Colliers International (NSW) Pty Ltd v Ziani Corporation Pty Ltd

[2006] NSWDC 65

CITATION:	Colliers International (NSW) Pty Ltd v Ziani Corporation Pty Ltd and Anor [2006] NSWDC 65
HEARING DATE(S):	17/07/2006-20/07/2006
EX TEMPORE JUDGMENT DATE:	07/20/2006
JURISDICTION:	Civil
JUDGMENT OF:	Neilson DCJ at 1
DECISION:	Verdict and Judgment for the plaintiff against the first defendant; Verdict and Judgment for the second defendant against the plaintiff; Plaintiff to pay defendants' costs of these proceedings
CATCHWORDS:	Real estate agent's commission - Whether earned - Whether plaintiff "introduced" tenant to landlord
LEGISLATION CITED:	Trade Practices Act 1974 (Cth) Institute of Sport Act 1995 Civil Procedure Act 2005
CASES CITED:	Big Brother Movement Ltd v Richard Stanton & Sons Pty Ltd [1988] NSW Conveyancing Reports 55-434 LJ Hooker Ltd v WJ Adams States Pty Ltd (1977) 138 CLR 52 Moneywood v Salamon Nominees Pty Ltd (2001) 202 CLR 351 Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387
PARTIES:	Colliers International (NSW) Pty Ltd (Plaintiff) Ziani Corporation Pty Ltd (1st Defendant) Raymond John Jones (2nd Defendant)
FILE NUMBER(S):	1442/05
COUNSEL:	Mr J. Stoljar (Plaintiff) Mr N. Kidd (Defendant)

JUDGMENT

1 HIS HONOUR: The plaintiff, Colliers International NSW) Pty Limited was formerly known as Colliers Jardine (NSW) Pty Limited. However, at times stationery has been used indicating that its name, or its holding company’s, may have been Colliers International Holdings (Australia) Limited. Nothing turns on the description of the plaintiff company. I shall refer to it merely as Colliers or the plaintiff.

2 The plaintiff is described in its stationery as “Land Economists, Property and Hotel Consultants, Valuers, Property Managers, Real Estate Agents, Auctioneers”. Essentially, the plaintiff carries on a real estate agency business.

3 The first defendant is Ziani Corporation Pty Limited. The second defendant is Mr Raymond John Jones of Clontarf who is the managing director of the first defendant, Ziani Corporation Pty Limited. I infer that Mr Jones is the principal of the first defendant.

4 The first defendant was at all material times the holder of a long term lease of land known as 6 Figtree Drive at Sydney Olympic Park. The name of that property has sometimes been transcribed as 6 Victory Drive. I need merely refer to the land in question as the property. For present purposes, the first defendant can be described as the owner of the property.

5 The dispute before me concerns the payment of agent’s commission on the letting by the first defendant of part of the property. The eventual lessee of the property was the Crown in right of the State of New South Wales “care of New South Wales Institute of Sport”.

6 It is convenient at this time to say something of the New South Wales Institute of Sport, to which I shall refer as the Institute.

7 The Institute is constituted by the Institute of Sport Act 1995. Section 4 of that Act provides:

“(1) There is constituted by this Act a body corporate with a corporate name of the New South Wales Institute of Sport.

(2) The Institute is, for the purposes of any Act, a statutory body representing the Crown.”

The Institute has a board. The board consists of eight people appointed by the Minister, and the Director General of the Department of Sport and Recreation. Under s 10 of the Act the board is required to prepare and deliver to the Minister at least three months before the beginning of each financial year, a draft corporate plan for the ensuing financial year. The corporate plan must specify, amongst other things, the budget of the Institute for the ensuing financial year. The board must consider any comments on its draft corporate plan that are made by the Minister within two months after the plan is delivered to the Minister and must deliver the completed corporate plan to the Minister before the beginning of each financial year. The Institute must exercise its functions in accordance with the relevant corporate plan.

8 It is clear from subs (5) of s 10 that in developing the corporate plan, the board of the Institute is subject to the directions of the Minister administering the Act. Section 14 of the Act refers to the powers of the Institute. Under subs (2) it has the ability to make and enter contracts and to acquire and develop any land. Significantly, it may occupy, use and control any land or building owned or held under lease by the State and made available for the purposes of the Institute.

9 Under s 14(4) the Institute cannot employ any staff, but it is clear from the note under that subsection and from s 18 that members of the New South Wales Public Service may be appointed to be in effect the members of the staff of the Institute.

10 Section 16 provides that the Institute is, in the exercise of its functions, subject to the control and direction of the Minister.

11 Section 17 provides for the appointment of a Chief Executive Officer who is responsible for the day-to-day management of the Institute, subject to and in accordance with the policies and other decisions of the board, and subject to any direction of the Minister.

12 Section 22 provides for the establishment of the New South Wales Institute of Sports Fund. Section 23 provides for payments to be made into the Fund and s 24 provides for payments to be made out of the Fund. Essentially, the payments to be made out of the Fund are the ordinary outgoings of the body corporate. Section 23(d) provides for the payment into the Fund of all money appropriated by Parliament for the purposes of the Institute.

13 Although the Institute is a body corporate which can clearly sue and be sued in its corporate name and title, the Institute is largely subject to the direction and control of the relevant Minister of State. The evidence discloses that the relevant Minister of State was either called the Minister for Tourism, Sports and Recreation or the Minister of Sport and Recreation. The evidence also establishes that there is a Department of the executive government of this State called either the Department of Sport and Recreation or the Department of Tourism, Sport and Recreation. I shall merely refer to it as the Department. The only relevant Minister of the Crown described in the evidence is the Minister of the Department, the Honourable Morris Iemma.

14 In 1997 the first defendant was granted the head lease of the property. The lease was granted following an appearance by Mr Jones before a government panel in order to establish that the first defendant was a fit and proper entity to become a head lessee within the Olympic precinct at Homebush Bay. The panel comprised three persons and the chairman was Mr Mick O’Brien, the Deputy Director General of the Olympic Coordination Authority, which was subsequently known as the Sydney Olympic Park Authority, or by its acronym SOPA.

15 At the time that the lease was granted to the first defendant there was a building on the property. That building is described as the existing building. The defendants proposed to build a second building adjacent to the existing building on the property. The proposed building can be described as the new building. A development approval for the new building was granted on 5 May 1998 by the local council.

16 Commencing on 27 January 1998, the existing building was let to a company described both as the Australian Council of Physical Education and ACPE Redlands Limited, which may be referred to merely as ACPE. The initial term of that lease was from 27 January 1998 until 26 July 1999. The term was varied before its ending so that the termination date became 29 February 2000. ACPE vacated the existing building in approximately March 2000 after the lease expired.

17 There were dealings between the first defendant and both the Department and the Institute prior to the involvement of the plaintiff. Paragraph 7 of Mr Jones’ statement has not been challenged and is not controversial. It contains this matter:

“I first became aware of the Department of Sport and Recreation (DSR) and New South Wales Institute of Sport (NSWIS), both government sporting bodies, in early 1998 following my appearance before the government panel as referred to in paragraph 2 of this Statement. At the time, DSR occupied premises at North Sydney, NSWIS occupied premises at the Athletics Field in Homebush Bay and Sports House, also a government sporting body, occupied premises at Wentworth Park, Glebe.”

