (additional circa $460k). Bill has already pre-flagged that this will not be accepted...". 399In cross-examination, Mr Allan explained that the "Bank error" of $150,000 related in some way to "the retention". Otherwise, I was not able to divine, from the evidence, what the "error" was. 400The following day, 13 August 2009, Mr Jamieson drew a cheque on 101A Darling Point's account in favour of the builder in the sum of $684,195. In his affidavit evidence he said that he believed the Bank would pay that cheque. It is hard to see on what basis Mr Jamieson could have reached that conclusion. The day before, Mr Allan was reporting that Mr Jamieson was complaining that he required a "further" $610,000. 401The "further" $610,000 that Mr Jamieson referred to was the amount needed to pay progress claim 13. This further sum was required because Mr Jamieson had authorised the Bank to utilise the bulk of the funds drawn down by 101A Darling Point to pay progress claim 13 to clear the excesses on his accounts and those of Mrs Jamieson and Billgate. 402As there were no funds in the 101A Darling Point account, the Bank dishonoured the cheque from Mr Jamieson in favour of the builder. 403However, although Mrs Jamieson did not agree to increase the limit of her guarantee (as mooted by Mr Allan in his communication of 12 August 2009 - see [398] above), the Bank approved a temporary overdraft in the account of 101A Darling Point (to expire on 19 September 2009) and, on 28 August 2009, caused a payment to be made by telegraphic transfer to the builder in satisfaction of progress claim 13. 404Shortly thereafter, the builder made progress claims 14 and 14A. The Bank advanced funds under the 101A Darling Point Facility to enable 101A Darling Point to pay these progress claims. 405The 101A Darling Point account remained, however, significantly overdrawn by reason of the combined effect of the 28 August 2009 transfer of $684,230 to pay progress claim 13 and the expiry of the temporary overdraft facility on 19 September 2009. 406On 15 September 2009, Mr Allan presented an internal submission recommending that the problem be resolved by an increase in 101A Darling Point's Facility by $1.2 million to meet the excess in 101A Darling Point's account caused by the 28 August 2009 payment, to correct the $150,000 "retention error" made by the Bank and to meet further contingency professional fees and land tax expenses. 407In that submission Mr Allan stated: - "Due, in part, to protracted Bank delay in approving funding, the client appears to have incorrectly assessed the amount available under the facility to complete works. Specifically, the contingency and professional fees were misunderstood by the client, with funds being drawn under the old loan facility between February and July 2009 and thus were not able to be re-drawn under the new facility". 408Mr Allan's reference to funds being drawn between February and July 2009 appears to be a reference to the drawings made by 101A Darling Point which had the effect of increasing the amount drawn from $8.222 million (the amount drawn as at 20 February 2009 and referred to in the 9 June 2009 letter of offer as "Land (Existing debt)") and the figure in the order of $9.261 million representing the actual drawings of 101A Darling Point as at 9 June 2009. 409It was not until 10 November 2009 that the Bank made a formal offer to 101A Darling Point for an increase in the facility of $1.2 million. That offer was conditional on Mrs Jamieson agreeing to increase the limit of her guarantee to $2.2 million and upon 101A Darling Point agreeing to a "success fee" in the sum of $1 million. 410In the meantime, the Bank refused to permit further drawings on the 101A Darling Point account with the result that the builder's progress claims 15, 16 and 17 were not paid until December 2009, in the circumstances to which I refer below. 411Thus, on 15 October 2009, Mr Allan reported to his superiors: - "Just an update - I have advised [Mr Jamieson] of the Bank's position regarding not funding the current or any further payments until our current application is finalised and he has advised that he must therefore close the site and that he will progress with a legal damages claim against the Bank". 412On 23 October 2009, Mr Allan sent an email to Mr Howes: - "Mr Jamieson has asked us to consider releasing the current progress draw prior to the finalisation of the current funding proposal. My understanding from our discussions is that this is not possible, however I seek some clarification. Mr Jamieson's concerns are that the delay in funding will be delaying (potentially jeopardising) the project as the builder increasingly grows concerned around payment & the payment falls further outside the contract payment terms." 413Mr Howes replied: - "Correct, we are not releasing funds prior to approval." 414As I have mentioned, the Bank's letter of offer in respect of the proposed increase in the facility of $1.2 million was sent on 10 November 2009. 415On 16 November 2009, Mr Jamieson notified the Bank that Mrs Jamieson did not agree to increase the limit of her guarantee in respect of 101A Darling Point from $1 million to $2.2 million (as proposed in the Bank's offer of 10 November 2009) and stated that: - "He would write to the Bank to formally decline the loan offer & put forward an alternative suggestion re completion plan for the project". The builder suspends works 416On 26 November 2009, the builder served on 101A Darling Point a Notice of Default and Notice of Suspension by reason of non-payment of progress claims. The builder gave notices of its intention to suspend work at the site (although, as it turned out, the builder did not actually suspend work until 19 February 2010). 417In the meantime, Mr Jamieson came to an arrangement with the builder whereby the builder agreed to defer payment. 418Thus, on 16 December 2009, Mr Allan recorded in a note: - "The client has now written to the Bank formally declining the offer [of 10 November 2009]...The client declined the transaction as they believed that the large success fee ($1m) was not commercial; it was also unlikely that the client was able to achieve an increased guarantee from Mrs Jamieson as it appears that the couple are now estranged. The $1.2m funds required to complete the project are now to be sourced from equity/creditors as follows 1. The client has come to an external agreement with the builder to defer payment on $745,000 of construction costs (to 31 August 2010 or sale of asset) to enable the completion of the project without additional Bank funding. This deferred payment effectively becomes equity from a lending standpoint. This will clear the excess." (emphasis added) 419On 24 December 2009, the Bank permitted a draw down by 101A Darling Point of $952,903.50 of which $712,000 was paid into 101A Darling Point's account (clearing the excess in that account) and $240,903.50 paid to the builder. The payment to the builder was on account of the amount (a little under $1 million) due to it by 101A Darling Point. Events in 2010 101A Darling Point 420On 9 February 2010, the builder at 101A Darling Point gave notice of its intention to suspend work and, on 19 February 2010, in fact suspended work at the site. 421The builder did not resume at the site until 13 August 2010. 422Construction work at the 101A Darling Point site resumed in August 2010 because, on 21 July 2010, the Bank agreed to increase the 101A Darling Point Facility by $2.58 million (with a "renegotiation fee" of $20,000 in lieu of the "success fee" of $1 million proposed in the Bank's letter of offer of 10 November 2009). 423From August 2009, draw downs for building work for the Darling Point Project were made regularly and practical completion was achieved in February 2011. Increase in the Billgate Facility 424On 1 February 2010, Mr Jamieson, on behalf of Billgate, requested additional funding of $1.07 million on behalf of Billgate to complete the Woollahra project. 425On that day, Mr Jamieson and Mr Le Compte met with Mr Allan and other representatives of the Bank. 426During that meeting the question of Mrs Jamieson providing a guarantee for the Billgate Facility was raised. 427Mr Allan's note included: - "As confirmed at interview, Jennifer Jamieson has agreed to secure via property at [Vaucluse] (Legal Advisor Lou Le Compte has confirmed)". 428That suggests that Mr Le Compte represented to the Bank on 1 February 2010 that Mrs Jamieson had, at that date, agreed to execute a guarantee, secured over the Vaucluse property, in respect of the borrowings of Billgate. 429Mr Jamieson gave this evidence about the Billgate guarantee: - "Q. In relation to that increase you got documentation for the Bank that made it plain that a requirement if there was to be such increase was a guarantee from your wife. A. Yes. Q. You spoke to your wife about that requirement? A. Yes. Q. You told her that in order to get this additional funding for Billgate of $1.3 million, she would need to give a further guarantee? A. Yes. Q. Although she was reluctant to do that, she agreed to in the conversations with you? A. Yes." 430Mr Jamieson also gave evidence that Mr Le Compte had a conversation with Mrs Jamieson as follows: - "Mr Le Compte: They are pulling you into another guarantee for the $1.3 million. Mrs Jamieson: What? Is it in addition to the $1 million I have already given? I can't pay the $2.3 million. This is monopoly money. Where is it going to come from? I don't have it, where do they think it is going to come from?" 431Mrs Jamieson placed that conversation on 14 January 2011. It appears likely that she is mistaken about that matter and that the conversation took place sometime before she signed the guarantee on 15 April 2010. 432On 5 March 2010, the Bank sent a letter to Billgate offering an increase of $1.3 million in the Billgate Facility. One condition of the offer was that Mrs Jamieson give a guarantee in respect of the indebtedness to the Bank of Billgate, limited to $1.3 million and supported by the mortgage Mrs Jamieson had given the Bank on 18 June 2009. 433Mrs Jamieson first saw the guarantee document on the date it was presented to her for signature. Mrs Jamieson said that she did not understand that she was signing a new and separate guarantee. She said she thought she was agreeing to increase the limit of the 18 June 2009 101A Darling Point guarantee by $300,000, rather than agreeing to guarantee Billgate's debts to $1.3 million. 434As we will see, it does not appear that Mrs Jamieson's execution of the Billgate guarantee loomed large in her mind when she was communicating with the Bank in August 2012, immediately prior to the execution of the Deed. 435In any event, Mrs Jamieson's execution of the Billgate guarantee is of limited significance in the case as the Woollahra property has been sold, its proceeds paid to the Bank and, by operation of the Deed, Mrs Jamieson has been released from such obligation as she otherwise might have had under the Billgate guarantee. 436In the proceedings, the Bank seeks no relief from Mrs Jamieson in respect of the indebtedness of Billgate to it. The claim for damages by 101A Darling Point, Billgate and Mr Jamieson 437The claims for relief by 101A Darling Point, Billgate and Mr Jamieson (see [29] to [43] above) all turn on the proposition that the Bank failed to advance to 101A Darling Point promised funds, leading to the suspension of works on the Darling Point Project and consequent delays on Billgate's project at Woollahra. 438Thus in his opening submissions, Mr Muddle submitted: - "The shortage of available funds proved chronic and intractable and in October 2009 the Bank halted further draw downs to 101A under its bill facility and formally declined further necessary funding in March of 2010. This caused 101A to default on its building contract for the project and resulted in a halt to works - the builder gave a default notice for non payment on 26 November 2009 and a notice of suspension of works on 9 February 2010. 