Commonwealth v Davis Samuel Pty Ltd (No 8)
[2014] ACTSC 312
•21 November 2014
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Commonwealth of Australia v Davis Samuel Pty Limited and Ors (No 8) |
Citation: | [2014] ACTSC 312 |
Hearing Date(s): | 6 December 2013 |
DecisionDate: | 21 November 2014 |
Before: | Refshauge J |
Decision: | The parties be heard on the draft orders published on 21 November 2014. |
Category: | Principal Judgment |
Catchwords: | EQUITY – Election between remedies – Plaintiff can make claims in the alternative but must elect at trial which remedy it ultimately seeks – Tracing – Principle of tracing involves identification of new asset to replace old asset – Tracing is a process – Tracing is not a remedy – Tracing is for the inherent value of the asset – Asset traced into mixed fund – Plaintiff can choose property into which it traces its interests – Funds can be traced into multiple assets so long as there is no double recovery EQUITY – Equitable compensation – Property held on constructive trust for Plaintiff – Demand made for property by Plaintiff – Plaintiff had right to call for the property – Property not returned – Failure to return property amounts to breach of fiduciary duty – Trustee has duty to preserve trust property – Trustee failed to preserve trust property – Plaintiff’s claim for equitable compensation succeeds PROCEDURE – Pleadings – Claim for equitable compensation not pleaded – Pleadings contained general claim for equitable relief – Pleadings cannot become instruments of oppression – Departure from pleadings allowable where no prejudice or unfairness suffered by Defendant – Cases not determined on pleadings – Cases determined on evidence – Departure from pleadings allowable where no objection is taken to evidence raising fresh issues – Plaintiff raised equitable compensation in opening submissions and in the course of evidence – No objection taken by Defendant – Departure from pleadings allowable in this instance |
| Legislation Cited: | Cheques Act 1986 (Cth), s 71 Court Procedures Rules 2006 (ACT), rr 1013, 1619(2), Pt 2.1 of Sch 2, Sch 2 Table 2.1 |
Cases Cited: | Alemite Lubrequip Pty Ltd v Adams (1997) 41 NSWLR 45 |
| Texts Cited: | JD Heydon and MJ Leeming, Jacob’s Law of Trusts in Australia (7th ed, 2006, LexisNexis Butterworths: Sydney) 594; [2203]. |
Parties: | Commonwealth of Australia (Plaintiff) Davis Samuel Pty Ltd (First Defendant) David John Muir (Second Defendant) Callform Pty Limited (Third Defendant) Peter Michael Cain (Fourth Defendant) Allan Paul Endresz (Fifth Defendant) CTC Resources NL ACN 009 061 036 (Sixth Defendant) Jozsef Endresz (Seventh Defendant) Dawn May Endresz (Eighth Defendant) William Arthur Forge (Ninth Defendant) Kamanga Holdings Pty Limited ACN 003 316 292 (Tenth Defendant) Pellon Pty Limited ACN 082 375 951 (Eleventh Defendant) Michael McCann (Twelfth Defendant) Amative Pty Limited ACN 082 375 924 (Thirteenth Defendant) Mark Joseph Endresz (Fourteenth Defendant) Bisoya Pty Limited ACN 003 016 242 (Fifteenth Defendant) Winton Oil NL ACN 001 863 878 (Sixteenth Defendant) Quancorp Pty Limited ACN 002 755 133 (Seventeenth Defendant) Allan Paul Endresz as representative of the members of ‘Border Basketball Association Inc’ an unincorporated association (Eighteenth Defendant) Rodney James Endresz (Nineteenth Defendant) Joy Beverley Endresz (Twentieth Defendant) Tresmonay Pty Limited ACN 073 120 635 (Twenty-first Defendant) ACT Organics Pty Ltd ACN 008 628 662 (Twenty-second Defendant) Graham McCann Pty Limited ACN 008 653 969 (Twenty-third Defendant) Sandra Endresz (Twenty-fourth Defendant) Lorraine Olive Forge (Twenty-fifth Defendant) Christopher Muir (Twenty-sixth Defendant) TNG Limited ACN 008 817 023 (Twenty-seventh Defendant) Darren Smailes (Twenty-eighth Defendant) Shane Smailes (Twenty-ninth Defendant) Peter John Clark (Third Party) |
Representation: | Counsel Mr M Slattery QC and Mr J Hogan-Doran (Plaintiff) Mr P Cain (First Defendant) No appearance (Second Defendant) No appearance (Third Defendant) In person (Fourth Defendant) In person (Fifth Defendant) Mr P Cain (Sixth Defendant) In person (Seventh Defendant) In person (Eighth Defendant) In person (Ninth Defendant) No appearance (Tenth Defendant) No appearance (Eleventh Defendant) No appearance (Twelfth Defendant) No appearance (Thirteenth Defendant) No appearance (Fourteenth Defendant) Mr P Cain (Fifteenth Defendant) Mr P Cain (Sixteenth Defendant) No appearance (Seventeenth Defendant) No appearance (Eighteenth Defendant) No appearance (Nineteenth Defendant) In person (Twentieth Defendant) Mr P Cain (Twenty-first Defendant) No appearance (Twenty-second Defendant) No appearance (Twenty-third Defendant) No appearance (Twenty-fourth Defendant) No appearance (Twenty-fifth Defendant) No appearance (Twenty-sixth Defendant) Mr J Giles (Twenty-seventh Defendant) No appearance (Twenty-eighth Defendant) No appearance (Twenty-ninth Defendant) Mr P Cain (Third Party) |
| Solicitors Australian Government Solicitor (Plaintiff) Mr P Cain (First Defendant) No appearance (Second Defendant) No appearance (Third Defendant) Self-represented (Fourth Defendant) Self-represented (Fifth Defendant) Mr P Cain (Sixth Defendant) Self-represented (Seventh Defendant) Self-represented (Eighth Defendant) Self-represented (Ninth Defendant) No appearance (Tenth Defendant) No appearance (Eleventh Defendant) No appearance (Twelfth Defendant) No appearance (Thirteenth Defendant) No appearance (Fourteenth Defendant) Mr P Cain (Fifteenth Defendant) Mr P Cain (Sixteenth Defendant) No appearance (Seventeenth Defendant) No appearance (Eighteenth Defendant) No appearance (Nineteenth Defendant) Self-represented (Twentieth Defendant) Mr P Cain (Twenty-first Defendant) No appearance (Twenty-second Defendant) No appearance (Twenty-third Defendant) No appearance (Twenty-fourth Defendant) No appearance (Twenty-fifth Defendant) No appearance (Twenty-sixth Defendant) Sneddon Hall & Gallop as agents for Jackson McDonald (Twenty-seventh Defendant) No appearance (Twenty-eighth Defendant) No appearance (Twenty-ninth Defendant) Mr P Cain (Third Party) | |
File Number(s): | SC 75 of 1999 |
Table of Contents
Introduction2
The Need for a Decision on Election7
Factual background17
(a) Mr Rodney Endresz and Mrs Sandra Endresz27
(b) Mr Mark Endresz32
(c) Lorraine Forge (“Ms Scott”)35
(d) Pine Avenue property (Quancorp)[40]
(e) The Haven Hill property[43]
(f) Bisoya47
The Commonwealth’s position49
Election57
Equitable Compensation96
The Demand101
The Commonwealth’s Claim111
Claim not pleaded121
The appropriate remedy160
Davis Samuel (No 7) has determined the claim against the Commonwealth165
Conclusion of the Commonwealth’s Claim for Equitable Compensation172Causation176
Quantum184
Interest240
Double recovery[249]
Conclusion on the claim by the Commonwealth against TNG[261]
The Albury Defendants[265]
General Findings against the Albury Defendants[269]
Knowledge[269]
Remedies – (a) Equitable Compensation[272]
Equitable compensation and interaction with proprietary remedies arising from the trace[282]
Remedies – (b) interest on the equitable compensation[287]
The First Defendant, Davis Samuel Pty Ltd (Davis Samuel)[307]
In Personam Claim for Equitable Compensation in respect of the September Funds[307]
Detriment[312]
Trade Practices[315]
Ultra Vires Payment[322]
Proprietary Claim - Hallmark Gold Shares (HLM)[325]
The Second Defendant, David Muir (Mr David Muir)[327]
Claim by TNG against Mr Muir[327]
Detriment[330]
The Fourth Defendant, Peter Michael Cain (Mr Cain)[332]
In Personam Claims[332]
Detriment[343]
Claim by TNG against Mr Cain[346]
The Fifth Defendant, Allan Paul Endresz (Mr Allan Endresz)[357]
In Personam Claims[357]
Proprietary Claims[365]
Claims by TNG against Mr Allan Endresz[375]
The Sixth Defendant CTC Resources NL (CTC Resources)[377]
In Personam Claims Equitable Compensation[377]
Detriment[381]
Trade Practices[384]
Ultra Vires Payment[387]
Proprietary Claims[391]
Claim by TNG against CTC Resources[401]Detriment[403]
The Seventh Defendant, Jozsef Endresz (Mr Jozsef Endresz)[405]
In Personam Claims[405]
Detriment[409]
Proprietary Claims[412]
Claim by TNG against Mr Jozsef Endresz[413]
The Eighth Defendant Dawn May Endresz (Ms Dawn Endresz)[415]
In Personam Claims[415]
Detriment[420]
Proprietary Claims[423]
Claim by TNG against Mrs Dawn Endresz[425]
The Ninth Defendant William Arthur Forge (Mr Forge)[428]
In Personam Claims - Equitable Compensation[428]
Detriment[437]
Proprietary Claims - Stanley Street Property[446]
Claim by TNG against Mr Forge[450]Detriment[454]
The Tenth Defendant Kamanga Holdings Pty Ltd (Kamanga)[456]
In Personam Claims Equitable Compensation[456]
Detriment[465]
Trade Practices[467]
Ultra Vires Payment[470]
Claim by TNG against Kamanga[473]Detriment[475]
The Fifteenth Defendant Bisoya Pty Ltd (Bisoya)[477]
In Personam Claims Equitable Compensation[477]
Proprietary Claims Stanley Street Property[480]
The Sixteenth Defendant Winton Oil NL (Winton)[482]
In Personam Claims Equitable Compensation[482]
The Seventeenth Defendant Quancorp Pty Ltd (Quancorp)[487]
In Personam Claims Equitable Compensation[487]
Detriment[490]
Trade Practices Act[493]
Ultra Vires Payment[496]
Proprietary Claims Pine Avenue Property[499]
Claim by TNG against Quancorp[508]Detriment[510]
The Twentieth Defendant, Joy Beverly Endresz (Mrs Joy Endresz)[513]
The Twenty-First Defendant, Tresmonay Pty Ltd (Tresmonay)[516]
In Personam Claims Equitable Compensation[516]
Detriment[518]
The Twenty-Fifth Defendant, Lorraine Olive Forge (Ms Scott)[520]
The Third Party, Peter John Clarke (Mr Clarke) [524]
Claim by TNG against Mr Clarke[524]
Detriment[525]
Other matters.................................................................................................................[527]
Refshauge J:
Introduction
Following the transfer on 17 April 1998 of $6 million from Commonwealth of Australia funds (the April Funds) to a bank account operated by CTC Resources NL and, on 24 September 1998, of $2.725 million (the September Funds) to a bank account in the name of Davis Samuel, these proceedings were commenced to recover those sums in various ways.
On 1 August 2013, I gave reasons for finding that a number of the Defendants were liable to the Commonwealth: Commonwealth v Davis Samuel Pty Ltd (No 7) (2013) 95 ACSR 258. I shall refer to those reasons as “Davis Samuel (No 7)”. I will generally use in these reasons the terms and abbreviations used in David Samuel (No 7), with which these reasons should be read.
I was unable to make final orders and sought additional submissions as to one issue between the Commonwealth and one of the defendants and as to the form of the final orders. I received written submissions from some of the parties and heard oral submissions also. These are the reasons for the final orders I will make, after I hear brief submissions from the parties as to the precise form of the orders to be made.
It is convenient to deal with this matter in two parts. The first deals with the issue between the Commonwealth and the 27th Defendant, now known as TNG Ltd, to which I shall refer as TNG. This includes the issue of the effect of the election by the Commonwealth in relation to certain of the remedies it was seeking against TNG.
The second matter is the question of what final orders should be made and the form in which they should be made.
PART I
The Need for a Decision on Election
In Davis Samuel (No 7) at 516-21; [1905]-[1938], I referred to the situation where the Commonwealth had settled its claim against Mr Mark Endresz who had, as a volunteer, received funds traceable to the April Funds and which were thereby impressed with a constructive trust in favour of the Commonwealth.
The funds that Mr Mark Endresz received, however, were traced from the April Funds through the proceeds of the sale to TNG of certain shares and options in Kanowna Lights NL (Kanowna Lights) by various persons, including entities, who had held the shares and options as constructive trustees for the Commonwealth. The shares are, however, still held by TNG and the Commonwealth has claimed them as also being, for reasons also set out in Davis Samuel (No 7), subject to a constructive trust in favour of the Commonwealth.
Mr Mark Endresz, however, had only received a portion of the funds that were received from the sale of the shares and options and the question arose as to whether this settlement meant that the Commonwealth had made an election and was thereafter unable to proceed with its claim against TNG in respect of the shares.
I made similar findings in relation to funds that found their way to Mr Rodney Endresz, with whom the Commonwealth had also settled, and to Ms Lorraine Scott, who had paid money into Court to await the outcome of the proceedings and which funds the Commonwealth also claimed.
The issue also arises so far as other claims are concerned, where funds received from the sale to TNG of the shares is sought to be recovered by the Commonwealth from subsequent recipients. If election is a relevant issue, then the Commonwealth can either recover funds from the subsequent recipients or can recover from TNG the shares, but not both.
These issues needed to be resolved before final orders could be made.
The consequence of my earlier finding was somewhat unclear and, in any event, had not been argued before me. Accordingly, I gave the Commonwealth and TNG the opportunity to address the issues with further submissions. I was greatly assisted by the written submissions I received and the oral submissions I heard, both as to the issues between the Commonwealth and TNG, but also as to the final orders that should be made.