18 In early 1998 Mr Mick O’Brien, the chairman of the government panel before which Mr Jones had appeared, telephoned him and there was a conversation to the effect that a New South Wales government body was looking for space in the Homebush Bay area and as to whether Mr Jones was interested in having that government body take space in the existing building. To that inquiry Mr Jones gave a positive reply. A few days later there was a second telephone conversation in which Mr O’Brien advised Mr Jones that the body looking for space was the Department. Again, Mr Jones gave to Mr O’Brien a positive response.

19 Subsequent to those telephone conversations, there was a telephone call made to Mr Jones by Mr Michael Scott the Chief Executive Officer of the Institute. Mr Scott gave Mr Jones to understand that the Institute was interested in renting premises at Homebush Bay and asked for details of the existing building on the property. Mr Jones offered to Mr Scott a view of the existing building. That view took place on 16 March 1998. Mr Jones made a file note about the meeting at the property. It is this:

“Met [Michael Scott] from [the Department] to view the building. Told him ACPE vacating in July 99 and that building available after that. He enquired rental and was told approx $550,000 net per annum. He’ll get back to us. I told him of the potential development on the adjoining land. Expressed interest and asked for details as they come [sic] available.”

It is not clear whether Mr Jones was at that time unaware that Mr Scott was the Chief Executive Officer of the Institute or whether he failed to appreciate the difference between the Department and the Institute.

20 After that, and before 24 April 1998, Mr Jones received a telephone call from Ms Marie Spencer, the Deputy Director General of the Department. Ms Spencer identified herself as being from the Department and said words to the effect that the Department was interested in leasing premises at Homebush Bay. She enquired as to whether Mr Jones was able to attend a meeting at the Department’s offices at North Sydney on 24 April 1998 to discuss the Department’s requirements. A positive response was made by Mr Jones.

21 On 24 April 1998 at 3pm Mr Jones met Ms Spencer and also a Mr Peter Freeman at the premises of the Department at North Sydney. Mr Jones made a file note of that meeting. That file note only merely advances my knowledge of what occurred by stating that the Department had need to rent 2,500 square metres of office space.

22 On 4 May 1998 Mr Jones attended a meeting with Mr Kymbal Dunne, a director of Pact Property Pty Limited, a real estate agency. Mr Jones had engaged Pact Property Pty Limited to find a tenant for the existing building and also a potential tenant for the proposed new building. Mr Dunne was charged with visiting the facilities of Sports House at Wentworth Park and the Institute at Homebush Bay for the purposes of ascertaining their space requirements. Both Mr Jones and Mr Dunne visited those two venues on 4 May 1998.

23 In approximately mid-May 1998 Mr Dunne telephoned Mr Jones and there was a conversation to the effect that the Institute might take space in the property. Mr Dunne advised that he would arrange a meeting with officers of the Institute.

24 On 27 May 1998 Mr Dunne wrote to Mr Jones as a director of the first defendant a letter, the first part of which is in the following terms:

“I confirm that the NSW Institute of Sport has postponed today’s meeting. Another meeting is expected in the ensuing two weeks. At that time and subject to Phil Coles’ availability your Architect may be required to properly explain the new development. In the interim I will be attempting to meet with Michael Scott, the executive director, to better qualify [sic] the requirement [sic].

I would like you to return the executed agency agreement as soon as possible.”

25 The letter merely goes on to explain why Mr Dunne required the agency agreement. He pointed out that it was to facilitate his involvement in trying to obtain the Institute as a tenant and very coyly does not point out that it would be necessary to enable Mr Dunne’s company to earn a commission.

26 The evidence of Mr Jones indicates that a further meeting was scheduled between Mr Dunne and officers of the Institute during the first week of June 1998 but there is no evidence that that occurred or why it did not occur.

27 Mr Jones’ first contact with the plaintiff was in early 1998. That contact was with a Mr Chris Snaith in relation to a proposed purchase of an adjoining property known as 8 Figtree Drive. That purchase did not proceed.

28 In or around September 1998 Mr Snaith telephoned Mr Jones enquiring as to whether he was looking for tenants for the existing building and the proposed new building. Mr Jones said that he was and Mr Snaith asked for Mr Jones to provide him with details. Mr Jones said that he would and he did. He did that in a letter dated 12 October 1998 which appears to have been sent by facsimile transmission to the plaintiff on 15 October 1998. The letter of 12 October 1998 addressed to Mr Snaith at the plaintiff referred to the prospective tenant as “Tech Pacific”. Not only was there an initial letter bearing date 12 October 1998 but also an amended letter.

29 On 9 December 1998 there was a meeting at the property between Mr Jones, an officer of Tech Pacific and an officer of the plaintiff. Later on that day Mr Jones sent to the plaintiff a letter containing a proposal to be put on behalf of the defendant to Tech Pacific.

30 On 11 December 1998 the plaintiff, through Mr Snaith, provided to the defendant the plans that Tech Pacific had made for its building requirements. Early in the following year Tech Pacific decided not to proceed with the proposed lease of the new building.

31 In February 1999 it appears that the plaintiff introduced to the defendants a proposed new tenant, Metal Manufacturers. There is reference in the documents before me to a facsimile transmission from the plaintiff to the defendant of 16 February 1999 and to some telephone discussions thereafter culminating in a letter of 24 February 1999 from the first defendant to the plaintiff outlining the first defendant’s proposal of the proposed lease to Metal Manufacturers.

32 On 26 February 1999 the plaintiff forwarded to the defendants a leasing agency agreement which had been dated 25 February 1999 by Mr Garry Pearce of the plaintiff. That document was executed by Mr Jones as a director of the first defendant. However that agreement is not the one relied upon in these proceedings.

33 It would appear that the proposed letting to Metal Manufacturers was dropped in either March or April of 2000 because the proposed lessee withdrew from the negotiations. That withdrawal motivated the defendants to extend the lease of ACPE until 29 February 2000. That extension was granted in April 1999.

34 In approximately mid-November 1999 Mr Jones received another telephone call from Ms Marie Spencer. Ms Spencer said words to the following effect:

“I have been in touch with Wayne Prior, director commercial services, SOPA, on 9 September 1999 to ascertain the possibility of [the Department] and [the Institute] being able to take space in the existing building. Would you be able to attend a site inspection with [the Department and the Institute]?”

To that Mr Jones made a positive reply.

35 On 24 November 1999 Mr Jones attended a meeting with Mr Michael Scott and Mr Bill Gillooly. The evidence discloses that Mr Gillooly was the Director-General of the Department and also a member of the Board of the Institute and that Mr Michael Scott was the Chief Executive Officer of the Institute. It should be clear from what I have said about the Institute of Sport Act 1995 that the Director-General of the Department of Sport and Recreation is ex-officio a member of the Board of the Institute.

