Supreme Court New South Wales Medium Neutral Citation: Rubino & Anor v Pineview Property Holdings Pty Ltd & Ors [2016] NSWSC 904 Hearing dates: 11-14; 18-22; 26 April 2016; 17 and 18 May 2016; 16 and 17 June 2016 Decision date: 30 June 2016 Jurisdiction: Equity Before: White J Decision: Refer to para [376] of judgment. Catchwords: REAL PROPERTY — Loss of interest in land — Claim for compensation out of Torrens Assurance Fund — Real Property Act s 129 — Plaintiffs transferred ownership of real property to second defendant — Second defendant mortgaged properties to secure loan — Proceeds of loan disbursed largely to the benefit of third, fourth and fifth cross-defendants to third cross-claim — Plaintiffs claim to have been deceived into signing transfer documents — Whether plaintiffs deprived of their interest in land by fraud — Plaintiffs intended second defendant to raise finance by becoming the registered proprietor of the properties and borrowing moneys on security of them — Signatures on transfer documents not procured by fraud — Claim against second defendant dismissed — Claim against Registrar General dismissed TORTS — Negligence — Whether fourth defendant breached duty of care by failing to take reasonable care to ensure certificate of title used only as instructed — Solicitor not retained to advise on wisdom of proposed transaction — Certificate of title used only as instructed by plaintiffs — Whether fourth defendant had duty to disclose known facts concerning third cross-defendant to third cross-claim's discredit — Plaintiffs had prior experience of third cross-defendant to third cross-claim's business practices — No duty of care — No breach of duty in any event EQUITY — Breach of fiduciary duty — Deceit — Whether third, fourth and fifth cross-defendants to third cross-claim owed a fiduciary duty to cross-claimants to third cross-claim — Whether third cross-defendant to third cross-claim deceived first cross-claimant to third cross-claim — Whether excess borrowed moneys disbursed without authority — Excess of moneys borrowed to purchase plaintiff's property intended to be used to discharge debts of plaintiffs and first cross-claimant to third cross-claim — Excess moneys disbursed by third cross-defendant to their own benefit without knowledge or authority of cross-claimants — Third, fourth and fifth cross-defendants to third cross-claim breached fiduciary duty owed to cross-claimants to third cross-claim — Third cross-defendants to third cross-claim deceived first cross-claimant to third cross-claim — Judgment in favour of cross-claimants to third cross-claim Legislation Cited: Civil Liability Act 2002 (NSW) Civil Procedure Act 2005 (NSW) Consumer and Competition Act 2010 (Cth) Environmental Planning and Assessment Act 1979 (NSW) National Consumer Credit Protection Act 2009 (Cth) Real Property Act 1900 (NSW) Cases Cited: Abigroup Pty Ltd v Abignano (1992) 39 FCR 74 Australia and New Zealand Banking Group Ltd v Huybers [2014] NSWSC 720 Australian Hardboards Ltd v Hudson Investment Group Ltd [2007] NSWCA 104; (2007) 70 NSWLR 201 Breen v Williams [1996] HCA 57; (1996) 186 CLR 71 Cassegrain, Felicity v Cassegrain, Denis [2016] NSWCA 71 Hardoon v Belilos [1901] AC 118 Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; (1984) 156 CLR 41 Re Application of Sutherland and Arnautovic [2014] NSWSC 821 Rubino v Australia and New Zealand Banking Group Ltd [2014] NSWCA 362 Category: Principal judgment Parties: Lee Rubino as executor of the estate of the late Alfio Rubino (1st Plaintiff/1st Cross-Defendant on 3rd Cross-Claim) Biagina Rubino (2nd Plaintiff/2nd Cross-Defendant on 3rd Cross-Claim) Francesco Rubino (4th Cross-Defendant on 2nd Cross-Claim) Pineview Property Holdings Pty Ltd (2nd Defendant/2nd Cross-Claimant on 3rd Cross-Claim) Registrar General of NSW (3rd Defendant) Salvatore Russo (4th Defendant/Cross-Claimant on 2nd Cross-Claim) Susan Huybers (1st Cross-Claimant on 3rd Cross-Claim) George Dimitriou (1st Cross-Defendant on 2nd Cross-Claim/3rd Cross-Defendant on 3rd Cross-Claim) Wyse & Young International Pty Ltd (2nd Cross-Defendant on 2nd Cross-Claim/4th Cross-Defendant on 3rd Cross-Claim) Wyse Accounting Pty Ltd (3rd Cross-Defendant on 2nd Cross-Claim/5th Cross-Defendant on 3rd Cross-Claim) Andrew Jetson (5th Cross-Defendant on 2nd Cross-Claim) Representation: Counsel: M W Young SC (Plaintiffs and 1st & 2nd Cross-Defendants to 3rd Cross-Claim and 4th Cross-Defendant to 2nd Cross-Claim) J Donohoe (2nd Defendant and 1st Cross-Claimant on 3rd Cross-Claim) (11-26 April 2016) M Auld (2nd Defendant and 1st Cross-Claimant on 3rd Cross-Claim) (17 May – 16 & 17 June 2016) C Webster SC with J Shepard (3rd Defendant) D A Allen (4th Defendant/Cross-Claimant on 2nd Cross-Claim) M Foley, Solicitor (1st-3rd Cross-Defendants on 2nd Cross-Claim and 3rd-5th Cross-Defendants on 3rd Cross-Claim) Solicitors: Bransgroves Lawyers (Plaintiffs and 1st & 2nd Cross-Defendants to 3rd Cross-Claim and 4th Cross-Defendant to 2nd Cross-Claim) Gardner Ekes (2nd Defendant and 1st Cross-Claimant on 3rd Cross-Claim) Land & Property Information (3rd Defendant) Russo Partners (4th Defendant/Cross-Claimant on 2nd Cross-Claim) Foleys Lawyers (1st-3rd Cross-Defendants on 2nd Cross-Claim and 3rd-5th Cross-Defendants on 3rd Cross-Claim) File Number(s): 2013/301976 Judgment Introduction 1. HIS HONOUR: The plaintiffs in these proceedings are Mrs Biagina Rubino and Ms Lee Rubino as executrix of the estate of the late Alfio Rubino. Alfio Rubino died on 21 October 2013 after these proceedings had commenced. His executrix, Lee Rubino, is the wife of his oldest son, Francesco (also known as Frank) Rubino. 2. Alfio and Biagina Rubino ("Mr and Mrs Rubino") were formerly the registered proprietors of two adjoining properties in Galston. One was in Calderwood Road and the other was in Pine Valley Road. In these reasons those properties are called the "Calderwood property" and the "Pine Valley property" or together the "Galston properties". The plaintiffs claim that Alfio and Biagino Rubino were deprived of those properties by fraud. They joined four defendants. The first defendant was Australia and New Zealand Banking Group Ltd ("the ANZ Bank"). The second defendant is Pineview Property Holdings Pty Ltd ("Pineview"). The third defendant is the Registrar General. The fourth defendant is Mr Salvatore Russo. He had been retained by the Rubinos as their solicitor. The plaintiffs claim that it was by his negligence that the frauds were able to be committed. 3. The plaintiffs' claim against the ANZ Bank was settled on 25 November 2015. The ANZ Bank took no part in the hearing. 4. By December 2011 the ANZ Bank claimed that Alfio and Biagina Rubino owed it more than $6.25 million. It claimed that the loans were secured over the Calderwood property, the Pine Valley property, and a third property owned by Mr and Mrs Rubino in Arcadia Road, Arcadia ("the Arcadia property"). Frank and Lee Rubino lived on the Arcadia property and had built a house on it. Mr and Mrs Rubino lived on the Calderwood property. Following a mediation, the ANZ Bank and Mr and Mrs Rubino entered into an agreement for the settlement of their dispute. The agreement was signed by the Rubinos on 20 December 2011. The Rubinos agreed that by 16 January 2012 they would deliver up vacant possession of the Arcadia property or else pay $1,650,000 to redeem and obtain a discharge of the mortgage over that property. They agreed that by 16 January 2012 they would either deliver up vacant possession of the Pine Valley property or pay $1,050,000 to redeem and obtain a discharge of the mortgage over that property. The Rubinos agreed that by 12 January 2012 they would provide the bank with full access to the Arcadia and Pine Valley properties to allow an inspection so that the bank could confirm that each of the properties was in a fit and proper state to enable vacant possession to be delivered up on 16 January 2012. The parties agreed that if the Rubinos performed their obligations the bank would discharge the mortgage over the Calderwood property. In essence, the effect of the agreement was that Mr and Mrs Rubino were able to keep their Calderwood property. They could also keep the Pine Valley property if they were able to raise $1,050,000 by 16 January 2012 to redeem the mortgage over that property. They could also keep the Arcadia property if they were able to raise $1,650,000 to redeem the mortgage over that property by 16 January 2012. 5. The plaintiffs, through their son Frank Rubino, engaged the services of Mr George Dimitriou to attempt to raise moneys to discharge the ANZ Bank's mortgages over the Pine Valley and Arcadia properties. Dimitriou operated principally through a company called Wyse & Young International Pty Ltd ("Wyse & Young"). Dimitriou organised two short-term loans to be provided to the Rubinos totalling $1,050,000 that enabled the ANZ Bank's mortgage over the Pine Valley property to be discharged. As security for these loans Wyse & Young took custody of the certificates of title to both the Calderwood and Pine Valley properties. The Rubinos claim that Russo was retained as their solicitor to obtain custody of at least the certificate of title to the Calderwood property and that he was negligent in providing it to Wyse & Young. 6. Pineview was incorporated on 9 January 2012 on the instructions of Mr Andrew Jetson who acted on behalf of Wyse & Young. On 8 March 2012 Mr and Mrs Rubino signed a transfer of both the Calderwood and Pine Valley properties in favour of Pineview for an expressed consideration of $2,500,900. Their signatures on the transfer were witnessed by Frank Rubino. That consideration was not paid to Mr and Mrs Rubino. They say they were tricked into executing the transfers by Jetson's representing to them that the document they were asked to sign was to help them get finance for the Pine Valley property. 7. Frank Rubino says that Dimitriou was engaged to obtain what he called a "conforming bank loan" to refinance the short-term loans of $1,050,000 provided by two of Dimitriou's clients. They were a Mr Danny Kalischer and a Ms Susan Huybers. Kalischer provided $480,000. Huybers provided $570,000. 8. Working with a lending manager of the ANZ Bank, Mr David Winiata, Dimitriou arranged for Pineview to borrow $2,000,720 from the ANZ Bank on security of first registered mortgages over the Calderwood and Pine Valley properties. The loan was settled on 9 March 2012 and in due course Pineview became the registered proprietor and the bank became registered as mortgagee. 9. Wyse & Young arranged for Huybers to be the sole shareholder and director of Pineview. She and another company of which she was shareholder and director, Green Global Constructions Pty Ltd ("Green Global"), guaranteed Pineview's obligations to the ANZ Bank. 10. The Rubinos say that this was done without their knowledge. They say that Dimitriou acted as a de facto director of Pineview, or in any event as Pineview's agent, and that he and Winiata caused them to be deprived of their estate as registered proprietors of the Calderwood and Pine Valley properties by fraud. The fraud lay in their being induced to sign a transfer of the properties in favour of Pineview without their appreciating that that was the effect of the document they signed. They also say that they were deprived of their interest by Pineview's then mortgaging the properties to the bank to secure loans totalling $2,000,720. What they say they were expecting was that Dimitriou would arrange a bank loan sufficient to repay $1,050,000 to the provider of the short-term funds together with whatever interest or other reward was properly payable to those lenders. According to Frank Rubino, it was not until February 2013 that he learned that the Calderwood and Pine Valley properties had been transferred to Pineview and that the ANZ Bank had mortgages over them for over $2 million (Frank Rubino [323]). 11. For the reasons which follow I reject that claim. At all times Mr and Mrs Rubino relied on Frank Rubino to act for them in attempting to save the Pine Valley and the Arcadia properties. I have concluded that, contrary to his denials, Frank Rubino was aware that finance was to be raised by Pineview's becoming the registered proprietor of the properties and borrowing moneys on security of them. The properties were to be held by Pineview on trust for Mr and Mrs Rubino, or possibly their grandchildren, and the loan was to be serviced by the Rubinos. This arrangement was entered into because it was thought that Mr and Mrs Rubino could not themselves borrow the funds to discharge the ANZ Bank's mortgage over Pine Valley, nor to discharge its mortgage over Arcadia. Mr and Mrs Rubino were in their 80s. They were pensioners. Other trading companies of the Rubinos had been placed in liquidation. Their three sons were either bankrupt or about to become so. 12. After deduction of stamp duty, other government charges and bank fees, $1,990,551 was received from the ANZ Bank on 9 March 2012. $123,059.50 was paid to Wyse & Young. That money was used to pay the stamp duty on the transfer of the properties. After deducting a special clearance fee, $1,867,446.50 was paid to Wyse Accounting Pty Ltd ("Wyse Accounting"). Of this sum $1,296,043.96 was paid to Dimitriou or companies associated with him, or retained by Wyse Accounting. Kalischer was paid $490,010 being repayment of his advance of $480,000 plus approximately $10,000 in interest for the loan. Huybers' advance of $570,000 was not repaid to her. Dimitriou says that with her authority he reinvested about $495,000 of her money by making a loan through another company he controls, Defined Properties Pty Ltd, to other borrowers. He claims that other repayments have been made to Huybers that means that she has been more than fully repaid her advances. She disputes this. Other moneys were kept as fees said to have been owed to Wyse & Young for services provided to members of the Rubino family or companies associated with them that went into liquidation and as fees for arranging the $1,050,000 loan to the Rubinos on 17 January 2012 and for arranging the $2,000,720 loan by Pineview from the ANZ Bank. Dimitriou says that Frank Rubino authorised these payments or retentions and also authorised payment of $64,000 to Kalischer in respect of an earlier short-term loan arrangement and authorised payment of $108,000 to Russo for outstanding fees claimed to be owed by the Rubino family to Russo. Dimitriou says that those moneys were not paid to Kalischer or Russo because they each owed him more than those sums. 13. Frank Rubino denies giving any such authority. He says he was wholly unaware of the transaction by which his parents' properties were transferred to Pineview and moneys were borrowed by Pineview on security of those properties. Consistently with that, he denies authorising any payments from the moneys borrowed by Pineview from the ANZ Bank. 14. Pineview, through Huybers, admits that it holds the Calderwood and Pine Valley properties on trust for Mr and Mrs Rubino. However, Pineview says that this is subject to the Rubinos paying moneys owing to the ANZ Bank. Pineview and Huybers claim that they were defrauded by Dimitriou. 15. The ANZ Bank has obtained judgment against Pineview, and against Green Global and Huybers who guaranteed the loan. Pineview and Huybers also say that Dimitriou was acting as agent for Mr and Mrs Rubino and they are responsible for the losses suffered by Huybers and Pineview arising from Dimitriou's conduct. 16. The plaintiffs did not join Dimitriou or any of his companies as defendants. The reason for this can only be a matter of speculation. The plaintiffs claim compensation from the Torrens assurance fund pursuant to s 129 of the Real Property Act 1900 (NSW) on the ground that they were deprived of their interest in the lands by fraud. The fraud relied upon by the plaintiffs in their case against both Pineview and the Registrar General was that Mr and Mrs Rubino did not know or understood that they had signed a transfer of the two properties and that signatures on the transfer were fraudulently procured by Wyse & Young, through Jetson, that was acting on behalf of Pineview, or through Dimitriou, who was the agent and de facto director of Pineview. The plaintiffs' case is that Mr and Mrs Rubino were tricked into signing the transfers. They submit that the fraud was not confined to the signing of the transfers, but extended to Pineview's applying to the ANZ Bank for loans secured over the properties ostensibly for the purpose of purchasing them. They say the loans were obtained with the collusive assistance of Winiata and through the use of forged documents purporting to be contracts for sale of the properties executed by Mr and Mrs Rubino. 17. The plaintiffs' case is not that the fraud consisted of Dimitriou's arranging for Pineview to borrow more money from the ANZ Bank than was required to repay the two short-term loans totalling $1,050,000 and fees or interest in respect of those loans. That is, the plaintiffs' case is not that they or Frank Rubino knew that the lands were to be transferred to Pineview which would borrow money from the ANZ Bank, and they were defrauded by Pineview's borrowing more money than was authorised, or by Dimitriou's applying the funds borrowed in payment of fees allegedly due to him or his companies. As Dimitriou submits, the plaintiffs in their statement of claim make no complaint against him in respect of the disbursement of the moneys borrowed. 18. Huybers says that she was unaware that settlement of the loan had occurred on 9 March 2012. She says she did not authorise the loan proceeds being paid to Wyse Accounting or to Wyse & Young. 19. The effect of what was done was that using the personal covenant of Pineview, and personal guarantees of Huybers and Green Global, and using the lands of the Rubinos, Dimitriou obtained for himself almost $1.3 million. 20. Dimitriou's conduct was unconscionable and fraudulent. The principal victim was Huybers, not the Rubinos. The Rubinos were not deprived of their land by fraud. They may have been defrauded to the extent the land was encumbered beyond what Frank Rubino on behalf of his parents had agreed to. But that was not the case the plaintiffs advanced. 21. Pineview and Huybers are entitled to damages or equitable compensation against Dimitriou, Wyse & Young International and Wyse Accounting. Other companies under the control of Dimitriou to which substantial moneys were paid were not joined as defendants. It may be open to Pineview and Huybers to bring proceedings against other Dimitriou companies, but that is not a question that presently arises. Proceedings brought by ANZ 1. No clear evidence was given as to what payments were made to the ANZ Bank or when the loan first fell into default. On 8 April 2013 the bank commenced proceedings against Huybers, Green Global and Pineview. It alleged that as at 6 February 2013 Pineview had failed to pay instalments under the two loans which, as at 6 February 2013, totalled approximately $58,000. It sought judgment for possession and judgment against Pineview for $2,083,046.96, and judgment against Huybers for $2,002,473.90. Judgment was entered in default of defence on 18 June 2013 and writs of possession were issued in respect of each of the Calderwood and Pine Valley properties on 9 July 2013. (Australia and New Zealand Banking Group Ltd v Huybers [2014] NSWSC 720 at [1], [5]). 2. On 3 September 2013 Mr and Mrs Rubino applied to be joined to the proceedings in the Common Law Division and applied for a stay of execution of the writs of possession. The current proceedings in the Equity Division were filed on 8 October 2013. The Rubinos' application was initially unsuccessful (Australia and New Zealand Banking Group Ltd v Huybers & Anor [2014] NSWSC 720). But on 24 October 2014 the Court of Appeal determined that there should be a stay of execution of the writs for possession, on terms, pending the final disposition of the Equity proceedings (Rubino v Australia and New Zealand Banking Group Ltd [2014] NSWCA 362 at [70]-[72]). 3. On 14 October 2015 the ANZ Bank filed a cross-claim against Dimitriou, Wyse & Young and Wyse Accounting. For the purposes of the cross-claim it repeated allegations made by the plaintiffs in their statement of claim and alleged that by reason of those matters Dimitriou, Wyse & Young and Wyse Accounting would, if sued, have been liable as a tortfeasor for the tort of deceit. At that stage no other party had joined Dimitriou, Wyse & Young or Wyse Accounting as cross-defendants. Settlement by the Rubinos with the ANZ Bank 1. On 25 November 2015 a deed of settlement was made between the ANZ Bank, Biagina Rubino, Lee Rubino and Frank Rubino. The bank agreed to discharge its mortgages over the Calderwood and Pine Valley properties if Lee and Biagina Rubino paid it $1,315,000 by (in the events which have happened) 30 June 2016. The bank agreed that if Biagina and Lee Rubino paid it $15,000 per month commencing on 30 June 2016 on the 30th day of each calendar month thereafter, it would refrain from enforcing the writs of possession until 31 October 2016. The Rubinos agreed that if $1,315,000 and any additional amounts of $15,000 per month were not paid by 31 October 2016 the ANZ Bank would then be at liberty to enforce the writs of possession. The Rubinos, including Frank Rubino, released the ANZ Bank from all claims and the parties agreed to consent to orders that the proceedings against the ANZ Bank be dismissed with no order as to costs. 2. That order was made on 3 December 2015. On 16 December 2015 by consent of the ANZ Bank and the cross-defendants to its cross-claim, that is Dimitriou, Wyse & Young and Wyse Accounting, I ordered that the bank's cross-claim of 4 October 2015 be dismissed with no order as to costs. However, Dimitriou, Wyse & Young and Wyse Accounting were later joined as cross-defendants to cross-claims brought by Russo and by Pineview and Huybers. Initial dealings between the Rubinos and Dimitriou 1. Frank Rubino deposed that he was introduced to Dimitrou by Russo in February 2010 (CB 1/244). From the end of November 2008 Rubino Holdings Pty Ltd ("Rubino Holdings") was in default in respect of a loan from the ANZ Bank. It seems that various loans were cross-collateralised. Frank Rubino says that he told Dimitriou that the family had several loans with the bank totalling $5 million and the bank had security over his parents' property as well as over property of Rubino Holdings. Rubino Holdings owned an 80-acre property at Cooranbong, and also a warehouse at Homebush. Either Mr and Mrs Rubino or Rubino Holdings owned another property at Calabash Road, Arcadia (this is in addition to the Arcadia Road property referred to at para [4] above). Russo was the solicitor for the Rubino family. The Rubinos also owned or had a leasehold interest in various florist shops in shopping centres and had franchise arrangements with other florists. A florist's business was conducted through a company called Inbloom Florist Pty Ltd ("Inbloom Florist"). Frank Rubino and his brothers Antonio and Mauro, were directors of that company (CB 5/1954-5). Russo gave evidence that to his recollection the debts owed to the ANZ Bank exceeded $7 million (T608). Dimitriou was engaged to negotiate with the ANZ Bank to endeavour to negotiate releases of the bank's securities on favourable terms to the Rubinos. Frank Rubino said that he attended meetings with Russo and Dimitriou and an accountant, Mr Arcuri, at offices of a firm of accountants called Chan Naylor. He said that he received advice about restructuring the Rubino businesses and planning for the financial future. New companies were incorporated. One of these was Natlee Holdings Pty Ltd ("Natlee"). It was incorporated on 19 July 2010. According to the company search its directors from 19 July 2010 were Lee Rubino and Amanda Rubino (a granddaughter of Alfio and Biagina). Alfio Rubino became a director on 27 July 2010. Another company incorporated at that time was Lukazara Pty Ltd ("Lukazara"). It was incorporated on 21 June 2010. Lee Rubino was the sole shareholder and director of that company. 2. Frank Rubino deposed that between May and August 2010 he called Dimitriou almost daily and visited him regularly checking where he was at with refinancing the ANZ loans. He said that between August and October 2010 he called Dimitriou almost daily and visited his office weekly checking where he was at with the refinancing. 3. Frank Rubino deposed that in late August 2010 Dimitriou advised him that the ANZ Bank had agreed to accept $1.85 million to discharge its mortgage over the Arcadia property. By that time Frank Rubino was dealing with a cousin, Mr Steve Gatto, who was involved in the finance business, who was to arrange a loan with a private lender. That loan did not proceed. The ANZ Bank's loan was not discharged. Frank Rubino deposed that in about October 2010 there was a Farm Debt Mediation in relation to the ANZ Bank's mortgage over the Cooranbong property. Dimitriou introduced a solicitor, Mr Michael Foley, to Frank Rubino. He acted for the Rubinos in relation to that Farm Debt Mediation concerning the Cooranbong property. Frank Rubino deposed that the bank agreed to allow "us" to manage the sale of the Cooranbong property which went to auction in April 2011 and sold for $1 million. Sale of the Cooranbong property 1. The Cooranbong property was sold to a neighbour of the Rubinos, a Mr Peter Lane. Frank Rubino said that the bank had valued the Arcadia property at $1.3 million. He said that "we let our neighbour know that we were putting it on the market. It was being auctioned and if he was able to help us to bid for that property, yes." He said in substance that having Lane purchasing the property would help the family because Lane could sell it back to the family. He said that Dimitriou was involved in the transaction. (T269). He said the property was sold for $1,010,000 (T270). He said that Russo was organising an agreement, that never eventuated, that Lane would sell the property back to the Rubino family. Russo confirmed that there was a meeting with Lane where there was discussion about his buying the property and giving an option to the Rubinos to buy it back (T609). It does not appear that this arrangement was ever documented. Russo said that Lane said words to the effect: "I will hold the property in trust, but the Rubinos have got to make the payments. If they don't make the payments, I'm going to take the property and the machinery". (T609.45) 1. Although there was no documentation to explain this transaction, it does seem that the ANZ Bank allowed Rubino Holdings, which owned the Cooranbong property, to sell the property and agreed to accept $1 million in discharge of its mortgage. It also appears that there was an undocumented informal arrangement with the purchaser, a neighbour, to hold the property for the Rubinos and transfer the property back to them if the Rubinos paid Lane what he had to pay to buy the property and serviced his mortgage debt. 2. This transaction has a dual significance. It is the same kind of transaction as all the parties, other than the plaintiffs, say took place in relation to the Calderwood and Pine Valley properties in March 2012. Its other significance is that Dimitriou claims that he was owed substantial fees for his role in the transaction. 3. On or about 28 April 2011 Dimitriou lodged a caveat on the title to the Cooranbong property claiming an interest as equitable mortgagee pursuant to a deed and unregistered mortgage given by Rubino Holdings dated 10 November 2010. The caveat bears the consent of Antony Rubino for the registered proprietor and is also signed by Frank Rubino as a witness. Dimitriou produced an unsigned mortgage dated 10 November 2010 in favour of him expressed to be between him and Rubino Holdings under which Rubino Holdings acknowledged receipt of a principal sum of $198,944 and agreed to pay that sum by 10 January 2011 and agreed also to pay an establishment fee of $7,850. There was no evidence of any such advance by Dimitriou to Rubino Holdings. I understand Dimitriou's case to be that this was an acknowledgment by Rubino Holdings of a debt due to him for his work done for that company. That is not what the document provides for. I do not accept that Rubino Holdings was indebted to Dimitriou for that sum for the work done by Dimitriou in relation to this transaction. But this is part of the background under which Dimitriou claimed that he was entitled to be paid fees by Rubino Holdings. 4. The caveat must have been withdrawn in order to allow the sale of the Cooranbong property to Lane to proceed. 5. Receivers were appointed to Rubino Holdings on 5 August 2011 and a liquidator was appointed on 12 August 2011. Dimitriou complains that as a result of actions taken by the Rubinos through their later adviser, an accountant, Mr Prestia, companies associated with the Rubino family were put into receivership or liquidation and Frank Rubino became bankrupt and this had the effect that he was unable to pursue his claim for outstanding fees for work done for members of the Rubino family. 2010 Dealings with Arcadia 1. Dimitriou was also involved in the production of documents in about November 2010 in relation to the Arcadia property. The authenticity of purportedly executed but unregistered transfers and a mortgage is disputed. An undated transfer was prepared in relation to the Arcadia property that purports to be a transfer from Mr and Mrs Rubino to Frank Rubino witnessed by Russo and Gabrielle Klopf. It is likely that this document was executed. In about November 2010 such a transfer was proposed and it was proposed that Frank Rubino then transfer the Arcadia property to Lee Rubino as part of a family law settlement. Consent orders were made in the Hornsby Local Court on 4 November 2010 that provided for Frank Rubino to transfer to Lee Rubino his right, title and interest in the Arcadia property and discharge the existing mortgage over the home (Exhibit WYX1). What Mr and Mrs Rubino understood about such a transaction can only be surmised. The transaction never proceeded. They remained the registered proprietor of the property and it remained mortgaged to the ANZ Bank until the bank sold it in exercise of its power of sale on 10 March 2012. 2. However, on 10 November 2010 a mortgage was purportedly given by Lee Rubino over the Arcadia property in favour of Dimitriou to secure a purported advance of $148,944. No such advance was ever made by Dimitriou. Lee Rubino denied ever signing the mortgage and I accept that denial. Her purported signature in favour of Dimitriou was purportedly witnessed by Alfio Rubino. I consider that neither Alfio Rubino's signature as a witness, nor the purported signature of Lee Rubino as mortgagor was genuine. What purports to be the signature of Lee Rubino bears a similarity to signatures on cheques purportedly signed by her that Frank Rubino admits are his signatures. The signature of Alfio Rubino as a purported witness to the purported signature of Lee Rubino is part of a group of documents that the handwriting expert, Ms Novotny, grouped as "group 2" signatures which were not genuine signatures of Alfio Rubino. Whether Frank Rubino made those signatures by which Lee Rubino purportedly acknowledge a debt of $148,944 to Dimitriou and purportedly secured that debt over the Arcadia property is an unresolved question. 3. Frank Rubino denied forging any signatures and there was no handwriting evidence that the signatures in question were made by Frank Rubino. 4. Nonetheless, I am satisfied that in November 2010 Dimitriou required an acknowledgment from the Rubino family of a debt of $148,944. I accept that the purported signature of Lee Rubino acknowledging that debt was a forgery and that she did not sign the mortgage. I do not accept that Dimitriou was owed $148,944 by Lee Rubino and I think it unlikely that he was owed that sum by anyone. He did not advance any such sum to Lee Rubino. But he was claiming this amount as a debt due from some member or members of the Rubino family. On Frank Rubino's admission he had been in daily contact with Dimitriou in relation to the refinancing of the ANZ Bank's loans. Dimitriou has not established that he was entitled to $148,944. As no amount is claimed under the mortgage it is not necessary to decide who forged her signature. Dimitriou's retainer agreement with the Rubinos 1. Dimitriou deposed that the Rubinos entered into a retainer agreement with Wyse & Young in January 2011. He annexed a draft of the retainer agreement that he said the Rubinos entered into and deposed that he did not have a complete signed original of that document and believed that the NSW Police had it in their possession. The unsigned document he produced was addressed to Frank, Alfio and Biagina Rubino and to Natlee Holdings, Lukazara, Rubino Holdings and Cooranbong Flowers and is dated 17 January 2011. A subpoena was issued to the NSW Police. Documents were produced. I assume that no signed retainer was produced. I am not satisfied that the retainer agreement produced by Mr Dimitrou was signed by the Rubinos. However, the document provided that it was an offer for the conduct of work which could be accepted, amongst other ways, by "providing us with further instructions in this matter" (CB 3/810). It is not clear what the "matter" might have been. The retainer letter is in substantially the same terms as a letter later provided to Huybers that Dimitriou said was a standard form precedent. It provided that Wyse & Young was engaged to do various kinds of work, including preparation of tax returns and various accounting work, and also the preparation, assessment and lodgment of applications for finance and negotiating for the discharge of current mortgages, charges or other securities "to make way for Finance to a new incoming Mortgagee". The letter provided that "in doing this we agree to pay a fee payable no less than 20% plus GST of the amount negotiated off the current balance of debt payable and the negotiated amount paid ('the saved debt')". (CB 3/806) The letter provided that the Rubinos agreed to pay a fee of three per cent for Wyse & Young's obtaining an "… unconditional loan approval and discharge of any current liability the subject of the loan application" (CB 3/806). 