Nasional Pty Ltd v Susanto - [2011] WADC 140

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: NASIONAL PTY LTD -v- SUSANTO [2011] WADC 140

CORAM: BOWDEN DCJ

HEARD: 25-29 OCTOBER, 1-5 & 12 NOVEMBER, 2022 DECEMBER 2010, 24 FEBRUARY, 17 & 29 MARCH, 4, 2021 APRIL 2011

DELIVERED : 9 SEPTEMBER 2011

FILE NO/S: CIV 1001 of 2007

BETWEEN: NASIONAL PTY LTD
Plaintiff
AND
IRWAN SUSANTO
First Defendant
JUNAIDY SUSANTO
Second Defendant

Catchwords:

Misleading or deceptive conduct contrary to Fair Trading Act 1987 (WA) and Trade Practices Act 1974 (Cth) relating to representations made during negotiations for sale of a business

Legislation:

Fair Trading Act 1987(WA)
Trade Practices Act 1974 (Cth)

Result:

Judgment for the plaintiff against the first defendant for $48,500 plus interest at the rate of 6% from 31 May 2004 until judgment
Plaintiff's claim against second defendant dismissed

Representation:

Counsel:

Plaintiff:     Mr P Mugliston
First Defendant             :     Mr Nugawela
Second Defendant         :     Mr Nugawela

Solicitors:

Plaintiff:     Brook & Co
First Defendant             :     Tan & Tan Lawyers
Second Defendant         :     Tan & Tan Lawyers

Case(s) referred to in judgment(s):

Argy v Blunts & Lane Cove Real Estate Pty Ltd (1990) 26 FCR 112
Briginshaw v Briginshaw (1938) 60 CLR 336
Collings Constructions Co Pty Ltd v Australian Competition & Consumer Commission (ACCC) (1998) 152 ALR 510
Gates v City Mutual Life Assurance Society Ltd (1986) 160 CLR 1
Henjo Investments Pty Ltd v Collins Marrickville Pty Ltd (No 1) (1988) 39 FCR 546
Henville v Walker [2001] HCA 52; (2001) 206 CLR 459
Houghton v Arms [2006] HCA 59
HTW Valuers (Central QLD) Pty Ltd v Astonland Pty Ltd [2004] HCA 54; (2004) 217 CLR 640)
Johnson v Perez (1988) 166 CLR 351
Jones v Dunkel (1959) 101 CLR 298
Legal Professional Complaints Committee and Caine [2010] WASAT 178
Marks v GIO Australia Holdings Ltd (1998) 196 CLR 494
Masters v Cameron (1954) 91 CLR 353
Mitchell v Valherie [2005] SASC 350; (2005) 93 SASR 76
National Australia Bank Ltd v Cunningham (1990) ATPR 41‑047
Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 67 ALJR 170
Professional Services of Australia Pty Ltd v Computer Accounting and Tax Pty Ltd [No 2] [2009] WASCA 183
Ricochet Pty Ltd v Equity Trustees Executor & Agency Co Ltd (1993) 41 FCR 229
Sellars v Adelaide Petroleum NL [1994] HCA 4, (1994) 179 CLR 332
Wardley Australia Ltd v State of Western Australia (1992) 175 CLR 514
Wendt v Yogesh Jogia Diamonds Pty Ltd (1993) 11 WAR 455

BOWDEN DCJ:

Introduction

In April 2004 Eden Pine Tree Pty Ltd (Eden Pine) ran a newsagency known as Spencer Village News (the Business) situated at the Spencer Village Shopping Centre in Thornlie.
The first and second defendants, Mr Irwan Susanto and his son Junaidy, owned all its issued shares and were its directors.
In early April 2004 Mr Susanto and his other son Jundy meet Ms Kosasih and her husband Mr Tanudjaja, who are directors and shareholders of the plaintiff, in Indonesia and discussed the sale of a half share of the business. A deposit was paid.
On 17 April 2004 in Perth, Ms Kosasih for and on behalf of the plaintiff, signed a written agreement to purchase the half‑share of the business.
Settlement took place on 31 May 2004.
This litigation arises from that sale.
Within the judgment I refer to Messrs Junaidy and Jundy Susanto and Ms Silvy Tanudjaja by the first name only. I mean no disrespect and it was the manner in which they were described by all witnesses.