36 Mr Jones made a file note of his meeting on 24 November 1999. The file note is to the following effect:

“Met with [Mr Gillooly and Mr Scott] to show them the site and give the overview of the project. [Mr Scott] is the Chief Executive Officer NSWIS and [Mr Gillooly] is Director-General, Sport and Rec. He is looking for a site to house all major State sports bodies including NSWIS, Sports House and [the Department] viewed plans and discussed timing, [Mr Gillooly] asked for a set of plans to be sent to him for further analysis. [Mr Scott] invited me to view his existing facilities, [Mr Gillooly] left us and [Mr Scott and Mr Jones] inspected NSWIS. [Mr Scott] introduced me to Bob Cantley [who is] the finance person at NSWIS. [Mr Cantley] asked for Ziani to provide outgoings, costs and rental for existing building with a view to taking a lease over it until new building completed.”

37 On 30 November 1999 Mr Jones, on behalf of the first defendant, forwarded to Mr Gillooly the development application approved plans for the new building. In a letter of 30 November 1999 Mr Jones pointed out that construction could commence as early as November 2000 should a pre-commitment be entered into by the Department and that completion of the construction would be due approximately twelve months after the commencement of construction.

38 On the same day a letter was sent by the defendants to Mr Michael Scott at the Institute giving certain information about the existing building and pointing out that as requested Mr Jones had sent copies of the new building to Mr Gillooly. Mr Jones, in that letter, pointed out that there was no objection to there being a short term lease of the existing building if that would facilitate the Institute taking space in the new building, together with the Department.

39 On 30 November 1999 there were two telephone conversations, at least. Mr Jones phoned Mr Cantley about the existing building, pointing out that most of the current financial data were available but that it may be necessary to estimate some for the short term. Mr Cantley said words to the effect that the information available was sufficient at the current time to see “if there is momentum within the Board to seek Government approval and funding”. That quotation is from Mr Jones’ file note. One can see from that that the Institute was subject to Government approval and funding.

40 On the same day Mr Jones received a telephone call from Ms Marie Spencer. She advised Mr Jones that she had spoken to some other senior public servant about the idea of relocating all sports groups to the property. That senior public servant, Mr Davis Gwyn, supported the concept according to Ms Spencer. Mr Gwyn had also been aware of the concept from another person whose name is identified in a memo in a file note of 30 November 1999 but whose position has not been explained to me. Ms Spencer had spoken to that gentleman on 9 September 1999 to seek a direction. According to Ms Spencer that person supported the project.

41 Ms Spencer went on to give information to Mr Jones about the space requirements of the sporting bodies. The Department had 150 people working for it at its premises at Miller Street, North Sydney. There was also Sports House and also the Institute. There were four regional offices at Burwood, Liverpool, Hurstville and Parramatta. The Department occupied 1,921 square metres, Sports House occupied 2,338 square metres and the Institute occupied 2,500 square metres. The total, according to the memorandum (I have not checked the mathematics) was 6,759 square metres, plus, according to the memo, one or more of the regional offices. The memo goes on to add a note that the Department had a lease until October 2001.

42 On the same day, that is 30 November 1999, the defendants forwarded to Mr Michael Scott of the Institute a letter giving the current approximate annual outgoings of the existing building and providing other information which might be pertinent to a lease of the existing building. Again an offer was made by the defendants that there was no objection to the entering of a short term lease on the existing building if that would facilitate the occupation of the new building by the Institute and the Department. The letter of 30 November 1999 was sent by facsimile transmission on 3 December 1999.

43 In early May 2000 Mr Jones received a telephone call from Mr Joseph Ali, an employee or officer of the plaintiff. Mr Ali advised Mr Jones of a potential tenant for the new building. According to Mr Jones’ witness statement the following conversation occurred:

“Mr Ali: We have a blue chip tenant to whom I have shown the existing building from the outside. They are interested in having an internal inspection. Is the building available?

Me: Yes, who are they?

Mr Ali: I need to have an agency agreement signed and then I will tell you.

Me: What is it with Colliers, they already have two executed agreements. Does every individual agent need a separate agreement?

Mr Ali: No, but I’ve looked in the files and I can’t find one.”

44 In his second witness statement Mr Ali denied that the conversation described by Mr Jones occurred. According to Mr Ali the conversation went thus:

“Ali: I have a tenant relocating from the south-western Sydney market he’s after around 2000 square metres of office space with 70-80 car spaces. I would like to take them through but want you to sign an agency agreement before I do so.

Jones: Okay.”

45 Mr Ali goes on in his second witness statement to explain why he asked for the agency agreement and that was because the Real Estate Institute required that there be an agency agreement prior to a prospective tenant being shown premises owned by a landlord. Mr Ali’s witness statement goes on to say this:

“At no stage did Mr Jones ever say to me words to the effect of those set out in the paragraph beginning ‘What is it with Colliers...’ and did not ever tell me that he had already executed two agency agreements with Colliers. Further, I did not say [and would not have used] words to the effect of those set out in the paragraph beginning ‘I need to have an agency agreement...’ as I do not show such disrespect to clients or potential clients.”

46 This is not the only disputed conversation in the current matter. Essentially the protagonist in the current matter is Mr Joseph Ali, the only witness called in the plaintiff’s case. The antagonist is Mr Jones, the only witness called in the defendants’ case. I am required to resolve factual disputes concerning conversations which took place between Mr Ali and Mr Jones.

47 Mr Ali spent very little time in the witness box. He was called and sworn at 11.15am on 16 February 2006. His evidence-in-chief was merely to aver that the statements that he had made, exhibits A and B, were true and correct. Cross-examination then commenced. That cross-examination commences at the foot of p 16 of the transcript. At the foot of p 20 of the transcript the morning tea adjournment was taken. I assume that it was the usual hour of 11.30am. After leaving the witness box Mr Ali became extremely unwell and I caused the Court file to be noted that the witness had collapsed. The matter was then adjourned.

48 On 1 January 2005 Mr Ali had fallen ill. That illness was due to a malignant tumour on the left side of his brain. Mr Ali came under the care of a neurosurgeon, Professor Michael Besser, who resected the tumour from Mr Ali’s brain on 27 January 2005. Pathological examination identified the tumour as being a Grade III anaplastic astrocytoma. After that surgery Mr Ali came under the care of Professor Martin Stockler, a consultant medical oncologist. For ten months following the surgery, that is throughout 2005, basically, Mr Ali underwent radiotherapy and chemotherapy. Mr Ali remains under Prof. Stockler’s care. According to Professor Stockler, Mr Ali’s presenting symptoms were a complex seizure due to the underlying tumour. Since the surgery Mr Ali has had further seizures despite being prescribed an anti-convulsant. According to Professor Stockler there has been improvement with the passage of time and serial scanning of Mr Ali’s brain does not show any evidence of recurrence of the tumour or any adverse progression of the tumour.

49 Mr Ali was taken from this courthouse to the Royal Prince Alfred Hospital on 16 February where he was observed and underwent scanning of his brain. He made a steady recovery over the ensuing few hours. The repeated CT scan of Mr Ali’s brain showed no evidence of any new problem. According to Professor Stockler what happened to Mr Ali at court was entirely consistent with a generalised complex brain seizure. According to Professor Stockler psychological stress is a well described precipitant of such seizures in those prone to them.