101A could not achieve recommencement of works until late August 2010, after the Bank had made available a further facility to 101A for continued construction of the project. This interruption escalated the cost of construction and holding costs and caused 101A to miss the market to sell the development. It is still not sold. These events also affected the major refurbishment being undertaken by Billgate at Woollahra by disruption of relationships with trades, cash shortages and delay. Mr Jamieson did not discover the errors in the statements as to the level of debt in the 9 June offer letters until preparing his evidence in this case." 439As emerges from what I have said earlier, my finding is that the "chronic and intractable" shortage of funds was caused by Mr Jamieson's decision to accede to Mr Allan's 6 August 2009 request that funds from the 101A Darling Point account be used to clear the excesses in the accounts of Mr and Mrs Jamieson and Billgate. 440Further, I do not accept the submission that Mr Jamieson only discovered the "error" in the statement of 101A Darling Point's "existing debt" in the 9 June 2009 letter of offer after the commencement of these proceedings. I have found that Mr Jamieson was aware of the true position at all relevant times (see [259] - [276] above). 441It follows that, in my opinion, the defendants for whom Mr Muddle appears have not made out any basis for a claim for damages. 442In any event, in so far as 101A Darling Point and Billgate seek damages because of movements in the market leading to property sales at unfavourable levels, there is simply no evidence to support any such propositions, as Mr Muddle, in effect, accepted during final submissions. 443Finally, as I will discuss below, the Deed is a complete answer to these claims. 444I turn now to the decisive issue in the case, the circumstances leading up to and the execution of the Deed. Events leading to the execution of the Deed 445On 2 March 2011, the Bank demanded from Mrs Jamieson the arrears owing under the Portfolio Loan. At that time, the Vaucluse property was on the market and scheduled for auction on 15 March 2011. 446In March 2011, Mrs Jamieson sought the advice of Mr Peter English, a partner in Surry Partners Lawyers. 447As I have mentioned, on 25 March 2011, Mrs Jamieson exchanged contracts to sell the Vaucluse property for $7.5 million. 448On 28 March 2011, Mr English wrote to Mrs Jamieson as follows: - "As I presently understand it, you say that you were induced to provide guarantees and collateral securities to the Bank on two occasions - the second as a result of the Bank approving the first facility for an entity controlled by your husband (the borrower), to allow the completion of a development project in Woollahra (with equity draw downs which would have funded you to meet other obligations to the Bank), but which was immediately exhausted by the Bank debiting non related, or existing, debt of the borrower to that facility - such that there were no funds to complete the designated project and there were a series of knock-on events - including delays in completing Woollahra, penalties paid to the builder, placing you in default of your primary obligations to the Bank and which gave rise to the need for the borrower to take out the second facility (guaranteed by you) to complete a project in Point Piper. This is a high level analysis based on my discussions with you and with Lou to date. On the face of it, you have defences to the guarantees and the provision of the second mortgage. I understand that you have now exchanged contracts to sell your residence in Vaucluse over which the Bank has a first mortgage and a second mortgage to secure the recent guarantees. I understand that time is of the essence. Once I have the documents and clearer instructions, I will prepare a cost estimate and will ask you for funds to place in our trust account." (emphasis added) 449A number of matters emerge from Mr English's communication of 28 March 2011. The first is that Mrs Jamieson was quite clear about the complaints she made about the Bank. They were that: - (a)she had been induced (evidently by representations made by someone) to provide guarantees and collateral securities in respect of borrowings of an entity controlled by her husband; (b)she had provided those guarantees and collateral securities to allow completion of the development at Darling Point (Mr English said it was in Woollahra; in fact it was Darling Point); (c)there was supposed to be "equity draw downs which would have funded you to meet other obligations to the Bank" (that is Mrs Jamieson's obligations under the Portfolio Loan); (d)drawings had been "immediately exhausted" as a result of the Bank "debiting non-related, or existing, debt of the borrower to that facility" (evidently a reference to the 6 August 2009 transfer to clear excesses in the accounts of Mr Jamieson, Mrs Jamieson and Billgate); (e)as a result of which "there were no funds to complete the designated project" (evidently the Darling Point Project); (f)which caused a "series of knock-on events" including delays in completing the Woollahra, penalties paid to the builder on one or both projects and placing Mrs Jamieson in default of her "primary obligations to the Bank" (under the Portfolio Loan). 450The account given by Mr English of Mrs Jamieson's complaints suggests that Mrs Jamieson had a clear idea of the claims she had against the Bank. The matters recited by Mr English bear a strong resemblance to those agitated by Mrs Jamieson in these proceedings. 451Further, Mr English advised Mrs Jamieson that, on the face of it, she had, in his opinion, a basis upon which to resist any claim made by the Bank against her based on the guarantee she had executed in relation to the 101A Darling Point and Billgate Facilities and the Vaucluse mortgage. 452In cross-examination, Mrs Jamieson agreed that Mr English had advised her that she "had grounds under the guarantee", and that she "shouldn't have been put in the situation to sign the guarantee". Mrs Jamieson said she was unable to recall why Mr English said that was the case, but agreed that, at their very first meeting, Mr English told her that on the face of it she had a defence to the Bank's claims against her and that it appeared to her at the time that she might have an answer to those claims. 453Mrs Jamieson said that she did not want to take action against the Bank. She said she "didn't want to be in this situation", "wanted it all to go away" and "just wanted everything to settle". 454Mrs Jamieson attended a meeting at the offices of the Bank's solicitors, Gadens Lawyers, on 6 April 2011 with Mr English. Mr English told the Bank he was acting for Mrs Jamieson and had been instructed by her to attend with her. Mr English sought from the Bank, on Mrs Jamieson's behalf, copies of the documents she had signed in connection with the facilities. 455On 27 April 2011, Mr English wrote to Mrs Jamieson saying that he had received "a couple of folders of documents" from the Bank's solicitors but that he would not commence reviewing the documents until Mrs Jamieson signed a costs agreement and money was paid into trust on account of fees. He added: - "I understood that we were to take over to conveyance of your Vaucluse property and take steps to attempt to have the deposit released, but have heard nothing." 456Mrs Jamieson said that Mr Jamieson had told her that "he would have to get the money to put... in the trust for Mr English", and that Mr Jamieson: - "... paid certain bills for Mr English, but then he couldn't continue because he wanted a substantial amount of money to be put into trust to continue on the progress of looking after my affairs with the Bank and at that time he couldn't afford it". 457Two days later, on 29 April 2011, the Bank served on Mrs Jamieson demands under the 101A Darling Point guarantee and the Billgate guarantee for a total amount in the order of $30.3 million. 458Thereafter, in May 2011, Mrs Jamieson retained Mr Brenden Miller, from Garland Hawthorn Brahe, to act on her behalf. 459At this time, Mr Jamieson was continuing to receive legal advice from Mr Le Compte. 460Mrs Jamieson said: - "My husband told me that we were going to meet with a solicitor he knew, Brenden Miller, to take over from Peter English. To the best of my knowledge, I think he had been speaking with Brenden and Brenden was going to be far more reasonable with his fee structure and sort of help us out. So Bill asked me to meet with Brenden. I went in one afternoon with Bill and we met Lou outside and we all went up together and I met Brenden for the first time." 461Mrs Jamieson said that, at her first meeting with Mr Miller, she told Mr Miller that "I felt I was completely defrauded" and: - "I said that I had been put into a terrible situation because of a guarantee that I had signed, it hadn't been honoured, and through the repercussions of not signing that document and consequent documents, I got into the situation where I now had the default notices. I had to sell my home." 462This evidence reveals, once again, that in May 2011 (some 16 months before she executed the Deed) Mrs Jamieson had a clear idea of the nature of the complaints and claims she had against the Bank. 463On, or shortly before, 1 June 2011, Mr Miller met with the Bank's solicitor and with Mr Howes, from the Bank. Mr Le Compte and Mr Jamieson were also present at that meeting. Mrs Jamieson said she was not contacted by Mr Miller about that meeting and that she did not provide him with any instructions. She said that Mr Jamieson told her that there was no need for her to attend. 464On 1 June 2011, Mr Miller sent a letter to Mrs Jamieson. The letter was addressed to the Jamieson "family" email address, rather than Mrs Jamieson's individual email address. Mrs Jamieson claims she did not receive this letter. The letter attached a draft letter that Mr Miller proposed to send to the Bank's solicitor. That draft letter included: - "As you would be aware my client has a very firm opinion that she has claims against your client as a result of its conduct towards her (and the conduct of others, upon which your client relied). As I made plain in our discussion, I do not propose to explore or ventilate by client's claims in any detail pending all parties working together to realise the security assets at Vaucluse, Darling Point and Woollahra. My client does though reserve her rights." 465Although Mrs Jamieson denied seeing this letter, the material to which I have referred shows that it was true for Mr Miller to say that Mrs Jamieson had "a very firm opinion" that she had claims against the Bank. 466On 2 June 2011, an email purporting to be from Mrs Jamieson was sent to Mr Miller from the Jamieson family email address. 467The email suggested a change to Mr Miller's proposed draft letter to the Bank's solicitors as follows: - "In reference to the proposed letter to the Bank, would it possible to re-enforce/clarify [sic] that I do not want any of the proceeds from the sale of Vaucluse touched until after ALL disputes between Darling Point and Woollahra are settled. I know that you do state this... but could it be reiterated?" 468Mr Miller made a change to the letter he sent to the Bank's solicitors in accordance with this suggestion. 469Mrs Jamieson denied that she had sent this email and said that what was set out in the email to Mr Miller was not her view "as this is written". Mrs Jamieson said she did not send emails from the family email address, only from her individual email address. She said that sometimes Mr Jamieson asked her to type letters but that she could not recall sending this email. For his part, Mr Jamieson said he had no recollection of sending this email. 470Mrs Jamieson must be mistaken about this. It is unlikely that Mr Jamieson would send an email in Mrs Jamieson's name. He appeared to me to be giving honest evidence when he said he had no recollection of doing so. Mrs Jamieson, on the other hand, sounded to me to be unduly defensive when denying her involvement in the email; and this at a time during her evidence when she was presenting as being far less focused on detail than when she gave evidence later in the cross-examination. 471The sale of the Vaucluse property settled on 24 June 2011. The Bank did not pay Mrs Jamieson the net proceeds of sale of the Vaucluse property (some $1.4 million) but required that it be placed on a term deposit under its control to secure Mrs Jamieson's obligations pursuant to the 101A Darling Point guarantee and the Billgate guarantee. 