2. The retainer agreement did not entitle Wyse & Young to a fee of "no less than 20% plus GST" for an amount saved in respect of the ANZ Bank's debt over Cooranbong. Wyse & Young claims to have been entitled to a fee for, it says, persuading the ANZ Bank to accept $1,100,000 when it exercised its power of sale over the Cooranbong property. But that was not a saving that entitled it to a fee under its retainer agreement as the bank did not discharge its mortgage to make way for finance to a new incoming mortgagee. Instead, it exercised its power of sale as mortgagee by selling to the highest bidder at auction. 3. Nor was there evidence that in 2011 Wyse & Young obtained an unconditional loan approval for any members of the Rubino family. Mr Foley for the Wyse & Young parties put to Lee Rubino that she received an offer of finance from Bankwest and went to the offices of Bankwest with Dimitriou and Jetson, was given documents to sign, but suddenly refused to sign them. She denied that that happened (T69) and there was no evidence it did. 4. The retainer letter, an unsigned draft of which was produced by Dimitriou, also provided that any other services that might be requested of Wyse & Young would be charged at standard hourly rates being $350 per hour for a director (viz. Dimitriou) and lower rates for a tax agent, manager, senior accountant or junior accountant. 5. Dimitriou is not an accountant, nor a licensed financial adviser, nor a tax agent. It does not appear that Wyse & Young has an Australian credit licence. Dimitriou completed schooling only to Year 10 and has no formal qualifications. He says that he engages qualified tax agents to prepare tax returns. It was not suggested that he or Wyse & Young required a financial services licence, nor an Australian credit licence under the National Consumer Credit Protection Act 2009 (Cth). 6. Be that as it may, it suffices to say that in 2011 Dimitriou claimed to be entitled to hundreds of thousands of dollars of fees for work done for the Rubinos. He did not receive any payment for the work he did. It does not appear that he was entitled to any payment, except an hourly rate, which he did not invoice. 7. By May 2011 the ANZ Bank had commenced proceedings for possession. Frank Rubino deposed that in about late May 2011 he was frustrated with unfulfilled promises made by Dimitriou to be able to refinance the properties. Not long after late May 2011 he stopped using Dimitriou's services and saw a Joe Prestia from Crest Capital to attempt to raise finance to discharge the ANZ Bank's mortgage. Prestia introduced Frank Rubino to Mr Richard Watson of Watson & Watson solicitors. A further Farm Debt Mediation was scheduled and took place over three days on 14 and 29 November, and 14 December 2011. Evidently some of the main terms were settled prior to 14 December 2011. On 29 November Lee Rubino told Frank that the bank had agreed that the Calderwood property would be released to his parents free of any mortgage and the bank would release the Pine Valley property for $1,050,000 and the Arcadia property for $1,650,000. (CB 1/263 para [149]). Lee Rubino - application for finance through Lukazara 1. In December 2011 Lee Rubino proposed to Alfio and Biagina Rubino that she, through her company Lukazara, could raise the funds sufficient to pay off the $1,050,000 loan. She proposed that the Pine Valley and Calderwood properties be transferred to Lukazara, but that it would hold them on behalf of Mr and Mrs Rubino. With the properties in the name of Lukazara, with her wages, with the income available to the Rubinos through Natlee Holdings (that carried on the family flower business), and with potential rental income from houses on the Calderwood and Pine Valley properties, she thought that the funds necessary to pay off the mortgage could be raised. 2. On 12 December 2011 Eclipse Prudent Mortgage Corporation Limited ("Eclipse") wrote to Lukazara providing conditional approval for a mortgage advance of $1,100,000. The advance was to be secured by a registered first mortgage to be provided by Lukazara over the Calderwood and Pine Valley properties (CB 4/1353 at 1355). 3. In her principal affidavit sworn on 9 April 2015 Lee Rubino deposed that during the mediation process she and Frank agreed to give up their home at Arcadia so that Alfio and Biagina could keep their home at Calderwood and would be able to keep the Pine Valley property if they paid $1,050,000 to the ANZ Bank. Frank and Lee had built a house on Alfio and Biagina's land at Arcadia and had an agreement with Alfio and Biagina in relation to that property. She deposed that during December 2011 she was making applications for finance for the $1,050,000 for the Pine Valley property which she did not proceed with. 4. After orders were made for the plaintiffs to give discovery of documents relating to the applications for finance, which resulted in the production to the defendants of the mortgage approval from Eclipse, Lee Rubino swore a further affidavit in which she deposed that in about December 2011 she, Frank, Alfio and Biagina had a conversation to the following effect: "Me: Look, the problem is that Frank, Anthony and Mauro are bankrupt so there is no way they can apply for a loan. I do not think that Natlee Holdings Pty Ltd would get approved on its own as it is a new company without trading history. Frank: She's right, we can't. Me: I am happy to borrow the money for you. I have a clean credit rating and I can get loan approval easily. Alfio/Biagina: We don't understand? Me: Well, I do not think, due to your age, any bank will lend to you money. I have a company called Lukazara Pty Ltd. I could hold the Calderwood and Pine Valley properties on your behalf, and the bank will assess my ability to service the loan. So, we could lease out the three houses on the properties and use the rental income from the leases. This income, along with Natlee Holdings's [sic] income and my wage if necessary, enable us to make the repayments, but you need my clean credit rating so we can get approval. This will enable you to have the required money to pay the ANZ Bank on settlement of the Heads of Agreement. This way, you will be able to keep both the Pine Valley Property and you are aware the Calderwood property will be returned to you unencumbered from the ANZ bank upon settlement of the Heads of Agreement. I know the properties mean a lot to you as initially they use[d] to be one big 10 acre lot. You don't need to worry about anything. You know the ANZ Bank is giving you back your family home property (Calderwood) unencumbered, so you will not lose the Pine Valley property, as we only need to find $1,050,000. You will not lose your properties, I will not let you lose your properties. Do you trust me? Alfio/Biagina: Yes we trust you. Me: Okay. I am going to make a loan application to find ascertain if I can borrow $1,050,000 so we have the money for the Pine Valley property at the end of the settlement of the ANZ mediation." 1. Lee Rubino deposed that it was agreed that she would hold both properties on trust for Alfio and Biagina and that her credentials were to be used only for the purpose of facilitating the loan. She estimated that with the rental income the Rubinos could receive from renting three houses on the Pine Valley and Calderwood properties, and with her income and income from the Natlee Holdings' family flower business, there would be sufficient income to service the loan. 2. Lee Rubino did not proceed with that proposal because she and Frank separated in early January 2012. She told Frank that she wanted nothing more to do with it and he would have to arrange the refinance for his parents. After she and Frank separated she did not proceed with the loan. 3. Biagina Rubino also made an affidavit on 4 March 2016. She deposed that Lee Rubino said that if she (Lee) were to borrow the money she would have to put both the Calderwood and Pine Valley properties into her name and use them as security and would hold the properties for Alfio and Biagina (CB 1/225). Biagina deposed that she was not happy about putting the Galston properties in Lee's name, but trusted Lee and wanted to keep the properties. Biagina deposed that she did not agree to anyone else taking the Galston properties and getting a loan on her behalf. 4. In his affidavit sworn on 9 April 2015 Frank Rubino deposed that Lee was in the process of applying for finance for the Pine Valley property, but said that she would like to have the extra security of the Calderwood property (CB 1/264 [152]). Frank Rubino said that he told his father that, "Lee could borrow the money for Pine Valley but she wants the Calderwood property in her name if she does that." He deposed that his father asked him what he thought about that and he said he did not agree with the proposal, and had told Lee that it would be enough if she borrowed the funds against the Pine Valley property and had that put into her name, and the Calderwood property could be used as security for the loan without being put in her name. He told his father that Lee wanted the security of the other property in her name, but he did not agree with it. Frank Rubino deposed that because he and Alfio did not want the Calderwood property to be in Lee's name if she were to obtain finance, they did not progress the proposal of Lee's funding the $1,050,000 required to discharge the ANZ mortgage (CB 1/264, [154]). 5. This is at odds with Lee Rubino's and Biagina Rubino's evidence. For the reasons below I have serious doubts about Biagina's capacity in March 2016 to make her affidavit. Nonetheless, I prefer Lee Rubino's evidence to that of Frank Rubino. I am satisfied that the reason Lee Rubino's proposal for finance did not proceed was not because Frank and Alfio objected to both properties being transferred to Lee Rubino's company, Lukazara, but because Lee Rubino decided not to proceed because she was separating from Frank. 6. I find that Lee Rubino withdrew from this proposal in December 2011 rather than January 2012. 7. Frank Rubino admitted that her withdrawal left him with only one option and that was "to deal with the devil in the form of George Dimitriou" (T321.40 corrected to record the answer "Yes" T400). Engagement of Dimitriou 1. Frank Rubino deposed that Russo advised him to contact Dimitriou to arrange finance. Russo denies this and I accept his denial. Frank Rubino admits that Alfio told him that he would also like to keep the Pine Valley property and, if possible, the Arcadia property. He deposed that after the signing of the Farm Mediation Agreement (that is after 20 December 2011) he telephoned Dimitriou. He said he had not had any contact with Dimitriou since he stormed out of his office during a meeting in May 2011. He says that he asked Dimitriou if he could arrange finance for the discharge of the Pine Valley property and, if possible, the Arcadia property. He said his parents needed the funds before 16 January 2012. He deposed that Dimitriou said: "Ok. I can maybe arrange some short-term lender for both Pine Valley and Arcadia. Maybe, for a period of three to four months. That will give me time to arrange a conforming bank loan on a longer term basis." 1. Frank Rubino said that he understood that a "conforming bank loan" was a loan from a bank or financial institution. 2. Dimitriou said that in December 2011 he spoke with Frank Rubino who asked for his help. According to Dimitriou he complained that Frank had dumped him to go to Gatto and Prestia. Dimitriou deposed that a conversation to the following effect took place: "Frank: 'George the situation is still bad. We haven't the monies to discharge the Bank and give them what they want to save the family properties. George you need to help me. I have very little time. I have to settle by 5 January 2012. Me: 'Frank I need to make sure we are all paid or else I am not going to help. You are aware that both properties are required to be used as security for any facility that we obtain.' Frank: 'I understand that George. I have already spoken to Andrew and Sal. I know that if we can get the Galston properties out for $1,050,000. The Arcadia property can be saved for $1,650,000. If you can raise enough money on the Galston properties then we can pay a 10% deposit to the purchase Arcadia property. I need you to find some money so that I can settle with the ANZ.' Frank: 'George, my family will honour all of our commitments, you have my word. Lee is now out of the picture as she was not prepared to help us. She has finally left. I am living with my parents.'" 1. Frank Rubino was aware that Lee Rubino had a very poor opinion of Dimitriou. She described him to Frank as a liar, a cheat and a conman, amongst other things. 2. Dimitriou gave the following evidence in cross-examination: "Q. You never told Frank Rubino in late 2011 or in 2012 that you were looking for hundreds of thousands of dollars for fees out of this transaction did you? A. He was aware what he owed. Didn't have to discuss it. He offered it to me and he said that he's happy to pay everybody's fees including mine, knowing full well he provided a security for our money." 1. Dimitriou said that the security to which he referred were the mortgages previously provided to him. However, one of those was over the Cooranbong property which had been sold by the bank, and the other was the Arcadia property which was about to be sold by the bank in exercise of its power of sale as a first registered mortgagee, unless its mortgage could be redeemed. In any event, on Dimitriou's admission, Frank Rubino agreed only to pay "everybody's fees including mine". Frank did not agree (at least at that point) to payment of any particular amount. 2. I think it likely that some such conversation would have taken place between Dimitriou and Frank Rubino. Dimitriou was upset that the Rubino brothers had gone or were going bankrupt and that companies that might have owed him money had gone into liquidation. It is probable that he would have said that he wanted his fees paid. It is clear from his subsequent conduct that he saw the opportunity to raise moneys on the security of the properties of Mr and Mrs Rubino for his own benefit. Huybers and Dimitriou 1. Huybers was introduced to Dimitriou in about September 2011. She was asked by her brother, Mr Neil Arnott, to guarantee a loan for a company through which her brother did business in the construction industry. This was Green Global. Huybers became the sole director of Green Global but played no part in the management of the company. She owned a house in Enderlee Road, Clayfield valued at over $2 million that was subject to a first registered mortgage to the National Australia Bank to secure a debt of approximately $400,000. Wyse & Young acted for her in arranging a $500,000 facility through Winiata from the ANZ Bank that was secured by a second mortgage over the Enderlee Road property and guaranteed by her. Her arrangement with her brother was that he would service the loan. A small portion of the loan ($74,500) was applied to a business that Huybers conducted called Sandwich Girl. After payment of fees of $41,728.50 to Wyse & Young the balance was paid to a company that was set up for Huybers called Union Steel Pty Ltd ("Union Steel") and then disbursed to the Green Global business account. This facility was entered into in October 2011. The National Australia Bank loan was refinanced through the ANZ. 2. In about November 2011 Dimitriou and Huybers had a conversation to the following effect: "[Dimitriou]: We will get some more equity out of your house and make some investments and from the proceeds we can pay down all the loans and also make some good money from the profits. We'll think of a way for you to earn an income. [Huybers]: Have you got any ideas? [Dimitriou]: I'll talk to my mate Danny; he manages investment properties on the Gold Coast. He's a millionaire, maybe there will be an opportunity for you to work for him. [Huybers]: That would be great, because the catering doesn't earn me very much money. Frankly, I'll do anything." 1. By the end of December 2011 the $500,000 facility had been disbursed. Huybers retained $59,000. However, her brother did not make any repayments. Dimitriou said that he would figure something out so that Huybers could pay down the loan with the ANZ Bank. In about December 2011 she had a telephone conversation with Dimitriou to the following effect: "George said: 'Because of the position I'm in I'm often privy to good deals when they come up.' I said: 'That sounds great' He said: 'I've got some clients, the Rubinos, I really like them. They're really good people. The father was an immigrant who worked the land and made a lot of money out of flowers. They need to raise some money short term to save the parents' property from the bank. You and I will be the directors of this new company Pineview Property and it will borrow money and hold the property. If you agree to be a director of the company, you will be paid a fee of $100,000.' I said: 'I need money to pay off Neil's loan and that would help me do that. I really like the idea of helping them out as well. But how does this Pineview loan get repaid?' George said: 'Don't you worry about that, you're just a figurehead. The Rubinos will look after the repayments, it's really their loan. After this we can do other deals, these kinds of things come up all the time, we'll just put you in them, and by the end of the year your debt will be gone. We'll meet up for lunch when you're in Sydney and we'll talk about it then.'" 1. Dimitriou denied telling Huybers that she would be paid $100,000 merely for providing the loan she later provided and becoming a director of Pineview. He said she was entitled to be paid $25,000 for having agreed to be a "stand-in director" of Pineview, and $25,000 for providing her loan (T681). I prefer Huybers' evidence. 2. During the week after Christmas 2011 Dimitriou told Huybers that Frank Rubino had his house for sale, that he and his wife were going through a messy divorce and that there was an opportunity for him and Huybers to borrow money and buy the property cheaply and subdivide it. Huybers said she was interested. She and Dimitriou visited the Arcadia property on 31 December, but did not inspect the house. Lee Rubino was there. Jetson also attended and spoke to Lee Rubino alone. Dimitriou and Huybers then visited the Pine Valley property and Dimitriou introduced Huybers to Frank Rubino who was there. Lee Rubino arrived a few minutes later and there was a confrontation, and she ordered Dimitriou off the property. 3. Huybers did not at this point have any money to lend the Rubinos. The $570,000 she advanced on 17 January 2012 was borrowed from the ANZ Bank by Dimitriou's working with Winiata to obtain a further loan on security of her property in Clayfield. Huybers agreed in cross-examination that as a result of documents signed by her in December 2011 she was indebted to the bank for over $1.5 million and had $600,000 available to invest (T407-409), but it appears from bank statements that the additional amount borrowed was $570,000. Emails between Dimitriou and Winiata 1. On 22 December 2011 Dimitriou sent an email to Winiata referring to a deadline of 10 January 2012 and stating that the Calderwood property had been valued at $1,350,000, the Pine Valley property at $1,390,000 and the Arcadia property at between $1,950,000 and $2,595,000. He said: "Have a deadline to discharge away from ANZ on the 10th January where as [sic] 2,700,000 gets handed over 3 property titles get handed back. … Stamp duty will have to be paid as I suggested best they get sold by way of contract of sale. Or Niece at 28 wants Arcadia and Galstone and the unencumbered prop can be used as security it will have zero debt." (Emphasis added.) 1. This contemporaneous statement to Winiata corroborates Dimitriou's oral evidence that he discussed with Frank Rubino the method that was adopted of raising funds, namely that the properties be "sold". 2. Dimitriou communicated by email with Winiata in more detail on 31 December 2011. The email correspondence was sent through the email address of Ms Teri Dawson, who was Winiata's wife or partner. 3. On 31 December Dimitriou wrote as follows: "This is the situation, All three properties currently with ANZ. 1st property we will have title with no debt owing – value 1,350,000 That can only happen when we pay over the following, ANZ either want the keys for both properties or the Bank Cheques. 2nd Prop – Galston we need 1,050,000 – value 1,350,000 currently rented. 3rd Prop – Arcadia 1,650,000 value agreed propel 12 months ago 2,575,000 MJ 14 months 1,950,000 that was requested down. So I thought the following, 2 sales contracts separately – For Galston at 1,050,000 to someone in Trust – show the payment made of 20% to the vendor- Second Valuation needed for Stamp Duty purpose – now due to land and house I think Stamp Duty is on a different scale on Transfer – probably use Susan in a Trust Set up – Susan – can be the private lender the family will pay her the fees for that probs 20k for her trouble. There's the car issue sorted For Arcadia at 1,650,000 to someone in trust – show the payment made to Vendor ie deposit 20% and stamp duty paid and calculated. Property bought for investment purposes. Second Valuation needed for Stamp Duty purpose – now due to land 40 acres and house I think Stamp Duty is on a different scale on Transfer – probably use Danny in a Trust Set up – At Settlement the Galston unencumbered property transferred to the company trustee and the trust, so as the assets are quantified. We then re finance all or even just the unencumbered or sell it to the niece or re finance in business 1mil pay back trustee directors on both for the use of there [sic] money – raise the money. The trust set up – Director of Trustee Co Danny – benificiaries [sic] Nicole and her brother Tony Rubino 21 and 28 year old Then We do a share transfer to the Beneficiaries – set up a new trustee director – being the beneficiaries and transfer the shares of the trustee company So monies needed to be raised to payback based on unencumbered property 200k my outstanding lend amount – Danny fees lend outstanding 28k 3% of total lend amount split between you and I. Arcadia – Dannys [sic] 20% returned and also stamp duty returned and fees for the lend $- Galston – Dannys and Susans [sic] money Returned plus interest and costs and stamp duty paid monies. 20% deposit raised by Danny on Arcadia – based on $1,650,000 = 345k plus stamp duty as needed at settlement to supplement your monies raised (can you calculate stamp duty, based on this type property) 20% deposit raised by Danny on Galston – based on $1,050,000 = 210k plus stamp duty as needed at settlement to supplement your monies raised (can you calculate stamp duty, based on this type property) Just need 2 new sales contracts 2 transfers for new Purchase To raise money to pay back everyone – 1 trust – 1 trustee company – trustee director Nicole – beneficiaries Nicole and Brother As there is no debt against this prop the trust cab just refinance to pay everyone back. You've done loans for Danny and Susan so I can make Sarinda 1 trustee company and Susan of Green Global the other – susan has trust already so that's a bonus – Danny has his trust as well so that's a bonus – Both investments props – both should be approved swiftly. Can you work out stamp duty on both actually all three, the other prop may as well go to a trust set up once unemcumbered [sic]. Wow-geez they made me think! All up to you now" 1. Sarinda Pty Limited was a company owned by Kalischer. 2. The email is not easy to follow. It contemplates that the Pine Valley property would be transferred pursuant to a contract for sale to a company that would hold the property on trust and that the unencumbered Galston property (i.e. the Calderwood property) would also be transferred to the company and the trust. Dimitriou apparently believed that stamp duty on a different scale would be payable on a transfer of the Arcadia property. He contemplated a second valuation being obtained for the Arcadia property and that a trust would be set up using Kalischer with respect to that property. He contemplated that Huybers would be paid $20,000 for her trouble in relation to her being a private lender. The reference to the car issue being sorted is a reference to Dimitriou's being engaged to help Huybers get out of a lease to Esanda Finance in respect of a Lexus motor vehicle. (Huybers says that Dimitriou told her that he would attempt to get somebody to purchase the car so that she would be relieved of her responsibilities under the lease, but it ended up with her handing over the car to a third party, and the car ended up in Dimitriou's possession and registered to him.) 3. By his email Dimitriou contemplated that shares in the trustee company could be transferred to the beneficiaries who could be grandchildren of Mr and Mrs Rubino. Importantly he said that the moneys needed to be raised would include not only the moneys needed to repay short-term loans, but $200,000 for "my outstanding lend amount", $28,000 being outstanding "fees lend" payable to Kalischer, the return of a 20 per cent deposit if paid by Kalischer on the Arcadia property, moneys to cover interest and costs and stamp duty and "three per cent of total lend amounts split between you and I". 4. Dimitriou denied that this was an offer of a bribe or that a bribe was paid. He gave confusing and evasive answers when asked about that statement. He said that he would be charging the three per cent fee, but he also said that it was a reference to Teri Dawson raising a three per cent fee to charge to the Rubinos as finance broker (T779). But the moneys raised from the ANZ Bank did not include any fee for a finance broker. The bank agreed to lend $1,080,400 for the purchase of the Calderwood property. It deducted $5,736.20 from the advance for its fees and stamp duty, government charges and incidental costs (CB 4/1166). It advanced $920,320 for the purchase of the Pine Valley property and deducted from the advance $4,432.80 for its fees, government charges, stamp duty and incidental costs. The total amount deducted was $10,169 and the balance of $1,990,551 was paid to Wyse & Young and to Wyse Accounting. No amount was deducted for commission for Teri Dawson for acting as finance broker, and it was not suggested that the Rubinos paid or agreed to pay any such commission. Nor did Pineview pay any such commission. On the other hand, Wyse & Young International charged Pineview $66,023.76 for establishing the loans totalling $2,000,720 from the ANZ Bank. This was three per cent of the face value of the loans plus GST. I am satisfied that Dimitriou was offering Winiata money as an inducement to him to use his influence to have the loans approved. 5. Winiata responded later that morning advising on the stamp duty that would be payable on loans of $1.35 million, $1.05 million and $1.65 million. He said that he loved the proposed structure. He said that he had everything for Susan but would need Danny's "NOAs" (notice of assessment) for 2010 and 2011. The reference to Winiata's having everything for Susan is to his having arranged the loans to Huybers from the ANZ Bank referred to at paras [65], [67] and [70]. 6. Dimitriou replied to Winiata stressing the need for urgency. He asked what area of the bank would handle the application and whether they would rely on sales contracts or would need valuations as well. He said that more time might be bought if at least one transaction were done and said: "I suppose with Susans and Dannys money and mine we can probably discharge that one at $1,050,000. Leave them on titke so as the stamp duty not needed to be paid, so as we say buy the mortgage from ANZ at $1,050,000. We take there place. Then sell it soon after. [sic] What we then do is put Danny trust and company as the Mortgagor – we then take possession then refinance to buy Arcadia using the unencumbered again as Danny trust." 1. I think in this passage Dimitriou was referring to the sale of the Galston properties by Susan and Danny as mortgagees to a company that would hold them in trust for the Rubinos and would then refinance to raise money to buy Arcadia. 2. At this stage Dimitrou hoped that the ANZ's mortgages over both the Pine Valley and the Arcadia property could be discharged. 3. Winiata responded later that day as follows: "So if you pay ANZ $1.05m for Arcadia [scil. Pine Valley] from the funds you have this will hopefully give me time to set the facilities. Note that the loans will need to be in Resi as bot h Susan and Danny already have $500K business facilities. This only allows me to extend another $500K in the business area. So we need to put it through Resi under a trust structure. No limit on the size of the loan. If your [sic] happy to put through ANZ, I'm happy to. I suggested ING so that it looks like an arm's length transaction. ANZ will be faster as I know the process. Also ANZ will rely on a contract of sale but also need a valuation completed. How recent are the current vals you hold? If they are no more than 6 months I should be able to use them. If not I can order a val through my system and usually the val company will go off the contract. So I need to know exactly what you want to do! First you payout Arcadia then I do the following below. Susan – Green Global P/L ATF (Whatever Trust) – purchasing Arcadia ($840K lend) Danny – Sarinda P/L ATF (Whatever Trust) – purchasing Galston ($1320m lend) The new trust to purchase the unencumbered property ($1080m lend) Cheers Dave" 1. It may be noted that Winiata was proposing loans totalling $3,240,000. The moneys required to discharge the ANZ mortgages were $2,700,000. 2. On 6 January 2012 Dimitriou sent emails to Winiata at his email address at the ANZ Bank. One email was only partially reproduced, but was headed "Susan Heybers [sic] – Re-finance Investment facilities and the purchase of Arcadia Investment property". He asked Winiata to "… supply nett settlement figures available so as I am able to determine which way to place Galston Discharge and her new Purchase of Arcadia property." The email was headed "Precedent 1 out of 3". The balance of this email was not tendered. A short time later Dimitriou sent a further email to Winiata headed "Precedent 2" which stated: "Precedent 2. Contract of sale on 2 Galson [sic] properties let's say to Green Global atf trust Susie as director of trust or Danny new purchase trustee company and trust. That's [sic] secures the position Danny's investment and Suzie and mine (as the investors) immediately so as the supplement value can't be contested. This must all happen by 12th Jan Retail value on both $1,350,000 and $1,200,000 - = $2,550,000, Purpose to raise costs plus stamp duty and out of pocket for Arcadia difference for deposit. Gear up Galson [sic] so as procurers easier second time round on take out and his wife can't claim as she is unable any way – Mr and Mrs sells two titles o say company A atf. Trust A So as to sales contract in your business area say $1,050,000 plus. Raise 80% of contract of sale = $2,040,000 therefore $1,050,000 plus stamp duty on $2,040,000 is 100k – total used thus far $1,150,000 so that leaves 990k – 250k back to George for monies owed to date. 28k back to Danny for monies owed to date. 10k back to Foley for monies owed to date = $288,000.00 Leaves $702k – that gets tipped in to the pool. Frank will need to tip in the stamp duty of say 77k if he wants all properties in Two company structure trusts. In turn will supplement the 702k Then we lend $950,000 – equals to $1,650,000 equals the share of risk with owners – we keep title under the mortgage until 950k gets paid plus interest and costs. Fees payable on to obtain - $950,000 plus $2,040,000 – total $2,990,000 let's say 100k Susan fee, risk fee, term roll over admin fee and interest on her borrowed 600k for 3 months until repaid 90k – Danny fee risk fee, interest on 350k 3 months – incl pre paid 120k – Fees prep documents mortgage etc inclusive of solicitors and documents lodged = 310k So based on a $1,260,000 will need to be re paid based on a potential valuation of $2,575,000. To get coacher [sic] they sell down Arcadia at $2,575,000 less debt by way of our company Mortgage $1,260,000 = $1,515,000 to go back onto Galson [sic] at $2,040,000 leaves a $500 thousand dollar debt on both Galson [sic] properties retail valued at $2,550,000. If in fact finance not able to be done, Frank unable to sustain repayment our risk is reduced And we keep property at Arcadia. Therefore not entering the sress of Galson [sic] and the elderly parents etc. Arcadia currently is being moved out from. I will have the place cleaned up ready to sell or priced to sell for Frank and Family to make some money on. Please keep this between you and I mate. Just needed to get it all out of my head so as I can sleep tonight." 