The plaintiff's allegation

The plaintiff alleges the first defendant made a number of false and misleading representations to its directors Mr Tanudjaja and Ms Kosasih including that:
(i)The business was making around $2,000 $3,000 per week and would continue to do so.
(ii)The business was very good value.
(iii)The first and second defendants had purchased the business for $300,000 and had spent a lot of money on it.
(iv)A half‑share of the business was worth $170,000.
(v)The first and second defendants had another purchaser for the business who was going to pay $170,000.
(vi)The first and second defendants' families would cooperate with each other in supporting the staffing of the business and those staffing arrangements would be fair, reasonable and cordial (further further amended statement of claim, pars 6, 7, 9, 10).
The plaintiff says that by reason of these misrepresentations, it agreed to purchase 50% of the shares in Eden Pine and ultimately paid the sum of $168,000.
The plaintiff pleads that in making these misrepresentations the first defendant was engaged in conduct in trade or commerce which was misleading or deceptive, contrary to s 9 and s 10 of the Fair Trading Act 1987 (WA) (FTA) or, alternatively, s 51A and s 52 of the Trade Practices Act 1974 (Cth) (TPA).
They say the first defendant is liable because he made the misrepresentations whilst acting for himself, and as an agent for the second defendant and say the second defendant is vicariously responsible because the first defendant was acting as his agent.

The defendant's position

The defendants say:
(a)the plaintiff is not the correct party to this action;
(b)they did not make the alleged representations;
(c)if the representations were made, the plaintiff did not rely on them in purchasing the business, but rather purchased the business so their directors could fulfil their obligations under business migration visas issued by the Australian government (hereinafter referred to as the visas);
(d)if the plaintiff did suffer any loss as a result of purchasing the business, it was caused or contributed to by their conduct; and
(e)in any event if damages are payable they are almost negligible as a result of the decreased value of the business resulting from the construction of a flyover in very close proximity to the Spencer Village Shopping Centre as part of the Perth Metropolitan Rail Project.

The issues for determination

The issues for determination include:
1.Whether the plaintiff is the correct party to this action.
2.Whether the first defendant made any representations.
3.If they were made, were they false and misleading?
4.If false and misleading representations were made, did the plaintiff rely on them?
5.If the plaintiff did rely on them, has it caused or contributed to its own loss?
6.If the plaintiff did suffer loss and damage as a result of misrepresentations, the extent of the loss and damage.
7.If false and misleading representations were made by the first defendants is the second defendant also liable?

The evidence

The purchase of the business by the first defendant and his decision to sell a half‑share

Interestingly, the business has been used by both the plaintiff's directors and the first defendant to fulfil the requirements of their visas issued by the Australian government.
Mr Susanto migrated to Australia under a visa granted on 20 September 2001 and purchased the business on 31 July 2003 from Tak Him Liu. Settlement occurred on 13 October 2003.
Eden Pine was the corporate entity used to run the business and did so as trustee for the Psalm 68 Susanto Family Trust (Psalm 68). Mr Susanto, Junaidy and Jundy all worked at the newsagency.
Mr Susanto said he purchased the newsagency because he was required to purchase a business within three years of being granted a visa and he was not concerned about the profitability of the business. He said his purchase was '100% related to his migration application' (ts 892 ‑ 894) and he did not know whether he got the business at a good price.
In early 2004 he decided to sell part of the business and hoped to profit by selling a half‑share for more than it was worth (ts 789).
He did not advertise the business for sale or place it with a broker, but told his friends and the business' accountant Mr Low that part of the business was for sale. Mr Low confirms he was told this (exhibit 68.1).
Mr Susanto said he intended to sell a half‑share of the business to an Indonesian who needed a business for migration purposes and targeted persons migrating to Australia who were not going to be too fussy about the price (ts 789, ts 837).
Mr Susanto was able sell the plaintiff a half‑share of the business on 31 May 2004 for $168,000. He had purchased the whole of the business for $176,096.24 in October 2003.
Mr Susanto said he believed the Tanudjaja family were only interested in the business for migration purposes (ts 856).

