Danai Poked SXL & Anor v Kathari & Ors (Ruling)
[2024] VCC 1676
•28 October 2024
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
GENERAL LIST
Case No. CI-24-02511
| DANAI POKED SXL PTY LTD (ABN 405 700 566 53) as trustee of Thientosapol Family Trust | First Plaintiff |
| DANAI THIENTOSAPOL | Second Plaintiff |
| v | |
| SAMBHAV KOTHARI | First Defendant |
and Ors according to the attached schedule
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JUDGE: | HER HONOUR JUDGE MANOVA | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 23 October 2024 | |
DATE OF RULING: | 28 October 2024 | |
CASE MAY BE CITED AS: | Danai Poked SXL & Anor v Kathari & Ors (Ruling) | |
MEDIUM NEUTRAL CITATION: | [2024] VCC 1676 | |
RULING
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Subject:SUMMARY JUDGMENT
Catchwords: Application for summary judgment – forgery and fraud alleged by the plaintiffs – unsatisfactory or deficient pleadings – evidentiary basis for summary judgment not made out
Legislation Cited: Civil Procedure Act 2010, ss29, 61 and 64; County Court Civil Procedure Rules 2018, rr13.10, 22.04, 22.05 and 22.08; Evidence Act 2008, s140(c)
Cases Cited:Briginshaw v Briginshaw [1938] HCA 34; Giles v Jeffrey [2016] VSCA 314; Hausman & anor v Abigroup Contractors (2009) 29 VR 213; Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158; Spencer v Commonwealth of Australia [2010] HCA 28; Truklja v Google [2018] HCA 25; Finance & Guarantee Company Pty Ltd v Auswild & Ors (No 2) [2016] VSC 559
Ruling: Application dismissed.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr R Watson-Johnes (Solicitor) | Snowton Saje |
| For the Defendants | Mr C Twidale | NOH Legal |
HER HONOUR:
Introduction
1This is an application by the plaintiffs for summary judgment of part of their statement of claim on the basis that the defence or part of the defence has no real prospects of success.
2
The claims the subject of the application concern alleged forgeries of a signature of the second plaintiff, Mr Danai Thientosapol, on two documents dated
16 December 2021. The statement of claim asserts that the three defendants are criminally complicit in the alleged forgeries.
3It was submitted on the application that these alleged forgeries enabled an unauthorised company restructure to occur, a company to be deregistered and the interests of the second plaintiff to be defeated.
4The application is on summons and supported by two affidavits of the second plaintiff Danai Thientosapol, affirmed on 16 September 2024 and 21 October 2024. The affidavits were affirmed in his personal capacity and in his capacity as Director of the first plaintiff.
5The defendants relied on an affidavit of their solicitor, Mr Omar El-Hissi, sworn on 22 October 2024. This affidavit was served late and leave was granted to the defendants to rely on it, as the plaintiffs’ solicitor indicated he was not disadvantaged by the late service.
6The defendants do not admit the alleged forgeries and fraud and specifically deny that they created the forgeries in order to achieve a company liquidation. They also deny awareness that the documents were created to achieve that purpose.
7For reasons which follow, I find the plaintiffs have not made out the evidentiary basis for the summary judgement. In the alternative, I find it is not in the interest of justice to make the orders sought.
8I therefore dismiss the application.
Procedural History
Writ and statement of claim
9On 3 May 2024, the plaintiffs filed a Writ and statement of claim in this Court. That document pleads a number of background matters going to the relationship between the parties.
10To assist in understanding my ruling, I have summarised the background matters below. Where relevant to it, I have quoted portions of the pleading directly:
(a) on 20 March 2017, the first plaintiff, Danai Poked SXL Pty Ltd (“Danai Poked SXL”), was incorporated;
(b) the second plaintiff, Mr Danai Thientosapol (“Mr Thientosapol”) was the sole director and shareholder of Danai Poked SXL;
(c) pursuant to a trust deed, on 20 March 2017, Danai Poked SXL became the trustee of the Thientosapol Family Trust;
(d) on 11 April 2017, Poke’d SXL Pty Ltd (“Poke’d SXL”) was incorporated;
(e) the three defendants, Mr Sambhav Kothari, Mr Justin Hoang and Mr Thomas Wen Tao) are directors of Poke’d SXL;
(f) on 1 July 2017 the Poke’d SXL Unit Trust was established (“Poked Unit Trust”). Poke’d SXL was appointed trustee of the Unit Trust pursuant to a Trust Deed (“Poked Trust Deed”);
(g) Danai Poked SXL held 60 of the 120 units in the Poked Unit Trust;
(h) although not specifically pleaded, the other 60 units were held by Poked Corporate Ventures Pty Ltd[1] of which entity the three defendants were also directors.