1. Again, this email is not easy to follow. The first two paragraphs indicate that Dimitriou saw value in having the two Galston properties transferred so that it would secure Kalischer's investment, Huybers' investment and his, and that the "supplement value" could not be contested. Dimitriou was not asked what he meant by "supplement value". 2. His proposal was that 80 per cent of the value of the Calderwood and Pine Valley properties would be borrowed, being $2,040,000. His calculation was that the $1,050,000 loan would be repaid and stamp duty would be paid, leaving on his calculation $990,000. From this sum, $250,000 would be paid back to Dimitriou for moneys said to be owed to date, $28,000 was to be paid back to Kalischer. This represented fees Kalischer contended were owing to him from a previous loan he had made available to the Rubinos. Ten thousand dollars was to be paid to Foley, leaving $702,000. He proposed that Frank Rubino would tip in the stamp duty of $77,000. "We" would lend $950,000. That sum, with the $702,000, would be enough to pay the $1,650,000 that needed to be paid to discharge the ANZ Bank's mortgage over Arcadia. Seventy-seven thousand dollars stamp duty would be the duty on the purchase. There would be further fees totalling $310,000 charged on such a transaction. The result would be that the Rubinos would be responsible for paying the $2,040,000 loan and the $950,000 further loan ($2,990,000) plus $310,000 in fees ($3,300,000). There would be a $1,260,000 debt ($950,000 plus $310,000) on the Arcadia property that was valued at $2,575,000. If the Arcadia property were then sold and the $1.26 million debt was discharged, Dimitriou calculated that there would be $1,515,000 (in fact, $1,315,000) which could be applied in reduction of the $2,040,000 mortgage over the Galston properties leaving a $500,000 debt (scil. a $700,000 debt) on both Galston properties valued at $2,550,000. If Frank Rubino were unable to sustain repayment on the mortgages "our risk" would be reduced because the Galston properties were loaded with 80 per cent debt and the ANZ Bank would sell the Galston properties to recover the $2,040,000 advance. The alternative would be that Arcadia was not sold. It would be subject to "our company mortgage" of $1,260,000 which was only 50 per cent of the assumed value. 3. In substance Dimitriou would use the equity in the Galston properties and the Arcadia property to raise funds to pay himself $250,000 for moneys he said were owed, to pay Kalischer and Foley $38,000, to pay $190,000 to Huybers and Kalischer for the risks they assumed, and to pay $120,000 in further fees. 4. It is significant that Dimitriou concluded the email by imploring Winiata to keep what he was discussing between themselves. For the reasons which follow I am satisfied that, notwithstanding his denial, Frank Rubino was aware of the basic outline of the transaction and was talking to Winiata. But Dimitriou's wish that Winiata not disclose the extent of the moneys Dimitriou intended to collect in fees and alleged debts makes it improbable that he disclosed those matters to Frank Rubino. That having been said, it is probable that Dimitriou told Frank Rubino that he would only assist if his fees were paid and as appears below, Frank Rubino was aware that there were surplus funds available from the loan with which to discharge other debts. Contracts for sale of Calderwood and Pine View properties 1. Pineview was incorporated on 9 January 2012. Dimitriou said that the name Pineview was suggested by Frank Rubino who suggested the name because of views of pine trees from the properties. Frank Rubino denied this and went on to deny that there were such views, but this was contradicted by photographic evidence. 2. By 9 and 10 January 2012 Wyse & Young, through Jetson, prepared contracts for the sale of the Calderwood and Pine Valley properties. The draft contracts named Mr and Mrs Rubino as vendors and Pinevew as purchaser. 3. The contracts were falsely dated 7 December 2011. The purchaser's solicitor was named as "c/- Wyse & Young International Pty Ltd". The price stated on the contracts was $1,350,500 for the Calderwood property and $1,150,400 for the Pine Valley property, a total of $2,500,900. The contracts purportedly recorded the payment of deposits of 10 per cent by Pineview. 4. Both forms of contract bear what purport to be the signatures of Alfio and Biagina Rubino and an unidentified signature of a witness to their signatures. The plaintiffs say that the purported signatures of Alfio and Biagina Rubino are forgeries. However, a report of a handwriting expert, Ms Michelle Novotny, concluded that the signatures of Alfio and Biagina Rubino on the copy contracts for sale with which Ms Novotny was provided revealed numerous similarities and only isolated dissimilarities with a group of specimen documents (group 1 specimen documents) that it can be inferred contain genuine signatures of Alfio and Biagina Rubino. She concluded that there was evidence supportive of a proposition that the questioned signatures on the contracts were each written in original form by the writer of the group 1 specimens and there was no evidence to support the alternative proposition. The conclusion was qualified due to the questioned documents provided to her being photocopies. 5. Ms Novotny was not cross-examined and I accept her opinions. The Registrar General submitted two original documents and six copy documents to Ms Novotny for her opinion on the authenticity of signatures on those documents and submitted some 34 specimen documents containing what were assumed to be the signatures of Alfio and Biagina Rubino for comparison. Ms Novotny said that a comparison of the specimen signatures attributed to Alfio and Biagina Rubino revealed that they fell into two groups. The similarities observed on a comparison of the group 1 and group 2 specimens were superficial, although there were linking similarities between the signatures within each group. It can be inferred that the group 1 specimen signatures are genuine. They included Alfio Rubino's driver licence, the Heads of Agreement signed with the ANZ Bank, and the transfer dated 8 March 2012 (which the plaintiffs admit to having been signed by Alfio and Biagina Rubino). 6. Specimen documents in group 2 bearing what purport to be the signatures of Biagina and Francesco Rubino that were not their genuine signatures included a deed bearing date 20 February 1999 between Alfio and Biagina Rubino and Frank and Lee Rubino relating to the terms on which Frank and Lee Rubino could occupy the Arcadia property and be compensated for the cost of building a house on it if the property were sold, a letter addressed to Ms Sandra Campagna (an employee of the ANZ Bank) from Frank Rubino on behalf of Rubino Holdings giving authority to a company known as Reconstruct Pty Ltd (a Dimitriou company) to liaise on behalf of the Rubino family in respect to loans with the ANZ Bank, a caveat in respect of the Arcadia land apparently consented to by Alfio and Biagina Rubino that was prepared in the name of Lee Rubino as caveator and claiming an interest in the land pursuant to the deed dated 4 October 1998, a mortgage expressed to be given by Lee Rubino over the Arcadia land in favour of Danny Kalischer as mortgagee in a document to be lodged by Dimitriou, and the transfer of the Arcadia property from Frank Rubino to Lee Rubino whose signatures were purportedly witnessed by Alfio and Biagina Rubino. Notwithstanding that someone other than them wrote their signatures on a number of documents, the signatures on the contracts are their signatures, unless a copy of their genuine signatures was cut and pasted onto the form of contract and then the document recopied. There is no indication of that having been done, but it is a possibility. 7. On 12 January 2012 Ms Gabrielle Klopf sent a draft contract for the sale of 45 Pine Valley Road, Galston to Jetson under cover of an email that said "Here is the contract that was prepared by us some time ago." The special conditions she provided were included in the form of contract produced by Jetson. Klopf was employed as a paralegal by Russo. She deposed that in 2010 Frank Rubino attended a meeting with Russo. She was called into the meeting in Russo's office and he asked her to prepare a contract for the sale of Frank's parents' properties and do the usual searches. She prepared a contract and left it on the file. She deposed that on about 12 January 2012 she received a telephone call from Jetson and Frank Rubino who was on speakerphone and that a conversation to the following effect took place: "Andrew: Gabrielle, I am sitting here with Frank who says you prepared a contract ages ago for the Galston properties. Gabrielle: I can't remember. Frank: Gabrielle, its Frank. If you can find it can you send it to Andrew?" 1. Jetson kept a diary. His diary page for 10 January 2012 records "Alfio – Biagina to sign sale contracts". His diary entry for 12 January 2012 records "Signed sale contracts". He deposed: "54 I think that I visited the Galston properties to have Alfio Rubino (Alfio) and Biagina Rubino (Biagina) sign documents, at the request of George, on what to my recollection seems like only two occasions. I do not recall that I have any reason to believe that these two occasions were on dates other than on 10 January 2012 and 12 January 2012 in accordance with what it says in my diary. … 59 I do not recall whether, when I went to visit the Galston properties on the day that I think was 10 January 2012, that Alfio and Biagina actually signed any documents. I am not sure whether Biagina was present on that day. 60 I do have a recollection that on the other occasion, which I can only assume was 12 January 2012 that I did actually have Alfio and Biagina sign documents or a single document. 61 However, I do not have any recollection of how many documents I had Alfio and Biagina sign and I do not have any recollection of what those documents were. It is entirely possible that I had Alfio and Biagina sign a Transfer document or contracts for sale, or some other type of document, or some or all of these documents. But I just have no particular recollection." 1. Jetson had made a statutory declaration on 20 August 2013 in which he said he was instructed by Dimitriou to take the transfer document for the two properties to Alfio and Biagina Rubino and had the transfer document signed by them. He said in that statutory declaration that when the parents sat down he gave them the transfer document. He then declared that "they asked what it was and Frank and I explained that it was to help arrange financing for the second property". 2. Jetson swore an affidavit on 23 October 2013 in which he said he did not recall any contract for sale between Alfio and Biagina Rubino and Pineview Property Holdings Pty Ltd. However, Jetson did not then have access to his diary and it is clear from his diary that he was aware of contracts having been prepared and it appears from his diary that he took the contracts to the Rubinos for their signature on 10 and 12 January. He accepts that when he met the Rubinos, Alfio Rubino asked what the documents were for and he said that "they are to help you get finance for the Pine Valley property". 3. In 2013, 2014 and 2015 Jetson, who had terminated his relationship with Dimitriou, was sympathetic to the plight of Mr and Mrs Rubino. In an affidavit made on 29 October 2015 he said: "28 I do not recall asking any employee of the Russo or Russo to provide a draft transfer. In or around March 2012 at the Office, George handed me some papers and said words to the effect of: 'Take these over to the Rubinos at Galston, Frank will meet you there and you just need to get the parents to sign the papers to get the financing to get them away from the bank.' I thought these documents to be the transfer documents. 29 I went to Galston, I met with Frank he went and got his parents and we met in an office in a shed on the property. Mr and Mrs Rubino said hello. Their English was not very good and we were not able to have a proper conversation. 30 Alfio exchanged words to the following effect: Alfio: What are these documents for? Me: They are to help you get finance for the Pine Valley Property. 31 At that time, my understanding was that the documents were to get finance to pay the bank so that the Rubino's [sic] could get their other property. I never organized or helped George organize any short term finance for the Rubinos at any time, nor was I acting on behalf of the lenders giving the finance. I was just there at the direction of George to get signatures and leave. 32 Biagina Rubino looked at me and said words to the effect of: 'Is it going to be alright. Are we going to keep our properties?' I replied in words to the effect of: 'Yes it's going to be alright'." 1. After Jetson was joined as a cross-defendant to Russo's cross-claim he had to search for bank statements and in the course of doing so, located his diaries for 2011, 2012 and 2013 in a box in his garage. He used his diaries to prepare his affidavit of 1 April 2016. The cross-claim between Russo and Jetson was settled, but the Registrar General read some of the paragraphs of Jetson's affidavit of 1 April 2016 and he was cross-examined on parts of his affidavit of 30 October 2015 that was not otherwise read. Parts of his affidavit of 1 April 2016 that were read incorporated paragraphs of his earlier affidavit, including paragraphs 28-32 set out above. In relation to those paragraphs Jetson said: "62 I refer to paragraph [28] of my previous affidavit where I said that 'I thought that these documents were transfer documents'. I do not remember the basis for which I said this in my previous affidavit. I think that I must have been thinking about transfer documents because everyone at the time was talking about the 'transfer'. When I say 'everyone at the time', I mean the solicitors who assisted me to prepare my previous affidavit as well as Lee and Frank on all of the occasions, since 2013, that I spoke to them about assisting them with their case. 63 In about January 2012 I was familiar with what a Transfer document looked like, being a single document that contained the word 'Transfer' across the top and contained boxes to fill in relevant details. I know this because I dealt with Transfer forms in my tasks for George and from my own personal experience. 64 I refer to paragraphs [29] to [32] of my previous affidavit. I repeat those paragraphs. Whatever the exact documents were that I had Alfio and Biagina sign, and on whatever date that might have occurred, I do nevertheless recall saying the words to the effect as I have stated in my previous affidavit in paragraphs [30] and [32]. 65 In relation to paragraph [32] of my previous affidavit, when I said to Biagina the words 'Yes it's going to be alright', I said those words to Biagina as no more than words of reassurance to help put her at ease. 66 I could give her no more than words of reassurance, because I did not know the specific details of the arrangement to help Biagina and Alfio with their properties. That is, I did not know exactly what was to happen or how the arrangement was to work at each stage. 67 As I said in paragraph [31] of my previous affidavit, 'my understanding was that the documents were to get finance to pay the bank so that the Rubino's [sic] could get their property'. I also refer to paragraph [26] of my previous affidavit. To elaborate on as much as what I recall that I understood at the time – my understanding was that George had arranged for lenders, being Kalischer and Huybers – to pay the debt that the rubino family owed to the ANZ bank. The Galston properties would be transferred to a 'friendly' entity who could apply for and receive finance. The Rubino brothers could not apply for finance because they were bankrupt (or at least that's what I thought that I understood at the time) and the family did not want to use Lee to obtain finance. After a period of say, a few months, George would have arranged a conforming bank loan for a Rubino family member, and the properties would be sold back to that family member." 1. I accept Jetson's latest evidence that he attended on the Rubinos in January to sign documents rather than in March. The plaintiffs submitted that Jetson changed his evidence out of self-interest, that is, as a result of his having been joined as a party to the proceedings. I do not accept that submission. His earlier affidavits and statutory declaration were prepared without the benefit of his diaries. His latest evidence accords with the objective probabilities having regard to other evidence as to the production of the contracts and transfers. His oral evidence was given in a straightforward way. 2. On 11 January 2012 the Hornsby Shire Council issued a planning certificate under s 149 of the Environmental Planning and Assessment Act 1979 (NSW) addressed to A and B Rubino at the Calderwood property. This document was required for inclusion in the contract for the sale of the Calderwood property. 3. In cross-examination Frank Rubino said that the Hornsby Council was near the Westfield Shopping Centre where he had a stall (T851). A record of Frank Rubino's telephone calls from his mobile phone shows his having made a telephone call to the council on the morning of 12 January 2012. He denied that the call had anything to do with his having requested or seeking to collect the s 149 certificate (T852). He said the call could have been about council rates. 4. The Optus mobile phone records for Frank Rubino's mobile phone showed that on 11 and 12 January 2012 he either called or sent text messages to Jetson on 17 occasions over those two days. 5. Wyse & Young required contracts to show to the bank's valuer who was to attend the properties on 12 January. Frank Rubino denied that any valuer came to the property on 12 January (T853-854). He denied meeting Jetson on 12 January 2012. He said that he was dealing with Jetson in relation to another issue concerning his Hornsby shop. The valuer's report to the bank was provided by CB Richard Ellis. They valued the Calderwood property at $1,350,500 and the Pine Valley property at $1,150,400, the same values that appear in the contracts. The report stated that the valuation was made as at 12 January 2012 which was the inspection date of both properties (CB 3/1022, 1026). The valuations stated that: "We have been provided with a copy of a pre-contract 'sales agreement' dated 7/12/11 with a proposed purchase price of $1,350,500 [$1,150,400]. As we HAVE NOT been provided with a copy of the fully executed contract of sale, we therefore confirm that we are unable to form an accurate opinion as to the veracity of the sale, nor any special conditions that may relate thereto. We have assumed in assessing our valuation that the contract amount as detailed in the Pre-Contract Sales Agreement is correct and final and that there are no onerous annexures or conditions attached to the contract that may have an adverse effect on the market value or marketability of the property." 1. It is not clear what the valuer meant by a "Pre-Contract 'sales agreement'", but it does not appear that the valuer was provided with a fully executed contract containing special conditions and necessary annexures. 2. Having regard to Klopf's evidence, which I accept, the handwriting evidence of Ms Novotny, Jetson's diary entries and his evidence summarised above, and Dimitriou's statement to Winiata that he had suggested that the loan proceed by way of a contract of sale, I conclude that Frank Rubino was aware of the preparation of the contracts and that his parents signed them. Preparation of trust deeds 1. On 9 January, Jetson, on behalf of Wyse & Young ordered a discretionary trust deed from a company called Company Creations Pty Ltd. Jetson advised that the details of the trust deed were for it to name Pineview as trustee, Dimitriou as "guardian/appointor" and Mr and Mrs Rubino's five grandchildren as "specified beneficiaries". A trust deed was duly provided. 2. Although a trust deed naming the Rubino grandchildren as beneficiaries was prepared, no executed trust deed naming them as beneficiaries was tendered. The only executed copy of the trust deed that was tendered was a trust deed dated 16 January 2012 signed by Jetson as settlor and by Huybers on behalf of Pineview as trustee. It named Huybers as the "specified beneficiary". The schedule to that trust deed which identified the settlor, the trustee, the specified beneficiary, the guardian, the appointor and the settled sum, was not signed or initialled, although it was dated. Dimitriou said that there was one trust deed with two schedules. He said that the ANZ Bank wanted a trust deed which showed one of the guarantors as being the beneficiary of the trust and that the change to the schedule was for the purpose of the stamping of the deed and its being shown to the bank (T744). He said that Winiata had said to him that the Rubino grandchildren could not be named as beneficiaries and that Huybers, as the company director and guarantor, should be the specified beneficiary, and the schedule was redone accordingly. 3. Mr and Mrs Rubino were not aware of the proposal to transfer the lands to Pineview that would hold them on trust for their grandchildren. Settlement with the ANZ Bank: release of certificates of title to Wyse & Young 1. The Heads of Agreement with the ANZ Bank provided that by 12 January 2012 Mr and Mrs Rubino were required to provide the bank or its agent with full access to the Arcadia and Pine Valley properties to inspect each of them to confirm that each was in a fit and proper state to enable vacant possession to be delivered to the bank on 16 January 2012. If and only if that obligation were performed the bank agreed to grant releases and to discharge the Calderwood mortgage. 2. Watson & Watson had acted for the Rubinos on the Farm Debt Mediation. On 11 or possibly 12 January they obtained the discharge of mortgage and certificate of title from the ANZ Bank in respect of the Calderwood property. They claimed a lien over the certificate of title as security for their costs. At that time they had not rendered a final account. 3. Frank Rubino deposed that on 12 January 2012 locksmiths turned up at the Pine Valley property and on the same day he was informed by Lee Rubino that the locksmiths had changed the locks on the Arcadia property. He and Lee had vacated the Arcadia property in accordance with the Heads of Agreement. Frank Rubino deposed that he telephoned Watson & Watson to enquire why the properties were being "rekeyed". He was told by Mr Watson's secretary that she believed that the Heads of Agreement had been settled. Frank Rubino deposed that he then telephoned Russo to ask what was going on and that he asked "How could it settle early?". He said that he thought that the family had until the 16th. According to Frank Rubino, Russo rang back and said that he had spoken to Watson & Watson who had advised that they had settled early on the instruction of Frank's father and mother. Frank said that that would not have been possible. According to Frank Rubino, Russo said he would notify Minter Ellison (solicitors for the ANZ Bank) to advise that the Rubinos were organising the required finance. 4. The conversation that Frank Rubino deposed to with Russo did not take place on 12 January. Russo was then in New Zealand and out of mobile phone contact. He returned on the night of Friday, 13 January 2012. 5. On 12 January 2012 Jetson faxed a letter to Mr and Mrs Rubino for their signature. The letter to be signed by Mr and Mrs Rubino was addressed to the ANZ Bank, Watson & Watson and Minter Ellison and stated that they gave authority for Dimitriou of Wyse & Young to act on their behalf to ensure the successful settlement of all three properties. The letter stated that Watson & Watson were provided with requests that were not undertaken and had no instructions to procure settlement yesterday (January 11, 2011). Nor were they provided with any instructions other than to advise the bank of the Rubinos' intention to discharge the Pine Valley and Arcadia properties within the time specified in the deed. The document contains what purports to be the signatures of Alfio and Biagina Rubino. However, the signatures were not their signatures but were consistent with the group 2 specimen signatures referred to previously in which other documents had been purportedly signed for Mr and Mrs Rubino. Those signatures could have been placed on the document by Frank Rubino or, possibly, by either Jetson or Dimitriou. It is unnecessary to make a finding on this question. 6. On 13 January 2012 Wyse & Young sent a copy of the attached authority to the ANZ Bank, to Mr Richard Watson of Watson & Watson and to Minter Ellison. Dimitriou, who signed the letter for Wyse & Young, advised that: "Our clients have elected at 4pm Monday, 16 January 2012 by way of redemption and discharge of the Pine Valley mortgage pay the sum, of $1,050,000 … to you the lender at the offices of Minter Ellison." 1. In his affidavit of 21 July 2014 Russo had deposed that on or about 12 January 2012 Frank Rubino telephoned him and said that Watson & Watson was refusing to release the title deed unless they were paid some money. Frank Rubino asked him to step in and sort it out. In oral evidence, after having checked his itinerary Russo said that this happened on the morning of Saturday, 14 January. Russo deposed that he then attended on Frank Rubino and Mr and Mrs Rubino at their home and had a conversation in which Frank said words to the effect: "We want you to negotiate a settlement with Watson & Watson. George has organised the money to buy the second block but it must be done by the date in the Agreement. We want you to go up and make sure we can get this property." 1. Russo said he was happy to do the negotiations with Watson & Watson. Under cross-examination by Mr Foley for Dimitriou, Russo said that his involvement started on 14 January when he was contacted by Frank and he went over to the Rubinos. He had a discussion with Mr and Mrs Rubino and Frank in which Frank: "… spelt out a bit of a chronology, what had happened since Lee Rubino pulled out, and that the money had been organised, and that he had been speaking to Watson & Watson during the course of the week, and that a problem had arisen in relation to picking up the title deeds, because they were owed some money, and that he needed the title deeds for the purposes of getting the short-term finance." 1. Frank told him that Watson & Watson were claiming a solicitor's lien over a title deed Watson & Watson had collected from Minter Ellison. That had the potential completely to disrupt the Rubinos' ability to get back the Pine Valley property (T618-619). His instructions were to go with them to Watson & Watson on Monday, 16 January to resolve the dispute with Watson & Watson and then to go to the settlement and do the settlement with Minter Ellison (T619). This evidence was consistent with the objective probabilities and I accept it. 2. This was the extent of Russo's retainer, namely, to negotiate with Watson & Watson to obtain from them the certificate of title to the Calderwood property. 3. On 14 January 2012 Alfio and Biagino Rubino signed authorities addressed to Watson & Watson and to the ANZ Bank and Minter Ellison, advising that Russo had been retained to act for them to conclude the settlement of all outstanding matters. The advice to Watson & Watson directed that firm to hand over all documents to Russo at his request. 4. On Sunday, 15 January 2012 Dimitriou sent an email to Richard Watson accusing Watson & Watson of unprofessional conduct in settling with the ANZ Bank to obtain the discharge of the Calderwood property. He alleged that Watson & Watson did not have the "proper consent and knowledge by the farmers". He threatened to report Watson & Watson to the Law Society. Dimitriou's concern was that he required the Calderwood certificate of title to provide security for the advance of $1,050,000 that had been arranged to discharge the ANZ Bank's mortgage over the Pine Valley property. 5. On 16 January 2012 Jetson sent an email to Mr David Quinn, a solicitor at Watson & Watson also acting on the matter. He attached to his email a letter of authority that bore the signatures of Alfio and Biagina Rubino dated 16 January 2012. The letter stated: "We Alfio Rubino and Biagina Rubino hereby authorise Mr Harjeet Singh on behalf of Wyse & Young International Pty Ltd to collect original title deeds and discharge of mortgage for the property at … Calderwood Road, Galston that was presented to you at the unapproved settlement on Wednesday, January 11, 2012. … We also hereby advise that we wish you to cease acting on our behalf. This notice of termination of services is effective immediately. Please send a final invoice for your work." 1. The plaintiffs denied the authenticity of the signatures of Alfio and Biagina Rubino on this letter. However, three things point to the signatures being authentic. First, Ms Novotny said that a comparison of the questioned signatures in the name of Alfio and Biagina Rubino revealed numerous similarities and only isolated dissimilarities between the signatures on this document and the group 1 specimen documents. Because of the quality of the reproduction of the document with which she was provided, she expressed no conclusion as to whether or not the signatures were the genuine signatures of Alfio and Biagina Rubino. So far as her opinion goes, it is consistent with their signing the letter of authorisation. A second document was prepared dated 16 January 2012 addressed to Watson & Watson that omitted the last paragraph quoted above. It also appears to be signed by Alfio and Biagina Rubino. Ms Novotny had the same opinion in relation to that document. 2. Although Ms Novotny expressed no conclusion as to the authenticity of the signatures, her only hesitation was due to the quality of the reproduction. Her opinion provides no support for the plaintiffs' contention that the signatures on the letters were forged. 3. Secondly, the first letter was sent to Wyse & Young from a fax machine that had the name "Inbloom Warehouse". It was admitted that there was a fax machine at the Calderwood property that had been the fax machine of Inbloom Flowers. It is probable that the fax was sent from the Calderwood property. Lee Rubino accused Dimitriou of manufacturing the document and including a false footer stating "Inbloom Warehouse". There was no evidence to support that accusation. The fax imprint bears a date 17 January 2012 at 01.06, whereas the letter was an attachment to an email sent on 16 January at 1.04pm. Although this raises some concern about the fax footer, it is more probable that there was a problem with the dating of the fax machine than that the footer naming "Inbloom Warehouse" was somehow manufactured by Wyse & Young. 4. Thirdly, the plaintiffs retained a solicitor, Mr Dominic, to represent them in the proceedings in the Common Law Division in which they sought a stay of the bank's judgment for possession. Mr Dominic affirmed an affidavit on 23 October 2013 in which he deposed to certain facts and said that he did so in reliance on instructions given by Alfio and Biagina Rubino and on instructions given to him by Lee Rubino as well as by reference to certain other documents including documents received from Watson & Watson. Mr Dominic exhibited to his affidavit the letter from Dimitriou addressed to the ANZ Bank dated 13 January 2012 together with the letter of authority from Alfio and Biagina Rubino dated 12 January 2012 referred to at para [116] above and he also exhibited to his affidavit the email dated 16 January 2012 sent by Jetson at 1.04pm on that day with the enclosed authority from Alfio and Biagina Rubino to Watson & Watson "to collect original title deeds and discharge of mortgage for the property". It would be expected that Mr Dominic would have raised any issue he had about the authenticity of the signatures of Mr and Mrs Rubino had they raised any such question with him. 5. There is no sufficient basis to conclude that the signatures of Alfio and Biagina Rubino on the letter of authority were not genuine. It is the plaintiffs who raise the issue of authenticity. The onus is on the plaintiffs to establish that the signatures were not genuine (Re Application of Sutherland and Arnautovic [2014] NSWSC 821 at [63]-[65]). 