472On 27 July 2011, Mr Miller sent an email to Mrs Jamieson (at her private email address) stating that he had prepared a chronology "referencing relevant documents as regards your relationship" with the Bank and stating that the "next step" was to expand the chronology and "identify with some precision the basis of your complaints". He continued: - "When the second step has been undertaken, then a comprehensive brief can be provided to a competent senior barrister [and Mr Miller nominated a particular Queen's Counsel] to give an opinion on your liability to/claims against the Bank." 473Mrs Jamieson agreed that she had received this email but could not recall reading it. She said she took no steps in response. 474Mrs Jamieson agreed that, in July 2011, she understood that Mr Miller was seeking to review the relevant information with a view to providing her with more comprehensive advice about her rights against the Bank. She said she was interested to know what those rights were. She said she knew that Mr Jamieson was providing Mr Miller with relevant documents. She said she thought that Mr Miller's recommendation that senior counsel be briefed, once the documentary material had been assembled, was a good idea. 475On 31 August 2011, Mr Miller wrote to Mrs Jamieson: - "I am aware that [Mr Jamieson] has been liaising with [Mr Le Compte] putting together a statement to submit to Counsel for advice. Whilst your position does differ markedly to [Mr Jamieson's] position, it may well be more cost effective at this stage for [Mr Jamieson] to obtain his advice, and then as necessary you to prepare your own statement and obtain your own advice thereafter. Otherwise if you wish to progress matters now, I am happy for you to come in and go through things with me at your convenience." 476Mrs Jamieson agreed that her position differed "markedly" from Mr Jamieson's "because I'd signed the guarantee for my home". She said that "Bill was speaking to Brenden and I wasn't advising him". Mrs Jamieson said that Mr Jamieson had set aside funds for senior counsel, that she left "the legal stuff" to Mr Jamieson to look after but that "Mr Miller was there to represent me". She added: - "And I was very concerned because I didn't want to give away my rights and I was concerned about my rights, yes". 477This reveals a tendency which Mrs Jamieson evidenced in the course of giving evidence of asserting her reliance on Mr Miller as her solicitor, yet attributing responsibility for seeking his assistance to others, notably Mr Jamieson. 478On 30 September 2011, Mr Miller wrote to Mrs Jamieson referring to "discussions with yourself and Bill" and stated that: - "I can see the genesis of a case that you can mount against the Bank. That said, there is a considerable amount of work that needs to be done to fill in a number of gaps, and expand the evidence so as to provide a firm definite view of your likely prospects of success of: (a) avoiding liability to the Bank under the guarantee(s) supplied by you; and (b) recovering the funds currently held on term deposit with the Bank (which are subject to release only by agreement or Court order)." 479Mr Miller suggested that "the initial way forward" would be to obtain a copy of "the statement Bill has prepared with the assistance of his lawyers", to utilise "the facts in Bill's statement together with the material we have gathered to date, finalising a detailed statement from you" and to submit that material to senior counsel. 480Mr Miller continued: - "I have mentioned utilising Bill's statement as that statement should contain a significant amount of factual detail that would be common to the position both you and Bill have with the Bank, and would thus save the cost of duplicating investigation into those matters. I do not see any conflict issues with us utilising Bill's statement in this fashion... If you wish to proceed, could you please let me know and then we will need to take steps to obtain a copy of Bill's statement". 481Mrs Jamieson said she did not speak to Mr Miller about this letter. 482In the meantime, on 29 September 2011, the Bank's solicitors had provided Mr Miller with a proposed "Deed of Forbearance" which the Bank "as a gesture of goodwill" was prepared to enter. 483On 4 October 2011, Mr Miller wrote to Mrs Jamieson stating that he had had a "quick skim of the Deed" and that, so far as Mrs Jamieson was concerned, what the Bank was proposing was that it would permit Mr Jamieson, until 31 December 2011, to sell the security properties and, in exchange, Mrs Jamieson would have to "give up the right to $1.3M held on term deposit", "give up any claim you might have against the Bank" and "remain liable for any shortfall". Mr Miller continued: - "If you wanted to enter into the Deed or variation of it, I'd need to go through each clause in detail. But, if as I understand your position, that is, you don't want to give up your rights, then I think my summary above is sufficient. You should assume that if we don't enter into the Deed, or some minor variation of it, by say mid/late next week, the Bank will likely appoint receivers over the companies who will take control of the properties." 484Mrs Jamieson said that she did not "deal with" this letter, that she probably "skimmed" the letter and that she assumed that Mr Jamieson, Mr Le Compte and Mr Miller were "looking after my concerns". 485On 23 January 2012, Mr Miller wrote to Mr and Mrs Jamieson forwarding further correspondence from the Bank's solicitors and stating: - "We do need to have a chat, because I couldn't image the Bank holding off for too much longer, unless there has been some real progress on the refinance front, to the Bank's satisfaction?" 486Mrs Jamieson said that she "probably" spoke to Mr Jamieson about this letter although she could not recall having done so. She said that Mr Jamieson was "always" working on a solution and that he would speak to Mr Miller. Mrs Jamieson said that she trusted that Mr Jamieson was doing all that he could and that: - "I wanted him to negotiate a settlement to get this whole thing over with". 487On 9 February 2012, the Bank sent further demands to the companies and to Mr and Mrs Jamieson. 488On 10 February 2012, Mr Miller wrote to Mrs Jamieson: - "Obviously you have no intention of paying these demands, and on one view of it I suppose it is good that the Bank is issuing demands rather than taking action. I have not heard what is happening in respect of re-finance/sale, so if you get a moment perhaps you could update me." 489Mrs Jamieson said that she "would have" told Mr Jamieson about this letter but that she did not contact Mr Miller. 490The first occasion in which a possible settlement of the matter for $23 million was raised was in an email from Mr Howes to Mr Jamieson on 26 March 2012 in which Mr Howes stated: - "As a further gesture of goodwill the Bank is prepared to allow you until 4.00pm on Friday, 25 May 2012 to provide the following: · An unconditional offer of finance which includes a payment to the Bank of at least $23 million; and · A proposal as to the payment of the shortfall to the Bank (which will be at least $13.6M, as the Jamieson Group's debt currently stands at approximately $36.6M)". 491Mr Howes said that the figure of $23 million represented the Bank's assessment of the likely return to it if it exercised power of sale over the 101A Darling Point and Woollahra properties. 492The Bank served further demands on the companies and Mr and Mrs Jamieson on 10 April 2012. 493On that day, Mr Jamieson sent an email to Mr Howes saying that he was close to "completing negotiations with a new Australian based financier (Wingate Group from Melbourne)" and expressing the hope that the Bank "is now not going to terminate negotiations". 494Mr Howes replied stating, "any refinance proposal must result in the Bank's debt being repaid in full". Thus, the Bank's position at this stage was that it required payment in full of the amounts due to it by Billgate and 101A Darling Point. 495On 12 April 2012, the Bank's solicitors wrote to Mr Miller: - "The Bank is in the process of enforcing its rights under its facilities and securities. We understand that your client currently occupies part of 101A Darling Point Road, Darling Point. We are instructed to convene a meeting, to be held at our office, with you, your client and a representative of the Bank, to confirm the Bank's requirement for it to be given vacant possession of the Property, in an orderly manner." 496It will be recalled that the sale of the Vaucluse property was completed in June 2011. Nonetheless, Mrs Jamieson, her mother and two of Mr and Mrs Jamieson's children had remained in occupation of the Vaucluse property under an arrangement with the new purchaser. Mrs Jamieson, her mother and the children moved from Vaucluse to one of the apartments at 101A Darling Point in or around April or May 2012. 497Mrs Jamieson said that in the months leading up to the Bank's solicitors' letter of 12 April 2012, she understood that Mr Jamieson was working on refinancing the obligations of Billgate and 101A Darling Point to the Bank and was hoping that Mr Jamieson could negotiate a settlement with the Bank. She said that she knew Mr Miller was available to give advice to her but that she was hoping the matter could be settled. Mrs Jamieson said that she believed that "Bill, Lou and Brenden" were looking after her concerns and that Mr Jamieson was having discussions with Mr Miller. Mrs Jamieson said she was "trusting Bill to fix this up". 498Thus, Mrs Jamieson's position was that she was vitally interested in the resolution of her dispute with the Bank (and did not wish to forego her asserted rights) but sought to distance herself from taking any responsibility for constructive participation in the process that was necessary to achieve that result. A year after demands had first been issued by the Bank against her, and despite being acutely concerned about her position in relation to the Bank, Mrs Jamieson claimed not to be concerned to get any definitive legal advice about her rights against the Bank because, she said, she believed that Mr Jamieson and Mr Le Compte were working with Mr Miller on her behalf. 499Arising from the Bank's solicitors' letter of 12 April 2012, Mrs Jamieson attended a meeting with the Bank's representatives on 8 May 2012. 500Prior to the meeting, on 3 May 2012, Mrs Jamieson sent an email to Mr Miller which included the following: - "My understanding of our meeting and the points you were going to raise is that Bill offered the Bank $20 million, to settle all debts, including any guarantees. The Bank wrote that they require $23 million as a gesture of goodwill knowing Bills [sic] assets. Bill agreed to $23 million once again to settle all debts, including any guarantees associated with the debt. The Bank wants an unconditional offer (which is not possible as there is no such document so I have been told) of finance and a proposal of payment for the shortfall... Why is the letter of offer from Wingate not sufficient? ... what is the point of he or I attending a sit down meeting if we don't know what it is about and cannot prepare the necessary answers or documents they may require to speed up any arrangements that need to be made. It just wastes more time. I just want this settled and the longer the Bank takes to respond means the proposed new lender may be lost. Is there an agenda with the Bank deliberately blocking every attempt at finalising with Bill... If this is so I need to know so I can begin action to protect my position and commence the necessary proceedings. The Bank has not offered any agreements they had with me and surely they must have some form of duty of care." (emphasis added) 501This letter reveals a number of things. First, it shows that Mrs Jamieson was closely following Mr Jamieson's negotiations with the Bank. Second, it confirms that Mrs Jamieson's overriding objective was to have the dispute with the Bank settled. Third, it bespeaks an intention and inclination to litigate with the Bank if the matter was not settled on terms satisfactory to Mrs Jamieson. 