As to one matter raising the election issue, the Commonwealth made it clear in its closing submissions at the trial that it sought to trace the funds received from TNG, which were received when TNG purchased the options in Kanowna Lights, through to certain of the other Defendants, either as knowing recipients of these funds which had been obtained in breach of fiduciary duties owed to the Commonwealth or as volunteers. This decision, then, meant that the Commonwealth was not seeking any recovery in respect of the options from TNG. The options had in fact, expired before they were exercised.
Thus, the Commonwealth sought no remedy against TNG in respect of its holding of the options it had purchased notwithstanding that those options were purchased with funds subject to a constructive trust in favour of the Commonwealth. For this reason, however, the Commonwealth sought, and, in my opinion, was able, to trace its interests as beneficiary of a constructive trust, instead into the funds paid by TNG to various of the Defendants.
The issue was, then whether, the Commonwealth, having recovered funds (by way of settlement or otherwise) from Defendants, who had received funds or other property traceable to the April Funds through the sale to TNG of shares in Kanowna Lights, had made an election such that it was thereby precluded from claiming the transfer from TNG to it of the shares in Kanowna Lights as a proprietary remedy.
Factual background
It is appropriate and probably necessary to set out briefly the factual background to the issues that it is necessary to decide.
I do not, of course, recite the whole of the factual background, set out in detail in the Davis Samuel (No 7) and these reasons should be read with it, especially as to the reference to persons and entities (Davis Samuel (No 7) at 266-275; [11]-[112]) and to the transfer on 17 April 1998 of $6 million of funds, called in it and in these reasons “the April Funds”, from the Commonwealth to CTC Resources NL (CTC Resources) (Davis Samuel (No 7) 266; [6]-[7], 276; [124]-[127]).
The shares and options the subject of this argument are securities in the company, Kanowna Lights NL, to which I shall refer as Kanowna Lights. That company is described in Davis Samuel (No 7) at 404; [1013]-[1014].
As the Commonwealth does not seek to recover the options from TNG, it is not necessary to dwell on that aspect of the relevant transactions, save as it is necessary for the unfolding of the relevant facts.
During June 1998, CTC Resources (see Davis Samuel (No 7) at 269; [35]-[38]), purchased a total of 3.8 million shares in Kanowna Lights: see Davis Samuel (No 7) at 445; [1354], 500; [1783]. These shares were purchased by CTC Resources from the April Funds. I found in Davis Samuel (No 7) that these funds were improperly sent to CTC Resources and that, as a consequence, they were charged with a constructive trust in favour of the Commonwealth.
On 23 October 1998, (the 23 October resolutions – Davis Samuel (No 7) at 445; [1354]), the board of TNG resolved, inter alia
ACQUISITION OF 3.6 MILLION The transfer form was tabled. It was FULLY PAID ORDINARY resolved to execute same for the purchase SHARES IN KANOWNA of 3.6 million shares at $0.20 cents for a total consideration of $720,000.
A similar resolution, but of sale of those shares, was passed on the same day by the Board of CTC Resources.
There is no doubt that, for reasons set out in Davis Samuel (No 7) and to which I do not need specifically to refer, the resolution of TNG was effected by Mr Forge, Mr Muir and Mr Clark dishonestly and in breach of a fiduciary duty each owed to TNG.
The consideration of $720,000 was paid by cheque number 1002, apparently dated 26 October 1998, deposited that day in the CTC Resources bank account, though the transfer form was dated 23 October 1998.
The receipt of $720,000 was then disbursed to various of the Defendants and others and it is with that disbursement that I am now concerned, though not, at this stage, with every disbursement. I now turn to the relevant disbursements.
(a) Mr Rodney Endresz and Mrs Sandra Endresz
Mr Rodney Endresz and his wife, Mrs Sandra Endresz, received a loan from Bisoya Pty Ltd (Bisoya) on 16 June 1998. That amount was traceable to the April Funds (a portion of which Bisoya had received) but, of course, not to those funds which are traceable through the sale to TNG of shares in Kanowna Lights, for that had not yet happened.
As a result, however, of these funds being received by them, the Commonwealth sought those funds from them. The Commonwealth has now settled its claim against Mr Rodney Endresz and Mrs Sandra Endresz (Davis Samuel (No 7) at 273-4; [85]-[90], [97]-[98]).
While the property recovered by the Commonwealth was property acquired with April Funds, it was not with that part of the April Funds which had been used to purchase shares in Kanowna Lights and then traced into the proceeds of the sale of those shares to TNG.
On 6 November 1998, however, Kamanga Holdings Pty Ltd (Kamanga) paid, from the April Funds, traceable through the sale of shares in Kanowna Lights, the sum of $50,000 to Bisoya in settlement of the loan it made to Mr Rodney Endresz and Mrs Sandra Endresz. They did not, therefore, receive those funds and so there was no property they had to which the April Funds was traceable through the sale of the shares in Kanowna Lights, even though the debt they had to Bisoya has been extinguished and, to that extent, they have received something of value. This seems to me to follow from the principles established by the UK Court of Appeal in In re Diplock; Diplock v Wintle [1948] 1 Ch 465.
The Commonwealth did not, in any event, seek to trace these funds into the hands of Mr Rodney Endresz or Mrs Sandra Endresz, even if they could. Any tracing available to the Commonwealth of funds held by Bisoya is another matter. The settlement with Mr Rodney Endresz and Mrs Sandra Endresz, therefore, did not amount to an election by the Commonwealth in respect of any claim it may otherwise have to the Kanowna Lights shares held by TNG.
(b) Mr Mark Endresz
On 28 October 1998, the Davis Samuel Partnership or Davis Samuel paid $75,000 to Mr Mark Endresz. That sum was paid from funds received for the sale to TNG of options in Kanowna Lights, not shares.
The Commonwealth has settled with Mr Mark Endresz. I found that this settlement constituted an election by the Commonwealth to trace the April Funds into the funds received from the sale of the options in Kanowna Lights as against tracing into the options. See Davis Samuel (No 7) at 520-1; [1927]-[1937].
The Commonwealth, however, has abandoned any claim to trace the April Funds into the options in Kanowna Lights that had been sold to TNG. The issue, then, does not arise in respect of this transaction.
(c) Lorraine Forge (“Ms Scott”)
Ms Scott was married to Mr Forge. During the currency of the marriage, Mr Forge, Ms Scott and Bisoya acquired in equal thirds a residential property at 564 Stanley Street, Albury, with the April Funds or funds traceable from the April Funds.
Mr Forge and Ms Scott ended their marriage and made a final property settlement effected by consent orders in the Family Court of Australia.
By those orders, Mr Forge agreed to pay Ms Scott a sum of money and she agreed to transfer her interest in the Stanley Street property to him or his nominees.
On 30 October 1998, CTC Resources paid to Mr Forge $75,000 which was part of the funds it had received from the sale of shares in Kanowna Lights, thereby traceable April Funds. Mr Forge used those funds to pay part of the money he was required to pay to Ms Scott.
Ms Scott has paid that money into Court to await the orders of the Court. The Commonwealth sought payment of those funds to it, as has TNG. It is submitted by the Commonwealth that each have an equal entitlement to those funds. This amounts to an election to recover the funds from the moneys paid into Court as to one half of those funds, and not to seek to have transferred to it the shares represented by those funds.
(d) Pine Avenue property (Quancorp)
Quancorp Pty Ltd (Quancorp) became the registered proprietor of certain premises at 21 Pine Avenue, Elwood, Victoria. This property is Lot 1 on Plan of Subdivision 3071 03F more particularly described in Victorian Certificate of Title Volume 10032 Folio 720. I shall refer to the property as “the Pine Avenue Property”. It was subject to a mortgage which received a home loan advanced by Citibank Australia.
On 30 October 1998, the Davis Samuel Partnership paid $115,000 to Quancorp. The funds had come from the funds received by it from the sale of the options in Kanowna Lights, which funds were traceable from the April Funds. Of that sum, $95,000 was then paid into Citibank Australia, reducing the loan secured by mortgage over the Pine Avenue property.
The Commonwealth has abandoned any claim to trace the April Funds into the options in Kanowna Lights. Thus, no issue of election arises in respect of this transaction.
(e) The Haven Hill property
Mr Allan Endresz and Mrs Joy Endresz purchased a property known as “Haven Hill” on the Riverina Highway, Splitters Creek, Albury, New South Wales, being the property more particularly described in New South Wales Certificate of Title Folio 33/622002, being Lot 33 in Deposited Plan 622002. It was purchased in June 1995. I shall refer to it in these reasons as “Haven Hill”.
Improvements to the property were made from time to time with funds that were traceable from the April Funds. Some of the funds came from various sources and were paid before the sale of securities in Kanowna Lights; some came from the proceeds of the sale of options in Kanowna Lights.
In addition, the following amounts were paid for the following works of improvement to “Haven Hill” from funds that were traceable from the April Funds and which had been used to purchase shares in Kanowna Lights and were then received as proceeds from the sale of the shares to TNG before being used as follows:
· On 24 December 1998, $20,000 for landscaping;
· On 14 January 1999, $10,000 for interior decorations; and
· On 20 April 1999, $5,737 for renovations.
The Commonwealth, however, elects not to trace the proceeds of the sale of the Kanowna Lights shares to TNG into the funds of CTC Resources and thereafter into the improvements to Haven Hill.
(f) Bisoya
As I have noted above in respect of Mr Rodney Endresz and Mrs Sandra Endresz, the loan they received from Bisoya was discharged when Kamanga paid to it the amount of the loan, namely $50,000.
The Commonwealth has now sought to recover that sum from Bisoya. It was a sum that was traceable to the April Funds through the sale to TNG of shares in Kanowna Lights. This would amount to an election to seek to recover those funds from Bisoya and not to seek a transfer of the relevant shares in Kanowna Lights from TNG.
The Commonwealth’s position
As is now clear, the only irrevocable elections the Commonwealth has made are in respect of the claim it had against Mr Mark Endresz and in respect of the interest in Haven Hill.
As to the claim against Mr Mark Endresz, however, the funds in his hands that were traceable from the April Funds were received through the sale to TNG of the options in Kanowna Lights. As the Commonwealth has abandoned any claim against TNG in respect of those options, there is no inconsistency between its claims.
As to the claim against Mr Allan Endresz and Mrs Joy Endresz for an interest in Haven Hill, the Commonwealth has expressly and probably irrevocably abandoned its claim so far as it represents the interest obtained through the expenditure of funds traceable from the April Funds through the sale to TNG of shares in Kanowna Lights. Thus, there is no inconsistency between its claims.
The other claims, however, that depend on the payment away of funds that are traceable from the April Funds are either traceable through the sale of the options in Kanowna Lights to TNG (Pine Avenue property – Quancorp) or traceable through the sale of shares in Kanowna Lights to TNG (Ms Scott and Bisoya).
I do not need to consider the former further, since the Commonwealth has expressly abandoned any claim it has against TNG in respect of the options in Kanowna Lights that it purchased.
The only consideration then is in respect of the claims it has made on Ms Scott and on Bisoya. Subject to the findings on the TNG submissions as election, the following seems to be the position.
In its final submissions, the Commonwealth did claim from Bisoya the $50,000 paid to it by Kamanga as set out above (at [47]). It seems to me that, in the circumstances, this is an election by the Commonwealth and the claim against TNG should be reduced accordingly. The same applies to the claim made to one half of the sum paid into Court by Ms Scott to which both the Commonwealth and TNG make claim. The amount represented by one half of that sum should be discounted from the claim against TNG.
The question arises, however, whether the making of the claims against Ms Scott and Bisoya amount to an election which prevents the Commonwealth from claiming its proprietary remedy in respect of the Kanowna Lights shares from TNG at all or whether these claims simply reduce, pro tanto, the claim to the shares.
Election
The notion of an election is that a party entitled to recover under a judgment may have a variety of remedies. A common example arises when a purchaser of land fails to complete a contract where time has been made of the essence. The vendor can either treat the contract as repudiated and claim damages or can seek an order for specific performance. The vendor may make these claims in the alternative but at trial must elect which remedy is ultimately sought as the vendor is not entitled to both. See Johnson v Agnew [1980] AC 367 at 392. The important point is that the remedies are inconsistent; if one is granted, the other should not be granted.
That example, however, hides the issue here for the example concerns the sale of a unit of property, a block of land. In this case, however, there were a large number of shares purchased from TNG by a single cheque.
The Commonwealth seeks to trace the April Funds and says that some of those funds have been converted into the shares which TNG now possesses. The principle of tracing was explained in Davis Samuel (No 7) of 330; [477]-[450]; 519-20; [1922]-[1927]. In particular, I note that, in a passage of the speech of Lord Millett in Foskett v McKeown [2001] 1 AC 102 at 127, his Lordship pointed to the distinction between following and tracing, and noted that tracing involves the identification of a new asset to replace the old. The use of the singular “asset” raises the question here of whether the principle requires an aggregation of what is sold and paid for the purposes of the process or not.
The interactions in this case between the doctrine of election and the process of tracing is as follows. TNG had purchased a parcel of shares and paid with a cheque Had TNG purchased only one share, the Commonwealth would have had to choose whether to claim its interest by tracing it into that share or the cheque that was received from TNG; it could not do both.
Where, however there were a number of shares, but purchased with the one cheque, the question is whether the Commonwealth could claim on interest in the funds paid by TNG for the shares, so far as it wishes – or can – but, for the balance, claim an interest in the shares to the extent they are not represented in its claim against the funds.
In short, the Commonwealth says it can; TNG says it cannot. TNG submits that, since the Commonwealth has sought to claim against the funds, which were received by, inter alia, Mr Mark Endresz from the cheque paid by TNG, it has elected to trace into the funds and so may not, even pro tanto, trace into the shares.
The Commonwealth submits that each share is a separate item of property divisible from all other shares. Accordingly, the claim against any share does not prevent a claim to the funds representing another share.
TNG submits that the election, however, is between property rights in different assets and that this requires as a critical necessity the identification of the asset in relation to which the election operates at the juridical moment.