6. Frank Rubino deposed that on the morning of 16 January 2012 he received a phone call from Russo who told him that Watson & Watson had organised a settlement for the Heads of Agreement at 2pm that same day, but that they would not hand over the title deed to the Calderwood property unless his parents attended the office in the city. He said that Russo told him that Watson & Watson also wanted $25,000 to be deposited into their trust account for their fees as they had not "reconciled" (sic) their final account. He said that Russo asked him whether he could organise the money and make sure that his parents got ready. He deposed that Russo said: "I will come through and pick you up – just hurry." Frank Rubino said that he immediately left his florist shop in Hornsby where he had been working and went back to the Calderwood property. He arranged for his parents to go immediately into the city. They brought with them $9,000 in cash that Mrs Rubino had in the house. Russo picked them up at the Calderwood property. On the way into the city Frank Rubino telephoned Lee and arranged her to transfer $16,000 into Watson & Watson's trust account. 7. Russo also said that he had a conversation with Lee Rubino in relation to her providing money on the 16th. He gave the following evidence: "Q. What did you say? A. I said to her, or something along these lines, 'Lee, if I don't have this money I can't go and do the settlement up at MinterEllison, and I can't give the certificates of title to get the money'. Q. That was provided, the money? A. Yes, she made some remarks about Watson and Watson, and I think I said to her, 'Well, that's for another place; we've got to do this now, otherwise we're going to lose this property' and she said, 'I'll do it straight away' and she did it straight away. … We went down, after the meeting concluded I walked down the stairs with Biagina, Alfio and Frank, and I said to them, 'Are you sure you want to do this?' and they said, 'Yes, run' and then I went racing up to MinterEllison." 1. The plaintiffs' case against Russo was that he was negligent in releasing the certificate of title to the Calderwood property to Jetson. The plaintiffs say that Russo was retained to collect the certificate of title and to hold it for Mr and Mrs Rubino. But if that were so, what was the urgency? 2. Frank Rubino said that there was no dispute with Watson & Watson about their account. He could not explain why there was any urgency. His only answer was to say that he was following Russo's instructions (T234-235). I do not accept that evidence. In any event, there is no reason Russo would have given any such instructions unless there were an urgent need to obtain the release of the certificate of title over the Calderwood property. 3. Frank Rubino, and at least his father, knew that the short-term lenders that Dimitriou was organising required security over both the Pine Valley and the Calderwood properties. He deposed that he received a telephone call from Russo in which Russo said that Dimitriou wanted caveats signed by Frank's parents on both properties. He said that he asked what a caveat was for and Russo said that it was a form of security for the short-term loan that Dimitriou wanted. I do not accept that this telephone call was made between Russo and Frank Rubino, but it demonstrates that Frank Rubino knew that the short-term lenders required security over both properties. Frank Rubino deposed that he told his parents that a caveat gave the private lender a form of security over the property until the $1,050,000 was paid back. He said that Alfio said that if that was what was needed to be done to get the private loan then they should sign it. 4. Russo, Mr and Mrs Rubino and Frank attended at the offices of Watson & Watson on the afternoon of 16 January 2012. Mr David Quinn, a solicitor employed by Watson & Watson, prepared a detailed file note. Mr Kim Gourlie and Quinn met with Alfio and Biagina Rubino and Russo. Quinn kept notes and Gourlie conducted the conference. Quinn deposed that the meeting was called urgently because under the mediation agreement, the Rubinos had only until 4pm on that day to pay money to discharge the mortgage over the Pine Valley property. 5. He deposed that the Rubinos required the title deed to the Calderwood property so that it could be provided to a short-term funder to allow moneys to be paid to the ANZ Bank to discharge the amount claimed under the Farm Debt Mediation agreement. (Affidavit para [7]). He took extensive notes of what occurred at the meeting. There was no challenge to the accuracy of those notes. Russo acted as interpreter for Alfio and Biagina Rubino. Quinn recorded the series of questions posed by Gourlie interpreted by Russo from English into Italian and then the answers provided by Mr and Mrs Rubino in Italian as translated into English by Russo. His notes include the following: "KG: Richard Watson wanted in the first instance to retain your property but that if there was some money paid for one or two of the other two properties then they could be retained. AR: Yes, but he, meaning Frank, wants to keep the other 5 acre property. KG: You want no more than to keep your house? AR: Yes, and another 5 acre property. KG: You told Richard Watson you did not want to make further borrowing, that is more money? AR: No. We deny that we told Richard that. KG: Biagina, did you tell Richard to settle as soon as possible with no further borrowing? BR: No, I did not say. KG: Are you happy with what is happening today, that is, that you are borrowing more money? It has been explained to us by Mr Russo that Frank proposes to secure a temporary arrangement with Illawarra Mutual Building Society (IMB) wherein they will provide enough money for him to redeem, that is to secure again the 5 acre property for $1,050,000.00? AR: Yes, we are alright. KG: Do you understand that only a proposed temporary arrangement of 2 weeks? AR: Yes we are okay. Anyway we have saved the 5 acre property and we want to save the other 5 acre property and if possible the 40 acre property. KG: You are happy to refinance your house on a temporary basis and that the Illawarra Mutual Building Society will at some stage after the 2 week period to secure the 5 acre property (not being your home property) and that your home property will then be unencumbered. That is the proposition that has been put do you understand that? AR: Yes. KG: You may if the loan with the Building Society is not serviced and interest paid then you lose your home in say 6 months time? AR: Yes KG: You are happy to place your home again at risk? AR: Yes. We have to do what we have to do if things go wrong we will lose our house. AR: What would you do if you saw your son drowning in water, would you let him drown? KG: Are you happy for Watson & Watson to give the title deeds to your home property being the Calderwood property and the discharge of mortgage to Sal Russo? AR: Yes. Thereafter there was discussion about the mechanics of the settlement with Minter Ellison and that Watson & Watson would accept the termination of instructions from Alfio and Biagina Rubino, thus Russo & Partners through Sal Russo would attend a settlement later that day the mechanics of which we would endeavour to assist so that the transaction proceeded. At the end of the conferencing we confirmed that Watson & Watson maintained a lien over the Certificate of Title for unpaid legal fees which were then of the order of $5,167.50 in respect of Tax Invoice no. 5 dated 21 December 2011 being the balance. David Quinn had prepared over the lunch time break a quick calculation of what the likely quantum of new Tax Invoice no. 6 (Final) to be dated 17 January 2012 for the period 21 December 2011 to 17 January 2012 would be and that it was anticipated that there would be Counsel's fees due to Mr Jim Johnson for his involvement in relation to the proposed Supreme Court Equity Proceedings which did not eventuate and in that regard David Quinn made an allowance of $3,000.00. …" 1. Quinn recorded that Watson & Watson calculated that the amount owing for their fees and for counsel's fees was $25,000. Russo had in his possession $9,000 in cash which was counted by Mr Gourlie and thereafter a bank transfer of $16,000 of cleared funds were received into the firm's trust account making a total of $25,000. 2. Mr Quinn's filenote continued as follows: "Thereafter appropriate authorities and acknowledgments were prepared and the writer was present when the acknowledgement on file dated 16 January 2012 signed by Alfio Rubino and Biagina Rubino was first of all interpreted and thereafter signed by them and that was then notarised by Mr Sal Russo as both solicitor and interpreter. Thereafter there was also the acknowledgement signed in relation to the receipt of documents which is also on the file. During the totality of the conference, Mr Frank Rubino was requested to wait in the waiting room adjoining the conference room and he took no part in the conference whatsoever." 1. The letter "notarised" by Russo is the letter signed by them on 16 January addressed to Watson & Watson in which they acknowledged receipt of the certificate of title for the Calderwood property, a discharge of mortgage, and a letter of release from Minter Ellison dated 11 January 2012. They signed a letter that included the following: "In essence, we acknowledge the following to be our understanding: (a) Whilst we wish to retain the Calderwood property, we are intent in seeking where possible, to retain the other 5 acre property. (b) We understand that the Calderwood property will be used as a temporary facility for borrowing from Illawarra Mutual Building Society (IMB) and that after a period of two (2) weeks from today, there will be a re-adjustment of securities so that the title to the Calderwood property will be returned to us without encumbrance. (c) We are content for Items (1) and (2) above to be handed to our new solicitor, Mr Sal Russo on our behalf. (d) We understand that our home property will again be used as security for borrowings and as such could be placed at risk." 1. The reference to the Illawarra Mutual Building Society is curious. Russo said that he was repeating what he had been told by Frank Rubino. Frank Rubino denies this. It is unnecessary to pursue the question. It is clear from Quinn's evidence that the Rubinos understood that the Calderwood property would be provided as security for a loan with which to discharge the mortgage over the Pine Valley property and that if the instalments for repayment of the loan were not made the Rubinos could lose their Calderwood property. 2. It does not follow that Frank Rubino was aware of the plan that Pineview would take a transfer of the property from Mr and Mrs Rubino and borrow on security of the properties which would be held on trust for the Rubinos. But it does follow that the principal complaint made against Russo, namely that he allowed Wyse & Young to collect the certificate of title to the Calderwood property on 16 January 2012, is groundless. 3. Jetson did not arrive with the cheque for $1,050,000 by 4.30pm on 16 January. However, Minter Ellison agreed to the settlement taking place on the following day. Russo provided the certificate of title to the Calderwood property and discharge of mortgage to Jetson. Jetson attended settlement the following day and received the certificate of title to the Pine Valley property and the discharge of mortgage over that property. Those documents were kept by Wyse & Young. 4. The $1,050,000 loan from Huybers and Kalischer to the Rubinos was not documented. There appears to have been no discussion as to what interest or fees would be paid to Huybers and Kalischer. Frank Rubino said that he assumed that the interest would be about 10 per cent per month, but then said that therefore if the loan were for three months, it would cost $30,000 (T323). This would only be so if interest on the loan were one per cent per month, or 12 per cent per year. Dimitriou's advice to Huybers 1. On Friday night, 6 January 2012 Dimitriou sent an email to Winiata that was copied to Huybers in which Dimitriou said that the ANZ Bank had confirmed that a settlement of Huybers' loan would take place the following Monday. Huybers agreed that the $600,000 was available on or about 6 January (T 409). An indication of Huybers' vulnerability to Dimitriou is shown in her email to him on the night of 6 January responding to his advice in relation to the settlement for the 9th. She said: "Hey George, Im just checking emails and can see that you are hard at work on a Friday night. Go home darling!!!! Ring me if you want to b/c Im at home by myself. … I got back here about 6. I sent you a text. Maybe you are in business mode right now? I know that is important but I like you better in social mode …" 1. On 15 January 2012 Dimitriou sent an email to Huybers advising her that he had written to the solicitors to advise them that they would settle the Pine Valley property facility first. He advised that the valuations for the Pine Valley and Calderwood jointly came in at $2,550,000 and said: "… so we are lending jointly $1,050,000 and the stamp duty, your investment, my investment and some from Danny together we will be lending thru Defined Properties Investment Pty Ltd – Defined Properties Investment also owns currently $3,800,000 worth of asset. I am the director. I will guarantee all investors monies as I always do. In this lend we will hold both titles, both titles will immediately after we receive the titles, have registered mortgages by Defined Properties and caveats in behind by you, I and Danny – defined properties investment will also allow a charge to you and to danny and I for the funds deposited into it for the purpose of this lend. I am preparing those documents over night tonight and the mortgages and caveats, and also So therefore we are all covered two fold. Upon the purchase of the 2 Galston properties by Pineview Trust (susan sole director and beneficiary and her children and grandchildren jointly) that David has procured, immediately will return the monies together with interest and fees and then ANZ will hold those titles. Upon discharge of this facility, all extra monies made will be direct debited to your on line saver account. I will then procure to set the funding for Arcadia, we will then invest and lend the $1,050,000 into that property, The Rubinos will supplement the facility with 550k and they will pay that Stamp duty as Bank discharge is $1,650,000. So we will then hold a 1st Mortgage over Arcadia worth $2,595,000. I have also with David lodged the facility for this one as well. Susan all thru the process you will be fully informed. Furthermore Danny and I will more than likely catch up with you within this week. Please do not discard this email and remember that 'Angel You Met' Just remember you need to thank Neil, for all the Bad he did, one good thing came out of it, you met Andrew and I. [sic]" 1. Contrary to what he represented to Huybers, Dimitriou did not join in lending any money to the Rubinos. Nor was the $1,050,000 investment made through Defined Properties Investments. Nor was the $1,050,000 loan secured by a registered mortgage. Nor did Defined Properties Investments give Huybers a charge for funds deposited into it. The $1,050,000 was not deposited into Defined Properties Investments. Huybers was not "covered two fold". 2. Nor was Huybers the beneficiary of the Pineview trust. A schedule to the trust deed was prepared naming Huybers as the beneficiary of the trust, but it was only prepared for the purpose of being shown to the ANZ Bank to satisfy its lending requirements. Dimitriou said that a second trust deed was prepared naming Huybers as beneficiary as it was the only way the bank would agree to lend the money to Pineview. He said the two Galston properties were never going to be held on trust for Huybers. He said it was a "banking rule" that the Rubino children could not be the beneficiaries and that she had to be the specified beneficiary (T749). The second trust deed naming Susan Huybers as a beneficiary of the Pineview trust was a sham. It was never intended to operate according to its tenor. It was produced to deceive the bank. 3. In his email of 15 January 2012 Dimitriou promised that on the purchase of the two Galston properties Huybers' loan would be immediately repaid together with interest and fees. That did not happen. I find that Dimitriou had no intention of its happening. When the ANZ Loan to Pineview was settled, on 9 March 2012 he did not tell Huybers. He has not repaid her the $570,000 she advanced. 4. Dimitriou had no basis for his statement that the $1,050,000, when repaid on the settlement of the ANZ Loan, would be used to discharge the bank's mortgage over Arcadia with the Rubinos contributing $550,000. That was never the proposal. His statement that Huybers would be fully informed throughout the process was false. I am satisfied he had no intention of keeping Huybers informed. Dimitriou preyed on Huybers' naïvety and vulnerability. Wyse & Young's retainer agreement with Pineview 1. Huybers as sole director of Pineview and Green Global signed a retainer agreement with Wyse & Young dated 9 January 2012. The agreement was in similar terms to the Rubino retainer agreement of January 2011. The agreement was also signed by Dimitriou as sole director of Wyse & Young. Part of the work described was the preparation of tax returns and financial statements for Pineview and provision of accounting work for Green Global. Item 6 of the letter identified other work as being: "Finance Fee Referral Mandate Reduction in Mortgage Discharge, Debt negotiation, discharge and Reduction to outgoing first Mortgagee, Referral agreements, Consultancy work, Separation Consultancy Business advisory, Relevant searches and all travel expenses, All interstate accommodation expenses." 1. Under this heading the work Wyse & Young was to do was more particularly described as including preparing, assessing and lodging and referring finance applications on behalf of Huybers, Green Global and Pineview, and also negotiating the discharge from a current first registered mortgage. Huybers agreed to pay a fee of not less than 20 per cent plus GST of "the amount negotiated off the current balance of debt payable and the negotiated amount paid (the saved debt)". This paragraph is really inexplicable as a term of a retainer agreement with Pineview or Green Global. Dimitriou said that it was simply a standard term of the retainer letter. The letter contained an agreement by Huybers, Green Global and Pineview to pay a fee of 3.3-8% of "the total loan amount unconditionally approved plus GST, being the fee payable for obtaining the unconditional loan approval and discharge of any current liability the subject of the loan application". There were further provisions to provide for the payment of that fee whether or not the loan proceeded. Section 5 of the letter stated that the estimated disbursements for carrying out the tax return and accounting work and the work described in paragraph 6 would be $58,500 and the estimate of disbursements and fees for the work described in paragraph 6, 8 and 11 was $650,000 plus GST. (Paragraph 8 of the letter did not refer to the doing of work. Paragraph 11 provided for the charging of "our standard hourly rates" for "Additional Services".) I assumed that the estimate of $650,000 as fees that might be charged to Huybers, Green Global and Pineview was a typographical error and should have read $65,000. (Wyse Accounting raised an invoice dated 14 February 2012 addressed to Pineview for $66,265.76 being a three per cent "loan fee" on the advance of $2,000,720 plus GST.) However, in submissions Mr Foley, who appeared for Dimitriou and the Wyse & Young companies, said that Dimitriou maintained that the retainer agreement was drawn up and signed to cover "that particular problem", that being Huybers' authority for Dimitriou to apply the moneys to be borrowed by Pineview from the ANZ Bank in payment of fees claimed by Dimitriou from his past dealings with the Rubinos. 2. The submission continued: "Foley: At page 931 of the court book and following … is a Wyse & Young appointment letter and costs agreement signed by Huybers, dated 9 January and containing, Mr Dimitriou believes, … a perfect authorisation in respect of para 7 of $650,000 plus GST. His Honour: You mean $65,000 plus GST? Foley: $650,000 plus GST. His Honour: In para 7? How can that arise from this document? Foley: He says that he had this document drawn up and signed to cover that particular problem, and it discloses that there is this $650,000 fee. His Honour: Actually it says that's an estimate of what those fees could be, doesn't it? Foley: Yes. His Honour: Having regard to the work described in paras 6, 8 and 11. Foley: Yes. And that doesn't – His Honour: How can you get there [for] that work? I can see three per cent on the loan that he arranged for Pineview. Foley: Yes. It's just that he says that the figure was put in there to justify that the payments to him are in respect of the Pineview moneys [sic]. His Honour: Really? Although they weren't for expenses that Pineview was incurring [but] for past debts that he claimed were owed by the Rubinos [where] Pineview and Susan Huybers had no involvement at all. Foley: Precisely. But still the document was created and signed by Susan Huybers, out of which she also benefitted in terms of the payments to her. …" (T1036) 1. I see no reason not to act on that admission. It was never suggested to Huybers that she understood that Dimitriou would be using the moneys borrowed to recoup moneys he claimed were owed by the Rubinos for past debts. It was not suggested to her that she understood that that was the intended purpose of the estimate of $650,000 plus GST in the retainer letter. The retainer agreement in this respect was misleading and apparently deliberately so. 2. The retainer agreement also included a term that Huybers, Green Global and Pineview consented to Wyse & Young's lodging a caveat over any property any of them own to secure, charge and encumber any such property for the fees and disbursements which remained unpaid. A caveat was in due course lodged over the Calderwood and Pine Valley properties, apparently consented to by Huybers. It was lodged after the transfer to Pineview had been registered. Information provided to the ANZ Bank 1. The information provided to the ANZ Bank in support of the loan application included what purported to be tax returns for Huybers and Green Global for the year ended 30 June 2011. Huybers' tax return as provided to the bank stated that she had a taxable income of $222,085. In her statement to the police dated 10 November 2015 Huybers said that she did not receive taxable income of $222,085 in the 2011 financial year. She said that in accordance with a draft return she had viewed and had instructed a Navneet Kaur to lodge on 15 November 2011, her taxable income for that year was $19,213. Navneet Kaur was an accountant whom Huybers said worked with Dimitriou at Wyse & Young. She said that on 15 November 2011 she received an email from Ms Kaur enclosing draft tax returns for the years ended 30 June 2010 and 2011 and a tax invoice from Wyse & Young for the preparation of those returns. The draft return for the year ending 30 June 2010 revealed a taxable income of $160 and that for the following year revealed a taxable income of $19,213. She replied by email to Ms Kaur stating that the drafts looked fine. She expected to receive a refund of tax but never did. The statement of Ms Huybers to the police was admitted without objection and without any application for limitation as to its use. I accept Huybers' evidence about this matter. She was not cross-examined on that evidence. Dimitriou did not respond to it and claimed privilege against self-incrimination when asked about the preparation of the tax returns. This is another example of a fraud being practised on the ANZ Bank to get the loan approval for the Pineview loan. Loan offers to Pineview 1. On 23 February 2012 Huybers signed the letters of offer from the ANZ Bank. There were two offers: one for $1,080,400; and the other for $920,320. On the same day she also signed mortgages in favour of the bank. Her signature to the mortgages was purportedly witnessed by Dimitriou. She said that she did not appreciate that she was signing acceptances for two loan offers rather than one. The documents had been sent to her in the post and she was told that it was urgent that she sign them. They had red and yellow stickers saying "Sign here". She spoke to Jetson on the phone and he told her to sign where it said "Sign here" (T379). The loan offer for $1,080,400 was at the top of the pile. She signed where indicated without appreciating that she was signing for two loans. I accept that evidence, but it does not materially assist Huybers' case. She has not alleged that Dimitriou misrepresented to her how much was to be borrowed from the ANZ Bank by Pineview. The first transfer document 1. Klopf gave evidence that on 2 March 2012 Jetson telephoned her and asked her to do a search for the Galston properties and fax them to him and also to type up a transfer for both properties which he said he would get Frank to pick up. He gave her further details on the basis of which she drafted a transfer document and printed the form of transfer. She deposed that Frank attended the office while she was there and collected the form of transfer. This was a transfer expressed to be from Alfio and Biagina Rubino to Pineview Property Holdings Pty Ltd for $2,450,900. She deposed that a few days later on 6 March 2012 she received a call from Frank Rubino who said words to the effect that "Andrew says the amount on the transfer needs to be changed". She asked what it should be and Frank said "$2,500,900. Mauro will pick it up". She deposed that she made the alteration and sometime later Mauro Rubino collected the transfer. This was the document later signed by Alfio and Biagina Rubino whose signatures were witnessed by Frank Rubino for transfer of the properties to Pineview for the consideration of $2,500,900. In oral evidence Klopf was not sure which brother collected which transfer. She said one was collected by Frank and one was collected by his brother (T591), but could not recall which way it went (T592). 2. I accept Klopf's evidence that she prepared the two forms of transfer, one of which was collected by Frank and one by Mauro. It is more probable that the first transfer was collected by Mauro because he signed it as witness to his parents' signatures. 3. Mauro gave evidence that the transfer document that he signed as a witness was brought to him by Jetson at a shed on the Calderwood property who handed the form to him and asked him to sign it. Mauro deposed that he asked Jetson what the form was and Jetson said that the form was part of a new loan application which was being made by Dimitriou for the Pine Valley property. He said he was aware that Dimitriou was making an arrangement to apply for a loan for the Pine Valley property. He says that he signed the form at the place where Jetson indicated he should sign. He said there were no other signatures on the form when he signed it. He said that Jetson took the form away. 4. I do not accept this evidence. Mauro was not a convincing witness. Mauro's evidence was not corroborated by Jetson at any time. His evidence that he signed the transfer as a witness but there were no signatures to be witnessed is implausible and I reject it. The transfer he signed that showed the consideration of $2,450,900 was undated. 5. I find that the transfer bearing Mauro's signature as a witness was collected from Russo's Arcadia office by either Mauro or Frank. It was probably collected by Mauro. I find that Mauro signed the document after his parents had signed the document as transferors and he witnessed their signatures. The second transfer document 1. There is no dispute that Frank Rubino witnessed his parents' signatures to the second form of transfer of the properties to Pineview that was ultimately registered. He deposed that Dimitriou telephoned him that morning and said words to the effect that he was sending Jetson with some "application forms for the new loan" for his parents to sign. Frank Rubino says that he telephoned Russo who telephoned back half an hour later to say that: "Don't worry. George wants your parents to sign application forms for finance. Ask your parents to sign them. You know George, he keeps everything to himself. They are just application forms. Get your parents to sign them and give them back to him. Do you want the loan or not?" 1. Frank Rubino said that in his conversation with Dimitriou he asked him whether he had organised a loan and Dimitriou said there were two possible lenders he was looking at and he would see who gave the best deal. 2. Russo said he had no knowledge of any loan documents or details of loans being undertaken by Dimitriou. I accept that evidence and accept Russo's denial of the conversation attributed to him. Russo's evidence is consistent with the mobile phone records of Frank Rubino produced on subpoena by Optus. These showed four telephone calls having been made by Frank Rubino to Russo's office on 2 March 2012 and one to Wyse & Young on that day (Exhibit SR-1 page 71). That was the day that Klopf said she received a call from Jetson asking her to prepare the transfer. His mobile phone record records a call to Russo's office on the morning of 6 March 2012 which again is consistent with Klopf's evidence, but no calls to Russo's office on 8 March. (There were further calls on 9 March which again is consistent with the defendants' case because the auction of Arcadia was scheduled for 10 March contrary to Frank Rubino's evidence who initially said the auction was scheduled for 17 March). 3. Frank Rubino said that Jetson visited the Calderwood property at about 2pm on 8 March with several papers in his hand. According to Frank Rubino, Jetson said that the documents were for refinancing the Pine Valley property and were "applications for the conforming loan". According to Frank Rubino, he said, "Do you know which bank the application is for?", and Jetson said: "No. George has got a couple of banks he is dealing with at the moment. He is negotiating with them. Your parents just need to sign these application forms so I can get them back to George and he can get the process going." When he and Jetson met his parents Alfio asked what the documents were and Frank said, "These documents are the loan application for the Pine Valley property loan. I have spoken to Sal Russo and he says that it is okay to sign the documents", and that Jetson said, "Mr Rubino, these papers are for the application for finance, for the Pine Valley property." Frank Rubino said that the papers were marked with his parents' initials to indicate where they were to sign and that Andrew "flipped the pages to where the markings were for the signatures and my parents each signed. They did not read the documents." Frank Rubino said that he also did not read the documents, but signed as witness to his parents' signature at several points where Jetson directed. 1. There is no corroborative evidence that there were several documents signed at this time by the Rubinos, rather than a single transfer document (aside from the earlier transfer referred to above). I do not accept that at least Frank Rubino could have been in any doubt when he witnessed his parents' signatures to the transfer that the document his parents had signed was a transfer of two properties from them to Pineview. In the witness box Frank Rubino gave a demonstration indicating that there was a wad of documents attached by a large bulldog clip with the transfer somewhere in the middle with the top pages folded back. The demonstration was unconvincing. But it showed that he could plainly see the document he was signing and that it was a form of transfer of property from his parents to Pineview. 2. The plaintiffs tendered a statutory declaration made by Jetson on 20 August 2013. This was at a time when Jetson was assisting the plaintiffs in their fight with the bank. Jetson there declared that: "When the parents sat down I gave them the transfer document. They asked what it was and Frank and I explained that it was to help arrange financing for the second property." 