502On 4 May 2012, several days before the proposed meeting, the Bank offered to settle the matter upon payment to it of $23 million together with payment of the $1.4 million net proceeds of the Vaucluse property, subject to Wingate providing an unconditional letter of offer of finance by 25 May 2012. This offer represented a significant shift from the Bank's position as expressed on 26 March 2012 (see [490] above) and 12 April 2012 (see [495] above) that it would only settle on payment of the entire amount owing to it; in the order of $35.5 million. 503In cross-examination, Mrs Jamieson suggested that she was not aware that the Bank was proposing, as part of a settlement, that it be paid the $1.4 million Vaucluse sale proceeds. Mrs Jamieson gave this evidence: - "Q. You will see that the second of the terms proposed in this letter from the Bank's solicitors dated 4 May 2012 was that you would direct the moneys held in the term deposit being in the vicinity of $1.4 million to the Bank, see that? A. Yes. Q. And you were aware, weren't you, from about early May 2012 that that was part of what the Bank was proposing as a settlement? A. I am reading it, yes. Q. But you read it, didn't you, or were told of it in or about early May 2012? A. I wasn't aware that they intended to take my money. Q. Sorry, you aren't aware of what? A. That they were intending to take my funds, my money. Q. Do you tell his Honour when you went to the meeting in May 2012 that you had no understanding at all that the $1.4 million was something the Bank was requiring to be paid to it? A. I had the understanding that [Mr Miller], [Mr Jamieson] and [Mr Le Compte] were going in there to talk about the settlement and they would take care of the settlement, the discussion. Q. Before the May meeting, that is the May 2012 meeting, are you telling his Honour that no one really explained to you what was to be discussed at the settlement proposal? A. No one explained to me. Q. So you were not told what the Bank's position was? A. No, no one spoke to me." 504I do not accept that evidence. On 4 May 2012, Mr Miller sent an email to Mrs Jamieson at her private email address: - "The Bank will give you both a complete release for $23M plus the term deposit monies." 505Mrs Jamieson must have understood, from that email, what the Bank was proposing. 506On 8 May 2012, Mrs Jamieson, together with Mr Miller, attended a meeting with representatives of the Bank (including Mr Howes). Mr Jamieson and Mr LeCompte also attended the meeting. 507Mrs Jamieson said: - "I said to [Mr Howes] that I had been forced to give a guarantee that the Bank had never honoured and I believed that they had acted in a very fraudulent way towards me and I had lost my home." 508In cross-examination, Mrs Jamieson said her own assessment of her position was that "I should never have signed that guarantee" and that: - "I had been requested to sign a guarantee for a million dollar second mortgage on my home to ensure that funds were going to be available to continue paying for my mortgage and for my living expenses which included American Express card and enough money for Bill to complete Darling Point by Christmas, in which case the guarantee would be null and void. It would have been completed." 509Mrs Jamieson was asked "what was fraudulent about that" and she replied: - "Because I was never offered the draw down to pay my mortgage. Bill was never given the money to complete Darling Point. Yet they took my guarantee for money that was never there." 510This evidence suggests that not only at the time of her cross-examination, but also in May 2012, Mrs Jamieson had a very clear idea of the claims she had against the Bank. 511On 21 May 2012, Mr Le Compte wrote to the Bank's solicitors accepting the Bank's offer to settle for $23 million but stating that Wingate would not provide a letter of offer unless a commitment fee of $50,000 was paid and that Mrs Jamieson was prepared to pay that $50,000 (and valuation costs) "from the interest already accrued on the deposit of $1.4m (approx) which your client holds". 512Mr Le Compte said that he understood that "the foregoing is acceptable to" Mrs Jamieson. 513The Bank did agree to release from the interest accrued on the term deposit an amount for the commitment fee. Mrs Jamieson signed an "irrevocable direction and authority" authorising the release of that sum. 514On 8 June 2012, Mr Miller wrote to Mr and Mrs Jamieson: - "As my role in this matter is effectively concluding I take this opportunity to enclose the firm's account...". 515Nonetheless, Mr Miller remained involved in the matter. 516On 27 June 2012, the Bank's solicitors wrote to Mr Le Compte and Mr Miller threatening immediate enforcement action. 517In cross-examination, Mrs Jamieson initially suggested she was not aware of this. She gave the following evidence: - "Q. Mr Miller told you in about late June 2012 that the Bank was threatening to proceed with an enforcement action against you? A. He told me - no, he never told me. Q. Sorry? A. He didn't tell me. No. Q. Did you find that out from someone else? A. I left it to Bill. Q. Did you find it find it out from someone else? A. I would have found out from Bill and from the letter. Q. Didn't Mr Miller write to you telling you that he received this letter threatening to take enforcement action? A. If I have a letter, then yes. Q. You don't remember? A. I don't recall because I let Bill deal with it. Q. Do you accept that if you got a letter from the Bank's solicitors in late June threatening to proceed immediately to enforcement action that would cause you great alarm? A. Yes and I would speak to Bill and he would speak to Brenden and Lou. Q. In late or early July 2012 you did become alarmed because you came to know of the Bank's stated intention to proceed immediately against you with enforcement action. A. I was alarmed. Q. Because you were aware that enforcement action was proposed against you? A. I was aware of the letter of the letter I believed Bill and Lou and Brenden were dealing with it on my behalf." 518In fact, on 4 July 2012, Mr Miller had sent an email to Mrs Jamieson at her private email address enclosing a copy of the Bank's solicitors' letter of 27 June 2012 concluding: - "Could you let me know how you think I should respond to the Bank's request?" 519This evidence reveals, in my opinion, an inclination of Mrs Jamieson to seek to portray herself as having little grip on the detail of what was happening, and having left it all to Mr Jamieson and Mr Le Compte when, in fact, Mr Miller was keeping her informed of developments and seeking her instructions as to what he should do in her interests. 520Mrs Jamieson gave the following evidence concerning her state of mind at this time: - "Q. As someone concerned for your own position with regard to the claim the Bank was making against you, you tell us that as at June 2012 you didn't have any idea of what kind of deal your husband was seeking to implement with the Bank? A. He was working on settling with the Bank. Q. You're telling his Honour that you had no idea what the deal was he was working on? A. I had no idea. Q. You had no idea how close that deal was to being implemented? A. I wasn't a party to the deal. No. Q. Or what the difficulties might be with it being implemented? A. No. Q. You were uninterested in what your husband was doing by way of negotiating with the Bank? A. No. I wasn't uninterested but I wasn't a party to his dealings. Q. You agree if you were interested you would ask him questions about what he was doing? A. When I saw him he was extremely stressed. He told me he was working on it. Q. Did you ask questions? A. I would when I saw him how is it going, what's happening. Q. What do you say he told you when you asked those kind of questions of him? A. Lou and he and Brenden were working on it, working their way through it. Q. Didn't you say to him 'that's all you ever told me over the last year or so. What really is happening'; something like that? A. That's all he would tell me. Q. Did you ask him for more information? A. No. Q. Is that because you were content for him to negotiate whatever settlement deal that he thought to be beneficial and you would go along with it? A. He would do a deal to the best of his ability for the betterment of myself, himself and the family. Q. And you would accept and go along with it? A. Yes." (emphasis added) 521In my opinion, this evidence reveals Mrs Jamieson's true state of mind at the time. Above all else, she wanted the dispute with the Bank settled. She understood that Mr Jamieson was doing the best he could to negotiate the best possible settlement for the benefit of the Jamieson family. And, although she had earlier denied this, she was prepared to go along with the best that Mr Jamieson could negotiate. 522Negotiations continued in July 2012, albeit between the Bank's solicitors and Mr Le Compte. 523On 12 July 2012, Mr Le Compte wrote to the Bank's solicitors setting out terms of a proposed settlement. The proposed terms included the payment by Mr Jamieson of $23 million to the Bank, that the parties (including Mrs Jamieson) would enter into a settlement deed and that Mr and Mrs Jamieson would give certain releases. Mrs Jamieson said she had seen this letter prior to these proceedings and that she did not give Mr Le Compte any instructions in relation to this letter. 524On 18, 20 and 30 July 2012, the Bank's solicitors corresponded with Mr Le Compte (rather than Mr Miller) concerning the progress of the negotiations. 525It appears that Mr Miller was not directly involved in those negotiations. 526However, Mrs Jamieson must have been aware, to some extent, of the progress of the negotiations because, during July, Mrs Jamieson applied to the Australia and New Zealand Banking Group Limited ("ANZ") for an "ANZ Residential Investment Loan" of $4.45 million. 527On 30 July 2012, ANZ wrote to Mrs Jamieson (using her maiden name of "Wicks") approving that loan, expressed to be in respect of unit 1 of the 101A Darling Point property. Mrs Jamieson said that she had not seen that letter, and pointed out that it was addressed to her at the Vaucluse address. Mrs Jamieson was not living at the Vaucluse address on 30 July 2012. 528Mr Simpkins suggested to Mrs Jamieson that she had applied to the ANZ for a Residential Investment Loan. Mrs Jamieson replied "not to my recollection". Mrs Jamieson suggested, although faintly, that Mr Jamieson may have made the application to ANZ on her behalf. 529I am not able to accept this evidence. It is improbable in the extreme that ANZ would process and approve a loan of $4.45 million without dealing with Mrs Jamieson directly. I find that Mrs Jamieson did apply to ANZ for the loan and knew of its approval. I accept the Bank's submission that the ANZ loan approval was something that would have furthered Mrs Jamieson's stated intentions (in her affidavit) to acquire from Mr Jamieson title to one or more of the units in the 101A Darling Point property. Mrs Jamieson must have been confident that somehow she would be able to service the proposed loan. The loan approval must have operated as a powerful incentive for Mrs Jamieson to participate in a settlement with the Bank which would free the 101A Darling Point property incumbrances to the Bank and thus allow her to acquire part of it. The ANZ loan approval came within a fortnight of Mrs Jamieson's entry into the Deed. 530At around the end of July 2012, the Bank's solicitors circulated a proposed draft deed. From the end of July, the Bank's solicitors addressed correspondence to Mr Miller as well as to Mr Le Compte. 531By now, an agreed aspect of the proposed settlement was that Billgate and 101A Darling Point would pay the Bank $23 million in two instalments of $10 million and $13 million. The instalment of $10 million was to come from the proceeds of sale of the Woollahra property. By now Billgate had exchanged contracts to sell the Woollahra property and settlement was due on or about 1 August 2012. 532On 30 July 2012, the Bank's solicitors sent an email to Mr Le Compte stating: - "As you are aware, given Jennifer Jamieson is a guarantor of the companies, her consent will be required to any settlement." 