Thus, it submits, it is an incomplete description of the process to describe each share as a separate item of property because that ignores the other side of the transaction. The cheque received from TNG represents an indivisible chose in action, a single asset into which the Commonwealth seeks to trace its trust interest. Thus, the Commonwealth, it submits, cannot assert beneficial ownership of part of a cheque; it can only assert an interest in the shares or the cheque. It was, TNG submitted, a single transaction that could not be disaggregated, hence the need to elect.
TNG submits that the Commonwealth, having elected, as indicated above, to trace into and then claim in respect of the cheque (i.e. the funds), had elected and this prevented any claim against the shares.
It is a neat and seductively plausible argument. As TNG argued, the sale to TNG of the shares and options was a “package”, a single transaction: see Davis Samuel (No 7) at 441-5; [1346], [1351]-[1352]. This, it submitted, was how the trial was conducted: see Davis Samuel (No 7) at 446; [1362], 457; [1463].
However, I reject TNG’s submissions. It seems to me that there are two answers to them.
In the first place, tracing is not necessarily a process which results in giving a claimant the right to an asset; the tracing results in a claimant having a claim to the value inherent to the asset. As Lord Millett pointed out in Foskett v McKeown at 128
We also speak of tracing one asset into another, but this too is inaccurate. The original asset still exists in the hands of the new owner, or it may have become untraceable. The claimant claims the new asset because it was acquired in whole or in part with the original asset. What he traces, therefore, is not the physical asset itself but the value inherent in it.
That is re-inforced by the example given by the Court of Appeal in In Re Diplock; Diplock v Wintle at 547 where traceable proceeds of a breach of trust are used to make alterations to a house which alterations “add not one penny to the value of the house”. The Court continued;
Indeed, the alteration may well lower its value; for the alteration, though convenient to the owner, may be highly inconvenient in the eyes of a purchaser. Can it be said in such cases that the trust money can be traced and extracted from the altered asset? Clearly not, for the money will have disappeared leaving no monetary trace behind: the asset will not have increased (or may even have depreciated) in value through its use.
It is to be remembered that tracing is not a remedy, but a process. A remedy for the Commonwealth is the entitlement that the beneficiary of the constructive trust has, namely an interest in the property the subject of the trust. While a proprietary interest, it is not necessarily a right to the asset. As Lord Steyn said in Foskett v McKeown at 113, “in truth tracing is a process of identifying assets: it belongs to the realm of evidence”.
The equitable remedy may often be that a charge is imposed on the assets into which the value has been traced, especially where it is a mixed fund or an asset with more than one interest in it, showing that it is the value and not the physical asset that is the subject of the claim not the asset itself necessarily.
If it is, as it seems to me to be the case, the value in the asset to which the claimant is entitled; it does not prevent the claimant seeking part of the value to which it (or he or she) makes claim from one asset into which the funds can be traced and the balance of the value from another, so long as the values do not overlap and it is clear that there is no double recovery.
Indeed, to a large extent, this is the premise of this case, for the Commonwealth paid away the April Funds in one transaction which funds were then dissipated in various directions amongst various of the Defendants. The Commonwealth is not prevented by election from proceeding against defendants other than CTC Resources which was the original recipient of the transfer even if it also claims against that company. There is no inconsistency in this, requiring election, so long as there is no double recovery.
The second reason is, it seems to me, that the Commonwealth is correct that the cheque is not an asset into which it seeks to trace the funds. The paper which is a cheque is an asset of minimal value, but it is not a chose in action. As the High Court said in Parsons v The Queen (1999) 195 CLR 619 at 630; [23]
the right of the drawer to recover from the bank the balance standing to the credit of that party in the account with the bank was a chose in action but the effect of s 88 [of the Cheques Act 1986 (Cth)] is to emphasise that the drawing of a cheque does not of itself operate as an assignment of that chose in action of a part thereof. Rather, the generally accepted concept of a cheque is that of a “mandate”, addressed by the drawer to the banker directing the banker to effect a pro tanto satisfaction of the indebtedness of the banker to the drawer by honouring the cheque drawn on the banker. In this sense, a cheque “is merely a mandate, not a transfer of rights”.
(Footnotes omitted)
The right of a payee to recover from the drawer of a cheque that is dishonoured is not as a consequence of the failure to deliver a chose in action to which the payee is entitled, but a statutory right under s 71 of the Cheques Act 1986 (Cth). Indeed, a cheque is only a conditional payment, the condition being that the cheque is honoured on presentation and, if dishonoured, the payee has a right of action under the Cheques Act as pointed out by Dixon J in Tilley v Official Receiver (1960) 103 CLR 529 at 532-3. Indeed, the payment is effected by the creation of the chose in action that the payee has with his, her or its bank into which the mandate that is the cheque places the funding from the paying bank.
Thus, the asset to which the Commonwealth was able to trace the value to which it was entitled under the constructive trust was the funds in the bank account of CTC Resources. There was no need for the Commonwealth to be limited into tracing the funds into the cheque.
Hence, the tracing by the Commonwealth was into a mixed fund, a process allowed by equity. See Brady v Stapleton (1952) 88 CLR 322 at 336.
To refer to value, as I have done, is not to ignore the fact that the equitable remedy of the constructive trust is a proprietary remedy. There must, of course be an asset to which the right of the Commonwealth attaches. As the Court of Appeal said in In Re Diplock; Diplock v Wintle at 521
The equitable form of relief whether it takes the form of an order to restore an unmixed sum of money (or property acquired by means of such a sum) or a declaration of charge upon a mixed fund (or upon property acquired by means of such a fund) is, of course, personal in the sense that its efficacy is founded upon the jurisdiction of equity to enforce its rules by acting upon the individual. But it is not personal in the sense that the person against whom an order of this nature is sought can be made personally liable to repay the amount claimed to have belonged to the claimant. The equitable remedies pre-suppose the continued existence of the money either as a separate fund or as part of a mixed fund or as latent in property acquired by means of such a fund. If, on the facts of any individual case, such continued existence is not established, equity is as helpless as the common law itself. If the fund, mixed or unmixed, is spent upon a dinner, equity, which dealt only in specific relief and not in damages, could do nothing. If the case was one which at common law involved breach of contract the common law could, of course, award damage but specific relief would be out of the question. It is therefore, a necessary matter for consideration in each case where it is sought to trace money in equity, whether it has such a continued existence, actual or notional, as will enable equity to grant specific relief.
Where such a remedy is not available, equitable compensation may be available as a remedy, though the two are not mutually exclusive or inconsistent remedies.
The Commonwealth may, therefore, seek to recover value from the property of any relevant recipients of the proceeds of the sales of the shares for TNG and, pro tanto, from the shares held by TNG, making allowance for the other recovery or claim.
The flaw in TNG’s argument it seems to me, is that it asserts the Commonwealth cannot trace through “part of the cheque”. That is to say, if it seeks to trace through the cheque, then it must trace the whole of the funds paid by TNG for the shares. I do not accept that this is so.
In so far as the cheque is a chose in action, that being the asset into which the Commonwealth seeks to trace the April Funds, via shares, there is no prohibition from tracing some of the proceeds.
This is clear from how Lord Millet described what had happened in Foskett v McKeown, when his Lordship said at 127
The plaintiffs claim a continuing beneficial interest in the insurance money. Since this represents the product of Mr Murphy’s own money as well as theirs which Mr Murphy mingled indistinguishably in a single chose in action, they claim a beneficial interest in a proportionate part of the money only.
I see no reason why the Commonwealth should not likewise seek to assert a beneficial interest in part of the asset represented by the chose in action that is involved in the cheque and then to trace the funds to the ultimate recipients (provided the conditions for tracing apply).
I test this another way: I consider the position if TNG had purchased not only the shares which were subject to the constructive trust in favour of the Commonwealth, but also other shares in which the Commonwealth had no interest, I do not see any principle which prevents the Commonwealth, had TNG paid for both packets of shares with one cheque, from tracing its interest in one of the packets of shares (namely that in which it had an interest) through that cheque, though only part of the value it represented was value to which the Commonwealth had an entitlement.
Here, the Commonwealth has an interest, through tracing, in a number of shares and the chose in action into both of which it may trace the interest that it had in the April Funds. I see no reason in principle or in reality why it should not choose the property into which it traces its interest. Thus, each share is property and, although the shares were sold as a parcel, are not aggregated for the purpose of tracing. The Commonwealth may trace its interest into the shares or the proceeds (through the cheque) or partly one and partly the other. The election arises when the Commonwealth makes its claim. It cannot claim the share and the proceeds of the sale of that share; it must elect between the two. Where the property is separately identifiable, however, it may choose where to trace, though it cannot seek recovery from both the share and its sale proceeds at the same time.
TNG may have gained some comfort from the statement of Lord Millett in Foskett v McKeown at 127 where his Lordship said:
Tracing is the process of identifying a new asset as the substitute for the old. Where one asset is exchanged for another, a claimant can elect whether to follow the original asset into the hands of the new owner or to trace its value into the new asset is the hands of the same owner.
His Lordship, however, was clearly not suggesting that where the property the subject of the claimant’s claim consisted of various assets, there may not be a choice of how best to recover by following some and tracing others. As his Lordship continued, “[i]n practice his choice is often dictated by the circumstances”.
This leads then to the last point made by TNG in support of its contention.
TNG submitted, as noted above (at [65]) that there was, in the sale of shares (and options) to TNG, a single transaction, In one sense, that is correct; there was one share transfer form, there were cheques handed over at one time.
What TNG did not explain, however, is how that characterisation had any legal or equitable consequences. There are many transactions where there are different elements of a single transaction which may have different consequences. A simple example would be the sale of a residential property where the realty is sold often along with chattels. There is usually one contract and one settlement. Unusually, but unexceptionally, there could be one cheque payment. Nevertheless, the sale of the chattels would be subject to conditions and warranties under the Sale of Goods Act 1954 (ACT), while the realty would not be so subject. Thus, there can be separate rights applicable to different elements even in a “single transaction”. The appellation, “single transaction”, therefore, does not, without more, show that the Commonwealth is deprived of the right to recover from both TNG as well as from the recipients of the funds TNG paid for the shares, but with the important caveat that it could not recover twice, that is for the shares and also for the proceeds from the sale of those same shares.
The process of ensuring this is not difficult here, for each share was sold for the same price. In principle, it would not matter if that were not so, for it is value that is traced, but I can see that there may be complications that would be problematic if some of the shares had different values. I do not need to consider that possibility.
The matter is devoid of authority. Neither TNG nor the Commonwealth would point to any authority to justify its position or to show that any other position was contrary to authority.
In my view there seems no reason in principle why, where separate property is converted into other property, a claimant may not claim from identifiable property into which the property in which the claimant has an interest has been converted and separately claim other property being part of the one transaction so long as it is clear that there is no inconsistent claim, that is the claimant is not claiming the same specific value in two forms.
Equitable Compensation
The Commonwealth also sought from TNG, and TNG rejected the claim, for equitable compensation.
In Chameleon Mining NL v Murchison Metals Ltd [2010] FCA 1129, Jacobson J set out the relevant principle relating to a claim for equitable compensation. Although on appeal, in Grimaldi v Chameleon Mining NL (No 2) (2012) FCR 296, the Full Court upheld the appeal in part, it did not disturb his Honour’s findings on this issue. His Honour said at [1051]-[1055]
1051In Maguire v Makaronis [(1997) 188 CLR 449] the Court cited with apparent approval the following observation of Lord Browne-Wilkinson in Target Holdings Ltd v Redferns [1996] 1 AC 421 at 434:
... the basic rule is that a trustee in breach of trust must restore or pay to the trust estate either the assets which have been lost to the estate by reason of the breach or compensation for such loss.
1052The observations of the High Court in Youyang Pty Limited v Minter Ellison Morris Fletcher (2003) 212 CLR 484 (“Youyang”) at [35]ff are to similar effect.
1053There is no equitable by-pass to the need for Chameleon to establish causation of loss but on questions of causation it is important to focus on the relevant equitable duty; Youyang at [44] citing Mummery LJ in Swindle v Harrison [1997] 4 All ER 705 at 733 and 734.
1054The authorities were comprehensively reviewed by Spigelman CJ in O’Halloran v RT Thomas & Family Pty Limited (1998) 45 NSWLR 262 (“O’Halloran”) at 272-278. His Honour’s review addresses Australian, English and Canadian authorities as well as academic articles and other writing on the subject of equitable compensation. The review does not include reference to Younyang which was decided later but I do not consider that anything in that case alters the statements of principle to be found in Spigelman CJ’s judgment.
1055The following principles emerge from O’Halloran:
· The object of equitable compensation is to restore persons who have suffered loss to the position in which they would have been if there were no breach of the equitable obligation.
· The defendant’s wrongful act must relevantly cause the damage complained of and the plaintiff is to be put in the same position it would have been if it had not sustained the wrong. It follows from this that the defendant is only liable for the consequences of the wrong and it is not required to pay by way of compensation more than the loss suffered from the wrong.
· The plaintiff’s actual loss as a consequence of the breach is to be assessed with the full benefit of hindsight but the losses to be made good are only those which, on a common sense view of causation, were caused by the breach.
· The common sense formula should not be treated as a single formulation of the test for causation because causation in equity is not susceptible to the formulation of a single test.
· What is required is the identification of criteria which supply an adequate or sufficient connection between the equitable compensation and the breach of fiduciary duty.
· There is a sufficient connection where the loss would not have occurred if there had been no breach of duty.
· The preferable approach is to look to the policy behind compensation for breach of fiduciary duty and to determine the remedy that best furthers that policy.
· Directors who misapply, or are parties to the misapplication of the funds or other property of that company are liable to recoup the company for a loss thereby obtained
The Commonwealth put its case for equitable compensation as follows.
As I found in Davis Samuel (No 7), when TNG purchased the Kanowna Lights shares, it became a constructive trustee of the shares (at 524; [1961]) as a knowing recipient of that property under the first limb of Barnes v Addy (1874) LR 9 Ch App 244.
The Commonwealth further says that it required TNG to return the shares to it; it made a demand that it do so. TNG did not comply with the demand.
The Demand
The Commonwealth claims that the demand was made in a number of ways.