1. That is what the document was for. The significance of Jetson's statutory declaration is that he said that not only he, but Frank, explained to his parents that the document was to help arrange financing for the second property. Frank Rubino and Winiata 1. A matter adverse to Frank Rubino's credit emerged when he was cross-examined following his having given oral evidence in reply to matters raised in the oral evidence of, amongst others, Dimitriou. Dimitriou had given evidence that Frank Rubino was fully appraised of his discussions with Winiata. He said that Frank met Winiata in Dimitriou's boardroom (T774). He said that Frank had asked for the arrangements to be kept as confidential as they could be and knew everything that was happening (T797). In giving evidence in reply, Frank Rubino said that he had never met Winiata in his life (T829). He was asked (in chief) whether he had spoken to him other than face-to-face and replied, "I've never met him; I've never spoken to him" (T832). However, under cross-examination, after Frank Rubino was required to produce his mobile phone, he admitted that Winiata's telephone number was in his address book on his phone (under two different spellings). The mobile phone number recorded in his phone for Winiata matched entries in the documents produced on subpoena by Optus for Frank Rubino's mobile phone for calls on 19 and 20 January. Frank Rubino said as to these calls that he had inadvertently spoken to somebody on that number (T841). There was a further phonecall to David Winiata's mobile telephone number on 30 and 31 January and a further call on 6 February 2012. Having been taken to those calls Frank Rubino was asked the following questions: "Q. You'd agree would you not that the topic of the telephone conversation was obtaining money through the efforts of David Winiata? A. No because I can't recall the conversation. Q. What was the most pressing concern in your life in February of 2012? A. Obtaining finance, conforming loan for the Pine Valley property. Q. You knew David Winiata was an officer of the ANZ Bank didn't you? A. That's correct. Q. You knew in February 2012 that he was a man that could assist you in getting finance through the ANZ Bank? A. I didn't know he was a bank officer for the ANZ Bank back then. HIS HONOUR Q. I thought you said you did know he was an officer of the ANZ Bank, didn't' you say that? A. Well, I did know afterwards, yes. Late in 2012." 1. Frank Rubino was forced to shift his position repeatedly in relation to his dealings with Winiata. I am satisfied that in January and February 2012 he knew that Winiata was an officer of the ANZ Bank (contrary to his last denial). He was speaking to Winiata (contrary to his earlier denial) and the probability is that he was speaking to Winiata about the loan that Winiata was helping arrange for Pineview on the security of the two properties. 2. All of this took place well before the conversations that Frank Rubino said he had with Dimitriou and Jetson in which, according to him, he was told that Dimitriou was negotiating with two possible lenders for a conforming loan. I reject that evidence. Payment of ANZ loan 1. Huybers said that she gave no authority for the loan moneys to be paid to Wyse Accounting or Wyse & Young. Dimitriou provided the bank with a letter signed by him as "c/- Wyse & Young International Pty Ltd" stating that: "At settlement your client (viz. the bank) is directed to pay the balance of the Mortgage advance purchase namely $000,000 less ANZ Usual fees and charges in Bank Cheques as follows: In Bank Cheques as follows (c) $123,059.50 to WYSE & YOUNG INTERNATIONAL PTY LTD (d) $1,867,491.50 to WYSE YOUNG ACCOUNTING PTY LTD to Discharge Torrens Title 1/610450 and 2/610450 [sic]." 1. The letter was also addressed to Huybers and Pineview. I do not conclude it was sent to Huybers. I accept her denial of knowing that the loan moneys were to be paid to Wyse & Young or Wyse Accounting. 2. It was false to say that the $1,867,491.50 to be paid to Wyse Accounting was to be paid to "Discharge Torrens Title 1/610450 and 2/610450". Whilst Huybers and Kalischer had an equitable mortgage from the deposit of title deeds in respect of those properties, the only amounts required to discharge their security was the amount of their advances plus their reward for providing the short-term funding. 3. The false statement was made to the ANZ Bank, but if the document were sent to Huybers, which I do not accept it was, it would have been equally misleading of her. Distribution of loan proceeds 1. Settlement took place on 9 March 2012. Dimitriou deposed that the $1,990,551 received from the ANZ Bank was disbursed as follows: $45 was paid to the ANZ Bank in relation to a "special clearance fee"; $123,102.04 was paid to the Office of State Revenue for stamp duty payable on the Pineview transfer ([22] and GD3 and GD5); $490,010 was paid to Danny Kalischer ([20] and GD4); $21,350 was paid on 19 March 2012 to Foley ([23] and GD6). Foley prepared a letter addressed to each member of the Rubino family and to the secretary of Rubino Holdings dated 30 January 2012 in which he referred to three accounts rendered on 13 December 2010, 20 March 2011 and 20 May 2011. The last account was for $7,700 of which $5,250 was outstanding. The other two accounts had been paid. He prepared an additional tax invoice dated 20 January 2012 for work said to have been done from 21 March 2011 to 8 August 2011. This account was in the sum of $16,100. $26,475 was paid on 20 March 2012 to Defined Garden Artistry Pty Ltd ("Defined Garden Artistry"). This was also a company of Dimitriou's. He said that the payment was made in reduction of money secured to him by mortgages given to him by Rubino Holdings and Lee Rubino. Also on 20 March 2012 $215,210 was paid to Dimitriou. He said that he did not have documents and invoices to support the payment, but given time he believed he would be able to find them. None was produced. $10,000 was paid on 22 March 2012 to Jetson. On 11 April 2012 two payments of $25,000 were made, one to Green Global and the other to Pineview. Dimitriou said that one payment of $25,000 was in respect of the short-term loan facility that Huybers obtained from the ANZ Bank, and the other was a payment to Pineview so that it could be paid by Pineview to Ms Huybers as director's fees. On 14 May 2012 $1,050,010 was paid to Defined Properties Investment. This is one of Mr Dimitriou's companies. At all material times from 1 June 2011 he was its sole director. He is also the sole shareholder. 1. These payments total $1,986,202.04. Mr Dimitriou has not provided an accounting for the balance of $4,348.96. 2. Dimitriou said that Kalischer and Huybers were entitled to be repaid their advances and an additional $10,000 as interest. Hence Kalischer was paid $490,000. (There was a $10 bank charge.) 3. Of the moneys received from the ANZ Bank, Dimitriou or companies of which he is a director, namely Wyse Accounting, Defined Garden Artistry and Defined Properties Investments, received $1,296,043.96. 4. Dimitriou said that of the $1,050,000 paid to Defined Properties Investments, about $990,000 was paid (through another company called Defined Properties Pty Ltd) as a loan to companies associated with a Mr Corrado Sanna. Dimitriou said that of that advance about $495,000 was "Huybers' monies from the Pineview settlement". That is, it was part of the $580,000 she was entitled to receive on repayment of the loan she made on 17 January 2012. Dimitriou said that Huybers authorised him to reinvest those moneys, something she denies. 5. Thus, of the $1,296,043.96 Dimitriou acknowledges that $580,000 was held for Huybers. He says that she has been repaid that amount (and more) by various repayments and by the moneys being invested through Defined Properties Pty Ltd on her behalf as a loan to companies associated with Corrado Sanna. The dispute about that forms part of Huybers' cross-claim against Dimitriou, Wyse Accounting and Wyse & Young. 6. There remains $716,043.96 retained by Dimitriou or his companies. As to these sums Dimitriou claims that: Frank Rubino authorised him to pay a further $64,000 to Kalischer in respect of an earlier short-term loan finance arrangement, but that he has withheld the $64,000 because he claims that Kalischer owes him more than $64,000. In withholding those funds on that basis, Dimitriou in substance treats the moneys as belonging to himself ([52]). Frank Rubino authorised him to pay $108,000 to Russo for outstanding fees owed by the Rubino family to Russo, but he has not paid those moneys because Russo and companies associated with him owe him more than the $108,000 he was claiming. He says that he has set off the amount of $108,000 that he had been authorised to pay Russo against debts owed by Russo or companies associated with Russo, to him or to companies associated with him. Again, Dimitriou treats these moneys as if they were his own ([53]). He was owed $140,800 for "professional services" provided to the Rubinos in conjunction with the sale of the Cooranbang property to Lane, being a "saving fee" charged pursuant to a retainer agreement that was the subject of an invoice from Wyse & Young Accounting dated 26 July 2011 addressed to Frank, Anthony and Alfio Rubino and Rubino Holdings ([55]). He says that Frank authorised payment of that sum. The Rubinos were charged $34,650 and an administration fee of $242 as a fee for professional services provided to them "for the obtaining of the short-term lend", being three per cent of the loan amount of $1,050,000 plus GST ([56]). Wyse Accounting raised an invoice dated 14 February 2012 for $66,265.76 addressed to Pineview, being a three per cent "loan fee" on the advance of $2,720,000 plus GST ([57]). Wyse Accounting raised an invoice dated 10 January 2012 for $3,612 addressed to Pineview for "professional services rendered for set up of company and trust". 1. These amounts total $417,569.76. Dimitriou says that sums were paid on behalf of Pineview, including $9197.34 to prevent Hornsby Shire Council to prevent Pineview's being wound up for unpaid rates ([59]) and other payments were made to or on behalf of Huybers. I deal with these later in these reasons when dealing with Pineview's and Huybers' cross-claims. 2. Huybers denied that she authorised any payments to Wyse & Young or Wyse Accounting. She said she was not aware where the loan proceeds of the settlements that took place both in January and February or March 2012 were distributed to. She did not understand that the loan proceeds would be paid to Wyse & Young (at [36]). I accept her evidence on this. Auction of Arcadia property 1. The amount Pineview borrowed from the bank on 9 March 2012 was sufficient to cover payment of a deposit on the purchase of the Arcadia property when the bank exercised its power of sale. Dimitriou gave evidence that in December 2011 he discussed with Frank Rubino about how the Arcadia property could be got back for the family. It is clear from the email correspondence between Dimitriou and Winiata referred to above that Dimitriou's intention was to use part of the borrowed funds to buy the Arcadia property, and to arrange for the new purchaser to borrow the funds necessary to complete the purchase. The proposal had attractions because the Arcadia property was thought to be worth considerably more than the amount of $1.65 million that the bank had agreed to accept in discharge of its debt if paid by 16 January 2012. Dimitriou proposed to use Kalischer as the front man for the purchase in the same way as he used Huybers for the purchase of the Galston properties. On 9 January 2012, that is, on the same day that Pineview was incorporated, a company called Arcadia Property Holdings Pty Ltd was incorporated with Kalischer as its sole director and shareholder. Two trust deeds described as a deed for the Arcadia trust were prepared, but not apparently executed. One named Kalischer as the Specified Beneficiary. The other named a grandchild of Mr and Mrs Rubino as the Specified Beneficiary. Arcadia Property Holdings was named as trustee. Dimitriou admitted that the money raised from the bank on security of the Galston properties was to be sufficient to use as a 10 per cent deposit towards the Arcadia purchase. (T722) He said that he attended the auction and bid on behalf of "Danny", that is, Kalischer, but stopped bidding when Frank told him to stop. The Arcadia property was sold by the bank to unrelated third parties for $1,660,000. 2. Frank Rubino denied all knowledge of this. Jetson had given evidence that Frank Rubino was trying to salvage Arcadia, but it was his belief that that was not going to happen (T557). Jetson did not understand that a portion of the moneys being borrowed were to assist Frank Rubino in obtaining the property at Arcadia (T558). He said that he was not aware that anybody was going to acquire the Arcadia property. He said he was not aware that it was hoped that out of the Pineview settlement there would be sufficient moneys to be able to pay a deposit if a purchaser could be found to be the successful bidder at the auction of the Arcadia property (T558). There is objective evidence in the form of his email correspondence with Winiata and the incorporation of Arcadia Property Holdings to support Dimitriou's version of events. There was also corroboration from Russo who, under friendly cross-examination by Mr Foley for Dimitriou, said that it was his recollection that in early March Frank Rubino rang him and said "We're going to try and buy Arcadia at the auction" and that George was organising finance. Russo said that Frank Rubino said something along the lines of "We've done our figures and we think we can afford it." (T626) 3. Russo also said he was aware that the amounts being borrowed included a significant amount to pay various people fees "and other moneys that had been incurred". He said that he was aware of that from what he was told by Frank Rubino. He said that "I think he [Frank Rubino] told me in March he was borrowing about 1.7 or 1.8 or something like that. Something along those lines." Russo also said that he had a conversation with Frank Rubino after the auction said to him "We were at the auction, and once we got there, we did our figures and decided that we couldn't afford it." He also said that Frank told him that Pineview was going to purchase the Galston properties when he told him they were going to purchase Arcadia, and that in the same conversation he became aware that Arcadia Property Holdings had been set up to purchase Arcadia (T629). Russo said that once he learned that the auction had failed and there were surplus funds available he expected that his outstanding fees would be paid. He prepared a form of authority for Frank Rubino to sign, addressed to Wyse & Young for that purpose, and Frank Rubino did sign it. 4. Dimitriou's and Russo's evidence about Dimitriou's and Frank Rubino's intention to buy Arcadia through Arcadia Property Holdings, but that intention not proceeding because Frank Rubino decided not to bid at the auction, and there then being surplus funds available, is consistent with the objective facts; that is to say, Dimitriou's email correspondence with Winiata, the incorporation of Arcadia Property Holdings with Kalischer as its director and shareholder, the preparation of two versions of a trust deed and the authority signed by Frank Rubino in May. Although neither Frank Rubino nor Dimitriou is a witness on whose uncorroborated testimony I would place any weight, unless it contained admissions or was consistent with facts otherwise objectively established, I think I should accept Dimitriou's evidence on this matter, supported as it is by the objective facts and by Russo's evidence referred to above. Indeed, in final submissions, Mr Young SC for the plaintiffs submitted that the plan to purchase Arcadia fell through "apparently through a combination of a competing bidder pushing up the purchase price and a reluctance on the part of Frank Rubino to pay too much for the property." I accept this. 5. It is common ground that Dimitriou attended the auction and made bids for the property. Frank Rubino deposed that he attended the auction and saw Dimitriou there with Kalischer and that Dimitriou placed several bids on the property before it was purchased by another party for $1,660,000 (CB 1/284). On the plaintiffs' case, Kalischer and Dimitriou must have been acting on their own and hoped to acquire the Arcadia property for a cheap price. Frank's willingness to bid or not bid would be irrelevant. But it was not. It was relevant because the same kind or arrangement was proposed for Arcadia as had been adopted for the Galston properties. Frank Rubino's authority to Wyse & Young dated 8 May 2012 1. There are further reasons for rejecting Frank Rubino's version of events. The most telling are two authorities Frank Rubino signed 8 May 2012 addressed to Wyse & Young. It was his position that at that time he was still waiting for Dimitriou to arrange a conforming loan to discharge what he had called the "private lend" of $1,050,000. He gave the following evidence: "Q. How much did you understand Mr Dimitriou would be trying to raise by way of a conforming loan? A. Well, the million and 50? Q. Yes? A. And some extra money for the private lend. Q. Meaning the additional costs that the private lender … A. Yes, the interest that they were going to be charging. Q. Anything else? A. That was it, sir. Q. The money from the bank providing the conforming loan will go to pay off the private lender? A. The private lender, yeah. Q. Did you understand then that there would be any settlement funds that would be held for you from the conforming loan? A. No." 1. Frank Rubino denied that he ever instructed Dimitriou to pay anybody out of the ANZ Bank proceeds (T339). He admitted that Russo had rendered accounts over a couple of years which were of a six-figure sum (T339-340), and that he negotiated with Russo over a period of time to get them reduced (T339-340). He admitted that Russo prepared a document being an authority addressed to Wyse & Young for Russo to be paid $86,000 and that he signed it (T340). He admitted that after he signed the document he went home and sent an amended version to Dimitriou reducing the amount of money that he was authorising be paid to Russo. Both documents were addressed to Wyse & Young. The first stated: "I Frank Rubino on behalf of Alfio and Biagina Rubino, hereby authorise and direct you to draw a cheque for monies held on my behalf from the settlement funds as per the following: 1. Russo & Partners in the sum of $86,000" 1. The second document was in the same terms, except that Frank Rubino crossed out the sum of $86,000 and wrote in the figure $46,000 before faxing the document to Wyse & Young. 2. Frank Rubino tried to explain this document in a number of ways. He said that, "there was going to be a settlement once George Dimitriou got the conforming loan that he said he was going to get." 3. There are at least two difficulties with that response. First, the document refers to payment out from "monies held on my behalf from the settlement funds". It does not refer to moneys to be held from settlement funds to be received. Secondly, on Frank Rubino's evidence his understanding was that there would not be any substantial moneys left over from the conforming loan after paying off the private lenders. When asked about that, Frank Rubino's response was to say that he was not intending to honour the authority in any event (T346), but he was going to pay off Russo on a weekly basis. That answer does not explain anything. Quite apart from the fact that if he had no intention of honouring the authority there was no reason to amend it, the authority did not depend upon Frank Rubino's honouring it. Rather, it was an acknowledgment by him that there were funds on hand (or on his version, that funds would be received) from which payment of Russo's fees could be made. But Frank Rubino's case was that there would be no such moneys left over from the conforming loan. I think the documents plainly demonstrate Frank Rubino's awareness that by May 2012 Wyse & Young were holding settlement funds on behalf of him or his parents from which payment of Russo's outstanding fees could be made. That is wholly inconsistent with the plaintiffs' case. Collection and payment of rent 1. There are other circumstances pointing in the same direction. Three houses on the Calderwood and Pine Valley properties were repaired and let. PDW Realty was appointed as the letting agent. Residential tenancy agreements were entered into with three tenants on 2 May, 6 June and 21 June 2012. The agreements were made with Pineview. Frank Rubino deposed that a management agreement was entered into with that real estate agent. He did not produce the management agreement. The only management agreement in evidence was one between PDW Realty and Pineview. It was signed for Pineview by Dimitriou. Frank Rubino was not cross-examined about this document. On his evidence though he and his parents must have been expecting the rents collected by PDW Realty to be paid to the Rubinos pending the obtaining of a conforming loan to which the rental payments could be applied in payment of interest. But no moneys were accounted to the Rubinos by PDW Realty. The net rents were paid to Pineview and applied towards its ANZ mortgage. The plaintiffs and Frank Rubino did not explain why they thought they were not receiving the rents. Natlee Holdings' cheques signed by Frank Rubino payable to Pineview 1. From about July 2012 Dimitriou was pressing Frank Rubino for not having commenced making payments on the loan. 2. Wyse & Young produced on subpoena copies of invoices dated 6 March, 30 June, 12 July and 18 July 2012 addressed to DPW Realty, Alfio Rubino and Natlee Holdings, Francesco Rubino and Natlee Holdings. The invoices were expressed to be for rent or licence fees for occupation of the Galston properties. 3. The Registrar General submitted that Pineview issued these invoices for the payment of rent by Natlee Holdings in respect of Mr and Mrs Rubino's house. However, there was no evidence that the invoices were issued. It was not put to Frank Rubino or to Lee Rubino that they received the invoices and Mr Dimitriou did not say that they were issued. Nonetheless, it is not in dispute that between 18 July 2012 and 12 December 2012 Natlee Holdings issued cheques that were signed by Frank Rubino made out to Pineview Property Trust. The cheques were issued as follows: (a) on 18 July 2012, for $7,000 made out to Pineview Property Trust; (b) on 24 July 2012, for $2,000 made out to Pineview Property Trust; (c) on 3 August 2012, for $2,200 made out to Pineview Property Trust; (d) on 19 August 2012, for $2,600 made out to Pineview Property Trust; (e) on 7 September 2012, for $2,200 made out to Pineview Property Trust; (f) on 14 September 2012, for $2,200 made out to Pineview Property Trust; (g) on 28 September 2012, for $2,200 made out to Pineview Property Trust; (h) on 12 October 2012, for $2,200 made out to Pineview Property Trust; (i) on 15 October 2012, for $2,200 made out to Pineview Property Trust; (j) on 26 October 2012, for $2,200 made out to Pineview Property Holdings; (k) on 6 November 2012, for $2,200 made out to Pineview Property Trust; (l) on 15 November 2012, for $2,200 made out to Pineview Property Trust; (m) on 6 December 2012, for $4,400 made out to Pineview Property Holdings; and (n) on 12 December 2012, for $4,400 made out to Pineview Property. 1. Frank Rubino explained the payments by Natlee Holdings to the Pineview Property Trust or Pineview by saying that Dimitriou told him in about July 2012 that he needed to pay Kalischer his lender's fee which was $60,000. This conversation was said to have taken place in about the middle of July 2012. According to Frank Rubino he said that he did not have that type of money and had not been told what the costs of the private lending would be and asked about how the conforming bank loan application was getting on. According to Frank Rubino, Dimitriou told him that he was working on the conforming bank loan, but he had to come up with some money for Kalischer who wanted his lender's fee immediately. Frank Rubino said that he then spoke to Russo who told him not to worry and they discussed his making regular payments off Kalischer's fee and Russo advised him to bring cheques payable to the Pineview trust. This was an example of Frank Rubino's attempting to embroil Russo. Russo denied the alleged conversation and I accept his denial. I am satisfied that Frank Rubino understood Natlee Holdings was making payments to service the loan that Pineview had taken. 2. Lee Rubino was the director of Natlee Holdings. Frank Rubino signed the cheques for Natlee Holdings in favour of the Pineview trust using a signature that is different from his usual signature but is not very dissimilar from Lee Rubino's signature. When asked why, he said that he had been made bankrupt and wanted to make a new start, and that using a new signature was a way of making that new start (T261). I do not accept that explanation. Frank Rubino has continued to use his usual form of signature on documents where he is named as the signatory, such as his affidavits. This matter goes to his credit and illustrates that merely because some documents contain signatures that purport to be those of Mr and Mrs Rubino but which have been forged, it cannot be assumed that the documents were forged by Dimitriou, as Lee and Frank Rubino asserted. It is not necessary for me to make any findings as to the identity of a forger or forgers. But the fact that various signatures have been forged is clearly established. Plaintiffs' case against Pineview 1. Biagina Rubino made two affidavits: one on 8 April 2015 and the other on 4 March 2016. She gave evidence through an interpreter at the hearing. After a short time of cross-examination it became apparent that she was incapable of giving any reliable evidence. She was shown the transfer dated 8 March 2012 and denied that the signature on the transfer was hers (T116.48). Her case is that she and her husband did sign the transfer, but were induced to do so by a false representation. She denied having seen the document before (T117). She had no recollection of having entered into the heads of agreement with the ANZ Bank (T117). She was taken to various documents that purport to bear her signature and denied the authenticity of the signature on many of them. This included the signatures on her own affidavit. Not long into her cross-examination she seemed incapable of answering all but the simplest questions and said that she could not continue. 2. Thus, there could be no effective cross-examination on her affidavits. It is impossible to know how much of the affidavits were her own words. They were read to her in Italian by an interpreter, Ms Angelone, who gave evidence. Ms Angelone read each paragraph of Mrs Rubino's affidavit to her in Italian to make sure she understood it before moving to the next paragraph. She formed the view that Mrs Rubino understood because Mrs Rubino said she did understand. That was the sole basis of her opinion (T109). 3. In Biagina Rubino's first affidavit she deposed that she believed Russo was going to keep the title deed for the Calderwood property and that she and her husband were going to borrow the million dollars to get the Pine Valley property. In her oral evidence she denied any knowledge of Russo, although, when pressed, she remembered the Russo family who had also been involved in the flower business. In her affidavit she denied that the signatures on the two contracts for sale were hers. She denied that the signature on the first transfer for $2,450,900 was hers or that Alfio's signature was his. In her affidavit she said that she did not recall seeing the second transfer, but the signature looked like hers and Alfio's signature looked like his. She deposed that she did not understand what "transfer" meant until after the proceedings were commenced. 4. Alfio Rubino made an affidavit on 3 September 2013 in the proceeding in the Common Law Division. Mr Rubino said that he did not remember signing the transfer document and did not remember having seen it before. He deposed that he did not understand what the document was and did not understand what the word "transfer" means. He deposed that he did not authorise anyone to receive the titles to the Calderwood and Pine Valley properties in order to release them to anyone. 5. As noted above Mr Rubino died not long after making his affidavit of 3 September 2013. I admitted the evidence, but it has little weight because the evidence could not be tested. 6. Mr and Mrs Rubino left it to Frank to conduct negotiations and make arrangements on their behalf. There is no dispute that he acted as his parents' agent. There is no question of his having acted in fraud of his principals such that his knowledge might not be imputed to them. 7. Thus the fraud case propounded by the plaintiffs depends upon the acceptance of Frank Rubino's evidence. His credit is severely damaged. I do not accept him as a reliable witness. The most significant matters damaging to his credit are the overwhelming inconsistency of his version of events and facts which were either admitted or otherwise clearly established. These include: the authority dated 8 May 2012 addressed to Wyse & Young authorising it to pay moneys to Russo from settlement funds held; the complaint that Russo failed to retain custody of the certificate of title (and presumably discharge of mortgage) for the Calderwood property when it is clearly established that the certificate of title was required to provide security for the $1,050,000 loan. This is clearly established from the authority signed by Mr and Mrs Rubino and sent from the Inbloom Warehouse fax machine that was at the Calderwood property, the unchallenged filenote of David Quinn of Watson & Watson, the evident urgency (denied by Frank Rubino) to obtain the release of the certificate of title over which Watson & Watson was claiming a lien, and the improbability of the loan being unsecured. Indeed in their amended statement of claim filed on 18 February 2014 the plaintiffs alleged that Russo was negligent in failing to take reasonable care to ensure that the Calderwood certificate of title was only used for obtaining a short-term loan facility and was to be returned to Mr and Mrs Rubino after two weeks without encumbrance in accordance with their instructions. That admission was withdrawn (without leave) in the subsequent amendment to the pleading where it was instead alleged that Russo owed a duty personally to retain possession of the Calderwood certificate of title and not release it until such time as Alfio and Biagina Rubino authorised him to part with possession of it. The short answer to these claims is that Alfio and Biagina Rubino did so authorise Russo contrary to Frank Rubino's evidence. Frank Rubino's knowledge that moneys were to be borrowed by a company that would take a transfer of the titles and raise money on security for them for the benefit of the Rubinos is established from the signing of the contracts in January; the evidence of Klopf, which I accept, as to the collection by Frank and Mauro Rubino of the forms of transfer; Russo's evidence, which I accept, of what he was told by Frank Rubino about the transfer and mortgage; Jetson's statutory declaration in which he said that Frank, as well as he, explained the transfers to Mr and Mrs Rubino; Jetson's evidence in his later affidavit after having obtained his diary in which he corrected the evidence in his earlier affidavit (that had been prepared after he had been interviewed by Lee and Frank Rubino) to the effect that he attended the premises of the parents in March, when in fact he attended in January; Dimitriou's statement to Winiata in his email of 23 December in which he said that the proposed structure was one that he had suggested (that is, I infer, to Frank Rubino); and the events after the drawdown of the ANZ loan. 1. Frank Rubino's credit is also adversely affected by his denial of communications with Winiata and the evidence concerning his signature of the Natlee Holdings' cheques payable to the Pineview trust. 2. For the most part Frank Rubino gave responsive answers. There was nothing in his demeanour, even when caught out, that would suggest he was not telling the truth. But that only indicates the unreliability of witnesses' demeanour as a guide to assessing their reliability. 3. I conclude that Frank Rubino knew and consented to the transaction whereby the Galston properties were transferred to Pineview so that Pineview could use them as security for money it would borrow from the ANZ Bank. I think it likely his parents were aware of at least this much. How much more Frank Rubino knew is unclear. He knew that more money was borrowed than was required to discharge the advance of $1,050,000 and interest, and that at least enough money to pay a deposit on the purchase of Arcadia was also borrowed. He may well not have known the extent of the borrowing Dimitriou had arranged. But that is not the case of fraud the plaintiffs have raised. 4. For these reasons the fraud case alleged by the plaintiffs against Pineview fails. 5. Pineview admitted that it held the Galston properties on trust for the plaintiffs "pending [scil. subject to] the repayment of advances made to both of them." (Pineview defence paras 14 and 15.) The plaintiffs have not accepted that they were the beneficiaries of a trust. But they were. I do not accept that the Galston properties are held by Pineview on trust for Huybers or the plaintiffs' grandchildren. No executed trust deed in favour of the grandchildren has been produced. 