(i) a Unit Holders Agreement (“UHA”) regulated the operation of the Poked Unit Trust. Among the terms of the UHA were terms relating to the appointment of a liquidator or administrator or proposal to wind up Poked SXL; and
(j) the Poked Trust Deed included terms which provided that no business shall be transacted at a unit holders meeting unless a quorum of at least two unit holders was present;
[1]See affidavit of Danai Thientosapol affirmed on 16 September 2024 (“DT”) at DT-086 and DT-099
11In substance, the allegations in respect of which summary judgment is sought by the plaintiffs are as follows:
(a) between 16 July and 16 December “the defendants, as directors of Poke’d SXL [the Trustee of the Poked Unit Trust] met and corresponded with a liquidator, Mr Matthew Kucianski (“the liquidator”) concerning the solvency of Poke’d SXL and its related bodies corporate”. (emphasis added)
(i)during this period, no unit holders meetings were held;
contrary to the requirements of Clause 14 of the Poked Trust Deed, no notice of any unit holders’ meeting was provided to Danai Poked SXL or to Thientosapol.[2]
[2] Paragraph [9] of the statement of claim dated 3 May 2024
(b) on 16 December 2021, either the first, second or third Defendant:
(i)caused a mark purporting to be [Thientosapol’s] signature to be inscribed on two separate documents (the forgery);
(ii)aided abetted counselled or procured another of the defendants to engage in the forgery. (emphasis added)
(c) the alleged forgeries are particularised as the signature of Thientosapol affixed to the following two documents:
1) “a Unit Holder’s Consent to remove clause 21.4 of the Poked Trust Deed’;[3] and
2) “Statement of resolution by Members”[4]
[3]A copy of this document is at DT-187
[4]A copy of this document is at DT-151; see also paragraph 10 of the statement of claim dated 3 May 2024
(d) Mr Thientosapol had not signed the documents which purported to falsely represent that meetings had occurred and resolutions had been made [with his consent][5]; (para 11).
(e) The defendants each knew or ought to have known” [that by virtue of the forgeries, false documents had been created], no unit holders meeting had been held and none of the defendants had attended such a meeting;[6] (emphasis added)
(f) The defendants each knew or ought to have known that the false documents were intended to be used and would be used to induce the liquidator to accept his appointment as liquidator of [Poke’d SXL]. Purported particulars of this “knowledge” or imputed knowledge are said to be derived from the [liquidator’s] Declaration of Independence, Relevant Relationships and Indemnities dated 17 December 2021 (“the DIRRI”).