The plaintiff and its directors

Mr Tanudjaja said he left school at the age of 14 and later became involved in a whitegoods business (Tokyo Nasional), which he still runs with his wife, in Jakarta. In 2010 it had a turnover of approx $AUS400,000 and employed approximately 15 people.
He says that whilst his wife had no accounting or company education, the two of them were the joint general managers and worked and ran that business together, and jointly carried out all activities such as the day‑to‑day operations, developing operating plans, organisational structures, marketing plans, reviewing budgets and the like (ts 180 ‑ 182).
Ms Kosasih said she assisted her husband in the shop, served customers and helped with the purchase of stock (ts 596 ‑ 597).
Mr Tanudjaja said he originally wished to apply for a visa to come to Australia, however, because of his age his wife applied.
He said the immigration department was told his wife was the proprietor of Tokyo Nasional because she was younger and therefore could obtain more 'points' (ts 231).
On 22 July 2002 he and his wife and their two daughters, Silvy and Shirley, obtained their visas.
The visas required the principal applicant, Ms Kosasih, to purchase a business within three years of entering Australia and be actively involved in its day‑to‑day management at a senior level (ts 231, ts 241).
Mr Tanudjaja said he formed the plaintiff company, with the assistance of Mr Low, who was also his accountant, as the vehicle through which a business would be purchased in Australia.
He said Mr Low recommended a number of businesses including a post office, food franchise, pizza parlour, property development and vehicle importing and exporting, however, none were purchased as he did not consider any of those businesses suitable.
Mr Tanudjaja said Mr Low eventually mentioned Mr Susanto and the Spencer Village Newsagency. He knew Mr Low was Mr Susanto's accountant (ts 318).
Mr Tanudjaja said he was later contacted by his daughter Silvy ,who told him Mr Susanto was in Indonesia and had a half‑share of the business for sale. Silvy's evidence confirms this.
Mr Low said Mr Tanudjaja told him he was looking for a business that was profitable and wanted a good income; although when pressed he also said he did not know exactly what was said (ts 1472).
Mr Low said he told Mr Tanudjaja that Mr Susanto wanted to sell a half‑share of his business and said they should contact him direct. He said he thought it would be a marriage of convenience (ts 1461).
He later told them that the immigration department was very strict and they needed to buy a business quickly (ts 1461).

The discussions in Indonesia

The initial contact

Various accounts were given by witnesses as to how the initial contact was made.
Mr Tanudjaja said he rang Mr Susanto and arranged to meet him at Tokyo Nasional's premises, in Karawang, Indonesia (ts 8).
Mr Susanto and Jundy say whilst in Indonesia Ms Kosasih rung Jundy's phone, and spoke to Mr Susanto.
Mr Susanto confirmed this and said she told him she wanted to buy a half‑share of the business for migration purposes (ts 810, ts 841) and they arranged to meet the next day at KFC in Taman Anggrek (exhibit 30.1).
Ms Kosasih denied she called Mr Susanto (ts 575, ts 641, ts 661).

The meetings in Indonesia

Mr Tanudjaja and Ms Kosasih said there were two meetings in Indonesia; the first at Tokyo Nasional's premises in Karawang and the second at McDonalds in Gajah Mada Plaza shopping mall. They deny meeting (ts 174, ts 641) at KFC in Taman Angrek. Mr Tanudjaja said he had never been there.
Mr Susanto and Jundy said there were three meetings; the first at KFC in Taman Angrek, the second at Tokyo Nasional's premises in Karawang, and the third at McDonalds in the Gajah Mada Plaza shopping mall.
When Mr Susanto was cross‑examined it was put to him that there was no KFC in Taman Angrek at the time of the alleged meeting. He said there was and other independent evidence shows this to be so (exhibit 91). However, that establishes no more than there was the opportunity for such a meeting.