50 In a report of 6 March 2006 Professor Stockler advised that he had no doubt that the stress of Mr Ali’s appearing in court had contributed to the seizure occurring. The substance of Professor Stockler’s report of 6 March 2006 ends with this:

“Joe has done well following treatment for his brain tumour, however he remains at substantial risk of a recurrence and progression. He will remain prone to seizures indefinitely. The risk of a seizure would be increased by psychological stress. I recommended that he avoid such stressors if possible.”

51 When the matter came before me on 17 March for directions I, in effect, excused Mr Ali from further cross-examination because it would have been inimical to his health. Certainly that was what the plaintiff requested. My excusing Mr Ali from further cross-examination was opposed by the defendant. I granted the defendant leave to administer interrogatories to Mr Ali, if the defendant wished to do so, and made other orders concerning interrogatories. I then fixed the further hearing of this matter to commence on 17 July, which it did.

52 The defendant did administer some interrogatories to Mr Ali and they have been admitted into evidence as exhibit 2. Mr Jones was required for cross-examination and was essentially in the witness box for the best part of two days. It ought be apparent from what I have just said that I saw very little of Mr Ali and I saw very much of Mr Jones. Mr Jones’ evidence has been the subject of prolonged and sustained testing in cross-examination. The evidence of Mr Ali has not.

53 When the matter recommenced before me last Monday an application was made by the defendant that I, in some way, strike out or ignore the evidence of Mr Ali. For reasons which I gave at the time, I dismissed that application. However the fact remains that the extent of the weight that I can give to the evidence of Mr Ali in the circumstances is circumscribed. It is a question of what weight I might give to the evidence of Mr Ali.

54 This matter has been considered by the Court of Appeal in Amalgamated Television Services Pty Limited v Marsden [2002] NSWCA 419 between paragraphs 144 and 208. The circumstances in which the witness Lilburn, in Amalgamated Television Services, ceased being cross-examined are very different to the circumstances that have unfortunately befallen Mr Ali. However, clearly there are issues which must be determined between the evidence of Mr Ali, such as it is, and the evidence of Mr Jones.

55 The first thing that I can say is that I have heard Mr Jones over an extended period and thought him to be a careful witness, and I formed no adverse impression of him at all. Indeed, I formed the view that he was probably quite an astute businessman, and he certainly was prepared to make admissions which might be thought to be contrary to, not only his own interests, but those of his company. The only defect that I could detect in the evidence of Mr Jones was a reluctance to admit the involvement of Mr Ali in furthering relationships between the defendant and the Institute and the Department. Although clearly Mr Jones admits that Mr Ali is entitled to some remuneration for his work, that reluctance may be due to the naturally occurring resentment which cases of this nature often arouse. On disputed issues I am therefore quite happy to repose confidence in the evidence of Mr Jones.

56 I must give lesser weight, therefore, to the evidence of Mr Ali whom I have not had the benefit of seeing for any length of time, and whose evidence has not been tested by way of a prolonged cross-examination. Perhaps prolonged is the wrong word, the appropriate adjective is thorough. However there are other indications in the evidence before me that cause me to have reservations about the evidence of Mr Ali. For example the evidence now establishes that undoubtedly the first contact between Mr Ali and Mr Jones was certainly in or after March 2000 and more probably than not in May 2000.

57 There was no dispute on the evidence that ACPE vacated the existing building after the expiry of its lease on 29 February 2000, in or about March 2000. The existing building was then available for rental. Paragraph 2 of the first statement of Mr Ali contains the following matter:

“I first met Ray Jones in mid to late 1999, when Colliers was asked to find a tenant on his behalf for the space now occupied by the Department of Sport and Recreation (“DSR”) at the only then-existing building at 6 Fig Tree Drive, Homebush Bay. Mr Jones, another two officers of Colliers (Gary Pearce and Sean Lennon) and I were present on that occasion and undertook an inspection of the existing premises. At the time, the premises was [sic] vacant and for lease due to the previous lessee, Australian College of Physical Education (“ACPE”) having vacated the premises.”

58 Paragraph 4 of the same statement then goes on to say that Mr Ali next met Mr Jones in about mid-May 2000. After the service of Mr Jones’ statement dated 6 December 2005, a second statement of Mr Ali was made dated 11 January 2006. In paragraph 2 of that statement Mr Ali said this:

“In regard to paragraph 26, I accept that what Mr Jones says about the occupancy of the premises by ACPE in mid to late 1999 may be correct and it may be that I first met with Mr Jones at the premises around May 2000. However, I do recall that the meeting referred to in paragraph 2 in my earlier statement took place at a time when the premises were vacant and after ACPE had vacated the premises.”

59 There now seems no doubt that the first meeting between Mr Ali and Mr Jones could not have occurred in 1999, but more likely than not occurred in May 2000. The next thing to note is that unfortunately Mr Ali has had major brain surgery following a life threatening illness. One would expect some cognitive deficit to result from such major surgery. In exhibit 2, the interrogatories verified by Mr Ali, Mr Ali conceded that it was true that the treatment afforded to him had adversely affected his memory. The way in which it was adversely affected is not spelt out in the interrogatory. According to Mr Ali’s second statement, he said that he told Mr Jones words to the following effect;

“Part of my memory has gone, being essentially the part to do with music, so I can’t remember, for example, the names of the songs of U2, one of my favour bands, but 99 per cent of my work memory is okay.”

Mr Ali accepts that there has been some cognitive impairment but often the problem with cognitive impairment is that those who suffer from it are unaware of it.

60 If one’s memory has failed one, one does not know about what the failure has been. That is commonly seen in elderly people who suffer from senile dementia or Alzheimer’s disease or the like, commonly when people tell the same story repeatedly, forgetting that they have told a person that story before. How does one know what one has forgotten if one has forgotten it? I must therefore be cautious in approaching Mr Ali’s recollection of events, especially that is so when, for example, one comes to the essence of the issue before me, whether there was an agreement between Mr Ali and Mr Jones to accept half the usual commission for rendering assistance rather than full commission for introducing a lessee because of disputed conversations which Mr Ali says did not occur. In that regard I bear in mind what occurred when an account was sent by the plaintiff to the defendant and the defendant failed to pay the account.

61 In para. 115 of his statement Mr Jones stated that on 2 March 2005 Mr Robert Gishen of the defendant, came to his home. Mr Gishen is the State Director of Metropolitan Commercial Leasing for the plaintiff. The only inference which I can draw is that Mr Gishen is in fact much superior to Mr Ali in the plaintiff company. At the meeting on 2 March 2005 Mr Jones showed Mr Gishen his file concerning, I assume, the property going back to 1998, including correspondence between Mr Ali and Mr Jones regarding what Mr Jones described as the “agreement to pay 50 per cent of the fee”. Mr Gishen said that after seeing Mr Jones’ file that he would “need to speak with Joe and seek more information”. Joe is clearly a reference to Mr Ali.

62 In para. 116 of his statement Mr Jones said that on 7 March 2005 Mr Gishen telephoned him and there was a conversation to the following effect;

“MR GISHEN: I have spoken with Joe and he has no recollection of the 50 per cent agreement.

ME: I know he told me he has lost part of his memory, but this is ridiculous.”