(g) The DIRRI refers to a meeting between the first and second defendant (Mr Kothari and Mr Hoang) and the liquidator on 15 December 2021 where liquidation was discussed and forms reviewed;[7]
(h) The DIRRI is alleged to disclose (relevantly) that by 15 December 2021 the defendants had determined to liquidate Poked SXL and were aware they could not do so without following the process prescribed in the UHA and the Poked Trust Deed. The defendants created the forgeries knowingly and dishonestly to (sic) in order to achieve the liquidation of [Poked SXL] when they would otherwise have been unable to do so without the consent of [Thientosapol and Danai Poked SXL];[8]
[5] See paragraph [11] of the statement of claim dated 3 May 2024
[6] Ibid at paragraph [12]
[7] Ibid at paragraph [13]
[8] Ibid at paragraph [14]
12Paragraphs 15 to 19 of the statement of claim are not included in the application for summary judgment. The plaintiffs seek that these paragraphs be referred for trial. They plead:
(a) the defendants, in their capacities as directors of Poked SXL and Poked Corporate Ventures Pty Ltd, owed Poked SXL and the plaintiffs [Danai Poked SXL and Mr Thientosapol] statutory and contractual duties to abide by and comply with the UHA and the Poked Trust Deed (“the duties”);[9]
(b) various contraventions of the Australian Consumer Law, the Crimes Act 1958 and the Corporations Act 2001;[10]
(c) by reason of the contraventions, the defendants breached their duties to the plaintiffs and or caused Poked Corporate Ventures to breach their duties to the plaintiffs by causing “Poked Corporate Ventures to aid abet procure being knowingly involved in the forgeries, preparation and use of the false documents comprised of the forgeries”;[11] and
(d) by reason of the fraud and various breaches by Poked Corporate Ventures which was knowingly involved in the fraud, the plaintiffs have suffered loss and damage.[12]
[9] Ibid at paragraph [15]
[10] Ibid at paragraph [16]
[11] Ibid at paragraph [17]
[12] Ibid at paragraph [18]
Defence
13On 21 June 2024, the three defendants filed a joint defence by which:
(a) they admit the various background matters established by paragraphs 1 to 8 of the statement of claim;
(b) they deny that no meetings were held or convened and that no notice was provided of any meetings to the plaintiffs as pleaded in paragraph 9 of the statement of claim;
(c) they do not admit:[13]
[13] As contained in paragraphs [10] to [13] of the statement of claim
(i)that any of them or ether of them committed the forgeries;
(ii)that they knew or ought to have known that the forgeries had occurred and had resulted in the creation of false documents; and
(iii)that they knew that the false documents were intended to be used to induce the liquidator to consider himself as duly appointed and act as the liquidator of Poked SXL.
and further plead that the allegations in each of the paragraphs referred to above are inadequately particularised;
(d) they object to pleading to the allegation that “each knew or ought to have known that the false documents were intended to be used and would be used to induce the liquidator to accept his appointment as liquidator” on the basis that it is inadequately particularised and embarrassing and otherwise they deny the allegation;[14]
(e) they deny that by 15 December 2021:
(i)they had determined to liquidate Poked SXL “and were aware they could not do so without following the process prescribed in the UHA and the Poked Trust Deed”; and
(ii)they created the forgeries knowingly and dishonestly in order to achieve the liquidation of [Poked SXL] (para 14) and plead that Poked SXL was insolvent at the time the liquidator was appointed
and say further that Poked SXL, was insolvent and could not have continued trading and the second plaintiff was not in Australia or involved in the running of the day to day business of Poked SXL;[15] and
[14] Paragraph [13] of the Defence dated 21 June 2024
[15] Ibid at paragraph [14]
(f) they also deny the various allegations in paragraphs 15 to 19 and plead in the alternative that the plaintiffs were partly responsible for and have failed to mitigate their losses.
Affidavits of Mr Danai Thientosapol
14In the affidavits in support of summary judgment, Mr Thientosapol deposed to the following relevant matters:
(a) between 16 July and 16 December 2021 there were no Unit Holders meetings held or convened;
(b) no notice of Unit Holders meetings was provided to the plaintiffs;
(c) that he did not sign the two documents dated 16 December 2021 purporting to bear his signature and did not authorise anyone to sign on his behalf;
(d) he was not provided with the blank forms nor did he sign the proposed resolutions;
(e) he was in Thailand on 16 December 2021 when the documents were purportedly signed and he exhibited a copy of his passport verifying this position;[16] and
(f) that prior to 16 December 2021, he had no discussions with the three defendants about the appointment of a liquidator.
[16]One page only of the passport is exhibited to the affidavit sworn on 18 September 2024 at DT-189. There is no front page bearing the relevant identifying details of the passport holder.
Affidavit of Mr Omar El-Hassi
15
In the affidavit opposing the summary judgment, the solicitor for the defendants,
Mr El-Hassi, deposed to the following (relevant) matters:
(a) invoking the privilege against self-incrimination on behalf of all three defendants;
(b) providing details of the background of the dispute including the failure of the Poke’d Corporate Ventures which operated take-away food stores selling ‘Poke bowls’ in the Melbourne CBD. The failure was due to the forced closure of businesses in the CBD during the COVID Pandemic;
(c) the two directors Sam Kothari and Justin Hoang approached the liquidator because they were concerned “about possible insolvent trading claims”;
(d) the liquidator was appointed on 16 December 2021 following which, “the defendants” negotiated a Sale Agreement to purchase the plant and equipment of 8 food outlets included in the assets subject to the liquidation; and
(e) no payments were required to be made or were made by the plaintiffs to the liquidator under the sale agreement.