533On 31 July 2012, Mr Le Compte replied: - "We are instructed that Jennifer Jamieson consents to our settlement proposal". 534Mr Le Compte then sent an email to Mr Miller enclosing the correspondence with the Bank's solicitors and stating that he had: - "... asked Bill to get Jenny to contact you asap so that you can advise her and take her instructions". 535Mr Le Compte made this request despite having already told the Bank's solicitors that Mrs Jamieson had given her approval. I infer that Mr Jamieson had told Mr Le Compte that Mrs Jamieson did consent. 536Evidently Mr Jamieson did contact Mr Miller on or about 31 July 2012 because, on 1 August 2012, Mr Miller wrote to Mr and Mrs Jamieson: - "Pursuant to my discussions with Bill yesterday evening, I enclose a draft letter for approval to be sent to Gadens. Please let me have any comments." 537The draft deed circulated at this time provided that the borrowers and guarantors release the Bank on execution of the Deed, but that the Bank release the borrowers and guarantors only after receipt of the $23 million. In his draft letter to the Bank's solicitors, sent to Mr and Mrs Jamieson on 1 August 2012, Mr Miller argued that the releases between the parties should take effect at the same time, and after payment of the $23 million. 538Mrs Jamieson said she could not remember receiving Mr Miller's letter of 1 August 2012 and that she probably did not read the draft letter because Mr Jamieson and Mr Miller were doing everything they could to settle the matter. 539Mrs Jamieson agreed, however, that by late July or early August 2012, she was aware that the proposed settlement with the Bank involved payments to the Bank of $10 million (from the proceeds of sale of the Woollahra property) and $13 million. 540On 1 August 2012, Mr Miller also wrote a letter to Mrs Jamieson alone. The letter stated that the Bank was insisting that, in order for the matter to settle, Mrs Jamieson release the Bank from any claims on execution of the Deed (ultimately, the Deed provided that Mr and Mrs Jamieson release the Bank on payment to the Bank of the first tranche of $10 million but that the Bank would only release the Jamiesons on receipt of the whole $23 million) and that the term deposit would not be released to Mrs Jamieson until the Bank had received the $23 million settlement sum. 541Mr Miller continued: - "So far as a release of your rights against the Bank are [sic] concerned, I have heard from both you and Bill on the claim(s) you may have against the Bank, and have seen some material in this regard. Whilst I can see that there are prospects of a claim, I have not investigated it thoroughly, nor has Counsel's advice been sought on the matter. You may recall that there was at one stage a plan to have Counsel assess the strength of that case, but events superseded that occurring. Therefore, I am unfortunately not in a position to give you unqualified advice as to whether a release of your rights is a better option than maintaining those rights, which will probably lead to the current settlement proposal not proceeding, and ultimately embroil all in litigation. What I can say in respect of a release of your rights is: (a) it will allow the settlement proposal to proceed; (b) it will bring some certainty to the matters going forward; (c) if the settlement proposal completes, the Bank will provide you with the term deposit; (d) you will, as I understand it, retain the farm; (e) you will not be involved in litigation, and the uncertainty that litigation creates, going forward. Of course, signing the Deed of Settlement is only the first step and settlement of Roslyndale Avenue [Woollahra] must occur, and the re-financing for the $13,000,000 balance of the settlement sum must proceed. There are obvious risks associated with this. I am not across where things stand with either settlement of the sale or the re-finance and I can if you wish get a written position from Le Compte Davey." (emphasis added) 542Mrs Jamieson agreed that she did read this letter. In the letter, Mr Miller set out, in very clear terms, his view as to the advantages of settling on the basis of giving the Bank an immediate release and of the "obvious risks" of the refinancing, which was necessary for payment of the second tranche of $13 million, not occurring. 543On 9 August 2012, the Bank's solicitors wrote to Mr Miller enclosing a further draft of the Deed. In this draft (as was the case in the final Deed) release by the borrowers and guarantors of the Bank was to occur on payment of the first tranche of $10 million (rather than on execution of the Deed). The timing of the release by the Bank of the borrowers and guarantors was unchanged, namely only on receipt of the whole $23 million. The draft also provided that, on receipt of the first tranche of $10 million (in effect the proceeds of sale of Woollahra), Mrs Jamieson would be released from her liability under the Billgate guarantee but would have increased liability under the 101A Darling Point guarantee from $1 million to $1.4 million (in effect to match the $1.4 million from the proceeds of sale of the Vaucluse property held by the Bank, which would only be released to Mrs Jamieson on payment of the whole $23 million). 544On that date, Mrs Jamieson understood that the Woollahra property had been sold, and that the plan was for that sale to fund the first tranche of $10 million, and that the second tranche of $13 million would be obtained from refinance to be organised by Mr Jamieson. Mrs Jamieson said that, on 9 August 2012, her understanding was that the sale of Woollahra would settle in time to fund the first payment. Further, she then believed that Mr Jamieson would organise the finance necessary to fund the second payment. Mrs Jamieson said that, to the best of her knowledge, as at 9 August 2012, it was likely that the complete settlement of $23 million would be paid within the time required by the Bank. She said that her state of mind, on 9 August 2012, was that she was absolutely certain that she wanted to avoid bringing proceedings against the Bank. 545On 9 August 2012, Mr Miller sent Mrs Jamieson a copy of the Bank's solicitors' letter of that date. In that email, Mr Miller advised Mrs Jamieson that she should enter into the proposed deed with the Bank provided that she was confident that the sale of the Woollahra property would proceed (which, as it turned out, it did) and that Mr Jamieson would be able to refinance the balance of $13 million (which, as it turned out, he did not). Mr Miller's email was in the following terms: - "As I think I foreshadowed, the Bank will release the interest to you, a) after the $10M is paid b) in essence, if you/the $1.4M guarantee the payment of the balance of $13M. Bill's requests for changes to the deed have on the whole been rejected. That is, you will be required to release your rights against the Bank now, before settlement, whatever those rights are/maybe. My view is that I would proceed with the deed and put an end to all of this PROVIDED I was sure/certain/comfortable the sale will settle and the refinance will proceed. I would if at all possible avoid litigation in circumstances where i) the Bank is reducing the debt by $14M ii) the Bank will appoint Receivers if settlement breaks down, and I presently see no basis to stop that occurring/for removing those Receivers (iii) the Receivers would have you move out of Darling Point in the short term (iv) you'd be involved in litigation for at least a year minimum with the associated stress time and funding issues (v) your legal position will rely at least in part on the evidence of you/Bill/Lou being accepted over evidence of others (that's not to say in any way you won't be accepted, just that you must be, and where one person's version needs to be preferred over another, there's always uncertainty). Can you review the attached, and call to discuss, cheers." (emphasis added) 546Mr Miller's advice in this letter was clear. As Mr Simpkins submitted, he exposed his reasoning clearly, and sequentially. He told Mrs Jamieson that, in essence, the Bank would reduce the amount of its claim by $14 million (Mrs Jamieson agreed she already knew that was part of the proposal and was a "good thing"); receivers would be appointed if the settlement broke down; in that event she would have to move from 101A Darling Point in the short term (which she appreciated was at least a possibility); she would be involved in litigation for at least a year; and that there was uncertainty in her legal position which depended in part on her own evidence, and that of Mr Jamieson and Mr Le Compte, being accepted over the evidence of others. 547Mrs Jamieson did not discuss this email with Mr Miller. She said that, on 9 August 2012, she spoke to Mr Jamieson. 548Mrs Jamieson gave this evidence in response to questions from me: - "A: I spoke to my husband and I showed him the letter and we discussed it and he said 'This is ridiculous. You can't be expected to give your rights away', and I said 'I don't understand why I am being asked to give my rights away', and he said 'This is absolute bullshit. I will speak to Brenden'... Q: Is this right, on 9 August, you didn't know whether or not the Woollahra property could be sold in time to pay the $10 million, is that right? A: My understanding at the time, at the beginning of August was that Bill had a sale but he had to settle it. He was getting complications because he had to settle it. Q: Based on what Bill told you, you thought on 9 August that the Woollahra property had been sold? A: Yes. Q: And would probably settle in time to pay the Bank $10 million? A: Yes, but I was not prepared to give away my rights. I did not want give my rights, yes... Q: As at 9 August, did you know whether or not Bill would be able to organise finance to pay $13 million to the Bank? A: I believed that he could. Q: Because he told you that? A: Correct." 549Mrs Jamieson gave the following further evidence: - "Q: You were being advised, weren't you, as you understood it by Mr Miller, to ask yourself whether you were confident that Bill would be able to get the finance? A: I had to trust that Bill could. Q: Well, whether that is so, you realised that one of the things you had to make a decision about is whether you were confident Bill would be able to get the finance. A: I had to trust that Bill could get the finance, yes. HIS HONOUR: Q: Is this right, your state of mind was that while you had to trust that Bill could get it, it was not certain he could? A: I had no part in the dealings, so I didn't know. Q: You were not certain he could but he said he was confident? A: Yes, it was not certain he could it was not certain could not. Q: You saw yourself as taking a risk? A: I knew I was taking a risk. I believed... Q: That the finance would come through? A: I believed it to be my only choice." 550On 13 August 2012, the Bank's solicitors confirmed that the Bank was not prepared to settle unless Mrs Jamieson released it from all claims. 