The alleged meeting at KFC in Taman Angrek

Mr Susanto and Jundy say they do not remember exactly what was said at this meeting.
Mr Susanto recalled Mr Tanudjaja saying he wanted a half‑share of the business for migration purposes and said he gave Mr Tanudjaja some details of what the newsagency sold. He said Mr Tanudjaja asked for the price of $165,000 (ts 806, ts 841, ts 842) to be lowered; however he declined to do so (ts 843).
Jundy said he drove his father to the meeting at KFC which did not last very long. He said he did not participate in the meeting. Although he did not remember exactly what was discussed, he said there was talk about the price, what the business was and about Mr Tanudjaja wishing to migrate to Australia. He said Mr Tanudjaja did not ask much about the shop (ts 1131 ‑ 1134).
Jundy recalled Mr Tanudjaja saying he would think about the price.
Jundy also said there was no bargaining and said he did not recall much else because it was not important to him (ts 1131 ‑ 1134).

The meeting at Tokyo Nasional's premises in Karawang

Mr Tanudjaja said Ms Kosasih was present at this meeting and he showed Mr Susanto and Jundy around the shop.
He says Mr Susanto said, amongst other things:
(i)he wanted to sell a 50 % share of a profitable business;
(ii)he purchased the business for $300,000;
(iii)it had been owned by him for a year;
(iv)since the purchase he had spent a lot of money on it;
(v)the business was a newsagency
(vi)it was making between $2,000 - $3,000 net profit per week and would continue to do so;
(vii)the business was very good value;
(viii)a half share was worth $170,000;
(ix)there was another person interested in purchasing the business but if Mr Tanudjaja acted quickly he would be able to take the half‑share;
(x)the purchase would be an ideal situation for both families as each of the families could supply staff;
(xi)his family would cooperate with Mr Tanudjaja's family and the staffing would be fair, reasonable, cordial and the work environment a happy one; and
(xii)he would be able to sell the business in one year's time for a profit.
He said Mr Susanto told him he was offering a half‑share for sale for $175,000 (ts 322, ts 462) and when he asked why the price was so high Mr Susanto told him it had been more than a year since he brought the business and with expenses added the price had gone up slightly (ts 321).
He said the price was negotiated down to $160,000 (ts 322, ts 325, ts 463).
Mr Tanudjaja said Mr Susanto told him it was a good business and said he would have to make up his mind the following day and asked him to bring a deposit of $5,000.
He said Mr Susanto assured him that the business made $2,000 ‑ $3,000 per week and would continue to do so.
Both Mr Tanudjaja and his wife said they requested documents confirming these earnings and were told that although Mr Susanto had no paperwork or proof whatsoever with him, he would be able to provide the books when back in Australia (ts 239, ts 316, ts 464, ts 465).
Mr Tanudjaja said he was attracted to the business because of Mr Susanto's statements (ts 240) and as a result agreed to purchase one‑half of the business and pay the $5,000 deposit.
He said his main intention was to be involved in a business that was profitable and he would not have entered into the agreement had Mr Susanto not mentioned the income that could and had been generated (ts 342).
He said if the business was not profitable he would not have considered purchasing it and would have continued to look for a suitable profitable business (ts 284 ‑ 286, ts 342).
He said he trusted Mr Susanto because he was a fellow Indonesian (ts 318, ts 464).
Ms Kosasih said she was present at this meeting and generally supported her husband's account, although I note she made no mention of Mr Susanto saying that the business could be sold in one year's time for a profit.
She said the meeting lasted more or less two hours and she was not present for the whole time as she was away serving customers for 10 or 15 minutes and then returned (ts 642).
She said Mr Susanto offered the business for sale at $170,000, although in a later part of her evidence she said the price was between $170,000 to $175,000 (ts 643).
She was sure the price agreed at that meeting was $168,000 (ts 601).
Later she said she could not be definite about this price because she was not there all the time and said it was a matter between Mr Susanto and her husband, however her best recollection was the agreed price was 'something like' $160,000 or $168,000 (ts 645).
She recalled Mr Susanto saying he would try and help Mr Tanudjaja find another business for $50,000 (ts 644). Mr Tanudjaja denied this was said.
Mr Susanto said sometime after the KFC meeting Ms Kosasih rang and invited him to Tokyo Nasional (ts 842). He said he did not remember exactly what was discussed, however, the meeting lasted a few hours and took place inside the office. Basically he said the Tanudjajas said they were migrating to Australian and wanted to continue to conduct their business in Indonesia and wished to purchase the half‑share in his business and asked for his best price (ts 843 ‑ 844).
He said he told them his best price was $165,000 and there were further discussions over terms, payment, provision of security for the purchase and whether he would reduce the price for cash.
He said ultimately he reduced the purchase price to $160,000 (ts 853) and Ms Kosasih and Mr Tanudjaja asked him to await their call (ts 849, ts 899).
Mr Susanto told them he would proceed with the sale if they paid the deposit (ts 899).
Mr Susanto said there was no discussion at all in relation to the profitability of the business, what he paid for the business, the value of a half‑share, its earnings or profitability, how long he had owned it or relating to staffing or the working environment of the business. He denied saying there was another interested purchaser or that it was good value or a good business (ts 846 ‑ 855).
Mr Susanto said the Tanudjajas agreed to purchase the business, however, they wanted profit and loss figures and to inspect the premises.
Jundy said he drove his father to the meeting at Tokyo Nasional which did not last long.
Jundy said there was talk but no agreement at the meeting (ts 1135).
He remembered little bits of the discussion which interested him, such as talk about Mr Tanudjaja providing the certificate of title of his Indonesian business premises as security, and paying $50,000 cash and the balance by instalment (ts 1135 ‑ 1139, ts 1151, exhibit 53.1).
He recalled his father saying if they wanted to buy they should just pay the deposit (ts 1146) and said his father offered to find Mr Tanudjaja another business for $50,000.
He also recalled discussions concerning the items sold from both the newsagency and Mr Tanudjaja's business (ts 1141). He claimed the Tanudjajas said they wanted to move to Australia and intended to buy the business for migration purposes (ts 1117, ts 1140).
He said he understood what was being said but did not remember the figures discussed because it was not important to him (ts 1135, ts 1139, ts 1144).
He said the Tanudjajas' reasons for purchasing the business were of no importance to him (ts 1152) and any talk concerning the shop and migration was of no interest to him.