6. The Rubinos would be entitled as beneficiaries to call for a transfer of the trust property on indemnifying Pineview against liabilities properly incurred in execution of the trust. The Rubinos have not made such a claim as beneficiaries of the trust that Pineview admits. Nor did they raise any issue as to the extent to which Pineview is entitled to indemnify itself out of the trust property in respect of liabilities properly incurred in execution of the trust. This is however an important issue. If the ANZ Bank's mortgage were redeemed by the Rubinos for a sum provided for in the settlement agreement, it would not discharge Pineview's liability to the ANZ Bank pursuant to the judgment that has been entered against it. The question of its right to be indemnified out of the trust property would need to be resolved before the Rubinos could insist on a transfer. This may well not be an academic question. The only evidence as to the value of the Galston properties was of a valuer, a Mr Christopher McMurray. He valued the properties as at 27 January 2016 in the sum of $3,200,000. Even if the ANZ Bank's mortgage is not redeemed for an amount in accordance with the settlement agreement between it and the Rubinos, there may well be a substantial surplus following an exercise by it of its power of sale as mortgagee. The surplus proceeds would be trust property. However, these questions do not presently arise. Plaintiffs' claim against the Registrar General 1. For the same reasons, the plaintiffs have not established that they were deprived of an estate or interest in the Galston properties by the fraud they alleged. In their claim against Pineview and the Registrar General the fraud alleged was the fraudulent transfer to Pineview that made Pineview the registered proprietor of the properties subject to the registered mortgage to ANZ and the registration of ANZ as mortgagee of the properties. The fraud alleged was not the extent to which Pineview borrowed on the security of the properties or the disbursement of the moneys borrowed. The fraud case as framed and fought at the hearing fails. Claim against Russo 1. For the reasons above, the claim that Russo was negligent in handing over the Calderwood certificate of title to Jetson fails. That was not the only claim against Russo. 2. The plaintiffs also alleged that Russo had a duty to Mr and Mrs Rubino to advise them that no loan or loan security documentation had been provided to him by Wyse & Young or anyone else in relation to a loan involving the Galston properties, that he had not been involved in the drafting of any such documents, that the documents provided to Alfio and Biagina Rubino on 16 January were not related to any loan, that he or his office had sent a contract of sale for the Calderwood and Pine Valley properties to Wyse & Young, that it appeared that Wyse & Young was not in the course of arranging a loan but a sale and transfer of the Galston properties, that the certificates of title to the Galston properties were in the possession of Wyse & Young and not in Russo's possession, that it would be relatively easy for Wyse & Young or a person associated with them to register a fraudulent transfer of either or both of the properties, that there was a substantial and unacceptable risk that they would be defrauded through the lodgment of a fraudulent dealing in relation to the properties, and they should lodge a caveat to prevent any such dealings. 3. I have found that Frank Rubino, whose authority to act for his parents was not disputed, was aware and intended that the Calderwood and Pine Valley properties were to be transferred to Pineview and used by Pineview as security for a loan to be raised by it. Frank Rubino knew and approved of what was proposed. He discussed it with Russo even though Russo had no retainer to act on the transaction. Russo had no reason to give the advice that a caveat should be lodged. He had no duty to advise the Rubinos on the wisdom of what they proposed. Had he given the advice it is alleged he should have given, I do not consider that Frank Rubino would have followed it. 4. The plaintiffs also alleged that Russo owed a duty to inform them promptly on or immediately after 16 January 2012 of what the plaintiffs called the "Dimitriou Knowledge". Paragraph 57E of the statement of claim identified the alleged "Dimitriou Knowledge" as follows: "(a) Alfio Rubino and the Second Plaintiff were using George Dimitriou to arrange finance in relation to the Properties; (b) George Strathopoulos and John Mastrapas had arranged finance with the first defendant through George Dimitriou from which $244,000 was missing; (c) George Strathopolous suspected that George Dimitriou was responsible for the missing $244,000; (d) George Strathopolous was expressing the view to the effect that George Dimitriou was an untrustworthy person; (e) Caroline Rossier had arranged finance with the first defendant through George Dimitriou from which a disbursement of $106,496.50 had been made to Defined Garden Artistry Pty Ltd, a company owned by George Dimitriou, which disbursement had not been approved; (f) Caroline Rossier had been for some time dealing with the complaints department of the first defendant, and George Dimitriou in relation to the disbursement; (g) Caroline Rossier had lodged a FOS complaint in relation to the disbursement to Defined Garden Artistry Pty Ltd; (h) Clive Wilkie and Marion Wait had arranged finance with ANZ through George Dimitriou from which a disbursement had been made to Dimitriou, which disbursement had not been approved; and (i) Wilkie and Wait had made a complaint to the police in relation to George Dimitriou." 1. Alfio and Biagina Rubino knew that Frank Rubino was using Dimitriou to arrange finance in relation to the properties. They did not need to be told. The essence of the complaint is that Russo had a duty to tell the Rubinos of facts he allegedly knew to Dimitriou's discredit. 2. Whether Russo had such a duty depended upon the scope of his retainer, and also, what he knew about Dimitriou. Russo was not retained to advise the Rubinos on the wisdom of the proposed refinancing of the $1,050,000 debt owed to the ANZ Bank. He was not retained to act for the Rubinos as borrowers on either the short-term loans from Kalischer and Huybers arranged through Dimitriou, nor on the proposed refinancing of those loans that was completed on 9 March 2012. His retainer was to obtain the Calderwood certificate of title and discharge of mortgage from Watson & Watson who were claiming a lien for their unpaid fees. Even if he had all of the knowledge alleged by the plaintiffs as set out above, I do not consider that he had a duty to disclose it to the Rubinos. 3. Nor would it have made any difference if he had. The Rubinos were well able to make their own assessment of Dimitriou's capacity and integrity from their earlier dealings with him. Lee Rubino had made her feelings plain to the Rubino family. She had ordered Dimitriou off the Pine Valley property when he attended with Huybers in January 2012. Frank Rubino accepted that when Lee Rubino withdrew her proposal to obtain funds to discharge the ANZ mortgage over the Pine Valley property he was left with no choice but to deal with the devil in the form of Dimitriou. I do not think any warning Russo might have given would have made a difference to Frank's proceeding as he did. 4. In any event, I do not accept that Russo had the knowledge alleged. 5. Mr George Stathopoulos deposed that he met Dimitriou in June or July 2011 who introduced him to Russo. Stathopoulos was trying to "consolidate [his] finances". He said that he needed the help of his brother-in-law, Mr John Mastrapas. He said that he arranged finance through Dimitriou who arranged for five different loans for Mastrapas and his company, Smoothseas Pty Ltd ("Smoothseas") in around July 2011. He deposed that for each loan more was borrowed than was needed to repay existing debts so that John would have extra funds available to invest. He said that in about December 2011 he had a meeting with Russo in Melbourne where conversations to the following effect took place: "14. I went to the Melbourne Hilton to meet with Russo. We had a conversation in which words were said to the following effect: Russo: Hi mate. How's it all going? Me: Well, I'm having trouble with the loans. Russo: Why? There was quite a bit of surplus money for you? Me: But Sal, mate, let me say this to you. There's a lot of money we didn't get. Russo: What do you mean? Let's go through it. 15. Sal then wrote down each of the loan amounts and the expenses associated with each and worked out how much surplus there should be. We then had a conversation to the effect (Russo pointing at the amounts on the paper) Russo: This is what you borrowed on this house, this is what you borrowed on that house. There is enough money to be making your interest payments for several years, around $280,000. Me: Sal, that's all fine and I grant you that these numbers are right. But we never got that money. Russo: George, are you sure? Me: Yeah mate. 100% sure that the money is missing. Russo: Did John take it out? Me: No way mate. John didn't take the money. He would have told me. Russo: Did you take the money? Me: No. Russo: Then where has it gone? Me: Good question mate. Where has it gone? Russo: Go ask ANZ. Go get the bank statements. Then you have to watch Dimitriou. I have heard of other clients of his complaining about him. There are a lot of people unhappy with him." 1. In cross-examination Stathopoulos accepted that he could not recall the actual words which were said to Russo in 2011. He then gave the following evidence: "Q. Can you recount in the witness box today words to the effect of what was said? A. We were talking about all the loans that Mr Dimitrio and Wyse and Young procured for my brother in law and for his company, and Mr Russo had a small piece of paper and a pen, and he knew all the accounts, as in he knew how much borrowings there were, and with his own handwriting he was writing on a piece of paper saying this is what you borrowed, this is what you borrowed, this is what you borrowed. This is what you paid out, and this is what should be left, and I said to Mr Russo that we haven't got that money left, and but before I said that, he said, Mr Russo said to me that you've got enough money now to pay your interest for a number of years, and he also said that if you don't pay your moneys if you don't pay the interest, I'll come back to Melbourne and hit you across the head with a baseball bat or a four by two or something, and I said, don't bother doing that because there's no moneys in the account. Q. Is that the extent of what was said? A. Yeah. More or less, yes." 1. Only when his attention was directed to the specific words that he attributed to Russo in his affidavit, that is, that Russo told him he had to watch Dimitriou and had heard of other clients of his complaining about Dimitriou and there were a lot of people unhappy with him, did Stathopoulos again assert that those words were said. 2. This was notwithstanding that Stathopoulos had read his affidavit to himself on the same day. 3. I do not consider Stathopoulos to be a reliable witness. His credit was shaken by his evidence of his relationship with the company Smoothseas. In his affidavit Stathopoulos described the company Smoothseas as being his brother-in-law John Mastrapas' company. He was asked in cross-examination whether he was the real controlling mind at the time of Smoothseas and said he was (T157). He was asked whether there was any reason that he was not the director and said "Back then I was in a little bit of financial trouble, and I transferred the company to my brother-in-law." By that he meant that he resigned as a director and put his brother-in-law in as a director and transferred his shares to his brother-in-law. He was made bankrupt in 2012. Nonetheless, he described himself as the controlling mind of Smoothseas, but when asked in what way he exercised a controlling mind in relation to the affairs of the company he initially gave an unresponsive answer (T158.22) and then said "I didn't control it. I just told my brother-in-law my opinion and he would listen to my opinion." This evidence does not inspire confidence in the probity of the witness. 4. Although Stathopoulos says he was concerned about moneys taken by Dimitriou or his companies from the proceeds from advances arranged for his brother-in-law and Smoothseas, he was not so concerned that he did not subsequently borrow money from Dimitriou and use Dimitriou to arrange a borrowing from the ANZ Bank. 5. On 8 July 2015 Dimitriou sent a text message to Stathopoulos saying: "Please promise me that you did not prepare an affidavit against me in Rubino matter. The statement of claim says that you personally provided a statement against me and Wyse & Young International and I am a fraud." 1. Stathopoulos replied, "George, I promise you on my Dad's grave that I did not provide the Rubinos a affidavit statement [sic] against you or Wyse Young International." Although his affidavit is dated 3 September 2015, that is after the text message, he must have provided a statement to the plaintiffs for the allegations to have been included in the amended statement of claim. 2. On 23 March 2012 Mastrapas sent a letter to the ANZ Bank withdrawing a previous complaint concerning the conduct of Wyse & Young and Dimitriou on the settlement of a mortgage advance over two properties in Victoria. He confirmed that pursuant to a written agreement between himself and Wyse & Young that Wyse & Young and Dimitriou were appointed as his settlement agents with clear instructions to settle in the manner which had occurred. 3. Russo admitted that Stathopoulos complained that they did not get all of the money they expected to receive from the borrowings arranged by Dimitriou. He agreed that he told Stathopoulos to take the matter up with the ANZ Bank, but denied saying that Dimitriou had to be watched and he had heard of other clients of Dimitriou's complaining about him or that there were a lot of people unhappy with him. Having regard to the problems with Stathopoulos' evidence referred to above, I do not accept that Russo said the words about Dimitriou that Stathopoulos attributed to him. 4. Stathopoulos gave evidence that he considered that $244,000 had been transferred to Defined Properties Investments and that other moneys had also been taken without authority. But his evidence of what he said to Russo did not support the allegations alleged in paragraphs (b)-(d) to paragraph 57E of the statement of claim set out above. 5. Rossier gave evidence that Dimitriou had arranged refinance for her and her husband or their company through the ANZ Bank and that settlement of the refinance took place on 30 May 2011. She deposed that in early June 2011 she telephoned Russo asking why Dimitriou had kept back more than $106,000 of "our money from the settlement". She said that Russo said words to the effect "No I don't. I've never heard of him doing that before. He usually charges three per cent of the funds he gets people so it can't be for that. Do you want me to have a word with him?" She said, no, it was alright and she did not want to upset him at that stage. She deposed that about two months later they had another conversation in which Russo asked whether she had sorted out her problem with Dimitriou and she said "Nothing's been resolved Sal. He's still got our money." She deposed that Russo then said "OK then. You should now let me handle this my way. This is just not good enough." Russo denied saying those words. 6. Rossier commenced proceedings against Wyse & Young and Dimitriou in the District Court. The proceedings were settled. The dispute was about a fee of $106,000 that Dimitriou claimed he was entitled to from loans he arranged for the Rossiers. Dimitriou raised a cross-claim. The case was settled on the basis that Dimitriou's company got a verdict of $1 on its cross-claim against Rossier (T181). The dispute was about fees. 7. I do not accept that Rossier's complaint to Russo was of such a kind that he could have been required to warn the Rubinos of the matters alleged in paragraphs (e)-(g) of paragraph 57E of the statement of claim. Indeed, she deposes that she and her husband started using the services of Russo as their solicitor in 2009. As I understand her affidavit she consulted him as a solicitor, although it does not appear that any contract of retainer was entered into. Nonetheless, I do not consider that Russo could have given to the Rubinos advice of the details of her complaint to him without breaching his client's confidentiality. That having been said, Rossier did not give evidence that she told Russo of all of the matters in paragraphs (e)-(g) of paragraph 57E. Even if Russo had a duty to advise the Rubinos of matters he knew adverse to Dimitriou, the only matter that could arguably call for disclosure was his knowledge of a dispute between Rossier and Dimitriou about the alleged retention of moneys claimed as fees. 8. The plaintiffs called no evidence in support of the allegations in paragraphs 57E(h) and (i). 9. For these reasons, the allegation that Russo was in breach of what was called the duty to disclose the "Dimitriou Knowledge" is not established. 10. Accordingly, each of the plaintiffs' claims against Russo should be dismissed. Russo's cross-claim 1. Russo filed a cross-claim against Dimitriou, Wyse & Young, Wyse Accounting, Frank Rubino and Jetson. The cross-claim against Jetson was settled and was dismissed on the first day of the hearing. Russo claimed contribution against Frank Rubino, Dimitriou, Wyse & Young and Wyse Accounting (also purportedly against Pineview who was not joined as a cross-defendant (Amended Second Cross-Claim para 27)) as joint tortfeasors. As the claim against Russo will be dismissed that claim will also be dismissed. 2. Russo made an additional claim for damages being the costs he incurred in defending the proceedings. He alleged that the payments made by the ANZ Bank of $123,059.50 to Wyse & Young and $1,867,491.50 to Wyse Accounting were paid as a result of a conspiracy between Frank Rubino, Jetson, Dimitriou, Wyse & Young, Wyse Accounting and Pineview to take Mr and Mrs Rubino's property without their consent and to their detriment so as to borrow more money on security of the Galston properties than was required to discharge the existing encumbrances and to keep the excess for distribution amongst themselves. 3. Russo also pleaded that he gave Jetson the certificate of title to the Calderwood land and did not attend settlement to collect the certificate of title to the Pine Valley land acting on the instructions of Frank Rubino. He alleged that by acting on Frank Rubino's instructions he suffered damage, being the value of the certificate of title that represented the equity in the Calderwood land and the costs of the proceedings and any liability he had to the plaintiffs. 4. The claim against Jetson was not pursued. Pineview was not joined as a cross-defendant and it was not contended that Huybers was a party to any such conspiracy. It is not established that Frank Rubino was aware of the actual amounts borrowed from the ANZ Bank. In any event, Russo did not suffer loss and damage as a result of the alleged conspiracy. The costs he incurred were incurred as a result of Mr and Mrs Rubino's suing him for alleged negligence. 5. Russo did not suffer loss representing the value of the certificate of title because the land was not his. The costs he has incurred in the proceedings are the result of the plaintiffs' decision to sue him. 6. Whether Russo is entitled to an order for costs, either on the ordinary or the indemnity basis, against anyone other than the plaintiffs will be an issue to be decided on an argument as to costs. If Russo is entitled to costs against Dimitriou, Wyse & Young or Wyse Accounting, or against Frank Rubino, that can be determined on the argument about costs. 7. Accordingly, the second cross-claim will be dismissed. Pineview's and Huybers' cross-claim against Mr and Mrs Rubino 1. By their cross-claim Huybers and Pineview sought an order that the Rubinos account to Huybers for the sum of $570,000 plus interest and any profits that might have arisen as a result of the use of her moneys for their benefit or the benefit of any associated person or entity. The claim for an account of profits was not pressed. 2. Huybers pleaded that she advanced $570,000 as a loan to the Rubinos. She pleaded that the loan was made as a result of false representations made by Dimitriou that the loan would be repaid with interest and costs by the Rubinos once a refinance facility, which was imminent, for the Rubinos could be obtained and that the Galston property title deeds would be held as security for repayment of the loan. Huybers pleaded that Dimitriou represented to her and the Rubinos that the Pine Valley and Calderwood properties would be transferred to Pineview which would hold the Pine Valley property on trust for the Rubinos, subject to the repayment of the $570,000. She pleaded that the Rubinos have failed to account to her for the $570,000 advanced to them. In substance her claim in respect of this advance is a claim against the Rubinos for the recovery of moneys lent to them. 3. There is no issue but that Huybers advanced $570,000 by way of loan to Mr and Mrs Rubino and that the money was used towards the discharge of the existing ANZ mortgage over the Pine Valley property. For the reasons which follow in dealing with Huybers' claim against Dimitriou, Wyse & Young and Wyse Accounting, I accept that the loan has not been repaid to Huybers and she has not consented to money that would otherwise be repayable to her having been advanced instead to companies associated with Mr Sanna. Nonetheless I do not accept that Huybers is entitled to maintain against Mr and Mrs Rubino that the loan has not been repaid. 4. Huybers allowed Dimitriou to organise the loan of $570,000 to the Rubinos and to organise the refinancing of that loan through moneys borrowed by Pineview from the ANZ Bank. Mr and Mrs Rubino, through Frank Rubino, agreed to the transfer of the Galston properties to Pineview in order that Pineview could borrow moneys from the ANZ Bank that would be used to discharge the Rubinos' liabilities, including, at least, their liabilities to Huybers and Kalischer. They had no means of controlling how Dimitriou accounted to Huybers for the moneys received by Pineview which ought to have been applied in discharge of Huybers' loan. Because Huybers appointed Dimitriou to act for her in the transaction, as against the Rubinos, she is bound by his conduct whereby the Rubinos satisfied their obligation to repay the loan by taking the steps necessary for Pineview to become registered as the owner of the Galston properties and to receive the moneys borrowed from the ANZ Bank on security of those properties. She can look to Dimitriou or his companies for repayment of the moneys that ought to have been paid to her in March 2012, but the Rubinos' obligations to her were discharged. 5. Pineview and Huybers also sought an order that the Rubinos account to them for the sum of $2,000,820 (sic) plus interest and any profits that might have arisen as a result of the use of such moneys for their benefit. The basis of this claim was that Dimitriou was acting as agent for the Rubinos in arranging the finance, the transfer of the Galston properties and the trust structure and he directed payment of the moneys raised to Wyse Accounting and Wyse & Young such that neither Huybers nor Pineview received the benefit of the moneys borrowed from the ANZ Bank. This was said to be conduct by Dimitriou, Wyse & Young and Wyse Accounting that was in breach of fiduciary duties owed by them to Huybers and Pineview and was also said to be unconscionable conduct engaged in in contravention to schedule 2 to the Consumer and Competition Act 2010 (Cth) and to be conduct that involved the commission of the tort of deceit (amongst others). It was alleged that Mr and Mrs Rubino were vicariously liable for the tort, unconscionable conduct and breach of fiduciary duty committed by Dimitriou because he acted as their agent. 6. Dimitriou regarded the Rubinos as his clients. Frank Rubino, who acted for his parents in the transaction, authorised Dimitriou to arrange for the transfer of the Galston properties to Pineview and authorised him to arrange for Pineview to borrow moneys from the ANZ Bank that would be held on behalf of the Rubinos. I do not accept that Frank Rubino authorised the particular level of borrowing of $2,000,720. Dimitriou did not give any specific evidence to that effect. Frank Rubino denied any knowledge of the proposed loan to Pineview from the bank. Russo said only that Frank Rubino mentioned a figure of $1.7-$1.8 million. 7. I do not accept that Mr and Mrs Rubino are liable for the breaches of duty that Pineview and Huybers allege against Dimitriou. I am satisfied that he acted in fraud of Mr and Mrs Rubino by obtaining finance for his own benefit that covered alleged debts that they had no liability to pay and otherwise by retaining money to which he had no entitlement. This was not the fraud alleged by the plaintiffs against Pineview or the Registrar General. But it does mean that insofar as Dimitriou was acting in breach of his duty to Pineview and Huybers, or was otherwise committing a tort or engaging in unconscionable conduct towards them, he was acting beyond any authority conferred on him by the Rubinos and in fraud of the Rubinos as well as Pineview and Huybers. 8. The moneys borrowed from the ANZ Bank were trust moneys that Pineview held for the Rubinos. When Dimitriou applied the moneys to his own purposes he defrauded Pineview and Huybers by exposing them to their personal liability to the ANZ Bank and he defrauded Mr and Mrs Rubino by taking moneys that beneficially belonged to them, having reduced their equity in the Galston properties. 9. For these reasons the Rubinos are not vicariously liable to Pineview and Huybers for Dimitriou's conduct. 10. Pineview did not plead that Mr and Mrs Rubino were obliged personally to indemnify it for liabilities properly incurred in execution of the trust on the principle in Hardoon v Belilos [1901] AC 118 at 125. Hence, no issue has been joined between Pineview and Mr and Mrs Rubino as to what liabilities of Pineview were properly incurred in execution of the trust. 11. Accordingly, Pineview's and Huybers' cross-claim against Mr and Mrs Rubino should be dismissed. Pineview's cross-claim against Dimitriou, Wyse & Young and Wyse Accounting 1. In his dealings with Huybers, Dimitriou has acted through Wyse & Young and Wyse Accounting. The retainer with Pineview and Huybers was with Wyse & Young. Wyse Accounting rendered the invoices to Frank Rubino, Alfio Rubino and Biagina Rubino for the three per cent loan fee on the loan of $1,050,000 and to Pineview for the three per cent loan fee on the loan of $2,000,720. Wyse Accounting received $1,867,491.50 of the moneys Pineview borrowed from the ANZ Bank and disbursed most of it. Both Wyse & Young and Dimitriou owed fiduciary duties to Pineview and Huybers to act loyally in their interests and to avoid a sensible possibility of conflict between their duty to Pineview and Huybers and their personal interest, and to avoid a conflict of their duties to Pineview and Huybers on the one hand, and the Rubinos who were their clients on the other. 2. In Hospital Products Ltd v United States Surgical Corporation [1984] HCA 64; (1984) 156 CLR 41, Mason J said (at 96-97): "The accepted fiduciary relationships are sometimes referred to as relationships of trust and confidence or confidential relations, viz trustee and beneficary, agent and principal, solicitor and client, employee and employer, director and company, and partners. The critical feature of these relationships is that the fiduciary undertakes or agrees to act for or on behalf of or in the interests of another person in the exercise of a power or discretion which will affect the interests of that other person in a legal or practical sense. The relationship between the parties is therefore one which gives the fiduciary a special opportunity to exercise the power or discretion to the detriment of that other person who is accordingly vulnerable to abuse by the fiduciary of his position. The expressions 'for', 'on behalf of' and 'in the interests of' signify that the fiduciary acts in a 'representative' character in the exercise of his responsibility, to adopt an expression used by the Court of Appeal. It is partly because the fiduciary's exercise of the power or discretion can adversely affect the interests of the person to whom the duty is owed and because the latter is at the mercy of the former that the fiduciary comes under a duty to exercise his power or discretion in the interests of the person to whom it is owed …" (Citation of authority omitted.) 1. To similar effect in Breen v Williams [1996] HCA 57; (1996) 186 CLR 71 Gaudron and McHugh JJ said (at 107): "..., the categories of fiduciary relationship are not closed, and the courts have identified various circumstances that, if present, point towards, but do not determine, the existence of a fiduciary relationship. These circumstances, which are not exhaustive and may overlap, have included: the existence of a relation of confidence; inequality of bargaining power; an undertaking by one party to perform a task or fulfil a duty in the interests of another party; the scope for one party to unilaterally exercise a discretion or power which may affect the rights or interests of another; and a dependency or vulnerability on the part of one party that causes that party to rely on another." 1. Dimitriou had undertaken to act for or on behalf of and in the interests of Huybers in arranging for her to borrow moneys that he held out could be used to generate rewards that would reduce her liability to the ANZ Bank for the moneys she had borrowed to assist her brother. She left everything to Dimitriou. She was vulnerable to the abuse by Dimitriou of his position. There was a relationship of confidence, and inequality of bargaining power. Dimitriou undertook to act in the interests of Huybers. He had the scope to exercise powers which affected her interests by exposing her to a new liability to the ANZ Bank, both as borrower under a new loan for $570,000 and as guarantor of Pineview's loan. He owed a fiduciary duty to Huybers. He also owed a fiduciary duty to Pineview that was established as a company, the shares in which were owned by Huybers, to implement the transaction. 2. Wyse & Young owed the same duty as Wyse & Young made the retainer agreement with Huybers and Pineview. 3. Wyse Accounting, through Dimitriou who was its sole director, knew of and participated in Dimitriou's conduct that was a breach of his fiduciary duty. It received property obtained by Dimitriou's acting in breach of his fiduciary duty. 4. Dimitriou, and through him, Wyse & Young also committed the tort of deceit. For the reasons at paras [146]-[149] he lied to Huybers in his email of 15 January 2012. He deceived her by not disclosing that the moneys to be borrowed from the ANZ Bank for which she would be personally liable were to be substantially applied to reduce debts he claimed were due to him or to others by the Rubino family and by not disclosing his intention to retain other moneys whether he had any claim to them or not. Dimitriou through his companies has retained hundreds of thousands of dollars for which he has advanced no claim of right. He also deceived Huybers and, through her, Pineview by not telling her that moneys had been drawn down from the ANZ Bank, or what amount had been drawn down, or that the moneys had been paid to his companies, Wyse & Young and Wyse Accounting, and without obtaining her authority for that. He then further deceived Huybers by not telling her how the moneys received had been disbursed or obtaining her authority to the disbursement of those moneys. 5. The same facts establish a claim for damages for unconscionable conduct in contravention of s 20 of the Australian Consumer Law. 6. Because Dimitriou did not have Huybers' authority to pay the moneys borrowed from the ANZ Bank to Wyse Accounting and Wyse & Young, the simplest of the claims is Pineview's claim for an account of the moneys received by those companies. Pineview was the legal owner of the moneys borrowed from the ANZ Bank. The receipt of those moneys by Wyse Accounting with knowledge through Dimitriou that the moneys legally belonged to Pineview requires Wyse Accounting to account for the moneys it received. Dimitriou, who arranged for the moneys to be paid to Wyse Accounting and Wyse & Young, and was responsible for the subsequent disbursement of the moneys, is personally liable as a principal. 7. Pineview pleads that it did not receive the benefit of the moneys advanced by the bank and was not aware that the sums were being directed to it on account of the mortgages given to the bank. It pleads that Dimitriou, through Wyse & Young and without authority, directed the bank to issue cheques in favour of Wyse Accounting and Wyse & Young. It pleads that Huybers was not aware that the moneys had been lent by the bank and it seeks an order that Dimitriou, Wyse & Young and Wyse Accounting account for the sum of $2,000,820 (sic) plus interest. 