551Later on 13 August 2012, Mrs Jamieson wrote directly to Mr Howes at the Bank as follows: - "I have seen the letter that Gadens sent for the Bank this morning. At the foot of page one, Gadens say that they want to settle this matter on a commercial basis and ask me to consider my position. Please be assured that I have been acting commercially at all times and I do not see why the Bank should not do the same (including the $14 million debt reduction). For example, Bill has been trying to settle the $10 million payment but has been frustrated so far by the Bank's actions. I wonder if, between the lawyers, there has been a breakdown in communication and that the Bank is not fully aware of what it is asking of me, what the consequence for me would be. I was not a willing guarantor to Bill's loans and once the guarantee documents were signed, the Bank did not do things that it had agreed to. Since then, my family home has been sold to repay debt to the Bank which would not have been necessary if the Bank had not deceived me at the time I entered into the guarantee. The Bank holds my remaining equity - the only means I have to acquire another house for my family, which includes my elderly mother in her late 80s and my son and daughters. I do not believe that the Bank can rightfully hold that equity, but have instructed my solicitor to defer taking any action about that while Bill is working to settle his loans with the Bank. Now, through Gadens, it is being demanded that I relinquish the equity and any claims that I have against the Bank. I have previously instructed my solicitor that: · I will not sign a Deed where my existing rights are reduced, but I will release the Bank fully when they release me and return my equity to me. · Also, I am prepared to agree to continue to defer taking any action against the Bank while Bill is still working to settle his loans. Today's letter from Gadens says that I am not prepared to release the Bank. That is untrue. Also, if I did sign the Deed and Bill can't do everything that he has promised, then the Bank will take my remaining equity and will take legal action to claim more from me. I and my family will end up with no home, no money and bankrupt. The Bank will have taken everything. So, I'm not signing a Deed that allows that. I have tried to be reasonable so that Bill and the Bank can settle the loans this time. I don't know why the Bank is being unfair about this and would like you, not the lawyers, to explain to me why the Bank is acting in an uncommercial/vindictive and bullying way toward me. I understand that even now the $10 million will be lost if the matter is not settled today." 552Mrs Jamieson said that this email had been "dictated to me" by Mr Jamieson and Mr Le Compte, but that it reflected what she herself was thinking on the date it was written. 553Mrs Jamieson asserted that, contrary to what appears in the seventh paragraph of her email, she had not "previously instructed" Mr Miller of the matters there set out. Mrs Jamieson said that Mr Jamieson had conveyed those instructions to Mr Miller. She agreed that the Bank would read her email as a statement by her that she had in fact provided those instructions. 554Later, on 13 August 2012, Mr Howes replied to Mrs Jamieson's email in the following terms: - "The Bank is not prepared to settle the matter for less than the $23M proposed. The staggered settlement currently proposed exposes the Bank to the risk that the settlement will only partially complete. Therefore we will only discharge the minimum amount of our security to achieve that partial settlement and the balance of our security will be discharged in full when the full settlement is achieved. The $10M partial settlement has not been frustrated by the Bank, rather it has been frustrated by Bill's refusal to execute, amongst other clauses, the acknowledgements contained in the deed. Prior to Friday morning we were unaware that you also rejected, amongst other clauses, the acknowledgements contained in the Deed. Any allegation that the Bank deceived you at any time is without foundation and is denied. The Bank can rightfully hold you to your guarantee and our claim will be proved should it be tested. I understand that should that be the case, you will lose the $1.4M. I note that should Bill be able to settle the transaction as defined in the Deed, we will release those funds to you. If he cannot settle the transaction then the Bank will proceed against the remaining securities, including your guarantee. The Deed requires you to release the Bank from any future claim. The Bank will not settle the Deed on terms different from those detailed in Gadens' letter at around 2pm to Lou Le Compte and copied to Brenden Miller." 555In the email, Mr Howes made clear that "should Bill be able to settle the transaction as defined in the Deed" the Bank would release the proceeds of the sale of Vaucluse to Mrs Jamieson. 556By now, the purchaser of the Woollahra property had served a notice to complete. Mr Jamieson said that by 13 August 2012 he had been informed by the purchaser of Woollahra that "he was looking for another property and preparing to terminate the contract". Mr Jamieson said that at this point he concluded "that I had no choice in the circumstances but to accept the terms then being presented" by the Bank. 557On 13 August 2012, the Bank's solicitors wrote to Mr Le Compte (referring to Mr Le Compte's clients as being Mr and Mrs Jamieson): - "... If the Deed of Settlement and Release has been not been executed by all parties and settlement of the first tranche of the refinancing effected by 4.00pm Wednesday 15 August 2012, we anticipate receiving the Bank's instructions to commence proceedings against the borrowers and guarantors, without further notice." 558On the same day, Mr Jamieson had confirmed, through Mr Le Compte, his "in principle" agreement to the form of the Deed "subject, of course, to what transpires between Jennifer Jamieson and your client". 559On the evening of 14 August 2012, Mrs Jamieson participated in a teleconference with Mr Le Compte, Mr Jamieson and Mr Miller. 560In her affidavit evidence, Mrs Jamieson gave evidence of the following exchange with Mr Miller during that teleconference: - "Mr Miller: Jen, you are signing away your rights and if Bill can't get finance you will have no recourse against the Bank. Mrs Jamieson: Brenden, you know I don't want to sign the deed and sign away my rights. Mr Miller: The bank won't accept $10 million without your release. Jen, you have to do this if you want to settle it. If you are confident Bill will be able to get the finance then this is the best result for you." 561After the 14 August 2009 teleconference, Mr Miller sent an email to Mrs Jamieson: - "As I understand it you and Bill were to reflect on whether you would agree to release any rights you have on the signing of the Deed (cf releasing rights after Bill completes the settlement). Could you let me know what decision you have made in that regard." 562In this letter Mr Miller misstated the position in that the proposed Deed provided that Mr and Mrs Jamieson would release the Bank on payment of the first tranche of $10 million (rather than on signing the Deed). 563On 15 August 2012, Mrs Jamieson attended the offices of Garland Hawthorne Brahe, with Mr Jamieson, to sign the Deed. She was met by Mr Steven Martin, a partner of that firm. 564In her affidavit evidence, Mrs Jamieson gave the following account of her meeting with Mr Martin: - "Bill and I were shown into a conference room. A discussion then took place to the following effect: Mr Martin: 'Brenden has given me a brief rundown of the document you need to sign.' Mr Martin then handed me a copy of a document titled "Settlement Deed" and said: Mr Martin: 'Have a read of this. Have you got your driver's licence? I need to have some ID.' I handed Mr Martin my driver's licence and he left the room to photocopy it. Whilst Mr Martin was out of the room I flipped through the Deed but did not read it in any detail. When Mr Martin returned to the conference room we had a conversation to the following effect: Mr Martin: 'Any questions?' [Mrs Jamieson]: 'What is the purpose of any questions? I don't have any choice. They're not going to change anything. They're not going to take the $10 million unless I sign it. I'm screwed if I sign and I'm screwed if I don't. I really don't want to sign this.' Mr Martin: 'That is a matter for you.' [Mr Jamieson]: 'The bloody bank has manoeuvred us into this position from the first time they got involved in the project. They mismanaged everything and now they are determined to screw us. They got Jenny to sign a guarantee in 2009 that she should never have signed as they never abided by the undertaking to provide the finance they undertook to do, which they got Jenny to sign for in the first place.' Mr Martin: 'I really don't know about the background to this case however you are not the first people this has happened to and you won't be the last. I feel very sorry for you. You are in a very difficult position.' [Mrs Jamieson]: 'I'm only signing this so that the bank will accept the $10 million.' Mr Martin: 'You do realise that if the $13 million is not paid in [the] time specified in the deed you have no comeback as you have given up all your rights against the bank.' [Mrs Jamieson]: 'Well, let's sign it. Let's get it over with.'" 565Mrs Jamieson then signed the Deed. Mr Martin witnessed her signature. 566Mr Martin's contemporaneous diary note is in the following terms: - "After [Mrs Jamieson] had re-read the Deed I asked her 'are you ready to sign the Deed? I understand from Brenden that you are aware of its provision and wish to sign it'. She said 'I am not sure whether I want to sign and give up my rights against the Bank'. I said 'Well that's a matter for you to consider but you need to weigh up against any claim against the Bank that it is agreeing to waive a large sum of money provided you and Bill comply with the settlement sum of $23 million by 21 September. Your guarantee is being increased by $0.4 million to $1.4 million. If you doubt that Bill can refinance the properties to pay the remaining $13 million after the settlement you need to reconsider your position'. She advised 'I only want to have our family put back into the position it was before and I believe the only way that can happen is if I sign the Deed and hope Bill pulls off sale of the properties. I'll have to trust Bill'. I then reminded her that once the Deed was exchanged she had no further rights against the Bank even if the $23 million was not paid." (emphasis added) 567Mrs Jamieson gave the following evidence in cross-examination: - "Q: You understood that whether the settlement that had been negotiated and which would effect the settlement deed was achieved depended upon whether your husband was going to be able to make that second payment of $13 million? A. Yes. Q. You believed that your husband would be able to make that payment? A. I hoped and prayed. Q. You realised that that was not certain? A. I was hopeful it was. I had to trust, I had to trust everybody, I had to trust. Q. You realised it wasn't certain? A. I had to trust that it was certain. Q. You didn't believe it was certain? A. No, not at all. I had to trust that it was certain. I had been backed into a corner totally. Q. You knew that it wasn't certain? A. No. ... Q. Are you saying that you thought the refinancing for the $13 million was certain or uncertain? A. I was hopeful, always hopeful, always hopeful that Bill was going to be successful with the additional $13 million. Q. You knew from discussions with Mr Miller that there was a risk if the money wasn't paid over that you would have signed away your rights that the settlement wouldn't be achieved? A. I was aware from my discussion on the night of the 14th that I was signing my rights away. As he said, it was the only way the bank could accept $10 million. Q. You knew whether your husband, his entities and yourself was the benefit of the settlement it was dependent upon whether that second payment would be paid? A. I had to trust, yes, that Bill would be successful with the $13 million." 568Prior to giving that answer in cross-examination, Mrs Jamieson had not asserted, in any affidavit or otherwise, that Mr Miller or Mr Le Compte had told her that she had "no choice" but to sign the Deed. 569When pressed, Mrs Jamieson accepted that these words had not been said but that, rather, Mr Miller had said something to the effect that entering the Deed was "the best result". Mrs Jamieson's preparedness spontaneously to make such assertions causes me to regard her evidence concerning this aspect of the matter with some care. 570Mr Jamieson, 101A Darling Point, Billgate and the Bank executed the Deed shortly thereafter. Ultimately, it was dated 16 August 2012. 