Summons
16The summons for summary judgement was filed on 18 September 2024.
17The plaintiffs accept that the court must first accept it has made out its claim before turning to consider whether the defendants have shown cause against the application.
18There are currently no orders or directions in relation to interlocutory steps in the proceeding. There have been requests for further and better particulars of the statement of claim, but no interrogatories and no formal discovery.
19The basis of the plaintiffs application is that the alleged forgeries and fraud are established on the evidence by “legal logic” and that in their defence, the defendants have not denied commission of the forgeries.[17] The position of the plaintiffs is that:
“The plaintiffs elect to enter judgment for fraud against the First Defendant and judgment against the Second and Third Defendant for aiding and abetting or procuring the First Defendant’s fraud.”[18]
[17]Submissions of both plaintiffs dated 23 October 2024 at paragraph [19]
[18]Plaintiff’s submissions dated 23 October 2024 at paragraph [31]
The relevant legal principles
20Section 61 of the Civil Procedure Act 2010 (“the Act”) provides:
A plaintiff in a civil proceeding may apply to the court for summary judgement in the proceeding on the ground the defendant’s defence or part of the defence has no real prospect of success.”
21Section 64 of the Act provides:
Despite anything to the contrary in this part or any rules of court, a court may order that a civil proceeding proceed to trial if the court is satisfied that, despite there being no real prospect of success the civil proceeding should not be disposed of summarily because –
(a) it is not in the interests of justice to do so
(b) the dispute is of such a nature that only a full hearing on the merits is appropriate.
22Rule 13.10 of the County Court Civil Procedure Rules 2018 (“the Rules”) (relevantly) provides that:
(1) Every pleading shall contain the necessary particulars of any fact or matter pleaded;
…
(3) Without limiting paragraph (1), every pleading shall contain particulars of any––
(a) misrepresentation, fraud, breach of trust, wilful default or undue influence which is alleged; or
(b) disorder of the mind, malice, fraudulent intention or other condition of the mind including knowledge or notice which is alleged.
…
23Rule 22.04 of the Rules relevantly provides that the application shall be made on summons supported by affidavit:
(1) An application shall be made by summons support by an affidavit––
(a) Verifying the facts on which the claim or part of the claim to which the application relates is based; and
(b) Stating that in the belief of the deponent the defence to the claim or the relevant part of the claim:
(i) has no real prospect of success; or
(ii) has no real prospect of success except as to the amount of the claim or as to the amount of the relevant part of the claim.
…
24Rule 22.05 of the Rules provides:
(1) the defendant may show cause against the application by affidavit or otherwise to the satisfaction of the court;
(2) An affidavit under paragraph (1) may contain a statement of fact based on information and belief if the grounds are set out.
(3) Unless the court otherwise orders, the defendant shall serve a copy of the affidavit and any exhibit referred to in the affidavit or affidavits on the plaintiff not less than three business days before the day for hearing in the summons.
25Rule 22.08 of the Rules provides that:
(1) Subject to Part 4.4 of Chapter 4 of the Civil Procedure Act 2010, on the hearing of an application, the court may––
(a) dismiss the application;
(b) give such judgment for the plaintiff against the defendant on the claim or part of the claim to which the application relates as is appropriate, having regard to the nature of the relief or remedy claimed;
(c) give the defendant leave to defend with respect to the claim or the part of the claim to which the application relates either unconditionally or on terms as to giving security, paying money into court, time, the mode of trial or otherwise; or
(d) with the consent of all parties, dispose of the proceeding finally in a summary manner.
(2) The Court may stay execution of any judgment given under paragraph (1)(b) until after the trial of any other claim or counterclaim which remains outstanding in the proceeding as between relevant parties.