Correspondence between the Commonwealth’s lawyers and TNG, which I do not need to detail, put forward and considered a proposal for settlement of the claims that TNG had made against Davis Samuel, Mr Allan Endresz and Mr Cain. That settlement was subject to approval by the Commonwealth. In a letter, dated 4 May 1999, suggesting that proposal, the Australian Government Solicitor, on behalf of the Commonwealth, pointed out
(a)that the Commonwealth proposed to join TNG to the proceedings then on foot, being these proceedings; and
(b)that TNG held the shares and options in Kanowna Light on constructive trust for the Commonwealth.
While not an unambiguous demand, the letter made clear that the Commonwealth considered itself beneficiary of the securities and thus, of course, able to call for them at any time.
On 28 May 1999, the Commonwealth’s lawyers again wrote to TNG, confirming that it proposed to join it to the proceedings by order of this Court that was to be sought the next day. It also addressed the issue of the Kanowna Lights securities expressly as follows
3. The Commonwealth does not wish to impede a transaction which will benefit the shareholders of Hallmark Gold. However the Kanowna securities (or their value on appropriate terms) must be kept secure pending determination of the Commonwealth’s claim to a constructive trust over them. This would be achieved by the Commonwealth agreeing to the release of the Kanowna Lights securities on conditions such as the following:
a)Hallmark Gold would pay $600,000 (being a reasonable estimate of the present market value of these securities) to an appropriate independent trustee who would hold the monies pending the outcome of the action between the Commonwealth and Hallmark Gold;
b)If in that action the Court ruled that the Commonwealth was entitled to the Kanowna securities, Hallmark Gold would be required to authorise payment from the trust sum of $600, 000 or the market value of the Kanowna Lights securities at the time of the transfer to Davis Samuel, Cain and Endresz whichever is the less. The trustee shall also pay to the Commonwealth the interest accrued on the amount paid.
4. Please advise if you wish to pursue an arrangement along the above lines. Clearly if such an agreement in such terms is reached it will be necessary for some alteration to be made to the restraining orders made in the action to allow it to be effected.
On 4 June 1998, this Court ordered that TNG be joined as 27th defendant. The order noted an undertaking as to damages in the usual form given by the Commonwealth and ordered, inter alia
7. The 27th defendant be restrained from disposing of, encumbering or dissipating the following assets:
a)8.2 million options in Kanowna Lights NL purchased from Kanowna Holdings Pty Ltd and the Davis Samuel partnership in October 1998 for a total consideration of $656,000; and
b)3.6 million ordinary shares in Kanowna Lights NL purchased from CTC Resources NL in October 1998 for a total consideration of $720,00.
8. The 25th and 27th defendants, respectively, be restrained from disposing of, encumbering or dissipating assets wholly or substantially acquired from the proceeds of sale of the assets referred to in the proceeding orders, which proceeds may be held as at today’s date.
PROVIDED THAT this order will not operate to prevent any such defendant from dealing with any of the monies, the assets or the rewards described in these orders for the purpose of repaying monies to the plaintiff, or alternatively paying monies into Court to abide the order of the Court.
As a consequence of the order joining TNG as a Defendant (and, at the time, also two other parties as Defendants) the Commonwealth filed an Amended Statement of Claim on 2 July 1999, being the Third Further Amended Statement of Claim in which, inter alia, it claimed relief against all defendants, including as follows:
E1.1.4 An order that each defendant return to the Commonwealth any property held by such defendant which property was derived directly and indirectly from the April Funds or the September Funds.
E1.1.5 An order that each defendant account to the Commonwealth for the use by each such defendant of the whole of any part of the April Funds and the September Funds.
E1.1.6 An order that each of the defendants be restrained from dealing with or dissipating or diminishing in value any asset acquired through the use of the April Funds and the September Funds.
E1.1.7 Damages
E1.1.8 Equitable compensation.
On 1 July 1999, the Commonwealth’s lawyers again wrote to TNG confirming its agreement to TNG disposing of the Kanowna Lights shares so long as “$600,000 or the market (ASX) value of the shares and options on the date of sale plus $30,000 whichever is the greater sum” he invested pending the hearing of the proceedings.
It appears that this proposal did not proceed. There was some dispute between TNG and the Commonwealth as to a modification of the proposal but I do not need to address that.
Finally, TNG wrote that the proposal to have TNG pay $600,000 was rejected since, it asserted, that sum was
approximately double the present market value of the Kanowna securities and, as such, the Commonwealth offers are uncommenced, unattractive and unacceptable.
In my view, this correspondence and other material shows that the Commonwealth did seek that the Kanowna Lights shares be returned to the Commonwealth or sold and the proceeds held in trust, no doubt also invested, pending the outcome of the proceedings.
The Commonwealth’s Claim
The Commonwealth put its case for equitable compensation against TNG, as constructive trustee, in two ways.
The first was that by failing to acknowledge the trust and return the Kanowna Lights shares, TNG had continued in default as a trustee. If TNG had returned the shares, the Commonwealth could have made its own choice about their sale and converted this asset to cash to its advantage. The Commonwealth has been unable to do that by TNG’s failure to acknowledge the constructive trust and return the shares.
The Commonwealth had the right to call for the trust property, being the Kanowna Lights shares. See, for example, Saunders v Vautier (1841) 4 Beav 115; 49 ER 282 (affirmed (1841) Cr & Ph 240; 41 ER 482). The failure to comply with the direction of a beneficiary, sui generis and absolutely entitled to the property, is a breach of the fiduciary duty of the trustee.
While no authority was cited to me to show that a failure to deliver the trust property to such a beneficiary is a breach of a fiduciary duty that the trustee has to the beneficiary, I have no doubt that, as a matter of principle, this must be so.
Secondly, and alternatively, TNG can be considered as a trustee in possession which has failed to realise a volatile asset and allowed it to decline in value, contrary to the duty of care and diligence that equity imposes on trustees. The decline in value and the loss of income that could otherwise have been earned on the shares if they had been turned into cash is the measure of compensation for this breach.
The obligation of a trustee is, of course, to preserve the trust property: Nestle v National Westminster Bank plc [1994] 1 All ER 118. This includes a proper dealing with a wasting asset: Michael v Callil (1945) 72 CLR 509 at 521. See also Re Mulligan (deceased) [1998] 1 NZLR 481.
The Commonwealth submits that the equitable compensation to which it is entitled is an amount equivalent to the value for which the shares in Kanowna Lights could have been sold at the time that the Commonwealth required TNG to transfer them to it, together with interest on that amount, as from the time when the shares could have been sold.
In this regard, I note that, had TNG transferred the shares to the Commonwealth, the Commonwealth would have been obliged to sell them as quickly as it was appropriate to do so. While the Commonwealth could, it would appear, receive the securities (s 40 of the Financial Management and Accountability Act 1997 (Cth)), it would have had to dispose of them promptly, for this would not have been an authorised investment (s 39 of the Financial Management and Accountability Act and regulation 22 of the Financial Management and Accountability Regulation 1997 (Cth)). The repeal of this legislation and its replacement by the Public Governance Performance and Accountability Act 2013 (Cth) would not have altered this position as s 58 of that Act shows.
TNG rejects the Commonwealth’s claim on the grounds:
(a)that the claim as now made was not pleaded;
(b)that the remedy available for the pleaded claim was a transfer of the Kanowna Lights shares in specie and not for equitable compensation; and
(c)that Davis Samuel (No 7) has held that the Commonwealth’s claim on this basis has failed.
I shall deal with each of these matters in turn.
Claim not pleaded
Despite my complimentary description of the Commonwealth’s Statement of Claim in Davis Samuel (No 7) at 294; [249], it does seem to me that the present claim against TNG was not clearly pleaded; indeed, it seems to me that it was not expressly pleaded at all.
The relevant part of the Statement of Claim summarised the claims the Commonwealth made against TNG as “A Subsequent Recipient of the April Funds” and as “An Accessory to a Subsequent Receipt of April Funds”. The pleadings then made it clear that this was a receipt knowing that Mr Muir and Callform were guilty of dishonest breaches of fiduciary duties owed to the Commonwealth.
The claim was that TNG was “liable to pay the Commonwealth equitable compensation [for] its ... participation in the said dishonest breaches of fiduciary duty”.
There was also a claim for unjust enrichment because of the payment of the April Funds by mistake and the receipt of them by TNG whereby it was unjustly enriched.
There was, however, in the prayer for relief at E1.1.8 set out above (at [106]) a general claim for equitable compensation.
That does not seem to me to end the matter. While the pleadings are important for the reasons set out clearly in Canberra Data Centres Pty Ltd v Vibe Constructions (ACT) Pty Ltd (2010) 4 ACTLR 114 at 121-2; [24]-[31], they cannot become an instrument of oppression and it has long been held that, provided there is no unfairness or injustice, the parties may choose the grounds on which the litigation is to be conducted.
Thus, Isaacs and Rich JJ said in Gould v The Mount Oxide Mines Ltd (In Liquidation) (1916 22 CLR 490 at 517-8:
But pleadings are only a means to an end, and if the parties in fighting their legal battles choose to restrict them, or to enlarge them, or to disregard them and meet each other on issues fairly fought out, it is impossible for either of them to hark back to the pleadings and treat them as governing the area of contest. There is abundant authority for this, even if the matter were required to rest on authority only. ... There are qualifications, no doubt, and each case must depend for the proper application of the principle upon its own facts. It has been laid down by the Privy Council that ‘As a rule relief not founded on the pleadings should not be granted.’ ‘But in this case’ (said their Lordships) ‘the substantial matters which constitute the title of all the parties are touched, though obscurely, in the issues; they have been fully put in evidence, and they have formed the main subject of discussion and decision in all three Courts. The High Court are right in treating the case as not within the rule’: Sri Mahant Govind Rao v. Sita Ram Kesho [25 Ind App 195 at p 207].
This has been echoed more recently by the High Court where the above passage was cited or adverted to and accepted in Banque Commerciale SA (En Liquidation) v Akhil Holdings Ltd (1990) 167 CLR 279. Mason CJ and Gaudron J at 287
Ordinarily, the question whether the parties have chosen some issue different from that disclosed in the pleadings as the basis for the determination of their respective rights and liabilities is to be answered by inference from the way in which the trial was conducted. It may be that, in a clear case, mere acquiescence by one party in a course adopted by the other will be sufficient to ground such an inference.
Dawson J said, to the same effect at 296-7
But modern pleadings have never imposed so rigid a framework that if evidence which raises fresh issues is admitted without objection at trial, the case is to be decided upon a basis which does not embrace the real controversy between the parties ... cases are determined on the evidence, not the pleadings.
See also Leotta v Public Transport Commission (1976) 50 ALJR 666 at 668-9; Southwick v Moore Stephens Melbourne Pty Ltd [2008] VSCA 164 at [26]-[31]; Kriketos v Livschitz (2009) 14 BPR 26,717 at 26,734; [101]-[102].
In Ingot Capital Investments Pty Ltd v Macquarie Equity Capital Markets Ltd (2008) 73 NSWLR 653 at 710; [424], Ipp JA, with whom relevantly Giles and Hodgson JJA agreed, addressed the relevant authorities and summarised their effect as follows:
The following propositions may be extracted from these authorities:
(a)The rule that, in general, relief is confined to that available on the pleadings secures a party's right to a basic requirement of procedural fairness.
(b)Apart from cases where the parties choose to disregard the pleadings and to fight the case on additional issues chosen at the trial, the relief that may be granted to a party must be founded on the pleadings.
(c) It may be that, in a clear case, mere acquiescence by one party in a course adopted by the other will be sufficient to ground an inference that the parties have chosen a different basis to the pleaded issues for the determination of their respective rights and liabilities
(d) Acquiescence giving rise to a departure from the pleadings may arise from a failure to object to evidence that raises fresh issues – it is in this sense that ‘cases are determined on the evidence, not the pleadings’.
(e) While cases are to be decided upon a basis that embraces the “real controversy” between the parties, the real controversy has to be determined in accordance with the principles stated.
In that case, Hodgson JA described the position at trial as follows (at 668; [59]-[60], in terms that are helpful to addressing this ground
59.In certain respects, the opening before the primary judge by the appellants’ counsel went outside the pleadings, and no objection was taken. There was evidence and cross-examination that was relevant to this wider case, although it was also relevant to other issues, such as those raised by defences to the effect that defendants had acted honestly and reasonably. The appellants’ final submissions also supported this wider case; and while some defendants responded that this was outside the pleadings, all defendants responded to the substance of this case.
60.The primary judge in his judgment stated that he would decide the case on the pleadings, and he did not consider this wider case. In circumstances where this had been stated and agreed to during the hearing, I agree with Ipp JA that the primary judge’s approach should not be set aside on appeal.
See also Critchley v Conway [2009] NSWCA 297 at [37].
In opening the case, Mr M J Slattery QC, who appeared for the Commonwealth, raised directly the issue of the demand for the return of the shares and the claim for equitable compensation. He said
MR SLATTERY: Yes, but your Honour the law, we submit, is clear and I’ll take it to your Honour now, that in the absence of either the trust being acknowledged or the money being paid into Court we’ve asked for the shares clearly through the statement of claim and through correspondence. Really the duty of the constructive trustee, in my submission, is to do two things.
One is to respond to that request and either restore the shares to the Commonwealth as has been requested, the failure to do that is a continuing breach of trust. And alternatively – the Commonwealth has been denied the opportunity to have the shares realised somewhere in the interim or alternatively the constructive trustee which has elected to hold onto the shares, has got to manage them appropriately but there are volatile, potentially wasting assets and the trustees have got to take responsibility for the – as equity will impose, a care of diligence in relation to the ---
HIS HONOUR: Wasting asset.
MR SLATTERY: --- wasting asset. On either basis we’ve got a situation that either the trustee’s care or the Commonwealth’s loss of opportunity has led to the shares are now worth about 3 cents, the parcel is worth about $120 - $110,000 and they’ve not been turned into cash, there’s been no interest earned on them and in about a year after this, in the first 3 months of 2000 they went up to 47 cents.
This echoed what was set out in the extensive and helpful written opening submissions of the Commonwealth. Mr Slattery then addressed the question of the quantum of the equitable compensation recovered on this basis.