8. Dimitriou said that he relied on Frank Rubino's authority for the disbursement of moneys received by Wyse Accounting. He said he received a text message on his Blackberry from Frank Rubino authorising payments. He said that his Blackberry had been seized by the police. On the return of a subpoena to the NSW Police Detective Sergeant Schussler said that the Blackberry had been sent to Canada for forensic examination because Dimitriou had not provided the password. Dimitriou said that it was an old device and he no longer recalled the password. There was no corroboration of Dimitriou's evidence that Frank Rubino had authorised payments from the moneys borrowed from the ANZ Bank. 9. The issue is moot. Whilst Mr and Mrs Rubino were the beneficial owners of the moneys borrowed by Pineview, the authority of the legal owner of those moneys was required for their disbursement. A beneficiary of a trust may be entitled to call for the transfer of the trust property and so put an end to the trust. But whilst the trust exists, decisions in relation to the application of trust property are to be made by the trustee. That means that Dimitriou needed Huybers' authority, not Frank Rubino's authority, for the disbursement of the moneys that Pineview borrowed. 10. Dimitriou, Wyse & Young and Wyse Accounting alleged that the claim against them was an apportionable claim within the meaning of s 34(1) of the Civil Liability Act 2002 (NSW), that the plaintiffs, Pineview, Russo, Frank Rubino, Jetson and Huybers were concurrent wrongdoers, and that their liability should be reduced to an amount the court considered just and equitable having regard to the extent of their responsibility given all other parties' responsibility for the loss or damage suffered by the plaintiffs or Pineview or Huybers. 11. I reject this contention. The claims of Pineview and Huybers against Dimitriou, Wyse & Young and Wyse Accounting were not apportionable claims. Failure to take reasonable care was no part of the causes of action alleged by the cross-defendants (Cassegrain, Felicity v Cassegrain, Denis [2016] NSWCA 71 at [21], [27], [83]-[84]). Nor did the other parties have any liability to Pineview or Huybers. 12. Dimitriou contended that Huybers brought on a loss to herself, Pineview and the Rubinos by withdrawing money from Pineview's account that should have been used to service the ANZ Bank's loan. Huybers agreed that she withdrew moneys from Pineview's account, but said she only used moneys that Dimitriou said she could. She was told by Dimitriou that money going into the Pineview cheque account was her money. Dimitriou told her that Frank Rubino had to pay him $12,000 per month and she knew that those payments were not going into Pineview's account (T424-426). I accept Huybers' evidence about this. In any event, even though Huybers' withdrawal of funds from Pineview's account might have accelerated Pineview's default in servicing its loans from the ANZ Bank, that does not affect the conclusion that its loss was caused by the conduct of Dimitriou, Wyse & Young and Wyse Accounting in exposing it to its liability to the ANZ Bank and then taking the money it borrowed. 13. I have found that Huybers did not authorise the payment of the loan moneys to Wyse & Young and Wyse Accounting. Pineview is entitled to judgment against all three cross-defendants for the moneys received by Wyse & Young and Wyse Accounting, except insofar as the moneys were applied to meet liabilities of Pineview. 14. The stamp duty paid by Wyse & Young was one such payment. 15. Having regard to the purpose of the trust, Pineview was required to use the moneys borrowed from the ANZ Bank to discharge the debts incurred by the Rubinos to Kalischer and Huybers. The payment of $490,010 to Kalischer was a proper disbursement that Pineview was required to make on behalf of the Rubinos. 16. If Dimitriou had repaid Huybers' loan of $570,000, plus what he said was the $10,000 interest she was entitled to, then Pineview would also be required to give credit to Dimitriou, Wyse Accounting and Wyse & Young in respect of that payment. Huybers' loan not repaid 1. As noted above at paras [180] and [181] Dimitriou deposed that "about" $495,000 of the $580,000 due to be repaid to Huybers was lent to two companies associated with a Mr Corrado Sanna. He deposed (CB2/425) that in about late March 2012, Corrado Sanna and his wife met with him and he discussed lending them sufficient funds to save their companies. He deposed that after the meeting was over he spoke with Huybers about whether or not she wanted to invest about $500,000 into a commercial mortgage advance to the Sannas' companies. He said that Huybers said to him "It looks good. Please put half of whatever is needed to help the Sannas towards their Mortgage from my Pineview settlement monies." (CB 2/425 [45]) Dimitriou deposed that he estimated that Defined Properties Pty Ltd paid out about $990,000 for the loan advanced to the Sannas' companies of which about $495,000 was Huybers' money from the Pineview settlement (para 46). 2. Huybers denied that there was any discussion between her and Dimitriou about lending her money, with his, to the Sannas (T447). I accept that denial. She said she first became aware that he had lent a lot of money to the Sannas sometime in 2013. 3. Dimitriou produced a direction apparently signed by Corrado and Lepa Sanna on behalf of themselves and as sole directors of three companies called DCL Construction Group Pty Ltd, DCL Constructions (NSW) Pty Ltd and DLD (NSW) Pty Ltd in which they referred to a loan advance received from Defined Properties Investment of $1,200,000 and directed payment of the advance as follows: "(a) $10,0016.62 to Gadens Lawyers – fees for acting for the Mortgagor (b) $18,000.00 to Defined Properties Investment Pty Ltd – establishment fee (c) $20,000.00 to Defined Properties Investment Pty Ltd – interest for one month (d) $89,286.28 to Wyse & Young International Pty Ltd (part payment) (e) $149,223.39 to Wolgan Consulting Pty Ltd – saving fee; and (f) $913,473.65 to Australian Executor Trustees Ltd – Mortgage discharge" 1. As part of that exhibit Dimitriou said that: "Other amounts Payable for this settlement to take place: (g) $1,419.00 to R. B. H. M. (h) $1,457.50 to Grays Legal – conveyancing fees (i) $1,815.23 to Gosford City Council (j) $2,607.00 to Hancocks Solicitors (k) $3,089.00 to Russo & Partners (l) $4,690.00 to Foleys, Solicitors – mortgage preparation fees (m) $5,500.00 to Foleys, Solicitors – legal appearance fees (n) $ to the Office of State Revenue – stamp duty on Loan & Mortgage (o) $ to the LPI – registration of Mortgage etc. (p) $16,980.16 to Wyse & Young International Pty Ltd (part payment) (q) $39,632.34 to Wyse & Young International Pty Ltd – DCL Group payment The total of these amounts is in excess of $77,190.23." 1. Dimitriou accepted that about $495,000 of the moneys advanced were Huybers' funds. She did not lend the moneys she was entitled to receive to Defined Properties, nor to Defined Properties Investments, nor to the Sannas or their companies. The moneys Dimitriou dealt with were trust moneys that he was required to account for to Huybers. There is no reason to doubt that at least $495,000 of Huybers' funds was used in making an advance to the Sanna companies. I do not accept that that was done with her authority. This use of Huybers' money was a gross breach of trust. 2. Quite apart from the fact that Dimitriou did not have Huybers' authority, he was using her money to make a loan under which he, or companies associated with him, would make substantial profits if the mortgage advance were repaid. It appears from the settlement directions that the loan carried interest at the rate of 20 per cent per annum payable to Defined Properties Investments. Defined Properties Investments charged an establishment fee of $20,000. Wyse & Young was to receive payments it seems, of $89,286.28, $16,980.16 and $39,632.34. Wolgan Consulting Pty Ltd was to receive a saving fee of $149,223.39. This was another of Dimitriou's companies. In other words, Dimitriou stood to earn fees on this transaction from the Sannas of hundreds of thousands of dollars, but was to obtain such profits, in a substantial part, by using Huybers' money. On Dimitriou's case he mixed moneys belonging to Huybers with that of Defined Properties Investment. He produced no documents evidencing such an improvident arrangement. 3. It does not appear that the loan to the Sanna companies has been repaid. Mr Foley referred to proceedings in this court in which Defined Properties Investments is seeking to recover the loan. If any loan moneys are recovered Huybers should be entitled to a charge over the moneys recovered to at least the extent of $495,000, but there is no guarantee that anything will be recovered. 4. In any event I am satisfied she did not authorise the alleged transaction. Her loan has not been repaid by $495,000 being reinvested in a loan with the Sannas. 5. It follows that Pineview is not required to give credit for the alleged repayment of $495,000 to Huybers against its claim to require an accounting for the moneys received by Wyse Accounting. 6. However, to the extent Huybers' loan has been repaid by the cross-defendants or by another Dimitriou company acting on behalf of the cross-defendants, both Huybers and Pineview are required to give credit for the payments. There are many such alleged payments, most of which are disputed. I deal with these below. Claimed set-offs against Pineview 1. Apart from the payment of stamp duty and interest on the stamp duty payable on the transfer (a total of $123,102.04), the cross-defendants submitted that Pineview was required to give credit for various payments said to have been made on its behalf. I deal with each in turn. 2. The first was a payment said to be $510 for stamp duty on the Pineview trust deed. The trust deed naming Huybers as beneficiary was stamped in the amount of $500. There is no doubt that Pineview was liable to pay duty on the trust deed. Pineview must give credit for the moneys paid on its behalf, even though the trust deed was not intended to take effect according to its tenor, but was produced for the improper purpose of deceiving the bank. The statement of Wyse & Young's account from which the payment was made was not produced. The trust deed was stamped to $500, not $510. Pineview must give credit for $500. 3. The cross-defendants contended that Pineview should give credit for a further $510 for stamp duty said to have been paid on 1 March 2012 on a trust deed for the Arcadia trust. Pineview was not the trustee of that trust. I reject this claim. 4. The cross-defendants claim credit for two sums of $313.50 and $104.50 paid on 16 April 2014 by Wyse & Young for payments described as "payment to LPI for Pineview caveat". 5. Pineview was the registered proprietor of the Galston properties. I infer that the caveat lodged was a caveat by Wyse & Young to secure its claim for fees. I do not accept that this is an expense for which Pineview is liable. If Wyse & Young sought to enforce the Retainer Agreement to claim an entitlement to these fees, it would be met with the defence that the Retainer Agreement was liable to be set aside. 6. The cross-defendants claimed a credit of $25 for a payment said to have been made on 4 July 2014 by Wyse & Young only described as "payment to SAI Global re Pineview". There was no explanation of the payment. I do not accept this contention. 7. On 18 January 2013 Defined Properties Investments made two payments of $230: one described as a payment to ASIC for filing fees for Pineview; and the other payment of filing fees to ASIC for Arcadia Property Holdings. Pineview is not liable for the second payment. Prima facie, Defined Properties Investments would be entitled to reimbursement by Pineview in respect of the payment of filing fees made by it on its behalf. Dimitriou was the sole director and shareholder of each of these companies. He claims credit for the payment made by Defined Properties Investments. It appears that he made payments from accounts of companies by him without regard to whether the company in question had any contractual or other relationship with Pineview or Huybers. As he now claims credit for such payments against the liability of him, Wyse & Young and Wyse Accounting, and as he is the sole director and shareholder of those companies, I accept that I should infer that payments so made were made on behalf of the cross-defendants. 8. The same is true of a further payment of $661.95 paid on 18 January 2013 and described as a bill for Sydney Water paid by Defined Properties Investments for Pineview. Credit is claimed for a further payment of $4,518.90 for insurance paid by Defined Properties Investments for Pineview. But there is no evidence to support the claim that the payment was made to meet a liability of Pineview's. 9. The cross-defendants claimed a credit for two sums of $41 and $214 paid on 3 July 2014 by Defined Garden Artistry. The only evidence of what the payments were for was a description on Defined Garden Artistry's bank statement that payments were made by EFTPOS to "Handyway Lpi". In a schedule produced by Dimitriou he simply described the payments as "LPI – Pineview". There was no other evidence as to what the payments were for. I do not accept that the cross-defendants are entitled to credit for those payments. The evidence does not establish that they were made to discharge a liability of Pineview's. 10. The cross-defendants claim credit for $5,494.34 for rates paid on 8 October 2014 to the Hornsby Shire Council for the Galston properties. The amount claimed should be $5,194.34. The payment was made by Wyse & Young. It had been the subject of an invoice raised by Defined Properties Investments on 20 August 2014 (where a further claim was made for $4,002 in respect of what was said to be "wind-up fee", being payment of costs paid to the Hornsby Shire Council in respect of an application it had brought to wind up Pineview) (CB 4/1454 and 1455). As the payment of $5,194.34 was made by Wyse & Young and was in respect of a debt that Pineview clearly owed, I accept that the cross-defendants are entitled to a credit for that sum. No credit has been sought with respect to the invoiced amount of $4,002. 11. On 11 April 2012 Wyse Accounting paid Pineview $25,000 and paid Green Global $25,000. Dimitriou deposed that the $25,000 paid to Pineview was paid so that Pineview could pay the money to Huybers as director's fees. The payment to Green Global (that Dimitriou deposed, wrongly, was to her personal account) was said to be a "personal payment … in respect of the short-term loan facility that she obtained from the ANZ Bank" (CB 2/422). 12. Huybers' agreement with Dimitriou was that she would be paid $100,000 for her involvement in the transaction. Although not expressly stated, Huybers was entitled to look to Pineview for payment of the fee. The payment by Wyse Accounting of $25,000 to Pineview is something for which Pineview must give credit. I also think that the payment of the additional sum of $25,000 to Green Global which Huybers was able to disburse was also a payment that reduced Pineview's obligation to pay fees to Huybers. 13. In relation to these two payments Huybers said that she only received $8,623.30 and $315.05 in Pineview director's fees. She said this because other disbursements were made from the Pineview and the Green Global accounts, including four loan payments to the ANZ Bank in respect of the Pineview loan. Mr Foley who appeared for the cross-defendants accepted that because of such disbursements, Huybers did not receive the full $50,000 as payment of director's fees, but only received $8,938.35. It is unnecessary to decide whether this is so or not as Huybers has not sued for unpaid director's fees. The two payments of $25,000 were not paid in partial repayment of Huybers' loan. She is not required to give credit for the payments, but nonetheless they are amounts for which Pineview must give credit. 14. For these reasons Pineview is entitled to judgment against Wyse & Young, Wyse Accounting and Dimitriou for $1,990,551, being the total of the moneys received from the ANZ Bank, less $123,102.04 paid to the Office of State Revenue for stamp duty on the transfer, $500 paid for stamp duty on the trust deed, $490,010 paid to Kalischer, $661.95 for payment of water rates, $5494.34 for payment of council rates, $25,000 paid on 11 April 2012 to Pineview, and $25,000 paid on 11 April 2012 to Green Global. In addition, for the reasons below the cross-defendants are entitled to a credit for the amount of $44,348.38 representing loan repayments made to Huybers or matters for which they are entitled to claim a set-off against Huybers' claim for the loss of the $570,000. I will direct entry of judgment in the sum of $1,276,389.29 plus interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW) from 9 March 2012. 15. This may not be the extent of the cross-defendants' liability to Pineview. If the ANZ Bank receives less than the mortgage debt for which it has recovered judgment against Pineview from the exercise of its power of sale over the Galston properties, or if it is required to discharge its mortgage for a lesser sum by reason of its settlement with the Rubinos, Pineview would have a personal liability to the bank for the difference. Each of the cross-defendants would be liable to indemnify Pineview against that liability because it was through Dimitriou's breach of fiduciary duty, deceit and unconscionable conduct that Pineview incurred its liability to the bank. 16. If Pineview recovers moneys pursuant to the judgments to be entered against Dimitriou, Wyse & Young and Wyse Accounting as outlined at para [300] above, the recovery would be trust property for which it would be required to account to the Rubinos, except insofar as it was entitled to have recourse to the moneys in order to indemnify itself against liabilities it had properly incurred in execution of the trust. That would include its liability to repay Huybers' loan. But it would not thereby incur any further loss by reason of its having to account for any moneys recovered to the Rubinos. 17. Another possibility is that the ANZ Bank sells the Galston properties in exercise of its power of sale and recovers enough to satisfy the mortgage debt for which it has recovered judgment thereby discharging Pineview's liability to it, and Pineview receives the surplus proceeds of sale. Again, that surplus would be trust property. Pineview would be entitled to have recourse to the trust property to satisfy liabilities properly incurred, including the debt payable to Huybers, but might only be entitled to have recourse to that trust property on the taking of accounts on which the Rubinos might be entitled to claim that Pineview is liable to replenish the trust property to the extent moneys were borrowed and applied to make payments that were not properly incurred in execution of the trust. Whether the Rubinos would be entitled to make such a claim, not having made it in these proceedings, is not a question I can decide. It remains possible that Pineview could have a liability to the Rubinos in respect of the improper application of trust moneys for which Dimitriou, Wyse & Young and Wyse Accounting are liable to indemnify it. Any such liability is likely to be sufficiently covered by the judgment to be entered against them. Nonetheless, there remains a possibility that Pineview might be entitled to further relief. 18. Accordingly, in addition to giving judgment for Pineview against Wyse & Young, Wyse Accounting and Dimitriou for the moneys received by them and not accounted for to Pineview as set out at para [300], I will declare that they are liable to indemnify Pineview against its liability to the ANZ Bank in connection with the mortgages given by Pineview to the ANZ Bank on 9 March 2012 and in respect of any liability Pineview might have to the Rubinos in respect of payments made or liabilities incurred by Pineview otherwise than in the proper performance of the trusts on which Pineview holds the Galston properties for the Rubinos. 19. The extent of the cross-defendants' liability under the declarations will depend upon future events, including the extent to which Pineview's liability to the ANZ Bank may be reduced by the redemption of the ANZ Bank's mortgages or the sale of the mortgaged property by the bank. The extent of the cross-defendants' liability under the declaration of their obligation to indemnify Pineview in respect of any liability to the Rubinos might also be affected by the extent to which Pineview receives payment under the judgment. I do not think it necessary or desirable to attempt to deal with such matters within the terms of the declarations themselves. The working out of the declarations in the light of subsequent events can be left for another day. There will be liberty to the parties to apply and I will reserve the proceedings for further consideration in respect of the working out of such declarations. 20. Pineview sought a declaration that it was entitled to a "tracing remedy" against Dimitriou, Wyse & Young and Wyse Accounting and an account of profits that might have arisen from the use of its moneys for their benefit or the benefit of any associated persons. There was no evidence that Pineview's moneys had been used to acquire particular assets, or to discharge encumbrances over particular assets, or to earn profits, other than Dimitriou's admission that about $495,000 payable to Huybers was advanced by Defined Properties or Defined Properties Investments to companies associated with Mr and Mrs Sanna. Dimitriou did not say how he or Wyse Accounting dealt with the money they retained. Neither Defined Properties nor Defined Properties Investments was joined as a cross-defendant. Reservation of proceedings for further consideration enables matters not disposed of by final orders, and which arise in consequence of them, to be determined in the original suit (Abigroup Pty Ltd v Abignano (1992) 39 FCR 74 at 88; Australian Hardboards Ltd v Hudson Investment Group Ltd [2007] NSWCA 104; (2007) 70 NSWLR 201 at [72]). In my view the reservation of the proceedings for further consideration should extend to the consideration of any application that may be made for proprietary relief or an account of profits arising out of the use by the cross-defendants of Pineview's (or Huybers') moneys. Whether the legitimate scope of such further proceedings might extend to the joinder of additional parties is not a question that presently arises. Huybers' cross-claim against Wyse & Young, Wyse Accounting and Dimitriou 1. The ANZ Bank obtained two judgments against Huybers, one in the Supreme Court of Queensland and one in this Court. She owed money to the ANZ Bank on four separate accounts. They were the $500,000 loan to Green Global which she guaranteed that was used primarily, although not wholly, to raise money for her brother, a facility of approximately $400,000 to refinance her debt to the National Australia Bank, her loan of $570,000 that was used to make the loan for the Rubinos, and her guarantees of the Pineview loans. The judgment entered against her in this Court was in respect only of her guarantee of the Pineview loan where her liability was limited to $2,000,720. The bank has sold her Queensland property to reduce her liability to it in respect of the other loans. In addition it appears that she has a liability to Esanda Finance in respect of a facility provided in connection with a Lexus motor vehicle. Only her borrowing of $570,000 and onlending of that sum to the Rubinos and her guarantees of the Pineview loans were the subject of these proceedings. 2. Huybers has suffered loss by reason of the judgment against her on her guarantees of the Pineview loans. However, if the Galston properties are sold for a price that is sufficient to discharge all of Pineview's liability to the ANZ Bank, her liability as guarantor of Pineview's borrowings will also be discharged. If the bank exercises its power of sale but receives less than the sum required to discharge Pineview's liability to it then her liability under the judgment against her in this Court will only be discharged partially. Similarly if the bank is required to accept a lesser sum than the full mortgage debt pursuant to its settlement agreement with the Rubinos, leaving Pineview with a debt owed to the bank that is the subject of Huybers' guarantees, her liability under the judgment will be reduced only by the extent of the payment made by the Rubinos. 3. For the reasons above, Dimitriou, Wyse & Young and Wyse Accounting are liable to indemnify Huybers against her liability to the ANZ Bank in respect of the guarantee she gave of the Pineview loan. There should be a declaration accordingly. It is not possible at this stage to reduce the obligation of Dimitriou, Wyse & Young and Wyse Accounting to indemnify Huybers in respect of her liability as a guarantor of the Pineview loan to a judgment sum. The proceedings will be reserved for further consideration and Huybers will have liberty to apply for a judgment sum to give effect to her right to be indemnified. The reservation of the proceedings for further consideration will extend to any application Huybers may make for proprietary relief or an account of profits, in the same way as it will apply to Pineview. 4. I have concluded that Huybers did not agree to the loan moneys payable to her being reinvested as part of an advance by Defined Properties Investments to the Sanna's companies. Dimitriou is responsible for her loan advance not having been repaid. For the reasons above, Wyse & Young and Wyse Accounting are liable as accessaries to his breach of fiduciary duty, deceit and unconscionable conduct. Wyse Accounting received and disbursed the moneys that Dimitriou was required to pay Huybers. 5. Huybers' claim is for damages or equitable compensation for the loss caused to her by Dimitriou, Wyse & Young and Wyse Accounting by their steps to intercept the moneys that should have been paid to her. She has sued them for $570,000 plus interest. It was common ground that her pleaded claim extended to a claim for the $580,000 that Dimitriou accepts she was entitled to receive as repayment of the loan. 6. Dimitriou claims that Huybers is required to give credit for $276,228.11 for moneys paid to her or on her behalf. He identifies 173 payments for which credit is claimed. I attach as an annexure to this judgment the schedule of amounts for which the cross-defendants claim credit against Pineview's and Huybers' claims. 7. This includes the two payments of $25,000 made on 11 April 2012 for which I have found Pineview is required to give credit against its claim. 8. I do not consider that Huybers is required to give credit in respect of those moneys for her claim for loss of her $570,000 advance. The two payments of $25,000 were paid to her on account of her entitlement to fees for being a director of Pineview or giving her guarantees. As noted above, she contends that only a small part of the moneys paid to her were retained by her as director's fees. Her claim in this respect was conceded. But it does not matter, because she has not made a claim for outstanding fees payable to her for becoming a director of Pineview or providing her guarantees. That is, the two payments of $25,000 made on 11 April 2012 were not in repayment of the loan she advanced. Nor were they payments of interest on the loan. Nor do any of the cross-defendants have a claim against her for repayment of those moneys which could be set off against her claim for $580,000. 9. Dimitriou, Wyse & Young and Wyse Accounting pleaded that Huybers received her $570,000 from the Pineview settlement. They did not plead any defence of set-off. However, Dimitriou, Wyse & Young and Wyse Accounting were joined late to the proceedings and their claim to have made repayments of the moneys payable to Huybers or to a set-off was litigated. 10. The onus is on the cross-defendants to establish such repayments or a set-off. In many cases the payments relied upon were made by other companies associated with Dimitriou, in particular Defined Properties Investments, Defined Garden Artistry, Wolgan Consulting Pty Ltd ("Wolgan Consulting") or Union Steel Investments Pty Ltd ("Union Steel Investments"). 11. The cross-defendants claim credit for various categories of payments. Some payments were made to Esanda Finance in respect of the facility provided by it for the Lexus motor vehicle and payments were made for the car insurance and registration in respect of that vehicle. Credit is also claimed for payments of rent made for accommodation for Huybers and for hotel bills for what is said to be her accommodation at the Adina Apartment Hotel in Bella Vista when she was visiting Dimitriou's office. Other credits are claimed for payment of taxi fares said to be made on her behalf. Further credits are claimed for transfers made to the account of Green Global, Union Steel, or to her account during 2013, 2014 and 2015. Huybers disputes receiving many of the alleged payments or disputes that they were made on her behalf. She agrees that payments of just under $21,000 were made for her travel and accommodation, but says that this was pursuant to an arrangement with Dimitriou under which he agreed to be responsible for the payments. She says that over $53,000 was paid to her as director's fees for acting as a director of Pineview and that over $96,000 was paid to her for acting as a director of Union Steel. Payments for Lexus motor vehicle 1. The cross-defendants claim credit for the following payments made to Esanda Finance in respect of the Lexus motor vehicle: 27 February 2013 Wyse & Young $1,275.60 22 May 2013 Wyse & Young $3,804 17 January 2013 Defined Properties Investment $3,832.88 23 September 2013 Defined Properties Investment $2,536. 1. They also claim credit for two payments made on 29 August 2013 by Defined Garden Artistry of $267.74 and $471 said to be for car insurance and car registration for the Lexus motor vehicle. The payment said to be for insurance for the Lexus motor vehicle was with GIO Insurance, but there is no evidence to substantiate the contention that the payment was in respect of the Lexus motor vehicle. Nor is there any evidence to corroborate the assertion that payment of $471 to RTA Newcastle was in respect of that vehicle. Huybers deposed that she had never had a policy with the GIO and was not challenged on that evidence. 2. There was a dispute between Huybers and Dimitriou, that was not otherwise litigated in these proceedings, in relation to the Lexus motor vehicle. In her statement to the police of 10 November 2015 Huybers stated that at the time she got the loan for her brother she also got a Lexus car financed under the company name, presumably Green Global. She said that her brother Neil did not make repayments on the Lexus loan and in February 2012 Dimitriou told her that he had found a buyer for the Lexus vehicle so that the lease to Esanda could be paid out. In her statement to the police she stated that Dimitriou said to her words to the effect: "You're not going to believe this! You're going to be so happy with me. I've found someone to buy the Lexus at the full pay out price. Another client of mine called Bobby from Western Australia, he's very wealthy, he owns a chain of Indian takeaway shops and he's going to buy it for his daughter." 1. In her affidavit of 15 June 2016 Huybers said that on 22 February 2012 she had a conversation with Dimitriou in which the following words were said: "He said: 'Great news Bobby wants to buy the car for his daughter and there will be no liability to you after you hand the car over. But you have to get the car to the Gold Coast. Sue said: 'So I don't have to worry about the car payments anymore' He said: 'That's right' I said: 'Great I will get it down there'" 1. Huybers stated that on 23 February 2012 Dimitriou told her that the plan had changed and she was to meet "Bobby" and someone called "Jerome" at Quay 1 Tower and to give Danny (Kalischer) the documents. Her evidence is that following Dimitriou's instructions she provided the relevant documents to Kalischer and delivered the car to the two individuals to whom Kalischer introduced her as Bobby and Jerome. She said she did not receive a cheque in exchange for the Lexus as Dimitriou had told her that they would do the paperwork when Bobby and Jerome got back to Sydney. She stated that Dimitriou said "I've contacted Esanda to get a payout figure. I will sort that out." 2. In substance her case was that she handed over the car on Dimitriou's directions and on Dimitriou's assurance that he would deal with the repayments. Her evidence is that Dimitriou took possession of the car and has kept it. Huybers was cross-examined in relation to this transaction. She was asked what happened to the Lexus and said that it ended up being found by the police in Dimitriou's possession registered to him (T406). It was put to her that Dimitriou was attempting to get somebody to purchase the car so that she could get out of the lease in respect of it. She agreed that that was what Dimitriou told her, but she said that she believed that to be untrue and "I think he did it to trick the car out of me." She agreed that she was told that Bobby would be buying the car when she handed it over. 3. Huybers was challenged in relation to these matters on the basis that she had not put any of that material in her affidavit that was served as her evidence in chief and had not pleaded such a case against Dimitriou. She was not otherwise challenged on her evidence and Dimitriou did not respond to it. There was no substance to the challenge to Huybers' credibility on the basis that these allegations had not been pleaded or raised in her affidavit in chief. Huybers' cross-claim was filed late and in the course of directions hearings I made it clear that I would only give leave for the filing of a cross-claim that dealt with the same subject matters as were the subject of the plaintiffs' claim. Otherwise, there was a real risk that the hearing date would have to be vacated. The issue only arises because Dimitriou raises the payments made to Esanda and payments said to have been made in respect of insurance and registration of the vehicle by way of set-off or as an alleged repayment of Huybers' loan. He did not dispute that he had ended up with possession of the car. Dimitriou prepared a form called a "change of ownership form" stating that he had purchased the vehicle on 23 July 2012 (ex WYX.24). He did not pay Huybers for the purchase of the vehicle (T477), but nonetheless assumed ownership and took possession of it. The payments for which he claims credit were all made after he did so. 4. I am comfortably satisfied that Huybers has no liability to Dimitriou or any of his companies in respect of the payments made by them in connection with the Lexus vehicle. Payment of rent 1. Defined Properties Investment paid a rental bond on behalf of Huybers of $2,640 and rent $660 on 18 November 2014. Union Steel Investments made six payments of rent each of $660 between 16 December 2014 and 13 January 2015 on her behalf. The cross-defendants claim credit for those payments. 