Pleadings
26Where dishonesty is alleged, sufficient facts and circumstances must be pleaded in support of the allegation. The pleading will be sufficient where it pleads facts which, if established by the evidence might, or are capable of supporting an inference of specific dishonest conduct. The facts, circumstances and relevant context as pleaded must rise to the level of dishonesty in order for the pleading to be sufficient.[19]
[19]Finance & Guarantee Company Pty Ltd v Auswild & Ors (No 2) [2016] VSC 559 at paragraph [40]
Standard of proof
27In a civil proceeding, the standard of proof is the balance of probabilities.[20] The seriousness of the allegation and the gravity of the consequences which flow from a particular finding affect the degree of satisfaction which a court must have reached before it can find the allegation proved to the civil standard. The case of Briginshaw v Briginshaw[21] (“Briginshaw”) outlines that “in such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences”.
[20]Section 29 of the Civil Procedure Act 2010 and s140(2)(c) of the Evidence Act 2008
[21][1938] HCA 34, cited in Giles v Jeffrey [2016] VSCA 314
Summary judgment
28The onus is on the applicant to persuade the Court that there is no issue which warrants a trial and that summary judgment should be granted.[22]
[22]Hausman v Abigroup Contractors (2009) 29 VR 213
29The decisive considerations are:
(a) whether the respondent to the application has a real, as opposed to fanciful chance of success;
(b) that the power to terminate the proceedings should be exercised with caution; and
(c) the discretion should not be exercised unless it is clear there is no real question to be tried.[23]
[23]Lysaght Building Solutions Pty Ltd v Blanalko Pty Ltd [2013] VSCA 158
30The defendant must satisfy the Court that there is a question to be tried or for some other reason there ought to be a trial of the claim. Any affidavit in opposition to summary judgment should state clearly and concisely what the defence is and identify the facts relied upon in support of that defence.
31In considering an application for summary judgment, the Court must make a “practical judgment” as to the defendant’s prospects of success. Where factual issues are capable of being disputed, or are in dispute, summary dismissal should not be awarded to a party “simply because the court has formed the view the defendant is unlikely to proceed on the factual issue”. Further, where there are complex questions of fact, the court should exercise caution.[24]
[24]Spencer v Commonwealth of Australia [2010] HCA 28 at paragraphs [25]-[26]
32The power to dismiss an action summarily is not to be lightly exercised. Where there are a range of findings of mixed law and fact, it may be necessary to allow the trial to run and witnesses to be cross examined.[25] That is:
“…a party should not be denied the opportunity of placing his or her case before the court in the ordinary way, with the advantage of the usual interlocutory processes, unless there is a high degree of certainty about what the ultimate outcome of the proceeding if allowed to go to trial in the ordinary way”.[26]
[25]Truklja v Google LLC [2018] HCA 25
[26]Ibid at paragraph [21]
Submissions of the parties
33The plaintiffs made the following submissions:
(i)if the court is satisfied that the plaintiff has verified its claim, the question for it is whether the defendants have shown cause against the application by affidavit or otherwise to the satisfaction of the Court; and
(ii)the Court cannot find that the defendants have shown cause why summary judgment for fraud should not be granted primarily because they have filed no evidence;
(iii)the Court need only be satisfied on the balance of probabilities that the plaintiffs have made out their claim;
(iv)the Statement of Claim complies with the requirements of r13.10(3)(a) of the Rules; and
(v)it was ultimately accepted that the DIRRI does not mention the third defendant (Mr Tao) but the plaintiffs rely on his status as director and on the failure of the defendants to show how the forged signatures came into existence.
34The defendants made the following submissions:
(a) the plaintiffs have not established:
(i)which one of the three defendants committed the forgery; and
(ii)which one(s) aided, abetted, counselled or procured that defendant to commit the forgery;[27]
(b) the plaintiffs are asking the Court to guess which one or more of the defendants are guilty of the alleged conduct; and
(c) it was a monumental leap to make findings about the three defendants on a summary basis on the absence of evidence such might be expected in the form of handwriting analysis or the liquidator.
[27]Defendants’ submissions dated 22 October 2024 a paragraph [22]
Analysis
Are the pleadings sufficient?
35As outlined above, a pleading alleging dishonesty will be sufficient if it pleads facts which, if established by the evidence might, or are capable of supporting an inference of specific dishonest conduct.