No objection was taken to these submissions.
Concurrent evidence was then given about the value of the Kanowna Lights shares by two experts. Before that evidence was given, both Mr Slattery QC and Mr J Giles, the latter who appeared for TNG, summarised factual matters about the evidence that was about to be given. The evidence was given and the experts were, subject to the usual provisions relating to the adducing of concurrent evidence by experts, cross-examined. This evidence was central to the claim of the Commonwealth for equitable compensation.
In my view, applying the principles outlined above (at [129]), the claim for equitable compensation by the Commonwealth was fairly and justly an issue in these proceedings and one I can determine.
TNG, however, does submit that, had the claim been properly pleaded, there would have been defences that could have been raised. This, of course, is relevant to what must be the overall issue, not expressed by Ipp JA above (at [131]), but, in my view, inherent in the matter, namely whether there is an unfairness or prejudice to the party against whom the unpleaded claim is made.
Mr Giles submitted that the fiduciary duty of the constructive trustee, being his client, TNG, does not have an “absolute duty” to “have done a bit better with the Commonwealth investments in [TNG’s] hand and sold it [sic] at the top of the market”.
As he submitted, no trustee has such a duty. I have described the duty above (at [116]) and it is not an absolute one; it is a duty to preserve the trust property, in this case, the shares. The issue which Mr Giles raised is one that really goes to quantum and, perhaps, causation. TNG did address the former.
It also raises the possibility of a defence under the relevant trustee legislation. Given that TNG was registered in Western Australia where the transaction took place, it would seem that the relevant Act would be the Trustees Act 1962 (WA). Section 75 of that Act provides
Breach of trust, Court may relieve trustee from personal liability for
If it appears to the Court that a trustee, whether appointed by the Court or otherwise, is, or may be, personally liable for any breach of trust, whether the transaction alleged to be a breach of trust occurred before or after the commencement of this Act, but has acted honestly and reasonably, and ought fairly to be excused for the breach of trust and for omitting to obtain the directions of the Court in the matter in which he committed the breach, then the Court may relieve him either wholly or partly from personal liability for that breach.
TNG submitted that, had the claim been properly pleaded, this section could have been pleaded in defence of the claim. In the trial, TNG adduced no evidence of matters that would go to the question of whether it had acted honestly and reasonably. Thus, it was, it submitted, prejudiced by the absence of a pleading that would enable it fairly to address the issue.
Further, Mr Giles submitted that issues arose from the terms of the demand made by the Commonwealth which had not been addressed in the hearing.
In the first place, he pointed to the fact that the demand was for return of the shares plus other money. While that certainly was the demand of 1 July 1999 (referred to above at [107]) it was not the tenor of earlier demands, as, for example, on 28 May 1999 (as to which see [104] above). Nevertheless, even the earlier demand was challenged by TNG as unreasonable because the payment by TNG was said to be double the value of the shares (as referred to at [109] above).
In any event, as Mr Giles further pointed out, the demand was for all the shares when, by virtue of the election made by the Commonwealth, it was not entitled to all the shares. Thus, he submitted, before the demand could properly be made the Commonwealth had to make an election.
I have some doubt about the need for prior election. It may be that the failure to elect may require later adjustments between the parties. In the alternative, it may be that the demand, in that context, constituted an election in itself, though this was not fully argued before me.
This is a matter which causes me some trouble. It seems to me that TNG has made out its case for prejudice were I to find that it was not aware of the case that the Commonwealth was making against it outside the pleadings.
I am, however, not so satisfied. The opening submissions of the Commonwealth were comprehensive and in writing and senior counsel also spoke to them at some length. They made the claim for breach of trust for failing to return the Kanowna Lights shares on demand in express and, in my mind, unambiguous terms. No challenge was made to that claim nor was any objection raised to the Commonwealth propounding it.
The final submissions of TNG did address the issue directly. Thus, it referred to the Commonwealth’s claim that TNG “should be treated as if it were in breach of trust at every moment it held the [Kanowna Lights] shares ...” It then referred at some length to McNally v Harris (No 3) [2008] NSWSC 861, in support of a submission as to the date at which the calculation of the amount of the equitable compensation should be made. It referred expressly to breach of trust and the relevant date, which can only be a recognition of the claim against it by the Commonwealth on the basis not pleaded but expressly articulated.
TNG also expressly raised the issue in its closing submissions as to whether there was a proper demand, clearly aware of the nature of the claim. While it is correct as stated that, at one stage, there was a demand for money as well as for a transfer of the shares, as I have noted above (at [104]-[107]), this was not the only – perhaps operative – demand, nor was it what was stated in the orders of the Court made when TNG was joined as a Defendant to which I have also earlier referred above (at [106]) and which does not suffer from the claimed defect.
In my view, TNG must be accepted to have been aware of the claim by the Commonwealth, although not expressly pleaded, and, insofar as it claims that it has been prejudiced as a result, this is a result of its acquiescence in the conduct of the proceedings by the Commonwealth which included the claim for equitable compensation for loss caused by its breach of trust in not transferring the shares to the Commonwealth as it demanded.
So far as the claim, referred to above (at [142]), that TNG may, had the claim of the Commonwealth been satisfactorily pleaded, have sought relief from its claimed breach of trust, it does not seem to me that this is a reason for rejecting the Commonwealth’s claim.
In the first place, TNG could, at any time, have sought relief. The provision is not merely offering a defence; indeed, it is unclear whether it is a matter of defence at all. Thus, TNG could, at any time, have sought an appropriate order that it be relieved of liability; such order would then provide the defence.
In the second place, it is difficult to see the basis on which TNG would have been relieved under the section. It knew, as indeed its claim against the other Defendants disclosed, of the improprieties in the way in which it had received the shares and options in Kanowna Lights. While it chose to resist the Commonwealth’s demands, and it may have done that honestly or reasonably, the section provides, in addition, that it is required for the Court to consider whether it “ought fairly to be excused for the breach”.
It seems to me that any basis for such excuse could be raised in answer to the claim of the Commonwealth in the hearing itself and of which it had significant notice.
I have difficulty in holding that when a beneficiary requires the return by the trustee of trust property, the defence of the claim when honestly and reasonably, but wrongly, made, should justify the court in refusing to uphold the beneficiaries claim.
So far as the equitable compensation is concerned, the same seems to me to apply, though I accept that this may not always be so obvious.
I do not consider that the possibility of relief under s 75 of the Trustees Act would justify me, in these circumstances, from declining to entertain the Commonwealth’s claim.
The appropriate remedy
Allied to the earlier pleading point, TNG submitted that the claim was misconceived for, as it was put in its written submissions,
the remedy for knowing receipt is not the imposition of a constructive trust and equitable compensation. The available remedy in the circumstances in which the recipient remains in possession of the property is a constructive trust, and in effect an order for re-conveyance. That is because the claim is to vindicate the Commonwealth’s proprietary interest. In relation to assets, the current value of which can be readily determined, such as readily marketable volumes of shares in a listed company, a recipient might be ordered (but as an alternative remedy) to pay an amount equal to the market value of the assets at the date of the order in lieu of a transfer. Subject to that limited, and essentially practical exception, equitable compensation is not available against a recipient who retains the property received. Equitable compensation is available against a knowing recipient who has transferred away the property, in breach of the constructive trust on which the recipient held the property.
(Footnotes omitted)
As TNG correctly noted, this is not a case where it had improperly transferred away the Kanowna Lights shares.
That submission addresses the pleaded claim but not the claim addressed by the oral submissions and, of course, to which the expert evidence was addressed.
While the Commonwealth maintained its claim for the return of the Kanowna Lights shares in specie, its claim to equitable compensation was for the breach of fiduciary duty as outlined above, a separate claim.
For the reasons I have set out above (at [112], [115]), the two bases on which the Commonwealth put its case under this heading are good in law and need to be addressed.
Davis Samuel (No 7) has determined the claim against the Commonwealth
TNG finally submitted that the effect of Davis Samuel (No 7) is that a claim for equitable compensation for knowing receipt at trial had failed, hence the orders I then made do not contemplate the submissions now being advanced by the Commonwealth.
It may be accepted that, in Davis Samuel (No 7), I did not address the issue that the Commonwealth now raises. That was largely because the issue depended upon whether the Commonwealth had elected to pursue an alternative remedy, namely the recovery of funds from subsequent recipients of the assets traced from the April Funds.
Nevertheless, it is a fair criticism that, while I made findings about the knowing receipt by TNG of the Kanowna Lights shares, I did not address the factual issues and make findings on the issues now being addressed.
It needs to be recognised, however, that the question of knowing receipt had to be resolved before the question of election arose. It was not necessary to make findings about any breach of fiduciary duties of TNG as a constructive trustee in order to address the issue of election. Indeed, had the submissions of TNG on that issue prevailed, then this issue would not have arisen.
TNG did not particularise any findings that were made in Davis Samuel (No 7) which were inconsistent with the Commonwealth’s claim.
SCHEDULE 6: CTC RESOURCES NL
| Principal amount | |
| April Funds (T 1): | $6,000,000.00 |
| less | |
| April Funds recovered prior to judgment | $1,019.313.15 |
| April Funds Principal amount: | $4,980,686.85 |
| September Funds (T 50): | $60,000.00 |
| less | |
| September Funds recovered prior to judgment | $0.00 |
| September Funds Principal amount: | $60,000.00 |
| Interest amount | |
| The calculations for the claimed interest are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Amounts recovered | Date of recovery | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $6,000,000.00 | $0.00 | 18/04/1998 | 487 | 10.00% | $800,547.95 |
| $5,998,514.14 | $1,485.86 | 18/08/1999 | 26 | 10.00% | $42,729.14 |
| $5,989,500.00 | $9,014.14 | 13/09/1999 | 170 | 10.00% | $278,963.01 |
| $5,744,500.00 | $245,000.00 | 01/03/2000 | 243 | 10.00% | $382,442.05 |
| $5,743,250.00 | $1,250.00 | 30/10/2000 | 25 | 10.00% | $39,337.33 |
| $5,676,890.00 | $66,360.00 | 24/11/2000 | 7 | 10.00% | $10,887.19 |
| $5,676,690. 00 | $200.00 | 01/12/2000 | 0 | 10.00% | $0 |
| $5,656,454.15 | $20,235.85 | 01/12/2000 | 12 | 10.00% | $18,596.56 |
| $5,642,847.90 | $13,606.25 | 13/12/2000 | 16 | 10.00% | $24,735.77 |
| $5,640,347.90 | $2,500.00 | 29/12/2000 | 18 | 10.00% | $27,815.41 |
| $5,635,347.90 | $5,000.00 | 16/01/2001 | 15 | 10.00% | $23,158.96 |
| $5,615,347.90 | $20,000.00 | 31/01/2001 | 8 | 10.00% | $12,307.61 |
| $5,555,347.90 | $60,000.00 | 08/02/2001 | 1 | 10.00% | $1,522.01 |
| $5,549,174.30 | $6,173.60 | 09/02/2001 | 81 | 10.00% | $123,146.06 |
| $5,549, 174.30 | (change rate) | 01/05/2001 | 198 | 9.00% | $270,921.33 |
| $5,547,780.59 | $1,393.71 | 15/11/2001 | 12 | 9.00% | $16,415.35 |
| $5,087,270.38 | $460,510.21 | 27/11/2001 | 3 | 9.00% | $3,763.19 |
| $4,986,951.85 | $100,318.53 | 30/11/2001 | 11 | 9.00% | $13,526.25 |
| $4,980,686.85 | $6,265.00 | 11/12/2001 | 3124 | 9.00% | $3,836,629.90 |
| $4,980,686.85 | (change rate) | 01/07/2010 | 184 | 8.50% | $213,419.02 |
| $4,980,686.85 | (change rate) | 01/01/2011 | 365 | 8.75% | $435,810.10 |
| $4,980,686.85 | (change rate) | 01/01/2012 | 182 | 8.25% | $204,890.45 |
| $4,980,686.85 | (change rate) | 01/07/2012 | 184 | 7.50% | $188,310.90 |
| $4,980,686.85 | (change rate) | 01/01/2013 | 181 | 7.00% | $172,891.24 |
| $4,980,686.85 | (change rate) | 01/07/2013 | 184 | 6.75% | $169,479.81 |
| $4,980,686.85 | (change rate) | 01/01/2014 | 181 | 6.5% | $160,541.87 |
| $4,980,686.85 | 01/07/2014 | 144 | 6.5% | $127,723.91 | |
| $1,019,313.15 | 21/11/2014 | $7,589,625.18 | |||
Daily rate from 21 November 2014: $1,159.89
| September Funds Interest | |||||
| Balance outstanding | Rate Change | Date of change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $60,000.00 | (change rate) | 24/09/1998 | 950 | 10.00% | $15,616.44 |
| $60,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $49,532.05 |
| $60,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $2,570.96 |
| $60,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $5,250.00 |
| $60,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $2,468.22 |
| $60,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $2,268.49 |
| $60,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $2,082.74 |
| $60,000.00 | (change rate) | 01/07/2013 | 184 | 6.75% | $2,041.64 |
| $60,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $1,933.97 |
| $60,000.00 | 01/07/2014 | 144 | 6.5% | $1,538.63 | |
| 21/11/2014 | $85,303.14 | ||||
Daily rate from 21 November 2014: $13.97
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $4,980,686.85 | ||
| Principal September Funds | $60,000.00 | ||
| Interest April Funds | $7,589,625.18 | ||
| Interest September Funds | $85,303.14 | ||
| Total | $5,040,686.85 | $7,674,928.32 | $12,715,615.17 |
| Daily Rate April Funds after 21 November 2014 | $1,159.89 | ||
| Daily Rate September Funds after 21 November 2014 | $13.97 | ||
| $1,173.86[1] | |||
[1] Rounding correction.