The conversation continued about other matters not currently relevant. The important point to know is that Mr Ali had admitted to Mr Gishen of having no recollection of the 50 per cent agreement and Mr Ali now denies that it happened. There are of course a number of possibilities. One is that his memory was then affected by the surgery and adjuvant chemotherapy and radiotherapy and that it has somehow returned. However, equally the possibility is open that there has been a reconstruction by Mr Ali of what must have occurred and the next point to note is that it is clear from a number of places in Mr Ali’s statements that what he speaks of is based not on what his actual memory was but what his usual practice was and what would have been said. That is clear from what I have already quoted from Mr Ali about the initial conversation between Mr Jones and Mr Ali. In other words there is reconstruction based on normal or suspected usual practice.

63 Finally on this issue, there are on most of the occasions to which I need make reference, file notes made by Mr Jones which are in effect contemporary records and on crucial matters no file notes at all made by Mr Ali when he has at times made file notes which have made their way into evidence. Mr Ali’s personal circumstances excite the Court’s sympathy and would excite anyone’s sympathy. However I have to decide the issues raised before me. I have already made comment about how I perceived the evidence of Mr Jones and I have also pointed out matters concerning the evidence of Mr Ali. I am led to the inevitable conclusion that where there is any dispute based solely on disagreement between Mr Jones and Mr Ali, that I should prefer the evidence of Mr Jones, tested as it has been to the evidence of Mr Ali which, in essence, has not been tested.

64 I return to the matter I was discussing before I needed to discuss the general effect of the evidence of Mr Jones and Mr Ali. I return therefore to the conversation between Mr Jones and Mr Ali that occurred in early May 2000 according to Mr Jones. I accept Mr Jones’ version of what occurred. There is some corroboration in any event for that because material before me does disclose an earlier agency agreement between the defendant, meaning the first defendant, and the plaintiff, that leasing agency agreement dated 25 February 1999 that lends credence in my view to Mr Jones’ evidence that he already had to execute agreements with Colliers and also credence to his statement that Mr Ali said he had looked in the files and could not find one. If he had looked through the files and found one there would be no need to obtain another. That also in my view has bearing on another issue which will arise in due course as to missing documents.

65 The plaintiff, through Mr Ali, sent to the defendants on 25 May 2000 a facsimile transmission enclosing a letter of that date and also a leasing agency agreement which has upon it the typed date of 25 May 2000. Mr Jones executed that agreement on 26 May 2000 and transmitted it by facsimile transmission to the plaintiff on that date, 26 May 2000. The covering transmission sheet also asks for confirmation of a time for a proposed internal inspection of the existing building with the prospective tenant so as to enable Mr Jones to plan his week. The proposed tenant was Phillips Projects Australasia. An inspection was held on 31 May 2000. After that inspection the plaintiff forwarded to Mr Jones a letter bearing that date confirming that the inspection had taken place and as to what might happen in the future. A proposal was then prepared by a Mr Jones on behalf of the first defendant to be presented to Phillips Projects Australia or Phillips Projects Australasia. The evidence discloses both names. On 17 July 2000 the plaintiff advised the defendants that that proposed tenant did not wish to proceed with a lease. Nothing further of any significance occurred in the year 2000.

66 On or about 9 March 2001 the Department executed a lease of the existing building. The plaintiff was not involved in any guise in the negotiations between the Department concerning the letting of the existing building. The lease commenced on 1 April 2001. According to Mr Ali’s statement the lease was negotiated between the Department and Mr Jones directly, without the involvement of Colliers. That is common ground but the only addition made to the current enquiry by Mr Ali’s statement is that there would not appear to have been the intervention of any agent.

67 On 19 March 2001 Mr Jones received a telephone call from Ms Marie Spencer who has earlier been described as the deputy director of the Department. According to Mr Jones’ statement the telephone call concerned the letting of the proposed new building. That is confirmed by a letter of 21 March 2001 from the defendants to Ms Spencer concerning the proposed new building at the property. On 8 April 2001 Mr Jones had a telephone conversation with Ms Spencer. She advised Mr Jones that she had had discussions with the Director General of the Department and that the Department were very interested in renting the new building but needed to know the cost of that in dollar terms. The file note of Mr Jones continues thus;

“I said it would depend on the amount of space in square metres and if there are any unusual requirements, eg if NSWIS has special floor, special air et cetera. She said disregard requirements allow as normal tenancy, also to include Sports House plus a library currently located at Narrabeen. Sports House is 3,300 square metres including 1,800 square metres of office areas plus the additional library which would be enlarged and upgraded if relocated to Homebush, so allow 700 square metres total for DSR around 4,000 square metres plus NSWIS 3,500-4,000 square metres. I suggested that I would take out all the new building and suggested a meeting with her, the [Director General] Mr Jones and Steve Camillo to discuss plans and layouts. She agreed it would be best way forward and said Easter would be best. I reminded her of the tight time constraints and she acknowledged the urgency. I brought up the idea of a coffee shop/café on the ground floor and she thought it an excellent idea.”

68 It has been noted that Mr Steve Camillo is an architect engaged by the defendants, no doubt in the planning of the new building. On 24 April 2001 there was another meeting with Ms Spencer, a Ms Stephanie Cross of the Department and Mr Camillo. The meeting was held at the premises of the Department, presumably in the existing building. At the meeting Mr Camillo laid out the plans for the new building and explained the concept, finishes and the timing of construction. He asked for input from the Department and from the Institute as to their requirements. The members of the Department were asked to keep a copy of the plans to circulate “to all involved parties” for input. Ms Spencer advised that she was still awaiting on the Director General “to progress the matter”. She told Mr Jones that the Director General was meeting with the Minister “shortly” and would bring it up with him for an indication of his views on the matter.

69 There was a further telephone conversation between Mr Jones and Ms Spencer on 17 May 2001. Ms Spencer advised that she had spoken to the Director General and he supported the proposal. She advised him that the Director General was keen to bring “all aspects of sport under one roof”. She told Mr Jones that the Director General was on the board of the Institute and that they came under the same Minister, so that made things look favourable. She advised that the Director General was still waiting to have a meeting with the Minister and she would let Mr Jones know if the proposal had the support of the Minister. The proposal clearly was that the proposed new building be let essentially to the Crown to enable the proposed new building to hold the Institute, the entity known as Sports House and perhaps the balance to be let to other elements of the Department.

70 On 21 June 2001 Mr Jones made a telephone call to Mr Bruce Hawker who is a lobbyist. On the evidence before me, Mr Hawker was a former Chief of Staff of a former Premier of this State, the Honourable Robert Carr. Mr Jones asked Mr Hawker about his potential to assist with the concept of housing all the government sports bodies on the property. Mr Hawker advised that he would make enquiries with the Minister’s Chief of Staff to “test the waters”. He said he hoped to obtain an indication of the priority of the concept, presumably with the Minister and establish if there was government funding available.

71 On 25 June 2001 the defendants sent to the plaintiff at the request of Mr Mark Zouroudis of the plaintiff, a letter giving details of the proposed tenancy of the existing building. It may well be that Mr Zouroudis had obtained an expression of interest from a prospective lessee for accommodation in the Olympic Park area.