36I consider none of the pleadings alleging fraud or forgery comply with this requirement.
37Paragraph 10(a) of the statement of claim pleads that on 16 December 2021 either the first, second or third defendant “caused a mark purporting to be the Second Plaintiff’s signature to be inscribed on two separate documents (“Forgeries”)”.
38The pleading is deficient. It provides no particulars of the basis on which the claim is made. For instance, it does not particularise the following:
(a) which of the defendants forged the signature and in what circumstances; and
(b) what facts, matters or circumstances are relied upon to make out this bare assertion. For instance if the conclusion is to be drawn by inference, what are the facts on which the inference is sought to be based.
39Paragraph 10(b) of the statement of claim pleads that “either the first second or third defendant aided, abetted, counselled or procured another of or the other defendants to engage in the forgery”.
40This pleading is also deficient. It does not particularise:
(a) what words, deeds or conduct of which defendant is said to give rise to the legal conclusion of aiding, abetting counselling or procuring; and
(b) what words deeds or conduct of the defendant/s subject to the alleged aiding/ abetting or procuring is relied upon to establish complicity for instance presence during conversations, acting in pursuit of a common purpose (which acts must be specifically pleaded).
41Paragraph 12 of the statement of clam pleads that “the defendants each knew or ought to have known that forgeries had occurred and resulted in the creation of false documents”.
42This pleading is also deficient. It fails to particularise the basis of the alleged knowledge or imputed knowledge of each defendant. For instance, whether it is said that a particular defendant knew because of something he later admitted or wrote in an email. The particulars do not provide any basis for imputing knowledge. In effect, the particulars assert that no meeting had occurred. That is not a basis for the pleading that the defendants knew that forgeries had occurred.
43I consider the pleadings do not assist the plaintiffs application for summary judgment.
44In their joint defence, the three defendants do not admit that they committed the forgeries. This would require the plaintiffs to prove those matters. It is self-defeating for the plaintiffs to say ‘the defence which requires us to prove a fraud” has no prospects of success.
45Further, the defendants deny that each of them knew or ought to have known that the false documents were intended to be used and would be used to induce the liquidator to accept his appointment as a liquidator.
46They also deny that they “created the forgeries knowingly and dishonestly in order to achieve the liquidation of Poked SXL when they would otherwise have been unable to do so without the plaintiff’s consent approval and authorisation.” In their defence, they assert the Poked SXL was insolvent and rely on the provisions of the Corporations Act 2001 prohibiting trade whilst insolvent.
47The denials give rise to the conclusion that there is an issue to be tried, however, they are bare denials and the plaintiffs are justified in their sense of grievance that no attempts have been made to properly explain what has transpired.
Notwithstanding the pleadings, have the plaintiffs otherwise discharged their onus by reference to the evidence in the affidavits?
48In essence, the plaintiffs’ submission is that the documents exhibited to the affidavits demonstrate four facts in support of the “legal logic” which compels a finding that the defendants committed fraud:
(i)that the defendants participated in a number of meetings with the proposed liquidator to discuss winding up of Poked SXL;
(ii)the liquidator provided them with two blank forms which were necessary to be signed appointing him as liquidator;
(iii)following those meetings, the forms were returned to the liquidator bearing the forged signature of Mr Thientosapol; and
(iv)the defendants have provided no explanation for how the documents came into existence.
49The plaintiffs submit that the Court can infer from the above facts that:
(a) The defendants forged the signature; and
(b) They did so in complicity with one another to effect their joint purpose of the winding up of the company without first obtaining the necessary consent of Mr Thientosapol.
50For the purposes of this application, and based on the affidavit of Mr Thientosapol, I find that Mr Thientosapol did not sign the two documents bearing a signature which purports to be his. He has deposed to this and has not been challenged on it in this application.
51However, taking the totality of the documents into account, I am unable to find to the requisite standard that the defendants or any particular one of them forged the signature. This is a serious allegation which requires cogent proofs.
52I reject the submission that the contents of the DIRRI allow a finding that the three defendants or any of them engaged in the forgery. My reasons follow.