SCHEDULE 7: JOZSEF ENDRESZ
| Principal amount | |
| April Funds (T1): | $6,000,000.00 |
| less | |
| April Funds recovered prior to judgment | 1,019.313.15 |
| April Funds Principal amount: | $4,980,686.85 |
| September Funds (T50): | $2,725,000.00 |
| less | |
| September Funds recovered prior to judgment | 225,000.00 |
| September Funds Principal amount: | $2,500,000.00 |
| Interest amount | |
| The calculations for the claimed interest are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Amounts recovered | Date of recovery | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $6,000,000.00 | $0.00 | 18/04/1998 | 487 | 10.00% | $800,547.95 |
| $5,998,514.14 | $1,485.86 | 18/08/1999 | 26 | 10.00% | $42,729.14 |
| $5,989,500.00 | $9,014.14 | 13/09/1999 | 170 | 10.00% | $278,963.01 |
| $5,744,500.00 | $245,000.00 | 01/03/2000 | 243 | 10.00% | $382,442.05 |
| $5,743,250.00 | $1,250.00 | 30/10/2000 | 25 | 10.00% | $39,337.33 |
| $5,676,890.00 | $66,360.00 | 24/11/2000 | 7 | 10.00% | $10,887.19 |
| $5,676,690. 00 | $200.00 | 01/12/2000 | 0 | 10.00% | $0 |
| $5,656,454.15 | $20,235.85 | 01/12/2000 | 12 | 10.00% | $18,596.56 |
| $5,642,847.90 | $13,606.25 | 13/12/2000 | 16 | 10.00% | $24,735.77 |
| $5,640,347.90 | $2,500.00 | 29/12/2000 | 18 | 10.00% | $27,815.41 |
| $5,635,347.90 | $5,000.00 | 16/01/2001 | 15 | 10.00% | $23,158.96 |
| $5,615,347.90 | $20,000.00 | 31/01/2001 | 8 | 10.00% | $12,307.61 |
| $5,555,347.90 | $60,000.00 | 08/02/2001 | 1 | 10.00% | $1,522.01 |
| $5,549,174.30 | $6,173.60 | 09/02/2001 | 81 | 10.00% | $123,146.06 |
| $5,549, 174.30 | (change rate) | 01/05/2001 | 198 | 9.00% | $270,921.33 |
| $5,547,780.59 | $1,393.71 | 15/11/2001 | 12 | 9.00% | $16,415.35 |
| $5,087,270.38 | $460,510.21 | 27/11/2001 | 3 | 9.00% | $3,763.19 |
| $4,986,951.85 | $100,318.53 | 30/11/2001 | 11 | 9.00% | $13,526.25 |
| $4,980,686.85 | $6,265.00 | 11/12/2001 | 3124 | 9.00% | $3,836,629.90 |
| $4,980,686.85 | (change rate) | 01/07/2010 | 184 | 8.50% | $213,419.02 |
| $4,980,686.85 | (change rate) | 01/01/2011 | 365 | 8.75% | $435,810.10 |
| $4,980,686.85 | (change rate) | 01/01/2012 | 182 | 8.25% | $204,890.45 |
| $4,980,686.85 | (change rate) | 01/07/2012 | 184 | 7.50% | $188,310.90 |
| $4,980,686.85 | (change rate) | 01/01/2013 | 181 | 7.00% | $172,891.24 |
| $4,980,686.85 | (change rate) | 01/07/2013 | 184 | 6.75% | $169,479.81 |
| $4,980,686.85 | (change rate) | 01/01/2014 | 181 | 6.5% | $160,541.87 |
| $4,980,686.85 | 01/07/2014 | 144 | 6.5% | $127,723.91 | |
| $1,019,313.15 | 21/11/2014 | $7,589,625.18 | |||
Daily rate from 21 November 2014: $1,159.89
| September Funds Interest | |||||
| Balance outstanding | Amounts recovered/ Rate change | Date of recovery or change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $2,725,000.00 | 24/09/1998 | 139 | 10.00% | $103,773.97 | |
| $2,500,000.00 | $225,000.00 | 10/02/1999 | 811 | 10.00% | $555,479.45 |
| $2,500,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $2,063,835.62 |
| $2,500,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $107,123.29 |
| $2,500,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $218,750.00 |
| $2,500,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $102,842.47 |
| $2,500,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $94,520.55 |
| $2,500,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $86,780.82 |
| $2,500,000.00 | (change rate) | 01/07/2013 | 183 | 6.75% | $85,068.49 |
| $2,500,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $80,582.19 |
| $2,500,000.00 | 01/07/2014 | 144 | 6.5% | $64,109.59 | |
| $225,000.00 | 21/11/2014 | $3,562,866.44 | |||
Daily rate from 21 November 2014: $482.19
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $4,980,686.85 | ||
| Principal September Funds | $2,500,000.00 | ||
| Interest April Funds | $7,589,625.18 | ||
| Interest September Funds | $3,562,866.44 | ||
| Total | $7,480,686.85 | $11,152,491.62 | $18,633,178.47 |
| Daily Rate April Funds after 21 November 2014 | $1,159.89 | ||
| Daily Rate September Funds after 21 November 2014 | $582.19 | ||
| $1,742.08 | |||
SCHEDULE 8: DAWN MAY ENDRESZ
| Principal amount | |
| April Funds (T 1): | $6,000,000.00 |
| less | |
| April Funds recovered prior to judgment | $1,019.313.15 |
| April Funds Principal amount: | $4,980,686.85 |
| September Funds (T 50): | $60,000.00 |
| less | |
| September Funds recovered prior to judgment | $0.00 |
| September Funds Principal amount: | $60,000.00 |
| Interest amount | |
| The calculations for the claimed interest are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Amounts recovered | Date of recovery | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $6,000,000.00 | $0.00 | 18/04/1998 | 487 | 10.00% | $800,547.95 |
| $5,998,514.14 | $1,485.86 | 18/08/1999 | 26 | 10.00% | $42,729.14 |
| $5,989,500.00 | $9,014.14 | 13/09/1999 | 170 | 10.00% | $278,963.01 |
| $5,744,500.00 | $245,000.00 | 01/03/2000 | 243 | 10.00% | $382,442.05 |
| $5,743,250.00 | $1,250.00 | 30/10/2000 | 25 | 10.00% | $39,337.33 |
| $5,676,890.00 | $66,360.00 | 24/11/2000 | 7 | 10.00% | $10,887.19 |
| $5,676,690. 00 | $200.00 | 01/12/2000 | 0 | 10.00% | $0 |
| $5,656,454.15 | $20,235.85 | 01/12/2000 | 12 | 10.00% | $18,596.56 |
| $5,642,847.90 | $13,606.25 | 13/12/2000 | 16 | 10.00% | $24,735.77 |
| $5,640,347.90 | $2,500.00 | 29/12/2000 | 18 | 10.00% | $27,815.41 |
| $5,635,347.90 | $5,000.00 | 16/01/2001 | 15 | 10.00% | $23,158.96 |
| $5,615,347.90 | $20,000.00 | 31/01/2001 | 8 | 10.00% | $12,307.61 |
| $5,555,347.90 | $60,000.00 | 08/02/2001 | 1 | 10.00% | $1,522.01 |
| $5,549,174.30 | $6,173.60 | 09/02/2001 | 81 | 10.00% | $123,146.06 |
| $5,549, 174.30 | (change rate) | 01/05/2001 | 198 | 9.00% | $270,921.33 |
| $5,547,780.59 | $1,393.71 | 15/11/2001 | 12 | 9.00% | $16,415.35 |
| $5,087,270.38 | $460,510.21 | 27/11/2001 | 3 | 9.00% | $3,763.19 |
| $4,986,951.85 | $100,318.53 | 30/11/2001 | 11 | 9.00% | $13,526.25 |
| $4,980,686.85 | $6,265.00 | 11/12/2001 | 3124 | 9.00% | $3,836,629.90 |
| $4,980,686.85 | (change rate) | 01/07/2010 | 184 | 8.50% | $213,419.02 |
| $4,980,686.85 | (change rate) | 01/01/2011 | 365 | 8.75% | $435,810.10 |
| $4,980,686.85 | (change rate) | 01/01/2012 | 182 | 8.25% | $204,890.45 |
| $4,980,686.85 | (change rate) | 01/07/2012 | 184 | 7.50% | $188,310.90 |
| $4,980,686.85 | (change rate) | 01/01/2013 | 181 | 7.00% | $172,891.24 |
| $4,980,686.85 | (change rate) | 01/07/2013 | 184 | 6.75% | $169,479.81 |
| $4,980,686.85 | (change rate) | 01/01/2014 | 181 | 6.5% | $160,541.87 |
| $4,980,686.85 | 01/07/2014 | 144 | 6.5% | $127,723.91 | |
| $1,019,313.15 | 21/11/2014 | $7,589,625.18 | |||
Daily rate from 21 November 2014: $1,159.89
| September Funds Interest | |||||
| Balance outstanding | Rate Change | Date of change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $60,000.00 | (change rate) | 24/09/1998 | 950 | 10.00% | $15,616.44 |
| $60,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $49,532.05 |
| $60,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $2,570.96 |
| $60,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $5,250.00 |
| $60,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $2,468.22 |
| $60,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $2,268.49 |
| $60,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $2,082.74 |
| $60,000.00 | (change rate) | 01/07/2013 | 184 | 6.75% | $2,041.64 |
| $60,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $1,933.97 |
| $60,000.00 | 01/07/2014 | 144 | 6.5% | $1,538.63 | |
| 21/11/2014 | $85,303.14 | ||||
Daily rate from 21 November 2014: $13.97
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $4,980,686.85 | ||
| Principal September Funds | $60,000.00 | ||
| Interest April Funds | $7,589,625.18 | ||
| Interest September Funds | $85,303.14 | ||
| Total | $5,040,686.85 | $7,674,928.32 | $12,715,615.17 |
| Daily Rate April Funds after 21 November 2014 | $1,159.89 | ||
| Daily Rate September Funds after 21 November 2014 | $13.97 | ||
| $1,173.86[2] | |||
[2] Rounding correction.
SCHEDULE 9: WILLIAM ARTHUR FORGE
| Principal amount | |
| April Funds (T 1): | $6,000,000.00 |
| less | |
| April Funds recovered prior to judgment | $1,019.313.15 |
| April Funds Principal amount: | $4,980,686.85 |
| September Funds (T 50): | $60,000.00 |
| less | |
| September Funds recovered prior to judgment | $0.00 |
| September Funds Principal amount: | $60,000.00 |
| Interest amount | |
| The calculations for the claimed interest are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Amounts recovered | Date of recovery | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $6,000,000.00 | $0.00 | 18/04/1998 | 487 | 10.00% | $800,547.95 |
| $5,998,514.14 | $1,485.86 | 18/08/1999 | 26 | 10.00% | $42,729.14 |
| $5,989,500.00 | $9,014.14 | 13/09/1999 | 170 | 10.00% | $278,963.01 |
| $5,744,500.00 | $245,000.00 | 01/03/2000 | 243 | 10.00% | $382,442.05 |
| $5,743,250.00 | $1,250.00 | 30/10/2000 | 25 | 10.00% | $39,337.33 |
| $5,676,890.00 | $66,360.00 | 24/11/2000 | 7 | 10.00% | $10,887.19 |
| $5,676,690. 00 | $200.00 | 01/12/2000 | 0 | 10.00% | $0 |
| $5,656,454.15 | $20,235.85 | 01/12/2000 | 12 | 10.00% | $18,596.56 |
| $5,642,847.90 | $13,606.25 | 13/12/2000 | 16 | 10.00% | $24,735.77 |
| $5,640,347.90 | $2,500.00 | 29/12/2000 | 18 | 10.00% | $27,815.41 |
| $5,635,347.90 | $5,000.00 | 16/01/2001 | 15 | 10.00% | $23,158.96 |
| $5,615,347.90 | $20,000.00 | 31/01/2001 | 8 | 10.00% | $12,307.61 |
| $5,555,347.90 | $60,000.00 | 08/02/2001 | 1 | 10.00% | $1,522.01 |
| $5,549,174.30 | $6,173.60 | 09/02/2001 | 81 | 10.00% | $123,146.06 |
| $5,549, 174.30 | (change rate) | 01/05/2001 | 198 | 9.00% | $270,921.33 |
| $5,547,780.59 | $1,393.71 | 15/11/2001 | 12 | 9.00% | $16,415.35 |
| $5,087,270.38 | $460,510.21 | 27/11/2001 | 3 | 9.00% | $3,763.19 |
| $4,986,951.85 | $100,318.53 | 30/11/2001 | 11 | 9.00% | $13,526.25 |
| $4,980,686.85 | $6,265.00 | 11/12/2001 | 3124 | 9.00% | $3,836,629.90 |
| $4,980,686.85 | (change rate) | 01/07/2010 | 184 | 8.50% | $213,419.02 |
| $4,980,686.85 | (change rate) | 01/01/2011 | 365 | 8.75% | $435,810.10 |
| $4,980,686.85 | (change rate) | 01/01/2012 | 182 | 8.25% | $204,890.45 |
| $4,980,686.85 | (change rate) | 01/07/2012 | 184 | 7.50% | $188,310.90 |
| $4,980,686.85 | (change rate) | 01/01/2013 | 181 | 7.00% | $172,891.24 |
| $4,980,686.85 | (change rate) | 01/07/2013 | 184 | 6.75% | $169,479.81 |
| $4,980,686.85 | (change rate) | 01/01/2014 | 181 | 6.5% | $160,541.87 |
| $4,980,686.85 | 01/07/2014 | 144 | 6.5% | $127,723.91 | |
| $1,019,313.15 | 21/11/2014 | $7,589,625.18 | |||
Daily rate from 21 November 2014: $1,159.89
| September Funds Interest | |||||
| Balance outstanding | Rate Change | Date of change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $60,000.00 | (change rate) | 24/09/1998 | 950 | 10.00% | $15,616.44 |
| $60,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $49,532.05 |
| $60,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $2,570.96 |
| $60,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $5,250.00 |
| $60,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $2,468.22 |
| $60,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $2,268.49 |
| $60,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $2,082.74 |
| $60,000.00 | (change rate) | 01/07/2013 | 184 | 6.75% | $2,041.64 |
| $60,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $1,933.97 |
| $60,000.00 | 01/07/2014 | 144 | 6.5% | $1,538.63 | |
| 21/11/2014 | $85,303.14 | ||||
Daily rate from 21 November 2014: $13.97
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $4,980,686.85 | ||
| Principal September Funds | $60,000.00 | ||
| Interest April Funds | $7,589,625.18 | ||
| Interest September Funds | $85,303.14 | ||
| Total | $5,040,686.85 | $7,674,928.32 | $12,715,615.17 |
| Daily Rate April Funds after 21 November 2014 | $1,159.89 | ||
| Daily Rate September Funds after 21 November 2014 | $13.97 | ||
| $1,173.86[3] | |||
[3] Rounding correction.