72 On 27 June 2001 Mr Jones received a telephone call from the lobbyist Mr Bruce Hawker. Mr Hawker advised him that he had spoken to the “right people” and that the proposal to house all the sports bodies in the one building had approval in principle but that no government funding had been allocated and the matter was not seen as having a high priority. Mr Hawker promised to continue to “monitor the situation”.

73 On 7 August 2001 Mr Jones met Mr Zouroudis and Mr Ali at the property to discuss the prospective tenancy of the Spotless group. Mr Zouroudis said he would speak further with the Spotless group and asked for a proposal from Ziani to put to that proposed tenant.

74 There was a further telephone discussion with Mr Zouroudis on 9 August 2001 concerning the proposed tenancy for Spotless. On 9 August that day Mr Zouroudis sent to the defendants a letter which contains the following:

“Thank you for taking the time to meet Joe and myself during the week. It was great to finally catch up to discuss your site at Homebush in general.

As discussed, I can now nominate Spotless Services Limited as the potential tenant regarding the brief I sent you.

I have passed on your comments regarding the possibility of creating some warehouse area. I am planning to meet them next week to discuss further.

I would appreciate your acknowledgement of our introduction of Spotless Services.”

75 On 14 August 2001 Mr Jones sent, on behalf of the first defendant, a facsimile transmission to the plaintiff acknowledging its “introduction” of Spotless Services Limited as a prospective tenant for the new building. There were further transactions between the plaintiff and the defendants in August 2001 concerning the proposal of Spotless Services Limited but that company did not enter into a lease for the new building and it appears that their interest expired in perhaps September 2001.

76 In approximately early November 2001 Mr Ali received a telephone call from Mr Ralph Doubell, the new CEO of the Institute. According to Mr Ali, Mr Doubell said words to the following effect:

“The Institute is looking for some office accommodation and I have seen your signboard in regard to QUAD II.”

According to Mr Ali, during the conversation he had with Mr Doubell he said to him words to the effect that he was able to advise him of other leasing opportunities in or around Homebush Bay. Mr Ali said that he arranged to meet Mr Doubell at his office. QUAD II was a development at 8 Parkview Drive at Homebush Bay. On 14 November 2002 Mr Doubell and Mr Ali met at the premises of the Institute at Homebush Bay at the athletics field. Following upon that meeting Mr Ali sent a letter to Mr Doubell of November 2001. In that letter he enclosed floor plans and property particulars in regard to the QUAD II building at 8 Parkview Drive Homebush Bay and also regarding the property. He also provided information on industrial buildings in Carter Street that could be refurbished or altered to suit the Institute’s requirements. Attached to that letter were essentially brochures or fliers concerning QUAD II, the proposed new building at the property and properties known as the Orix Building, the Institute Broadcast Centre, both at Carter Street Homebush, an unidentified building known as 7 Carter Street at Homebush Bay, a Uniting Church site on the same street and a property at 1 Hill Road at Homebush. It is to be noted that Mr Doubell’s enquiry to Mr Ali was instigated by a sign that Mr Doubell saw on the QUAD II building and then Mr Ali offered to Mr Doubell information concerning a number of properties, the inference to be drawn being that the plaintiff was the agent for all of the properties referred to in the annexures to the letter of 19 November 2001.

77 According to Mr Ali some time between 19 November 2001 and 23 November 2001 he advised Mr Jones by telephone that he had met with Mr Doubell and arranged an inspection of the site of the new building. According to Mr Ali Mr Jones did not say anything to him at that time about any previous discussions that he may have had with personnel from the Institute or with any person from the Department regarding a possible tenancy of the new building by the Institute.

78 According to Mr Jones the following was the conversation in which Mr Ali first mentioned the Institute:

”MR ALI: I have had a call from Ralph Doubell at NSWIS, who are looking for space in Homebush Bay and they asked about what options there are in that area. I told them about the new building along with the QUAD.

ME: Joe, you know I’ve been dealing with DSR and NSWIS for years about this.

MR ALI: But Ralph Doubell contacted me for advice. I think I can push him towards your side.

ME: The deal is this is not an introduction of NSWIS for the leasing commission. However, if Colliers assist in negotiations with NSWIS and NSWIS takes a lease of the new building, Ziani will pay Colliers 50 per cent of the leasing commission, so by all means nominate them. If Colliers introduces a tenant for the new building who is not currently in negotiations with Ziani for a potential lease, like Spotless for example, Ziani will pay Colliers 100 per cent of the leasing commission.

MR ALI: Deal.”

Further in his statement Mr Jones says that Mr Ali did not communicate to him at any time prior to the inspection of the property by the Institute that he had arranged such an inspection. He said that he did not attend any inspection on 19 November 2001 and that the inspection was carried out without his prior knowledge. In other words the evidence of Mr Ali is his first contact with Mr Jones about the Institute was prior to the inspection on 19 November 2001 to advise him that he had arranged an inspection at the site. Mr Jones denies any knowledge of the inspection before or at the time of its occurrence. However Mr Jones’ evidence is that antecedent to that inspection, perhaps there was a conversation between him and Mr Ali about the Institute and its interest in the new building.

79 In my view the probabilities favour Mr Jones not having been advised of the inspection by the Institute. In my view it is likely that if the Institute wished to inspect either the existing building or the site of the proposed new building, Mr Jones would have done his best to attend it or if he were unavailable, to have rescheduled the inspection so that he could be available. The probabilities also favour that Mr Ali might now believe that he had advised Mr Jones about the inspection prior to its occurrence because that would be the normal procedure.

80 On 23 November 2001 Mr Ali sent to Mr Jones a letter which does refer to an earlier telephone discussion and confirms that the New South Wales Institute of Sport has carried out an inspection via Colliers on 19 November 2001. He goes on to advise Mr Jones that the proposed tenant required approximately 3,500 square metres of accommodation comprising an office, a laboratory and a gymnasium. He points out that the Institute had requested funding from the Treasury of New South Wales and anticipated that it would be available in the first quarter of the year 2002. Mr Ali asked Mr Jones to provide him with full scale floor plans which he would send on to the Institute.

81 The evidence before me does not contain any reply to the plaintiff’s letter of 23 November 2001. The evidence does not suggest that Mr Jones sent to the plaintiff floor plans for the new building which the plaintiff could pass on to the Institute. A query arises as to what the “recent telephone discussion” is that is referred to in the letter of 23 November 2001. It may represent a telephone conversation on that day or at some time either before or after 19 November 2001, accepting as I do, the evidence of Mr Jones that he was not advised before the inspection that it was to occur. It appears to me more likely that the telephone discussion referred to by Mr Ali in the letter of 23 November 2001 occurred some time after the inspection on 19 November 2001 and prior to his penning the letter of 23 November 2001. It may be that the conversation set out by Mr Jones in para. 58 of his statement occurred in that telephone conversation. If it did, it will only reinforce a finding to which I shall refer later.

82 On 29 November 2001 Mr Ali sent two letters to the defendants, one about the Quad II building, another about a building at C Homebush Bay Drive Road, advising of successful negotiations concerning those properties and advising the length of the lease and the amount of rental and the size of the letting. No doubt this information might be of utility to somebody trying to rent out property.