He said he was not listening 'exactly' to what occurred because he was not interested. In another part of his evidence he said that he was listening but was not interested (ts 1140, ts 1144, ts 1145) and therefore things may have occurred that he did not recall.
He denied his father made any of the statements relied on by the plaintiffs (exhibit 53.2), although he recalled his father saying 'if you want to know ask the accountant' (ts 1145).

The meeting at McDonalds

Mr Tanudjaja said that there was a second meeting at the Gajah Mada Plaza shopping mall in the McDonalds restaurant and that is where he paid the $5,000 deposit and requested paperwork confirming the business earnings.
He said Mr Susanto told him the profit was $2,000 ‑ $3,000 per week (ts 463 ‑ 464) but did not have any paperwork, saying he would give it to him later in Perth.
Mr Susanto's version of this meeting was that Mr Tanudjaja rang him a few days after the meeting at Karawang and wished to pay the $5,000 deposit, which he did when they met at the McDonalds restaurant (ts 849). He said they also agreed to meet in Perth where Mr Tanudjaja would inspect the profit and loss papers.
He said Mr Tanudjaja asked him to finish the purchase by doing what was necessary in Australia to finish the deal (ts 835, ts 837) and he later arranged for a written agreement to be prepared.
Jundy said he drove his father to McDonalds where the deposit was paid.
He said there was no discussion about the business earning $2,000 ‑ $3,000 per week and said Mr Tanudjaja did not discuss any documents which showed amounts earned by the business (exhibit 53.2).