SCHEDULE 10: KAMANGA HOLDINGS PTY LTD
| Principal amount | |
| April Funds (T1): | $6,000,000.00 |
| less | |
| April Funds recovered prior to judgment | 1,019.313.15 |
| April Funds Principal amount: | $4,980,686.85 |
| September Funds (T50): | $2,725,000.00 |
| less | |
| September Funds recovered prior to judgment | 225,000.00 |
| September Funds Principal amount: | $2,500,000.00 |
| Interest amount | |
| The calculations for the claimed interest are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Amounts recovered | Date of recovery | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $6,000,000.00 | $0.00 | 18/04/1998 | 487 | 10.00% | $800,547.95 |
| $5,998,514.14 | $1,485.86 | 18/08/1999 | 26 | 10.00% | $42,729.14 |
| $5,989,500.00 | $9,014.14 | 13/09/1999 | 170 | 10.00% | $278,963.01 |
| $5,744,500.00 | $245,000.00 | 01/03/2000 | 243 | 10.00% | $382,442.05 |
| $5,743,250.00 | $1,250.00 | 30/10/2000 | 25 | 10.00% | $39,337.33 |
| $5,676,890.00 | $66,360.00 | 24/11/2000 | 7 | 10.00% | $10,887.19 |
| $5,676,690. 00 | $200.00 | 01/12/2000 | 0 | 10.00% | $0 |
| $5,656,454.15 | $20,235.85 | 01/12/2000 | 12 | 10.00% | $18,596.56 |
| $5,642,847.90 | $13,606.25 | 13/12/2000 | 16 | 10.00% | $24,735.77 |
| $5,640,347.90 | $2,500.00 | 29/12/2000 | 18 | 10.00% | $27,815.41 |
| $5,635,347.90 | $5,000.00 | 16/01/2001 | 15 | 10.00% | $23,158.96 |
| $5,615,347.90 | $20,000.00 | 31/01/2001 | 8 | 10.00% | $12,307.61 |
| $5,555,347.90 | $60,000.00 | 08/02/2001 | 1 | 10.00% | $1,522.01 |
| $5,549,174.30 | $6,173.60 | 09/02/2001 | 81 | 10.00% | $123,146.06 |
| $5,549, 174.30 | (change rate) | 01/05/2001 | 198 | 9.00% | $270,921.33 |
| $5,547,780.59 | $1,393.71 | 15/11/2001 | 12 | 9.00% | $16,415.35 |
| $5,087,270.38 | $460,510.21 | 27/11/2001 | 3 | 9.00% | $3,763.19 |
| $4,986,951.85 | $100,318.53 | 30/11/2001 | 11 | 9.00% | $13,526.25 |
| $4,980,686.85 | $6,265.00 | 11/12/2001 | 3124 | 9.00% | $3,836,629.90 |
| $4,980,686.85 | (change rate) | 01/07/2010 | 184 | 8.50% | $213,419.02 |
| $4,980,686.85 | (change rate) | 01/01/2011 | 365 | 8.75% | $435,810.10 |
| $4,980,686.85 | (change rate) | 01/01/2012 | 182 | 8.25% | $204,890.45 |
| $4,980,686.85 | (change rate) | 01/07/2012 | 184 | 7.50% | $188,310.90 |
| $4,980,686.85 | (change rate) | 01/01/2013 | 181 | 7.00% | $172,891.24 |
| $4,980,686.85 | (change rate) | 01/07/2013 | 184 | 6.75% | $169,479.81 |
| $4,980,686.85 | (change rate) | 01/01/2014 | 181 | 6.5% | $160,541.87 |
| $4,980,686.85 | 01/07/2014 | 144 | 6.5% | $127,723.91 | |
| $1,019,313.15 | 21/11/2014 | $7,589,625.18 | |||
Daily rate from 21 November 2014: $1,159.89
| September Funds Interest | |||||
| Balance outstanding | Amounts recovered/ Rate change | Date of recovery or change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $2,725,000.00 | 24/09/1998 | 139 | 10.00% | $103,773.97 | |
| $2,500,000.00 | $225,000.00 | 10/02/1999 | 811 | 10.00% | $555,479.45 |
| $2,500,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $2,063,835.62 |
| $2,500,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $107,123.29 |
| $2,500,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $218,750.00 |
| $2,500,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $102,842.47 |
| $2,500,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $94,520.55 |
| $2,500,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $86,780.82 |
| $2,500,000.00 | (change rate) | 01/07/2013 | 183 | 6.75% | $85,068.49 |
| $2,500,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $80,582.19 |
| $2,500,000.00 | 01/07/2014 | 144 | 6.5% | $64,109.59 | |
| $225,000.00 | 21/11/2014 | $3,562,866.44 | |||
Daily rate from 21 November 2014: $482.19
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $4,980,686.85 | ||
| Principal September Funds | $2,500,000.00 | ||
| Interest April Funds | $7,589,625.18 | ||
| Interest September Funds | $3,562,866.44 | ||
| Total | $7,480,686.85 | $11,152,491.62 | $18,633,178.47 |
| Daily Rate April Funds after 21 November 2014 | $1,159.89 | ||
| Daily Rate September Funds after 21 November 2014 | $582.19 | ||
| $1,742.08 | |||
SCHEDULE 15: BISOYA PTY LTD
| Principal amount | ||
| Portion of the April Funds (T 1): | $428,333.36 | |
| 22 April 1998 | (T 8.1) | $260,000.00 |
| 28 May-17 December 1998 | (T 8.2-8.7) | $43,333.36 |
| 29 October 1998 | (T 14.3) | $50,000.00 |
| 29 October 1998 | (T 23.1) | $75,000.00 |
| less | ||
| April Funds recovered prior to judgment | $0.00 | |
| April Funds Principal amount: | $428,333.36 | |
| Interest amount | ||
| The calculations for the claimed interest are as follows: | ||
April Funds Interest
| Transaction Number | Balance outstanding | Rate Change | Date of change or rate | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| T 8.1 | $260,000.00 | 22/04/1998 | 36 | 10.00% | $2,564.38 | |
| T 8.2 | $270,833.34 | 28/05/1998 | 35 | 10.00% | $2,597.03 | |
| T 8.3 | $276,250.01 | 2/07/1998 | 33 | 10.00% | $2,497.60 | |
| T 8.4 | $281,666.68 | 4/08/1998 | 22 | 10.00% | $1,697.72 | |
| T 8.5 | $287,083.35 | 26/08/1998 | 64 | 10.00% | $5,033.79 | |
| T 8.6 | $297,916.69 | 29/10/1998 | 0 | 10.00% | $0.00 | |
| T 14.3 | $347,916.69 | 29/10/1998 | 1 | 10.00% | $95.32 | |
| T 23.1 | $422,916.69 | 30/10/1998 | 48 | 10.00% | $5,561.64 | |
| T 8.7 | $428,333.36 | 17/12/1998 | 866 | 10.00% | $101,626.49 | |
| $428,333.36 | (change rate) | 01/05/2001 | 3348 | 9.0% | $353,603.86 | |
| $428,333.36 | (change rate) | 01/7/2010 | 184 | 8.50% | $18,353.79 | |
| $428,333.36 | (change rate) | 01/1/2011 | 365 | 8.75% | $37,479.17 | |
| $428,333.36 | (change rate) | 01/1/2012 | 182 | 8.25% | $17,620.34 | |
| $428,333.36 | (change rate) | 01/07/2012 | 184 | 7.50% | $16,194.52 | |
| $428,333.36 | (change rate) | 01/1/2013 | 181 | 7.00% | $14,868.45 | |
| $428,333.36 | (change rate) | 01/07/2013 | 184 | 6.75% | $14,575.07 | |
| $428,333.36 | (change rate) | 01/01/2014 | 181 | 6.5% | $13,806.42 | |
| $428,333.36 | 01/07/2014 | 144 | 6.5% | $10,984.11 | ||
| 21/11/2014 | $619,159.70 |
Daily rate from 21 November 2014: $99.75.
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $428,333.36 | ||
| Interest April Funds | $619,159.70 | ||
| Total | $428,333.36 | $619,159.70 | $1,047.493.06 |
| Daily Rate April Funds after 21 November 2014 | $99.75 | ||
| Total Daily Rate | $99.75 | ||
SCHEDULE 16: WINTON OIL NL
| Principal amount | |
| Portion of the April Funds (T 3): | $328,271.14 |
| less | |
| April Funds recovered prior to judgment | 0.00 |
| April Funds Principal amount: | $328,271.14 |
| Interest amount | |
| The calculations for the claimed interest amount of $460,251.88 are as follows: | |
| April Funds Interest | |||||
| Balance outstanding | Rate Change | Date of Change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $328,271.14 | 20/04/1998 | 1107 | 10.00% | $99,560.59 | |
| $328,271.14 | (change rate) | 01/05/2001 | 3348 | 9.0% | $270,999.07 |
| $328,271.14 | (change rate) | 01/07/2010 | 184 | 8.50% | $14,066.19 |
| $328,271.14 | (change rate) | 01/01/2011 | 365 | 8.75% | $28,723.72 |
| $328,271.14 | (change rate) | 01/01/2012 | 182 | 8.25% | $13,504.09 |
| $328,271.14 | (change rate) | 01/07/2012 | 184 | 7.50% | $12,411.35 |
| $328,271.14 | (change rate) | 01/01/2013 | 181 | 7.00% | $11,395.06 |
| $328,271.14 | (change rate) | 01/07/2013 | 184 | 6.75% | $11,170.21 |
| $328,271.14 | (change rate) | 01/01/2014 | 181 | 6.5% | $10,581.12 |
| $328,271.14 | 01/07/2014 | 144 | 6.5% | $8,418.43 | |
| 21/11/2014 | $480,829.83 | ||||
Daily rate from 21 November 2014: $76.45
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $328,271.14 | ||
| Interest April Funds | $480,829.83 | ||
| Total | $328,271.14 | $480,829.83 | $809,100.97 |
| Daily Rate April Funds after 21 November 2014 | $76.45 | ||
| Total Daily Rate | $76.45 | ||
SCHEDULE 17: QUANCORP PTY LTD
| Principal amount | ||
| Portion of the April Funds: | $3,075,025.46 | |
| 20 April 1998 | (T 7.1-7.3) | $334,427.50 |
| 21 April 1998 | (T 15.1) | $210,000.00 |
| 21 April 1998 | (T 17.1-17.2) | $40,000.00 |
| 30 April 1998 | (T 18.7) | $60,000.00 |
| 13 May 1998 | (T 33.1) | $500,000.00 |
| 28 May 1998 | (T 10.1) | $150,000.00 |
| 28 May-9 November 1998 | (T 7.4-7.8) | $42,000.00 |
| 7 June 1998 | (T 12.3) | $270,000.00 |
| 10 June-30 October 1998 | (T 18.1-18.6) | $231,500.00 |
| 29 June-3 November 1998 | (T 38.1-38.5) | $6,000.00 |
| 30 July 1998 | (T 11.4) | $120,000.00 |
| 21 August 1998 | (T 22.1) | $775,097.86 |
| 26 October 1998 | (T 27.2) | $336,000.00 |
| less | ||
| April Funds recovered prior to judgment | 0.00[4] | |
| April Funds Principal amount: | $3,075,025.46 | |
| September Funds (T 50): | $2,725,000.00 | |
| less | ||
| September Funds recovered prior to judgment | 225,000.00 | |
| September Funds Principal amount: | $2,500,000.00 | |
| Interest amount | ||
| The calculations for the claimed interest are as follows: | ||
[4] $1,019,313.15 from April Funds have been recovered prior to Judgment from various persons. This recovery did not reduce the balance owing from Peter Cain. It was received from various persons and, after taking into account the payment, the amount for which each of those person was jointly and severally liable in respect of April Funds remained more than $3,256,723.46.