83 On 26 November 2001 Mr Jones received a call from Mr Charles Turner, the deputy Chief Executive Officer of the Institute. The file note generated by Mr Jones is this:

“Had a call from [Charles Turner] to inquire how we are progressing with DSR re new buildings. They could be interested with or without DSR. They appear to be fed up waiting on DSR and are investigating going solo. The basic requirement is for 2500 square metres of office and 6-800 square metres for a gym. They has[sic] been in contact with Joe Ali from Colliers to ask what are their options in Homebush. Given a list of the usual suspects including us. I said I would be happy to come and meet with them to see how to progress the matter.”

84 It is significant in my view that this is an approach directly by the Deputy Chief Executive Officer of the Institute to Mr Jones without the intervention of Mr Ali, and at a time when there is no evidence that Mr Ali had disclosed to the Institute Mr Jones’ details. The inference to be drawn is the contact was made because of previous contact between Mr Jones and the officers of the Institute. Furthermore, the conversation recorded in the file note indicates to me that Mr Turner knew of previous dealings between the Department and the defendants concerning proposed accommodation for the Institute on the defendants’ property. One can understand that the officers of the Institute might be “fed up” waiting for some response from the Department but it is clear from what I have earlier recited that both the Deputy Director of the Department and the Director General of the Department and some other senior public servant had all tried to obtain space for the Institute and the Department in the new building and that it appeared to have some “in principle” agreement from at least the Minister’s staff and the funding was a perennial government problem, a lack of funding. One might be forgiven for thinking that if the Department could not obtain the funding directly from its Minister for the Institute that the Institute might have problems doing it without the Department’s intervention. Furthermore, the file note confirms that that approach to Mr Ali was about options at Homebush and that a number of sites were mentioned by Mr Ali as is clear from Mr Ali’s letter to the Department of 19 November 2001. Everything recorded in the file note indicates to me that the contact was made by Mr Turner on behalf of the Institute with Mr Jones because of prior dealings between the Department and the Institute and Mr Jones and not because of the mediation or intermediation of Mr Ali.

85 On 4 December 2001 Mr Ali sent an email to Mr Doubell seeking to arrange a meeting between the owner of the building at 6 Figtree Drive, Homebush and Mr Doubell at the site. Mr Ali asked for some times that might be convenient for Mr Doubell to attend such a meeting. Significantly, the email does not refer to Mr Jones, does not refer to Ziani, but refers to them anonymously. That meeting took place on Friday 2 December 2001. The meeting occurred at 2.30pm. Present were Mr Doubell, his deputy Mr Turner, Mr Ali and Mr Jones. The file note prepared by Mr Jones is this:

“Met with the above at NSWIS premises to discuss the prospective tenancy - again!. [Ralph Doubell] seems to think he can move forward without DSR and that he is able to deal with parties without going to [an expression of interest]. He said that funding for the tenancy should be forthcoming in the New Year. They have had some space planning done and it appears their requirement is 3695 square metres. He will get back in touch in the New Year. Spoke after the meeting with [Joseph Ali] to say we will accept his involvement with NSWIS but not DSR. Agreed to 50 per cent of scale if he is of assistance with NSWIS. Should a different tenancy occur through Colliers, i.e. Spotless, then 100 per cent scale applies.”

86 The conversation that Mr Jones had with Mr Ali after the departure of Messrs Doubell and Turner is denied by Mr Ali. That denial must be seen in the context of Mr Ali having communicated to Mr Gishen in March 2005 that he could not remember any such conversation. The file note made by Mr Jones is a contemporaneous document. There was no suggestion that it was a recent fabrication. I accept that he states accurately what occurred at the meeting in two parts, that is the meeting with the officers of the Institute and the meeting solely between Mr Jones and Mr Ali. I believe it likely that that conversation is that more fully set out by Mr Jones in paragraph 58. However, clearly Mr Jones is of the view that a similar conversation occurred on two occasions. I am therefore prepared to accept that it did occur on approximately two occasions and it seems likely to me that the conversation that occurred referred to in paragraph 58 of Mr Jones’ statement occurred in the telephone call between 19 November 2001 and 23 November 2001. Mr Jones, in his witness statement, expands somewhat the conversation referred to in the file note of 7 December 2001. It sets out this in paragraph 61 of his statement:

“Me: As I told you two weeks ago, we will accept your involvement with NSWIS for the new building but not DSR as they are already a tenant. We will pay Colliers 50 per cent of the scale if they are of assistance with NSWIS. If a different tenancy occurs through Colliers, we will pay you 100 per cent of the scale. As to NSWIS, you're going to have to help and add value to the deal, otherwise, why do I need you?

Mr Ali: I can help because Doubell needs to be seen to be looking at all his options for probity reasons, so I am sure I can assist you.”

87 The opening words used by Mr Jones in that conversation do suggest the earlier conversation as having occurred between 19 and 24 November 2001, which was approximately two weeks prior to 7 December 2001.

88 In each of the two conversations there was no dissent by Mr Ali from the proposal put to him by Mr Jones that if he provided assistance to the defendant in obtaining a lessee for the new building and that tenant being the Institute that he would pay fifty per cent of the commission that would otherwise be payable if Mr Ali had introduced a lessee.

89 Mr Ali has conceded that the prior dealings between the Institute and the defendants were mentioned at some time by Mr Jones but that was not until some time in May and probably late May 2002. In my view that is highly unlikely. If there had been earlier dealings and the Institute was known to Mr Jones one would expect in normal circumstances for him to have mentioned that at the beginning of or towards the beginning of any conversations that Mr Ali and Mr Jones had. It does not have the ring of truth to suggest that Mr Jones would delay for over six months in advising Mr Ali of his earlier dealings with the Institute. I therefore accept that in the two conversations to which I have referred Mr Jones did draw to Mr Ali’s attention that he had had earlier dealings with the Institute and the Department on its behalf, if that be a proper way of dealing with the matter. It seems more probable than not to me that this would have occurred at the first time Mr Ali mentioned the Institute to Mr Jones and that is Mr Jones’ evidence. I accept it.

90 After the inspection on Friday 7 December 2001 Mr Ali wrote to the defendants on Tuesday 11 December 2001 referring to the inspection on the previous Friday. The letter continues thus:

“As indicated during the meeting the prospective tenant requires 3000 square metres - 3500 square metres of commercial accommodation and it is understood that the premises would be used for administration/ training and coaching of professional athletes with a gym which would not be open to the public.

Funding has been requested from Treasury and we anticipate a favourable decision will be made prior to Christmas. Full size floor plans have been requested and once received I will forward the same to the tenant.”

91 The first thing to note about that letter is that the information it conveyed is not as accurate as the information contained in Mr Jones’ file note. Mr Jones’s file note contains the exact amount of space required by the Institute, 3695 square metres, rather than providing the range suggested by Mr Ali. Furthermore, Mr Jones’ file note says that the funding “should be forthcoming in the New Year” whereas Mr Ali’s letter indicates the decision would be made “prior to Christmas” which appears to me to be unlikely. It should also be noted from that letter that again full size floor plans were requested by Mr Ali in order that he could forward them to the Institute, the same request having been made on 23 November 2001 and clearly not responded to. On this occasion it appears that the floor plans were provided to Mr Ali and he sent them to Mr Doubell under cover of letter 12 December 2001.