571On 17 August 2012, the Bank was paid the first tranche under the Deed of $10 million. The second tranche of $13 million was due by 21 September 2012, but was not paid. 572On 25 September 2012, the Bank appropriated the $1.4 million deposit representing the net proceeds of sale of the Vaucluse property. The effect of the Deed 573The effect of the Deed was that if the payments of $10 million and $13 million were made on time then: - (a)the Bank would release 101A Darling Point, Billgate and Mr and Mrs Jamieson from all further liability; (b)the money in the term deposit representing the net proceeds of sale of the Vaucluse property (some $1.4 million together with interest from June 2011) would be paid to Mrs Jamieson; (c)on payment of the first $10 million (from the proceeds of sale of Woollahra): - (i)the mortgages over the Woollahra property would be discharged and each of Mr and Mrs Jamieson would be released from liability as guarantors of Billgate; (ii)Mrs Jamieson's liability under the 101A Darling Point guarantee would increase from $1 million to $1.4 million (in effect, to match the term deposit); and (iii)101A Darling Point, Billgate and Mr and Mrs Jamieson would release the Bank from all claims. 574There was thus a differential staging of releases; the borrowers and guarantors released the Bank on payment of the first $10 million; the Bank only released the borrowers and guarantees once the whole $23 million was paid. Is the Deed liable to be set aside? Is the Deed an "unjust" contract? Did the Bank engage in unconscionable conduct in connection with the Deed? Did the Bank exert economic duress? 575Mr and Mrs Jamieson both seek to set aside the Deed on the basis that it was an "unjust" contract for the purposes of the Contracts Review Act, that the Bank engaged in unconscionable conduct (both statutory and equitable) in the circumstances leading to the execution of the Deed and that (particularly in the case of Mrs Jamieson) the Bank exerted economic duress which led to the execution of the Deed. 576In my opinion, the Deed is not liable to be set aside on any of these bases by either Mr or Mrs Jamieson. Mrs Jamieson 577Mrs Jamieson executed the Deed in circumstances where for 18 months, from March 2011 until August 2012, as Mrs Jamieson well knew, the Bank had negotiated with Mr Jamieson in an effort to settle the disputes that had arisen between the parties. 578The first point to be made is that throughout that period, Mrs Jamieson had legal advice, first from Mr English and then from Mr Miller. I do not accept the submission, made on behalf of Mrs Jamieson, that she did not thereby get independent legal advice. It is true that, so far as Mr Miller is concerned, he, from time to time, dealt directly with Mr Jamieson (as well as Mrs Jamieson) and addressed correspondence to both Mr and Mrs Jamieson. However, as Mrs Jamieson knew, Mr Jamieson was looking to Mr Le Compte for legal advice. Mr Miller was, at all times, available to Mrs Jamieson to give legal advice directly to her; and on a number of occasions, particularly in the weeks leading up to the execution of the Deed, Mr Miller gave Mrs Jamieson advice about her legal position, about whether she should execute the Deed, and the nature of the risks associated in so doing. 579In particular, on 1 August 2012 (see [540] to [541] above) and on 9 August 2012 (see [545] above), Mr Miller gave Mrs Jamieson focused and clear advice about the effect of the Deed and the calculated risks that she was running by executing it. 580Second, Mrs Jamieson was under no illusion as to the nature of the claims that she wished to make against the Bank. She obtained advice both from Mr English and Mr Miller about these matters and demonstrated, on many occasions a clear understanding of the nature of those claims; for example, at and prior to the meeting with the Bank on 8 May 2012 (see [500] above) and in her email to Mr Howes of 13 August 2012 (see [551] above) written two days before she executed the Deed. 581Third, Mrs Jamieson made very clear, both in her communications with Mr Miller and others at the time, and in the evidence she gave in these proceedings, that above all other things she wanted to achieve a settlement with the Bank. Over and over again she said something to the effect "I just wanted everything to settle". She was content to let Mr Jamieson deal with the Bank so far as settlement was concerned and was prepared to accept and go along with whatever turned out to be the best settlement that Mr Jamieson could achieve. 582The true state of Mrs Jamieson's mind was revealed, in my opinion, by what Mr Martin recorded in his contemporaneous note on the occasion Mrs Jamieson executed the Deed when she said to him: - "I only want to have our family put back into the position it was before and I believe the only way that can happen is if I sign the Deed and hope Bill pulls off sale of the properties. I'll have to trust Bill." 583Fourth, Mrs Jamieson had a powerful imperative to achieve a settlement with the Bank. If settlement could be achieved, and a compromise could be arrived at to quell the dispute between the Jamieson's and the Bank, there was a significant prospect of Mr Jamieson, and thus the family, achieving economic salvation which would, amongst other things, enable Mrs Jamieson to draw down the loan that she had negotiated with the ANZ and use it to purchase one of the units at 101A Darling Point (evidently unit 1) (see [526] - [529] above). 584Fifth, the settlement that Mr Jamieson was able to achieve with the Bank represented a considerable compromise of the Bank's rights. If Mr Jamieson had been able to arrange finance to secure the payment of the second tranche of $13 million, the Bank would have abandoned its claim to recover the full amount of its debt (an amount of some $14 million more than the $23 million the subject of the settlement) and would have returned to Mrs Jamieson the $1.4 million proceeds of sale of the Vaucluse property. 585Furthermore, it is not as if, throughout the 18 months during which the settlement was negotiated, the Bank put forward one proposal and told Mr and Mrs Jamieson to "take it or leave it". 586During the 18 months, both the Bank and Mr Jamieson negotiated. First, the Bank proposed that Mr Jamieson have until the end of 2011 to sell the properties. Next, Mr Jamieson proposed a settlement whereby he would cause $20 million to be paid to the Bank. Shortly thereafter that figure was increased to $23 million. Initially, the Bank stated that it would only settle upon the basis that some proposal was made to repay to it the entirety of the Billgate and 101A Darling Point debts. Then the Bank relented and agreed, in principle, to accept $23 million, and later agreed to accept that sum by the $10 million and $13 million instalments. It also agreed to return the $1.4 million to Mrs Jamieson if those instalments were paid. 587Initially, the Bank insisted that the Jamiesons release it from all claims upon execution of the Deed. Later, the Bank agreed that such releases could be postponed until payment of the first tranche of $10 million. It is true that the Bank always insisted that its releases of Mr and Mrs Jamieson and of 101A Darling Point and Billgate would only occur once the entire $23 million was paid. In insisting on that matter, and not budging from it in the final days of negotiation leading up to the execution of the Deed on 15 August 2012, the Bank certainly adopted a firm position. It had, however, moved a long way from the beginning of the negotiations and, as I have said, was offering, by its acceptance of the terms of the Deed, a considerable compromise over what would otherwise be its legal entitlements. 588Sixth, Mrs Jamieson was well aware of the risks that she was running. The benefit to her of entering the Deed depended entirely on Mr Jamieson's ability to negotiate finance for the second tranche of $13 million. So much was obvious but was, in any event, made very clear to Mrs Jamieson by advice she received from Mr Miller. 589No doubt there was considerable pressure on Mrs Jamieson to settle on the basis of the Deed. But settlement of the dispute with the Bank was the matter that, above all other things, Mrs Jamieson wished to achieve. 590It is also true that a further imperative on Mr Jamieson, and thus Mrs Jamieson, to settle was the fact that the purchaser of the Woollahra property had served a notice to complete and, according to Mr Jamieson, was giving indications of terminating the contract. 591Mr Williams placed great emphasis on the fact that Mrs Jamieson was, as it were, "on the hook", by reason of having executed the 101A Darling Point and Billgate guarantees and having executed a mortgage over Vaucluse which led to, on her case, the sale of Vaucluse in an unsatisfactory market, and the retention by the Bank of the $1.4 million proceeds of sale on deposit. It is also true that the 18 month period of negotiations leading up to execution of the Deed cannot be seen in isolation of the events which went before and led to the troubled circumstances in which Mrs Jamieson found herself by August 2012. 592However, at the end of the day, the substance of the matter is that a compromise was achieved. 593Mrs Jamieson gave evidence that she felt as if she had "no choice", in the sense of no practical choice, but to settle. Mrs Jamieson claimed that one reason that she felt she had "no choice" but to settle was that she was not, in August 2012, in a position to engage in litigation with the Bank. 594However, as Mr Simpkins submitted, had the parties been unable to agree on the terms of a settlement in mid August 2012, it is inevitable that the Bank would have promptly commenced proceedings for possession and debt; perhaps by the end of August 2012. 595The second tranche was due for payment only a short time thereafter (on 21 September 2012). Upon default, the Bank filed these proceedings shortly thereafter (on 9 October 2012) and 10 days later, on 19 October 2012, Mrs Jamieson sought to be joined as a party. Somehow or other she has been able to fund the defence of these proceedings (over 11 hearing days). Although there is no evidence of Mrs Jamieson's financial position in October 2012 compared to August 2012, the inference I would draw from those circumstances is that, in a way that she has not explained, Mrs Jamieson was in a position to litigate with the Bank, had she desired to do so. In my opinion, the reason she did not take that course was because, as I have sought to emphasise, of her overwhelming desire to see Mr Jamieson "get the best settlement achievable". 596In my opinion, the Bank has not engaged in economic duress. In order to establish economic duress, it is necessary to establish "threatened or actual unlawful conduct" (see Australia & New Zealand Banking Group Ltd v Karam [2005] NSWCA 344; 64 NSWLR 149 at [66] per Beazley, Ipp and Basten JJA and A v N [2012] NSWSC 354 at [506] per Ward J) (cf Crescendo Management Pty Ltd v Westpac Banking Corporation (1988) 19 NSWLR 40 where McHugh JA expressed the test as being the application of "illegitimate pressure"). 597I see no basis for any finding that the Bank engaged in or threatened to engage in unlawful conduct. 598I also see nothing in the conduct of the Bank which was unfair or which manifested some "moral fault or responsibility" (Australian Competition & Consumer Commission v 4WD Systems Pty Ltd (2003) 200 ALR 491 at [185] per Selway J), "high level of moral obloquy" (Attorney-General (NSW) v World Best Holdings Ltd [2005] NSWCA 261; (2005) 223 ALR 346 at [121] per Spigelman CJ) or "clearly unfair or unreasonable" behaviour (Cameron v Qantas Airways Ltd (1995) 55 FRC 147 at 179 per Beaumont J) such as would entitle me to conclude that the Bank had behaved in an unconscionable manner. 599There is certainly no basis on the evidence to conclude that the Bank had a "predatory state of mind" and unfairly exploited any weakness in Mrs Jamieson's position such as could lead to a conclusion of unconscionability in the general equitable sense (see Kakavas v Crown Melbourne Ltd [2013] HCA 25 at [161]). 600Nor do I see, in the circumstances that I have set out, any basis to conclude that the Deed was an unfair contract for the purposes of the Contracts Review Act. 601My conclusion is that Mrs Jamieson's attack on the Deed fails. Mr Jamieson 602The matters that I have outlined in relation to Mrs Jamieson apply with even greater force to Mr Jamieson. 603I have found that such misrepresentations as were made to him on 18 June 2009 were either then known to him to be a misstatement of the true position or, were so revealed shortly after. 