53First, the DIRRI outlines meetings and email correspondence in the period 16 July 2021 and 16 December 2021:
(a) between the liquidator and “a representative of NOH Legal”;
(b) between the liquidator, the first defendant Mr Kothari and the second defendant Mr Huang; and
(c) Between the liquidator, a representative of NOH Legal, Mr Kothari and Mr Huang.
54On 12 December 2021 at 4:28 PM, by email to the first two defendants, Mr Kothari and Mr Huang, the liquidator provided “all the documentation required to place the Poked group of companies into liquidation”.[28] Some of the forms were prepopulated with the relevant financial figures. The email included the following instruction:
“..the documents are ok to be signed electronically however I will require a copy of and ID from each party signing the forms (e.g. a picture of a driver license)”.[29]
[28]DT-161
[29]Ibid
55A carbon copy of the email was also sent to email addresses for Omar El-Hissi and Mark Laughton.
56The blank forms which subsequently bear the forged signature of Mr Thientosapol were included in that email.[30] There is no evidence before me which establishes that they were accompanied by the ID documents requested by the liquidator.
[30]DT-165 and DT-173
57On 15 December 2021, the liquidator met with the first and second defendants, Mr Kothari and Mr Huang, and discussed and reviewed the liquidation forms with them. The DIRI provides:
“There was also discussion surrounding the automatic removal clauses in the trust deed of certain entities within the Poked Group and the process required amend the trust deed (sic), if the parties so desired”.[31]
[31]Page 11 of the affidavit of Mr Thientosapol affirmed 21 October 2024
58On 16 December 2021, the liquidator “received completed and executed forms appointing me as liquidator to each entity within the Poked Group”.[32]
[32]Ibid
59It is not in dispute that among the completed forms were the two documents bearing the forged signature of Mr Thientosapol.
60The presence of Mr Kothari and Mr Hoang at the meetings and the receipt by them of the blank forms was said to give rise to the inference that they thereby became aware of the need for Mr Thientosapol to provide his consent and sign his name on the two documents which ultimately bore the forged signature.
61I accept that submission. It is supported by the email of 15 December 2021.
62However, that acceptance does not necessitate a finding that the two defendants engaged in the forgery. To make such a finding would be to draw an inference from an inference for which there is no evidence and which would be contrary to the requirements in Briginshaw.
63Put another way, receipt by Mr Kothari and Mr Hoang of the forms and participation by them in the meetings with the liquidator allows the inference to be drawn that they could have had a motive and opportunity to forge the signature of Mr Thientosapol.
64However, motive and opportunity are not the same as actions. Further evidence would be required in order to make a finding that one of them forged the signature.
65Arrival of the forged document at the liquidator’s office two days after it was provided to the first and second defendants could give rise to the inference that it was either of them who engaged in the forgery.
66However, that inference would only be sustainable if the evidence allowed a finding that only the first and second defendant received the blank documents.
67While it is possible to conclude that the first two defendants were present on 15 December 2021 where the forms (including those which ultimately bore the false signature of Mr Thientosapol) were discussed, for the following reasons, I consider there is insufficient evidence from which I can conclude that either or both of them (let alone the third defendant Mr Tao) were complicit in forging the signature:
(a) the blank forms were not only sent to Mr Kothari and Mr Huang, they were also sent to Mr El-Hissi and Mr Laughton on 12 December 2021, only four days before the signed documents arrived at the liquidator’s office;
(b) it is not clear from the evidence before me what was done with the forms by the recipients, including whether they were provided to the third defendant Mr Tao or to others;
(c) while I draw no adverse inference against Mr El-Hissi and Mr Laughton, I consider that the receipt by them of the blank documents (and possible on forwarding to others) is a complicating feature of the factual matrix within which the forged documents arrived at the liquidator’s office and creates a significant obstacle to the drawing of an inference that either Mr Huang or Mr Kothari or both of them forged the signature as pleaded;
(d) the evidence relied upon by the plaintiffs to establish the involvement of “the defendants” makes no mention of the third defendant, Mr Tao. Given that the pleading asserts that all three defendants were complicit, I consider this a significant obstacle in granting the application as there is no evidence at all upon which to make a finding about the involvement of Mr Tao;
(e) The DIRRI provides that on 16 December 2021, completed and executed forms were “received” by the liquidator. However, it does not specify how they were sent to him (for example by post or email courier) or by whom. While it may be possible to infer that they were sent by either Mr Huang or Mr Kothari or both of them, I consider that the seriousness of the allegation requires more than an indirect inference. I say this because of the possible I involvement of at least two other individuals who received the forms (and the unknown degree of involvement of the third director Mr Tao); and
(f) in the circumstances, I consider there is an insufficient evidentiary basis on which to find that Mr Huang or Mr Kothari or Mr Tao forged the signature of Mr Thientosapol, and insufficient evidence to make findings about the extent of involvement of the three defendants in the pleaded fraud.