92 On 21 December 2001 Mr Ali sent an email transmission to Mr Jones. In the first paragraph of that transmission he advised that the Institute was having another meeting with the Treasury on 21 January 2002 regarding funding. Mr Ali advised that he would be in contact with the Institute on 22 January to find out what happened following the hand in cap approach to Treasury on 21 January. The email continues:

“Would you care to confirm the nomination of NSW Institute of Sport by Colliers Jardine by responding to this email at your earliest convenience.”

93 On that day the defendants sent an email transmission to the plaintiff the first sentence of which is the following:

228 At the conclusion of the address of learned counsel for the defendants, and at my urging, the plaintiff was given leave to file in court a further amended statement of claim adding as an alternative to the four causes of action already pleaded a cause of action based on a oral contract made between Mr Jones on behalf of his company, Ziani Corporation Pty Limited and Mr Ali on behalf of his employer, the plaintiff, for remuneration by the first defendant of the plaintiff for half the commission if the plaintiff assisted the first defendant in obtaining the New South Wales Institute of Sport as a tenant in a building to be erected by the first defendant on its land at Homebush Bay.

229 Yesterday, for reasons which I gave, I rejected the claims based on the contract of 26 May 2000, on equitable estoppel, on the Trade Practices Act, and also on the quantum meruit because I found for the plaintiff on the alternative claim which was pleaded at the close of the defendant’s submissions.

230 In fact, it was not necessary really for me to find on that further alternative claim because the first defendant admitted that it was liable for the half commission. The only difference between the half commission and the judgment which I entered yesterday at approximately 6.30pm was the princely sum of $3,137.21 being an amount for interest between 27 December 2004 and 18 March 2005. In my view that sum is of such small magnitude that it can be effectively ignored. De minimis non curat lex.

231 The originating process was filed on 20 April 2005. It is necessary to recapitulate a little as to what happened before that time. Significantly on 18 March 2005 the first defendant had tendered to the plaintiff a bank cheque for the half commission in payment of the claim that had been made upon the first defendant by the plaintiff. That offer was rejected, and the bank cheque was returned by the plaintiff on 29 March 2005. The plaintiff did not agree, essentially, with the position adopted by the defendants, the position which was held to be the correct one yesterday. Furthermore it has to be borne in mind that on 2 March 2005 there was a meeting between the principal of the first defendant, namely Mr Jones the second defendant, and Mr Robert Gishen, a director of the plaintiff company, in which Mr Gishen was given full access to the defendant’s file concerning the property in question at Homebush Bay. In other words there had been de facto discovery prior to the commencement of any proceedings and prior to the tender by the first defendant of the bank cheque for the payment of the half commission.

232 The original claim made by the plaintiff was denied by the first defendant and the further claims added by the amended statement of claim filed on 26 July 2005 were also denied by the defendants. The plaintiff was only successful on the pleading that was made on Wednesday afternoon. Notwithstanding the fact that that plea was made and admitted by the first defendant the plaintiff pressed on with all four earlier claims.

233 The first question which in my mind arises is whether the defendant or defendants ought to have pleaded a defence of accord and satisfaction. If such defence were available in my view it ought to have been pleaded. There are authorities, for example, that state that relief must be pleaded Proudfoot v Stubbens (1886) 2 WN (NSW) 46, and also an authority which establishes that payment must be pleaded Young v Queensland Trustees Limited (1956) 99 CLR 560. Since the defence of accord and satisfaction has elements of those two matters it ought be pleaded. However, here there was no accord and satisfaction. The gist of that defence may be taken from the judgment of Scrutton LJ, in British Russian Asset and Trade Outlook Pty Limited v Associated Newspapers Limited [1933] 2 KB 616:

”Accord and satisfaction is the purchase of a release from an obligation whether arising under contract or tort by means of any valuable consideration, not being the actual performance of the obligation itself. The accord is the agreement by which the obligation is discharged. The satisfaction is the consideration which makes the agreement operative.”

234 Here there was no accord and satisfaction. For there to have been accord and satisfaction the defendants must have acknowledged an indebtedness for the whole commission and then reached a second agreement to compromise that claim by the payment of the half-commission. Here that did not occur. The half-commission was payable under a contract. That was not pleaded by the plaintiff until 18 July 2006. That was, as I have said, probably repeatedly, after counsel for the defendant had addressed. When the pleading of the half-commission contract was made it was admitted by the first defendant.

235 Costs follow the event. On the claim originally pleaded in the statement of claim filed on 20 April 2005 the plaintiff was wholly unsuccessful. On pleadings contained in the amended statement of claim filed on 26 July 2005 the plaintiff was wholly unsuccessful. In the further amended statement of claim filed in Court on 18 July 2006 the plaintiff was only successful on the alternative claim which was formally admitted at the time by the defendant. In other words, on the matters litigated the plaintiff was wholly unsuccessful. Therefore, in my view, the plaintiff ought pay the defendants’ costs. Furthermore, it has to be borne in mind that the plaintiff was offered the full half-commission by the first defendant on 18 March 2005 and was offered it in a very inviting form, a bank cheque. For its own reasons the plaintiff rejected that offer and returned the cheque but the reasons which the plaintiff had for so doing have not been held to be valid, that is essentially the findings that I made in my reasons for judgment yesterday.

236 After the commencement of proceedings three different offers were made by the solicitors for the defendants. The first offer was on 13 December 2005 and was essentially an offer to settle the matter for $109,493.15 inclusive of costs. A second offer was made by the defendants on 2 February 2006 for the sum of $173,968.96 inclusive of costs. That offer was made before the hearing commenced before me on 16 February 2006. The defendants’ final offer of settlement was made on 1 June 2006 before the hearing recommenced. That offer was for $200,000 and the letter of offer was silent as to costs. The letter of offer of 1 June 2006 states that the offer was made in accordance with rule 20.26 of the Uniform Civil Procedure Rules, which rule requires that such offers be made exclusive of costs. I am advised by counsel for the defendants that those instructing him and he considered that offer to be inclusive of costs. There might be some justification in that because the earlier offers, which were both inclusive of costs, made reference to the same rule. Perhaps the defendants’ solicitors should read the rules before they refer to them in their letters of offer.

237 However, it is correct as learned counsel for the defendants has put to me that the consideration of those offers is relevant only to the issue of indemnity costs which, fortunately, from my point of view, he does not seek as that would require further argument.

238 Those offers cannot be seen to displace the primary position that essentially the plaintiff was wholly unsuccessful in the claims agitated in substance before me. Furthermore, to make an award of costs in favour of the plaintiff in these circumstances would be to recompense an unsuccessful litigant for completely unnecessary litigation. It would completely contrary to justice, in my view, to award costs in favour of the plaintiff that has succeeded in obtaining a judgment for a monetary sum when the monetary sum was open to be accepted by the plaintiff prior to the commencement of proceedings.

239 I order the plaintiff to pay the defendants’ costs of these proceedings.

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