604The problems which arose with the builder of the Darling Point Project were, in substance, caused by Mr Jamieson's agreement to the 6 August 2009 transfer of funds to clear excesses. 605Mr Jamieson was able to negotiate, in the 18 month period to August 2012, a considerable compromise of the Bank's claim against him and his companies, both in terms of the amount to be paid, and the terms upon which that amount would be paid. 606As recently as the time that his Counsel made opening submissions in these proceedings, Mr Jamieson persisted in the claim that, when he signed the Deed, he thought the 9 June 2009 letter of offer for the 101A Darling Point Facility accurately stated the "existing debt" to be $8.222 million. In those submissions, Mr Jamieson contended that he had only learned the true position in the course of these proceedings. I have found that, in June 2009, Mr Jamieson well knew that $8.222 million was not the then "existing debt" of 101A Darling Point; he said as much to Mr Bovaird in September 2009. I therefore do not accept the proposition that Mr Jamieson was ignorant of that matter when he signed the Deed. 607Mr Jamieson had legal advice from Mr Le Compte throughout the period of the negotiations. I accept the Bank's submission that Mr Jamieson's decision to enter into the Deed was "plainly one of commercial calculation". He contemplated the sale of the Darling Point and Woollahra projects, following refinance with the Bank, and assessed, prior to execution of the Deed, that "buying out the Bank" in this way was to his financial advantage and that of his companies. To the extent that Mr Jamieson said he thought he had "no choice" but to enter the Deed, this was simply because he considered the litigious alternatives to be uncertain, as he acknowledged in cross-examination. 608Mr Jamieson thought, with the benefit of legal advice, that his financial position, and that of his related entities, was best served by taking the calculated risk that finance would be available to enable payment to the Bank of the second tranche of $13 million. Had Mr Jamieson been able to arrange that finance, the dispute with the Bank, which had been brewing for three years, would have been quelled and he would have achieved, at least so far as concerns the Bank, commercial salvation. It did not turn out that way. But, in my opinion, that is not because of any fault that can be laid at the Bank's door. 609Mr Jamieson's attack on the Deed also fails. The proper construction of the Deed - the Salkeld v Vernon point 610On behalf of Mr and Mrs Jamieson it was submitted that, assuming the Deed was binding on them, on its proper construction, it did not operate to release the claims now made by Mr and Mrs Jamieson as those claims were not known to them when they executed the Deed. 611On behalf of Mr Jamieson, Mr Muddle submitted: - "It is settled law that a release does not apply to something of which the releasing party was ignorant unless there is an exceptionally clear and solemn instrument releasing claims, whether known or not known at the date of the release: Salkeld v Vernon (1758) 1 Eden [64 at] 67, 68. The Deed... does not contain such a clause". The provisions of the Deed 612The Deed is drawn in very wide terms. 613Clause 6.1 states: - "Upon payment of $10,000,000 to the Bank, the Borrowers and Guarantors unconditionally and irrevocably release and discharge the Bank from all or any Claim that the Borrowers and Guarantors presently have, may have or which but for this deed would, could or might at any future time have or have had, against the Bank in respect of any matter arising directly or indirectly out of or in connection with the subject matter of this deed, and any other matters relating to, arising out of or otherwise connected with: (a) the Debt; (b) the Guaranteed Amount; (c) the Facility; and (d) the Securities." 614"Claim" was defined to mean, relevantly: - "...any...causes of action whatsoever arising at law, in equity, and under statute, which they may have or which but for this deed would, could or might at any future time have or have had against each other in respect of or arising out of either directly or indirectly any matter referred to in or arising out of this deed." 615The words "Debt", "Guarantee Amount", "Facilities" and "Securities" were defined to include all of those matters that were in dispute between the parties. 616Further, cl 19.6 of the Deed provides that: - "This document may be pleaded as a full and complete defence to any proceedings or claims commenced by or on behalf of the Parties arising out of the facts, matters and circumstances referred to in this deed." 617Save that the Deed did not, in terms, release the Bank from claims "unknown" to Mr and Mrs Jamieson, it is hard to contemplate a deed of release being drawn in wider terms. 618Mr and Mrs Jamieson relied upon what fell from the High Court in Grant v John Grant & Sons Pty Ltd (1954) 91 CLR 112 where Dixon CJ, Fullagar, Kitto and Taylor JJ refer to (at 130): - "... the equity to have the general words of a release confined to the true purpose of the transaction ascertained from the scope of the instrument and the external circumstances." 619At 129, their Honours stated that: - "... equity proceeded upon the principle that a releasee must not use the general words of release as a means of escaping the fulfilment of obligations falling outside the true purpose of the transaction as ascertained from the nature of the instrument and the surrounding circumstances including the state of knowledge of the respective parties concerning the existence, character and extent of the liability in question and the actual intention of the releasor." 620The principle has been discussed in many cases, including by Santow J in Karam v ANZ Banking Group Limited [2001] NSWSC 709 and more recently by Pembroke J in Owners Corporation of Strata Plan 61390 v Multiplex Corporate Agency Pty Ltd (No 2) [2012] NSWSC 322. 621In my opinion, the equity to which the High Court referred to in Grant v John Grant is of no avail to Mr and Mrs Jamieson. 622It is obvious, from the wide terms of the Deed, and "the external circumstances", that Mr and Mrs Jamieson intended to release the Bank from all claims that they might have against the Bank arising out of their dealings with the Bank concerning the borrowings of 101A Darling Point and Billgate. 623Each of Mr and Mrs Jamieson articulated those claims with clarity. Mr Jamieson claimed that he had been "dudded" by the Bank and that Mr Allan had made untrue statements to him in June 2009 concerning the monies which would be made available pursuant to the 9 June 2009 letter of offer. 624So far as concerns Mr Jamieson, the particular matter that he relied upon, and which was emphasised in his opening submissions, was his alleged ignorance of the "existing debt" of 101A Darling Point in June 2009. Mr Jamieson claimed that he was not aware that $8.222 million was not the "existing debt" of 101A Darling Point in June 2009 until after the commencement of these proceedings. I have found that, to the contrary, Mr Jamieson was well aware of the true position. 625So far as Mrs Jamieson is concerned, as I have set out above, she repeatedly articulated to the Bank her contention that she had been defrauded, that she was never a willing guarantor and that "the Bank did not do things it had agreed to do" (see, for example, the statements Mrs Jamieson made at the meeting with the Bank on 8 May 2012 (see [507] above) and her email communication with Mr Howes on 13 August 2012, two days before she signed the Deed (see [551] above)). 626It may be that Mr and Mrs Jamieson were not aware, when they executed the Deed, of particular factual matters relevant to the complaints they make about the Bank's conduct which have been revealed to them (for example, through disclosure by the Bank) in these proceedings. 627But they knew the fundamentals of their complaint, and ignorance of such particular matters cannot, itself, be a basis upon which to read down the general words of the release in the Deed. It is quite obvious to me from the words of the Deed, and the circumstances known to Mr and Mrs Jamieson when they executed the Deed, that, however reluctantly, Mr and Mrs Jamieson, by execution of the Deed, intended to release the Bank from all claims of the kind that they now seek to agitate in these proceedings. 628The facts in this case do not remotely resemble those in Grant v John Grant, where the plaintiff company had no knowledge at all of the liability of the defendant that the plaintiff sought to enforce, but which the defendant contended was caught by the general words of a release entered into in a entirely different context. 629In Multiplex, Pembroke J stated at [30]: - "The equitable principle only has a role to play when it appears from the terms or the context or other admissible evidence, that the enforcement of the legal right would, by a literal application of the general words of a release, be against conscience." 630I agree. There is no basis, on the facts of this case, to conclude that it would be "against conscience" for the Bank to rely upon the broad terms of the releases in the Deed. Those broad releases were an essential element of the compromise reached by the parties when they executed the Deed. 631I reject the submission that the terms of the Deed are not apt to release Mr and Mrs Jamieson from the claims they have sought to prosecute in these proceedings. Overall conclusion 632My conclusion is that, as Mr Simpkins submitted when he opened the case, the Deed is the beginning, and the end of these proceedings. Amendment to Mrs Jamieson's Cross-Claim 633On the sixth day of the hearing (30 July 2013), Mrs Jamieson sought leave to amend her Commercial List Cross-Claim to plead breaches of the Code of Banking Practice additional to those already pleaded, to plead breaches of certain of the Bank's internal procedure requirements and to amend pleadings already made concerning the availability of funds to 101A Darling Point. 634I allowed the amendment and said that I would give my reasons in this judgment. 635The proposed amendments made clear that Mrs Jamieson did not claim damages from the additional breaches contended for. Rather, they were to be pleaded as additional circumstances concerning the Contracts Review Act and unconscionability counts already pleaded. 636For the most part, the fresh allegations were of a factually uncontroversial and incontrovertible nature. 637Further, for the most part, the allegations were foreshadowed in written submissions circulated prior to the commencement of the proceedings. 638Mr Simpkins resisted the amendment on the basis that he had conducted his case, and in particular his cross-examination of Mrs Jamieson, on the basis of the existing pleading. Mr Simpkins also submitted that it might be necessary to adduce further evidence to meet the new claims. 639I accept that Mr Simpkins may have wished to cross-examine Mrs Jamieson about some of the matters the subject of the proposed amendments. In particular, Mr Simpkins may have wished to put to Mrs Jamieson that it would have made no difference to her position had the Bank acted consistently with what Mrs Jamieson contends to be its obligations under its internal guidelines and in accordance with the Code of Banking Practice. 640I accepted that submission, but considered that such prejudice as thereby arose would in substance be met if Mr Williams agreed that he would take no objection to Mr Simpkins submitting that I should find that Mrs Jamieson would not have acted differently had the Bank complied with its alleged obligations. Mr Williams so agreed. 641The taking of evidence continued for three days after 30 July 2013, during which time Mr Simpkins called Mr Allan to give evidence. If the Bank wished to adduce further evidence to meet the amended claims, it had ample opportunity to do so. Orders 642I propose to enter judgment for the Bank for debt owing to it by Billgate, 101A Darling Point and Mr Jamieson, and possession of the Darling Point and Joadja properties. 643I invite the parties to bring in short minutes of order to give effect to these reasons. ********** 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 September 2013