2. These payments related to a house at Mooloolaba that Huybers rented. Huybers said that Dimitriou had agreed to make payments of rent on her behalf. On 12 November 2014 she sent an email addressed to the reception at Wyse & Young to one "Ashley" saying "can you remind George to pay the $660 deposit on this today. I was approved but will lose it if deposit not paid." 3. By the time of these payments the ANZ Bank had taken possession of Huybers' house at Clayfield. It was put to Dimitriou that he agreed to pay the rent and accommodation expenses of Huybers because her house had been lost in the possession proceedings. He said "I didn't agree to pay it. I agreed that it needed to be paid and she was not in a position to make that payment, so we made that payment on her behalf …" (T1152). 4. Huybers has not established that payments of the rental bond and payments of rent were made by Dimitriou or his companies by way of gift. Although the payments were not made by any of the cross-defendants, it is her case that Dimitriou had agreed to pay the rent and the rental bonds and the cross-defendants did not dispute that the payments were made on behalf of at least Dimitriou. He claimed credit for the payments. I accept that he and the other cross-defendants are entitled to credit in respect of payments made by Defined Properties Investment. The bond was not returned to Dimitriou. These total $3,300. For the reasons below I do not accept that the cross-defendants can claim a set-off of moneys paid by Union Steel Investments. 5. Dimitriou claimed credit for $300 paid by Defined Properties Investment on 2 November 2012 to "Queensland Government Brisbane". There was no other evidence given by the cross-defendants about that payment. Huybers said that she was not aware of any payment on her behalf for $300 to any Queensland authority. The cross-defendants have not established that this was a payment to discharge a liability of Huybers or for which she was otherwise required to make restitution. 6. The cross-defendants claimed credit for $2,200 as legal fees paid on behalf of Huybers. The payment was made to Foley. Huybers said that the payment was "from" a company called Bramco. It appears that Foley had acted for a company called Bramco. But it is established that he acted for Huybers in relation to possession proceedings in Queensland and that the payment does not relate to his invoice for work done for Bramco. I accept that this payment was for legal fees incurred by Huybers to Foley. 7. Likewise, the cross-defendants have established that a payment of $554.43 made on 27 March 2013 was a payment of Huybers' Telstra bill. 8. Foley's fees were paid by Defined Properties Investments. The Telstra bill was paid by Defined Garden Artistry. Dimitriou is the sole director of both companies. By claiming a credit for those companies against moneys payable by him, Wyse & Young and Wyse Accounting he must be taken as acknowledging or asserting that the payments were made by those companies on his behalf such that those companies would be estopped from themselves suing Huybers for the moneys paid on her behalf. Hotel accommodation and taxi fares 1. The cross-defendants claim credit for 15 payments to the Adina Apartment Hotel said to have been for Huybers' accommodation. These payments were made between 29 April 2013 and 23 April 2014. They also claimed a credit for two payments made on 7 June 2013 for accommodation at the Pacific Rim Hotels at North Sydney and a payment made on 21 July 2014 for what was said to be Huybers' accommodation at Novotel-Norwest. 2. The cross-defendants also claimed a credit for numerous payments made to a cab company for what was said to be Huybers' travel in Sydney. There were 43 such claims ranging from $49.95 to $671.55 (a payment made on 23 September 2013). 3. Huybers disputes that many of the charges related to expenses paid for her. For example, the amounts claimed include payments made by Defined Garden Artistry on 23 September 2013 of $671.55, and two further payments on 25 September 2013 of $155.40 and $177.60. No receipts were provided. It appears from Huybers' bank statements that she was not in Sydney on 23 September 2013. She made EFTPOS payments on 23 and 24 September at Clayfield. Another claimed travel expense related to a payment by Defined Garden Artistry to Virgin Australian Airlines of $782.80 on 3 October 2013. Again, there was no invoice or any corroboration that the payment was made in respect of an expense incurred by Huybers. She said that she did not travel on that date and that Dimitriou never purchased airline tickets for her. 4. The cross-defendants have not discharged the onus of showing that the amounts claimed as travel expenses, mostly payments made to "GM Cabs" were for cab trips taken by Huybers which she was liable to pay, but they paid on her behalf. She was not in Sydney on some of the days for which taxi expenses were claimed. No records were produced showing Huybers as being a passenger in the taxi cabs. Some of the charges call out for explanation that was not provided. For example, on 8 July 2014 there were five debits to Defined Properties Investments credit or debit card, each of $149.85, two of the charges being for an effective date of 4 July 2013 and three for an "effective date" of 5 July 2013. Huybers was not in Sydney on those days. 5. The position with the accommodation at the Adina Hotel is different. Dimitriou produced what he said were true copies of various Adina Apartment Hotel Sydney Norwest tax invoices. These showed arrival and departure dates, accommodation and incidental charges and payments by Visa Mastercard in respect of various stays. Some of the invoices identified Huybers as occupying a particular room number, some identified Dimitriou as doing so. It appeared that they were not contemporaneous business records. Dimitriou said that he went to the Adina Hotel and spoke to someone called "Kim" who was the manager there and asked him to provide Dimitriou with information about Huybers' staying at that hotel. Dimitriou explained his lack of records on the basis that documents had been removed from his office by Huybers. Huybers admitted to removing two boxes of documents that she said were full of a jumble of her own papers, most of which she had taken to his office for the purposes of accounting which did not ever happen (T412). 6. The credits claimed by the cross-defendants in respect of Huybers' staying at the Adina Hotel were first a payment of $166.46 on 29 April 2013. The payment was made by Wolgan Consulting, another Dimitriou company. (Item 166) The "invoice" provided by the Adina Hotel records an arrival date of 26 April 2013 and a departure date on the following day. Huybers said that she was not in Sydney on those days. I accept that evidence. It appears to be corroborated by her bank statements, for example SH3-1 page 5 which shows EFTPOS transactions with an effective date of 27 April 2013 being made in Brisbane. 7. The next such transaction is a charge of $161.39 paid by Defined Garden Artistry on 13 May 2013 described as a "debit card purchase". There is a further claim (Item 132) for $385.09 paid by Defined Garden Artistry for the Adina Hotel on 27 May 2013. Items 133, 134 and 135 are further such charges for accommodation for the Adina Hotel paid by Defined Garden Artistry on 28 May and 24 June 2013 for $179, $731.49 and $1,447 respectively. In respect of these charges Huybers says she was not in Sydney on those dates. The charge for 27 May for $385.09 is described in an "invoice" for the Adina Hotel showing Susan Huybers in a particular room number with an arrival date of 22 May, departing on 24 May. There is no similar document recording her attendance at the hotel which might provide any corroboration for the payments made on 28 May and 24 June. Huybers' NAB Bank statements (SH3-1 page 12) shows EFTPOS transactions on 22 May at Baulkham Hills. I accept that Defined Garden Artistry made a payment of $385.09 in respect of Huybers' accommodation at the Adina Apartment Hotel on 22 and 23 May 2013. 8. The next item 136 is for a payment of $190.82 made by Defined Garden Artistry for accommodation at Hills Lodge. There is nothing on the bank statement to tie that payment to accommodation provided for Huybers. Huybers denied that she was in Sydney "on this date", apparently 4 July 2013. There is nothing to corroborate Dimitriou's assertion that this payment was made for accommodation provided to Huybers. The cross-defendants have not discharged their onus of showing that it was. 9. The next credit pressed by the cross-defendants for accommodation at the Adina Apartment Hotel was for items 153 and 154 being accommodation at the Adina Apartment Hotel in December 2013. Huybers said that she stayed at the Adina Apartments on nights of 14 and 15 December 2013 because her Clayfield property was auctioned on 14 December and Dimitriou insisted that she come to Sydney and said he would cover all expenses since she had been thrown out of her place. She said also in relation to another item for travel on 17 December 2013 that Dimitriou had insisted that she come to Sydney and that all her expenses would be covered. She said the same in relation to expenses incurred for accommodation on 24 March and 14 April 2014. I accept that evidence. Huybers mistakenly thought that the two payments related to two rooms. That was not so. Rather, the period of her occupation was not 14 and 15 December, but 11-15 December. However, I accept her evidence that Dimitriou told her that her expenses of coming to Sydney would be covered by him and that had he not given her that assurance she would not have incurred the expenses. The cross-defendants are not entitled to a credit for these amounts. 10. The same applies to the subsequent accommodation expenses incurred by Huybers. 11. In addition to paying expenses the cross-defendants say that they or other companies associated with Dimitriou paid a further $28,908.96 to Green Global and $23,800 to Union Steel in 2012 and 2013. They also say that between 26 April 2013 and 10 April 2015 $131,470.27 was transferred to Huybers' ANZ or NAB account and she was provided with cash of $3,600. Union Steel and Union Steel Investments 1. There is no dispute that payments were made to Green Global, Union Steel and Huybers. Huybers says that of the moneys paid to her $53,125.29 was paid to her as fees for acting as a director of Pineview and $96,695.62 was paid to her for acting as a director of Union Steel. She deposed that Union Steel held properties on trust for Luigi (Lou) Zaurrini and Helen Zaurrini and that in about the end of 2012 she had the following conversation with Dimitriou: "Dimitriou said: 'Sue if you let us to us use your company Union Steel to hold property assets for Lou and Helen, we will pay you $50,000 a year' I said: 'okay that would be great, not a problem'" 1. There is some contemporaneous corroboration of this. On 6 March 2014 Huybers sent an email to Dimitriou complaining about lack of communication from Dimitriou and her financial position. In that email to Dimitriou she said: "… I have been the front of Pineview and Union Steel without a single question. You told me there would be great financial benefits and I didn't ask questions. Please help me and call me tomorrow. I've got no-one to help me other than you and that makes me very vulnerable. Please don't just let another day go without contact." (4/1452) 1. There is no evidence of any reply to that email. Were it not for the evidence of the Pineview transaction, one would be sceptical that such an agreement as that deposed to would be made. But a similar agreement was unquestionably made between Dimitriou and Huybers in connection with Pineview. 2. There was no evidence as to when Union Steel Investments was incorporated. Dimitriou agreed that some payments were made to Huybers for the request for the use of the company Union Steel (T1134). Dimitriou said it was Jetson who made the arrangement for her to be paid fees for the use of Union Steel for the benefit of the Zaurrinis (T1134). The cross-defendants claim credit in respect of 70 payments made by Union Steel Investments between 24 December 2012 and 10 April 2015 said to be for Huybers' benefit. These include the six payments of rent referred to at para [326] above. The evidence in support of this claim is comprised of bank statements of Union Steel Investments showing various payments. The bank statements describe some of the payments as "loan to US" or "loan to Huybers". Some are described as "Fee S Huybers". Some are simply described as "Dir payment GD"; some as "US payment GD fee"; some as "US payment GD"; some as "D fee"; some as "US payment". 3. Dimitriou said that he had no recollection of any conversation with Huybers in which he said that if she allowed him to use Union Steel to hold assets for the Zaurrinis she would be paid $50,000 a year. He denied that there was any conversation of a similar nature (T1116). He denied that he ever offered to pay Huybers any money for using Union Steel to hold assets for the Zaurrinis. However, he later admitted that some fees were paid to Huybers that were "initially for the request for the use of the company Union Steel Pty Ltd" (T1134). He said that the only such payments were those shown on bank statements as payment of director's fees. At one stage in his evidence (T1117) he described payments from the bank account of Union Steel Investments as having been paid from "my" Union Steel Investments account. He was asked about payments which Huybers has characterised as being payments of Union Steel director's fees and agreed that they were paid to benefit Huybers, but then gave the following evidence (T1117-1118): "Q. Nothing to do with payment of director fees? A. No, not at the time. There was a request I recall I distinctly recall a conversation that Lou Zourini had with me and it was insofar as I think there was a small arrangement for Susan to receive a small amount of monies and I may have represented as a fee in my transfer, yes, but it was only a very small amount of money. It might have been I think in the vicinity of around about probably $15,000 all up and I think that contributed to I think the use of the company and there was some expenses that I felt or Lou felt that was relevant that Susan may have incurred but we soon realised that those expenses weren't paid so basically there seems there would seem to be an overpayment if that be the case." 1. Because of the late joinder of Dimitriou, Wyse & Young and Wyse Accounting they and Pineview and Huybers were not in a position to adduce their evidence on the quantification of Pineview's and Huybers' cross-claim at the conclusion of the hearing that concerned the other defendants. They sought a separate hearing of questions of quantification, but I was reluctant to make that order, not least because questions of credit arise on the quantification issues just as they do on other issues. The result was that the proceedings were adjourned for four weeks and directions were made for the service of further evidence by those parties on issues of quantification of the cross-claim and in particular the claimed repayments or set-offs that Dimitriou, Wyse & Young and Wyse Accounting asserted. Earlier in the proceedings, when Huybers was cross-examined by Foley, she gave the following evidence (T443): "Q. He [Dimitriou] put you into a deal in respect of the Zourinis at Kelso? A. The Union Steel was something completely separate where again I was being a director, but no money of mine was involved. Q. You got payment for that, didn't you? A. No, I did not. Q. You got $60,000, or thereabouts? A. No, I did not. Q. What did you say you got from that? A. I was supposed to be paid, but I wasn't. Q. You say you never got any money from that, from the Union Steel, involving the Zourinis? A. No, I did not." 1. On the quantification hearing both parties took opposite positions. Huybers asserted that she was paid $96,695.62 for acting as a director of Union Steel, and Dimitriou asserted that she was paid no more than $15,000. Huybers said the evidence she gave on 18 April 2016 set out above was given on the basis that at that time she did not know that the money had come from Union Steel (by which I understood her to mean Union Steel Investments) and that she only found out where the payments had come from when having to work through a notice to admit facts from which she saw that payments of $1,000 or $1,500, here or there, came from "Union Steel accounts". (T1101) 2. The provenance of the notice to admit facts was that Dimitriou made an affidavit on 21 April 2016 to which he attached what was called a "Susan Huybers reconciliation" that he said showed all the payments made by him or entities associated with him to Huybers or to others on her behalf or to entities associated with her. There was no other explanation of the schedule and none of the documents from which the schedule was prepared were exhibited. I rejected the schedule. But thereafter the cross-defendants served a notice to admit the facts stated in the schedule on Pineview and Huybers. Thus Huybers was saying that it was only after service of the notice that she found that payments had come to her from Union Steel Investments. 3. I asked Dimitriou whether the question asked by Foley, in which he put to Huybers that Dimitriou put her into a deal in respect of the Zaurrinis at Kelso, was put on his instruction and whether Foley's questions to Huybers that "You got payment for that didn't you?" and "You got $60,000 or thereabouts?" were put on Dimitriou's instruction. Dimitriou's answer, so far as I could understand it, was that Wyse & Young through Jetson and Zaurrini made an arrangement with Huybers, and that the fact asserted in the question that Huybers received $60,000 or thereabouts in payment for that, may well have been put on Dimitriou's instructions, but: "I was reflecting the $60,000 as moneys being paid to Union Steel, not on behalf of the Zaurrinis, to the Union Steel account. Not particularly on behalf of the Zaurrinis or any relationship between the Zaurrinis." 1. Whatever this answer means, I am satisfied there was an arrangement to which Dimitriou was a party that Huybers would be paid fees for Union Steel being used to hold property on behalf of the Zaurrinis. The reasons for that were not explained. 2. Dimitriou gave contradictory evidence about the ownership of Union Steel Investments. He said there was no direct relationship between Union Steel Investments and Union Steel (T1157). He said that Union Steel Investments was set up at the request of Lou Zaurrini and that a Giovanni Spada, who was also a director of Union Steel "at that point", set up Union Steel Investments. He said that Giovanni wanted out and Lou and he had an arrangement and that Lou asked Dimitriou to stand in and he then stood in as the director (T1158). I asked: "Q. Who owns the shares in Union Steel Investments? A. It was initially Giovanni Spada, but it does not trade, it does nothing at the moment and the shares have been transferred to myself and in trust for Lou Zourini. Q. When was that done? A. Probably around about 2013 or 14, I think." 1. Dimitriou then contradicted that evidence. He said that the company register said that he owned the shares in Union Steel beneficially. When asked what the true position was, he said that that had to be correct. This is but one example of Dimitriou's shifting testimony. 2. Dimitriou said that Huybers allowed Union Steel to be deregistered and Lou Zaurrini asked for it to be re-registered so that he could accommodate "the tax situation". His explanation of that was unintelligible. 3. The upshot is that I cannot be satisfied that Union Steel Investments is a company, the shares of which are beneficially owned by Dimitriou. I cannot be satisfied that payments made by Union Steel Investments to Union Steel or to Huybers were payments that discharged obligations owed by Dimitriou (or Wyse & Young or Wyse Accounting) to Huybers, or were payments for which he or his companies are entitled to the credit. Accordingly, I do not accept the credits claimed at items 185, 186, nor items 67-126, or 173-183. Cash withdrawals 1. The cross-defendants claimed credit for four cash deposits (described as cash withdrawals) said to have been provided to Huybers (items 168A-168E). The deposits were said to have been made on 28 March, 5 July, 17 December, 19 December and 23 December 2013 and total $3,600. Dimitriou exhibited copies of the bank accounts of Defined Garden Artistry from which it appeared that cash withdrawals were made at Baulkham Hills from an ATM machine on that account. He asserted in his schedule that the moneys withdrawn were provided to Huybers. In three cases he said they were provided by being deposited some days later into Huybers' account with the National Australia Bank. In three cases her National Australia Bank account showed deposits of $500, $1,000 and $1,000 some days after the withdrawals made from the Defined Garden Artistry account. There was nothing to show that the moneys deposited were the moneys withdrawn some days earlier by Defined Garden Artistry. The alleged cash payments were not shown on the schedule of payments in the notice to admit facts to which Huybers responded. The evidence relied upon was thus the uncorroborated assertion by Dimitriou that the cash payments were made to Huybers. I do not accept his uncorroborated word. 2. The remaining items in dispute were items 5, 6, 11, 21, 22, 59 and 60 of Dimitriou's schedule. They were all payments to the Green Global account. I accept that payments made to that account were made on Huybers' behalf and she should give credit for them. She admits as much in respect of many of the payments. There is no reason to differentiate between the payments. 3. The first two payments in issue are payments of $2,000 and $908.96 made on 27 February and 7 March 2013 by Wyse & Young to the Green Global account. In relation to the first item Huybers deposed that Dimitriou said to her on or about 23 February 2013 words to the effect "I'm going to help you out and give you $2,000", and she said "Thank you". I accept that evidence, but I do not think that the transaction can be construed as an unconditional gift that would not be repayable irrespective of whether or not Dimitriou were later to be sued for the loss he caused Huybers. I think the cross-defendants are entitled to credit for that sum. 4. The sum of $908.96 was a payment made for Huybers' accommodation at the Hills Lodge, Castle Hill, between 5 and 7 March 2013. There is no evidence that that money was paid by way of gift. The cross-defendants are entitled to a credit in respect of that sum as well. 5. Item 11 is a transfer from Wyse & Young to Green Global of $1,500 on 12 April 2013. Huybers says that no record of that payment is found in any bank statement, but in fact the payment appears in both the bank statements of Wyse & Young and of Green Global on 12 April 2013. The cross-defendants are entitled to credit for that sum. 6. Items 21 and 22 relate to two payments of $2,000 and $1,500 made on 15 February and 28 March 2013 by Defined Properties Investments to Green Global. I infer that the payments were made on behalf of Dimitriou or the other cross-defendants and they are entitled to credit for that sum. 7. Item 59 relates to a payment made on 19 July 2012 by Defined Properties Investments to Green Global of $20,000. Defined Properties Investments' bank statement describes the transfer as "Pineview int fee". The same description appears on Green Global's bank statement. Thus this was a payment that was appropriated by the payer to whatever account is designated by the expression "Pineview int fee". Clearly that does not mean the additional $10,000 that Dimitriou says was the interest repayable on the $570,000 advance. Rather, it relates to the additional fees that Dimitriou says total $50,000 and Huybers says was agreed to be $100,000 for Huybers' agreeing to act in the transaction in the various roles as director, guarantor and lender. I have accepted Huybers' evidence that it was agreed that she would be paid $100,000 for so acting. As I have said, she has not sued to recover any outstanding balance of that sum. In my view, the payment of $20,000 is not to be credited against her claim for the loss of $570,000 or $580,000. 8. Item 60 is a payment made on 10 September 2012 by Defined Properties Investment to Union Steel. The bank statements of both Defined Properties Investment and Union Steel describe the payment as a loan. Being so described as a loan from Defined Properties Investments to Union Steel I do not think I can take it to have been paid by or on behalf of Dimitriou, Wyse & Young or Wyse Accounting to Huybers. I reject that claim. 9. Item 31 relates to a payment made on 26 April 2013 from Defined Properties Investments to Huybers' ANZ Account of $774.65. She deposed that this was a payment made to reimburse her for her accommodation at Adina Norwest and that Dimitriou had volunteered to pay for her accommodation if she came to Sydney. Had she thought that the payment was a loan she would not have come to Sydney. I accept that evidence. I reject the claim for that credit. 10. Huybers admits items 61, 169, 170, 171 and 172. These were payments made to her in 2013 and 2014 in sums ranging from $1,000 to $10,000. They total $30,500. 11. As noted at para [272] above, in cross-examination Huybers agreed that she withdrew some moneys from Pineview's account. It was put to Huybers that she withdrew $49,000 from moneys the Rubinos had put into Pineview's account to cover mortgage payments. She denied that. In his affidavit of 25 March 2016 Dimitriou exhibited copies of Pineview's bank statements on which he made handwritten notations as to payments he asserted were payments made to Huybers personally, or in payment to Esanda for the Lexus motor vehicle, or otherwise for Huybers' benefit. This covered the period from 20 June 2012 to 4 March 2013. He contended that $41,803 was paid to Huybers personally, $9,804 was paid off her investment loan, $5,087 was paid to Esanda in respect of the Lexus vehicle, and $7,000 was paid to Green Global. 12. Huybers did not respond specifically to this evidence. Nor was it addressed in the parties' final submissions. The payments to Esanda Finance were made after Huybers had given up possession of the vehicle on Dimitriou's assurance that he would deal with repayments. There was no evidence that Pineview appropriated the payments against Huybers' loan as distinct from against her entitlement to $100,000 as her fee for her role in the transaction. Dimitriou did not dispute that Huybers only received $8,938.55 in respect of director's fees from the two payments of $25,000 made on 11 April 2012 referred to at paras [297]-[299] above. Accordingly, I have not allowed any further credit in respect of payments made to Huybers out of Pineview's account. 13. For these reasons, on Huybers' claim for compensation for the loss of the $580,000 payable to her that was misapplied by Dimitriou, for which all of the cross-defendants are liable, the cross-defendants are entitled to a set-off of the following moneys paid by them, or, I can infer, on their directions, to or for the benefit of Huybers: 1. $3,300 ([329]); 2. $2,200 ([331]) 3. $554.43 ([332]); 4. $385.09 ([340]); 5. $2,000 ([361]); 6. $908.86 ([362]); 7. $1,500 ([363]); 8. $3,500 ([364]); 9. $30,500 ([368]) 10. $44,848.38 1. Huybers is entitled to judgment against Dimitriou, Wyse & Young and Wyse Accounting in the sum of $535,151.62 plus interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW) from 9 March 2012. 2. The cross-defendants relied upon two emails written by Huybers late at night on 1 June 2014. She said: "Basically payments made into my anz access (july 2012 to june 2013) from Pineview, Green Global, Union Steel and you are $44,997. Payments into my NAB (march 2013 to may 2014) are $80,606. Total $125,603. I have all the statements to show each transaction. I don't really want to hand them over to support the caveat though bc they show all my personal spending and exactly where I've been on what dates. I don't want Rubinos having all that information. I can have someone check them and make a sworn statement that they're correct. Expenses paid from my accounts for travel, accommodation are around $30,000. Have everything to back that up too. That amount coming off $125,603 minus $30,000 means only about $95,000 paid for me re rubino. Plus the accommodation and travel you have paid for the dates I have given you." 1. She sent a further email later that night saying: "Wait that's wrong, I'm tired. You can put in the whole $125,603 – I just meant that the $30k in travel/accom has been paid out of the $125,603" 1. The reference to travel and accommodation is to expenses paid by Huybers for her travel and accommodation which she had paid out of the $125,603 she calculated had been paid to her. In this email she did not discriminate between payments made for acting as a director of Pineview or allowing Union Steel to hold property for the Zaurrinis and other payments made to her that could be applied in reduction of her loan. She said that when she did the email, which was late at night, she "just added up everything in total that I could find that had been paid towards me at that stage regardless of putting it in categories …". I accept that evidence. I would draw the same inference from the face of the email. Accordingly, the email is not inconsistent with the conclusion I have reached. Orders 1. For these reasons I make the following declarations and orders: 1. The plaintiffs' claims for relief against the second, third and fourth defendants be dismissed. 2. The cross-claim of the fourth defendant (the second cross-claim) be dismissed, save as to costs. 3. On the third cross-claim: (a) order that the claims for relief by the cross-claimants against the first and second cross-defendants (the plaintiffs) be dismissed (save as to costs); (b) give judgment for the first cross-claimant (Huybers) against the third, fourth and fifth cross-defendants in the sum of $535,151.62 plus interest pursuant to s 100 of the Civil Procedure Act 2005 (NSW) from 9 March 2012; (c) declare that the third, fourth and fifth cross-defendants are liable to indemnify the first cross-claimant against her liability to the first defendant (the ANZ Bank) in respect of her guarantees of the moneys borrowed by the second cross-claimant (Pineview) from the ANZ Bank; (d) give judgment for the second cross-claimant (Pineview) against the third, fourth and fifth cross-defendants in the sum of $1,276,389.29, plus interest in accordance with s 100 of the Civil Procedure Act from 9 March 2012; (e) declare that the third, fourth and fifth cross-defendants are liable to indemnify the second cross-claimant against its liability to the ANZ Bank in connection with the mortgages given by it to the ANZ Bank on or about 9 March 2012 and in respect of any liability the second cross-claimant might have to the first and second cross-defendants in respect of payments made or liabilities incurred by the second cross-claimant otherwise than in the proper performance of the trusts on which the second cross-claimant holds the properties at Calderwood Road and Pine Valley Road, Galston for the first and second cross-defendants; (f) Reserve the proceedings for further consideration and give the cross-claimants liberty to apply in respect of the working out of the declarations in para 3(c) and (e), or in respect of any application for proprietary relief or an account of profits in respect of the use of moneys of the cross-claimants misappropriated by the third and fifth cross-defendants. 1. I will hear the parties on costs. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 June 2016