April Funds Interest
| Transaction Numbers | Balance outstanding | Rate Change | Date of Change | No of days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| T 7.1-7.3 | $334,427.50 | 20/04/1998 | 1 | 10.00% | $91.62 | |
| T 15.1 | $544,427.50 | 21/04/1998 | 0 | 10.00% | $0.00 | |
| T 17.1 | $569,427.50 | 21/04/1998 | 0 | 10.00% | $0.00 | |
| T 17.2 | $584,427.50 | 21/04/1998 | 9 | 10.00% | $1,441.05 | |
| T 18.7 | $644,427.50 | 30/04/1998 | 13 | 10.00% | $2,295.22 | |
| T 33.1 | $1, 144,427.50 | 13/05/1998 | 15 | 10.00% | $4,703.13 | |
| T 10.1 | $1,294,427.50 | 28/05/1998 | 0 | 10.00% | $0.00 | |
| T 7.4 | $1,306,427.50 | 28/05/1998 | 12 | 10.00% | $4,295.10 | |
| T 12.3 | $1,576,427.50 | 09/06/1998 | 1 | 10.00% | $431.90 | |
| T 18.1 | $1,641,427.50 | 10/06/1998 | 19 | 10.00% | $8,544.42 | |
| T 38.1 | $1,643,427.50 | 29/06/1998 | 2 | 10.00% | $900.51 | |
| T 18.2 | $1,655,427.50 | 01/07/1998 | 1 | 10.00% | $453.54 | |
| T 18.3 | $1,670,427.50 | 02/07/1998 | 0 | 10.00% | $0.00 | |
| T 7.5 | $1,676,427.50 | 02/07/1998 | 1 | 10.00% | $459.30 | |
| T 18.4 | $1,688,927.50 | 03/07/1998 | 21 | 10.00% | $9,717.12 | |
| T 38.2 | $1,689,927.50 | 24/07/1998 | 6 | 10.00% | $2,777.96 | |
| T 11.4 | $1,809,927.50 | 30/07/1998 | 5 | 10.00% | $2,479.35 | |
| T 7.6 | $1,815,927.50 | 04/08/1998 | 17 | 10.00% | $8,457.74 | |
| T 22.1 | $2,591 ,025.46 | 21/08/1998 | 3 | 10.00% | $2,129.61 | |
| T 38.3 | $2,592,025.46 | 24/08/1998 | 1 | 10.00% | $710.14 | |
| T 7.7 | $2,598,025.46 | 25/08/1998 | 24 | 10.00% | $17,082.91 | |
| T 18.5 | $2,610,025.46 | 18/09/1998 | 6 | 10.00% | $4,290.45 | |
| T 38.4 | $2,611,025.46 | 24/09/1998 | 32 | 10.00% | $22,891.18 | |
| T 27.2 | $2,947,025.46 | 26/10/1998 | 4 | 10.00% | $3,229.62 | |
| T 18.6 | $3,062, 025.46 | 30/10/1998 | 4 | 10.00% | $3,355.64 | |
| T 38.5 | $3,063,025.46 | 3/11/19-98 | 6 | 10.00% | $5,035.11 | |
| T 7.8 | $3,075,025.46 | 9/11/1998 | 904 | 10.00% | $761,595.35 | |
| $3,075,025.46 | (change rate) | 01/05/2001 | 3348 | 9.00% | $2,538,538.83 | |
| $3,075,025.46 | (change rate) | 01/07/2010 | 184 | 8.50% | $131,762.73 | |
| $3,075,025.46 | (change rate) | 01/01/2011 | 365 | 8.75% | $269,064.73 | |
| $3,075,025.46 | (change rate) | 01/01/2012 | 182 | 8.25% | $126,497.28 | |
| $3,075,025.46 | (change rate) | 01/07/2012 | 184 | 7.50% | $116,261.24 | |
| $3,075,025.46 | (change rate) | 01/01/2013 | 181 | 7.00% | $106,741.29 | |
| $3,075,025.46 | (change rate) | 01/07/2013 | 184 | 6.75% | $104,635.11 | |
| $3,075,025.46 | (change rate) | 01/01/2014 | 181 | 6.5% | $99,116.92 | |
| $3,075,025.46 | 01/07/2014 | 144 | 6.5% | $78,855.45 | ||
| 21/11/2014 | $4,437,400.50 |
Daily rate from 21 November 2014: $716.10
| September Funds Interest | ||||||
| Balance outstanding | Amounts recovered/ Rate Change | Date of recovery or change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued | |
| $2,725,000.00 | 24/09/1998 | 139 | 10.00% | $103,773.97 | ||
| $2,500,000.00 | $225,000.00 | 10/02/1999 | 811 | 10.00% | $555,479.45 | |
| $2,500,000.00 | (change rate) | 01/05/2001 | 3348 | 9.00% | $2,063,835.62 | |
| $2,500,000.00 | (change rate) | 01/07/2010 | 184 | 8.50% | $107,123.29 | |
| $2,500,000.00 | (change rate) | 01/01/2011 | 365 | 8.75% | $218,750.00 | |
| $2,500,000.00 | (change rate) | 01/01/2012 | 182 | 8.25% | $102,842.47 | |
| $2,500,000.00 | (change rate) | 01/07/2012 | 184 | 7.50% | $94,520.55 | |
| $2,500,000.00 | (change rate) | 01/01/2013 | 181 | 7.00% | $86,780.82 | |
| $2,500,000.00 | (change rate) | 01/07/2013 | 184 | 6.75% | $85,068.49 | |
| $2,500,000.00 | (change rate) | 01/01/2014 | 181 | 6.5% | $80,582.18 | |
| $2,500,000.00 | (change rate) | 01/07/2014 | 144 | 6.5% | $64,109.59 | |
| 21/11/2014 | $3,562,866.43 | |||||
Daily rate from 21 November 2014: $582.19
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $3,075,025.46 | ||
| Principal September Funds | $2,500,000.00 | ||
| Interest April Funds | $4,437,400.50 | ||
| Interest September Funds | $3,562,866.43 | ||
| Total | $5,575,025.46 | $8,000,226.93 | $13,575,252.39 |
| Daily Rate April Funds after 21 November 2014 | $716.10 | ||
| Daily Rate September Funds after 21 November 2014 | $582.19 | ||
| $1,294.29 | |||
SCHEDULE 17A: CHARGES PINE AVENUE
Pre-KLS Payments
| Transaction | Judgment | Date | Source of Funds | Principal | Running Total (Principal) | Interest | Running total (Interest) | Running total (Principal and Interest |
| T 42.5 | [214](i) | 28/04/98 | Pre-KLS | $100,030.00 | $100,030.00 | |||
| 30/10/98 | $100,030.00 | $5,070.01 | $5,070.01 | $105,100.01 | ||||
| Subtotal (Pre-KLS payments) | $100,030.00 | |||||||
| Subtotal (Interest on Pre-KLS payments) to 30/10/98 | $5,070.01 | |||||||
| Total (Pre-KLS payments and interest) | $105,100.01 | |||||||
| Interest on Pre-KLS Payments, post-KLS | ||||||||
| 01/05/01 | Change interest rate from 01/05/01 | $25,048.61 | $25,048.61 | |||||
| 01/07/10 | Change interest rate from 01/07/10 | $82,578.19 | $107,626.80 | |||||
| 01/01/11 | Change interest rate from 01/01/11 | $4,286.22 | $111,913.02 | |||||
| 01/07/11 | Change interest rate from 01/7/11 | $4,340.34 | $116,253.36 | |||||
| 01/01/12 | Change interest rate from 01/01/12 | $4,412.28 | $120,665.64 | |||||
| 01/07/12 | Change interest rate from 01/07/12 | $4,114.93 | $124,780.57 | |||||
| 01/01/13 | Change interest rate from 01/01/13 | $3,781.96 | $128,562.53 | |||||
| 01/07/13 | Change interest rate from 01/07/13 | $3,472.27 | $132,034.80 | |||||
| 01/01/14 | Change interest rate from 01/01/14 | $3403.76 | $135,438.56 | |||||
| 21/11/14 | Judgment | $5809.40 | $141,247.96 | |||||
| Subtotal (Interest on Pre-KLS payments, Post-KLS) | $141,247.96 | |||||||
| Total (Pre-KLS payments and all interest on them) | $246,347.97 | |||||||
| Additional interest per day on Pre-KLS Payments, post-KLS) | $18.50 | |||||||
Post-KLS Payments
| Transaction | Judgment | Date | Source of Funds | Principal | Running Total (Principal) | Interest | Running total (Interest) | Running total (Principal and Interest |
| T 18.6 | [1972] and [175](v) | 30/10/98 | KLSO | $95,000.00 | $95,000.00 | |||
| 01/05/01 | Change interest rate from 01/05/01 | $23,789.04 | $23,789.04 | |||||
| 01/07/10 | Change interest rate from 01/07/10 | $78,425.75 | $102,214.79 | |||||
| 01/01/11 | Change interest rate from 01/01/11 | $4,070.68 | $106,285.48 | |||||
| 01/07/11 | Change interest rate from 01/7/11 | $4,122.09 | $110,407.57 | |||||
| 01/01/12 | Change interest rate from 01/01/12 | $4,190.41 | $114,597.98 | |||||
| 01/07/12 | Change interest rate from 01/07/12 | $3,908.01 | $118,505.99 | |||||
| 01/01/13 | Change interest rate from 01/01/13 | $3,591.78 | $122,097.77 | |||||
| 01/07/13 | Change interest rate from 01/07/13 | $3,297.67 | $125,395.45 | |||||
| 01/01/14 | Change interest rate from 01/01/14 | $3232.60 | $128,628.05 | |||||
| 21/11/14 | Judgment | $5498.28 | $134,126.33 | |||||
| Subtotal (Post-KLS payments) | $95,000.00 | |||||||
| Subtotal (Interest on Post-KLS payments) | $134,126.33 | |||||||
| Total (Post-KLS payments and all interest on them) | $229,126.33 | |||||||
| Additional interest per day on Post-KLS Payments, Post-KLS) | $17.57 | |||||||
SCHEDULE 21: TRESMONAY PTY LTD
| Principal amount | |
| Portion of the April Funds (T 11.4-11.5): | $50,000.00 |
| less | |
| April Funds recovered prior to judgment | $0.00 |
| April Funds Principal amount: | $50,000.00 |
| Interest amount | |
| The calculations for the claimed interest amount of $68,718.84 are as follows: | |
| Balance outstanding | Date of Change | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued |
| $50,000.00 | 24/09/1998 | 950 | 10.00% | $13,013.70 |
| $50,000.00 | 01/05/2001 | 3348 | 9.00% | $41,276.71 |
| $50,000.00 | 01/07/2010 | 184 | 8.50% | $2,142.47 |
| $50,000.00 | 01/01/2011 | 365 | 8.75% | $4,375.00 |
| $50,000.00 | 01/01/2012 | 182 | 8.25% | $2,056.85 |
| $50,000.00 | 01/07/2012 | 184 | 7.50% | $1,890.41 |
| $50,000.00 | 01/01/2013 | 181 | 7.00% | $1,735.62 |
| $50,000.00 | 01/07/2013 | 184 | 6.75% | $1,703.37 |
| $50,000.00 | 01/01/2014 | 181 | 6.5% | $1,611.64 |
| $50,000.00 | 01/07/2014 | 144 | 6.5% | $1,282.15 |
| 21/11/2014 | $71,087.92 |
Daily rate from 21 November 2014: $11.64
| Totals | |||
| Total Principal | Total Interest | Total Order sought | |
| Principal April Funds | $50,000.00 | ||
| Interest April Funds | $71,087.92 | ||
| Total | $50,000.00 | $71,087.92 | $121,087.92 |
| Daily Rate April Funds after 21 November 2014 | $11.64 | ||
| Total Daily Rate | $11.64 | ||
SCHEDULE 27A: TNG LIMITED
| 3,162,500 Kanowna Lights shares @ 9.5 cents each = $300,437.50 | ||||||
| Balance outstanding | Rate Change | Date | No of Days balance outstanding | Pre- judgment Interest Rate | Interest accrued | |
| $300,437.50 | 1/04/00 | 395 | 10% | $45,929.90 | ||
| $300,437.50 | (change rate) | 01/5/01 | 3348 | 9.% | $248,021.45 | |
| $300,437.50 | (change rate) | 01/07/10 | 184 | 8.5% | $12,873.54 | |
| $300,437.50 | (change rate) | 01/01/11 | 365 | 8.75% | $26,288.28 | |
| $300,437.50 | (change rate) | 01/01/12 | 182 | 8.25% | $12,359.09 | |
| $300,437.50 | (change rate) | 01/07/12 | 184 | 7.5% | $11,359.01 | |
| $300,437.50 | (change rate) | 01/01/13 | 181 | 7% | $10,428.89 | |
| $300,437.50 | (change rate) | 01/07/13 | 184 | 6.75% | $10,223.11 | |
| $300,437.50 | (change rate) | 01/01/14 | 181 | 6.5% | $9,683.96 | |
| $300,437.50 | (change rate) | 01/07/14 | 144 | 6.5% | $7,704.37 | |
| 21/11/14 | $394,871.60 | |||||
Daily rate from 21 November 2014: $69.96
SCHEDULE 27B: ORDER B 1
Interest payable under Order B 1
Principal $1,491.000.00
Interest
| From | To | Interest Rate | Days | Interest |
| 26/10/98 | 30/04/01 | 10% | 917 | 374,588.22 |
| 01/05/01 | 09/01/05 | 9% | 1350 | 496,319.18 |
| 10/01/05 | 30/06/10 | 9% | 1998 | 734,552.38 |
| 01/07/10 | 31/12/10 | 8.5% | 184 | 63,888.33 |
| 01/01/11 | 31/12/11 | 8.75% | 365 | 130,462.50 |
| 01/01/12 | 30/06/12 | 8.25% | 182 | 61,335.25 |
| 01/07/12 | 31/12/12 | 7.5% | 184 | 56,372.05 |
| 01/01/13 | 30/06/13 | 7% | 181 | 51,756.08 |
| 01/07/13 | 31/12/13 | 6.75% | 184 | 50,734.85 |
| 01/01/14 | 30/06/14 | 6.5% | 181 | 48,059.22 |
| 01/07/14 | 21/11/14 | 6.5% | 144 | 38,234.96 |
| Total Interest | 2,106,308.02 | |||
| Remaining Principal | 1,491,000.00 | |||
| Total Amount Claimed | 3,597,303.02 | |||
SCHEDULE 27C: ORDER B2
Principal
Shares retained by TNG
437,500 shares @ 12 cents a share $52,500.00
Shares transferred to Commonwealth
3,162,500 shares @ 20 cents a share $632,500.00
$685,000.00
Interest
| From | To | Interest Rate | Days | Interest |
| 26/10/98 | 30/04/01 | 10% | 917 | $172,094.52 |
| 01/05/01 | 09/01/05 | 9% | 1350 | $228,020.55 |
| 10/01/05 | 30/06/10 | 9% | 1998 | $337,470.41 |
| 01/07/10 | 31/12/10 | 8.5% | 184 | $29,351.78 |
| 01/01/11 | 31/12/11 | 8.75% | 365 | $59,937.50 |
| 01/01/12 | 30/06/12 | 8.25% | 182 | $28,178.84 |
| 01/07/12 | 31/12/12 | 7.5% | 184 | $25,898.63 |
| 01/01/13 | 30/06/13 | 7% | 181 | $23,777.95 |
| 01/07/13 | 31/12/13 | 6.75% | 184 | $23,308.77 |
| 01/01/14 | 30/06/14 | 6.5% | 181 | $22,079.52 |
| 01/07/14 | 21/11/14 | 6.5% | 144 | $17,566.03 |
| Total Interest | $967,684.56 | |||
| Remaining Principal | $685,000.00 | |||
| Total Amount Claimed | $1,652,684.50 | |||
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