68The defendant submitted that there was an additional complicating feature which was apparent on the face of the forged documents. Namely, that the apparent signature of Mr Kothari on one or both documents may also be forged.
69The defendant referred to the genuine signatures of all parties which feature on the Deed[33] and asked the Court to compare the signature of Mr Kothari on the “forged documents”.
[33]DT-134 and DT-135
70
I am concerned about this submission as it is not pleaded in the defence that
Mr Kothari did not sign the two documents bearing the forged signature of
Mr Thientosapol.
71The defendants have a duty to depose to matters in their affidavit in opposition to the application which “state clearly and concisely what the defence is and identify the facts relied upon in support of that defence”.[34]
[34]Hausman & anor v Abigroup Contractors (2009) 29 VR 213
72Neither of these duties appear to have been discharged, nor is the defence drafted in a way which tells the plaintiffs what the defendants’ position with respect to the allegations of forgery might be. Counsel for the defendants accepted that there were matters in the defence which should have been pleaded. This is an unsatisfactory state of affairs.
Conclusion
73The plaintiffs have not discharged their onus of establishing on a preliminary basis that the defendants committed any forgeries. Therefore, there is no need to consider whether the defence or part of the defence has any real prospects of success.
74After considering the evidence, I consider it is not possible to say that there is any degree of certainty about what the ultimate outcome of the proceeding might be if it is allowed to go to trial. Currently, the state of the evidence is such that either the first or second defendant may have committed the forgery or equally, they may not have done that and it is far from clear who did.
75This conclusion is based on the two fundamental difficulties with the plaintiffs’ application. This first is the self-defeating nature of their argument. The second is the lack of evidentiary material in support of the pleading which places all three defendants on the same footing and fails to establish any facts from which it can be concluded that either of them or all of them together participated in the alleged forgery and fraud.
76At its highest, the material supports a conclusion that Mr Kothari and Mr Hoang may have had motive and opportunity to commit the forgery. There is no evidence supporting a finding that Mr Tao was involved.
77The conclusion sought by the plaintiffs that three defendants committed the forgeries can only be reached by the drawing of indirect inferences against the defendants. Taking into account the seriousness of the allegation, that is not an appropriate course.
78Given these findings, it is not necessary to consider whether the defendants have satisfied the court that there is a question to be tried. I have already noted the deficiencies in the affidavit of Mr El-Hissi and the Defence.
Alternative basis for dismissal of the plaintiffs’ application
79If I am wrong about my conclusion, I would dismiss the application under section 64 of the Act.
80My reasons are that given the seriousness of the allegations and the consequences which have arisen by virtue of the winding up of the company, it is not in the interests of justice to dispose of the matter summarily.
81The dispute is of such a nature as only a full hearing on the merits is appropriate. This is because of the uncertain role of the first two defendants and the absence of evidence about the role of the third defendant, Mr Tao, in the pleaded forgeries. The winding up, effected in part by the forged documents, has allegedly resulted in the interests of the two plaintiffs being defeated.
82The application for summary judgment is dismissed.
83I will hear the parties on the question of costs and any consequential orders.
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SCHEDULE OF PARTIES
BETWEEN
DANAI POKED SXL PTY LTD First Plaintiff
(ABN 405 700 566 53) as trustee of
Thientosapol Family Trust
DANAI THIENTOSAPOL Second Plaintiff
and
SAMBHAV KOTHARI First Defendant
JUSTICE HUANG Second Defendant
THOMAS WEN TAO Third Defendant
0
7
0