Ms Kosasih's April 2004 visit to Perth – exhibits 7.1 and 7.2

Ms Kosasih said she came to Perth to view the business on or about 12 April 2004 and did so with her two daughters, Mr Low and Mr Susanto (ts 574). She said her husband was not present (ts 573).
She said at this meeting, which lasted about two to three hours, Mr Low, in the presence of Mr Susanto handed her two sheets of paper showing figures relating to the business (exhibits 7.1 and 7.2) and Mr Susanto told her to ask Mr Low if there were any questions (ts 577, exhibit 19, par 28).
Ms Kosasih said this was the first time she had seen those documents (ts 577) and they were the only documents she received (ts 615).
She said she looked at the figures and assumed they related to the monthly takings because, when divided by four, they equated to approximately $5,300 ‑ $5,500 which was more than the $2,000 ‑ $3,000 per week promised and therefore those figures confirmed the information provided by Mr Susanto as to the weekly business earnings (exhibit 19).
Silvy said by a similar process of reasoning she thought the figures confirmed the business was earning $2,000 ‑ $3,000 per week (exhibit 28, ts 733, ts 734).
Ms Kosasih said Mr Low said nothing to her about the figures, however, when she asked what they meant Mr Susanto told her they were sale and expenditure figures and the bottom line was the profit (ts 579).
Ms Kosasih agreed that the month and the year appear in English in exhibits 7.1 and 7.2 in precisely the same way as they would in the Indonesian language (ts 580, ts 581).
She said Mr Susanto did not say which month the figures related to and although she looked at the figures, she did not pay attention to the writing and, accordingly, did not know to which month or year the figures related (ts 580, ts 581).
I note she was able to read the year written in English on a statement of claim shown to her in court (ts 590).
After she left this meeting she rang her husband and told him she had received those documents.
Silvy also said this meeting took place at the business premises and said she discussed the figures with her mother. She said her mother did not ask Mr Susanto or Mr Low about the figures (ts 729 ‑ 731).
She said she first noticed the date on the documents when she handed them to her lawyers (ts 733).
Mr Susanto's written evidence was that Ms Kosasih visited the business with her husband and daughters between April and May 2004 but he did not recall exactly what was discussed. He accepted his recollection of this visit was wrong as Mr Tanudjaja was not in Australia at that time (ts 816).
Mr Low said Ms Kosasih and Silvy came to his office (ts 1458) where he gave them two BAS statements (exhibits 72 and 73) and financial statements of the business for the period October 2003 to March 2004 (exhibit 71). He did not think he explained those documents to them (ts 1474).
He denied handing exhibit 7.1 to Ms Kosasih in April 2004.
Mr Low said that although he prepared exhibits 7.1 and 7.2 (ts 1476), he could not recall when or why but they must have been generated after 30 June 2004 because his computer system could not produce post‑dated documents (ts 1507).
He said he gave them to someone but could not remember who due to the lapse of time (ts 1713).
Mr Tanudjaja, who was not present at the meeting, said his wife showed him exhibits 7.1 and 7.2 in April (ts 424, ts 425) when she returned from Perth and he relied on those documents when proceeding with the purchase (ts 426).
He thought it strange that documents, referring to 30 June, had been made available to him in April, however, he thought the figures matched what he was told because if you multiplied the weekly profit figures promised by Mr Susanto they 'matched' the monthly profit referred to in those exhibits (ts 425, ts 426).

Meeting of 17 April 2004

Ms Kosasih says that on 17 April 2004 she attended Mr Low's office and signed the agreement to purchase the business in his presence.
She said the agreement was translated to her by Silvy (ts 602) and she thought Mr Low explained the agreement to her. Later she contradicted this and said (ts 652) he did not explain the agreement to her.
She said the figures were already in the agreement when she signed it (ts 630).
She denied Mr Low told her she could get another accountant or gave her any documents at that meeting (ts 648), although later her evidence was that she did not know what documents she was given as she had forgotten (ts 648 ‑ 650, ts 664).
She said she did not say anything at the meeting and just signed the document (ts 647). In another part of her evidence she said although she chatted, she forgot what she chatted about.
She said she only dealt with Mr Low, through her daughter and never directly (ts 651).
She denied she was in a hurry to sign the agreement as a result of business migration considerations.
Silvy made no mention at all of the meeting of 17 April 2004 in her evidence.
Mr Susanto said he went to the meeting at Mr Low's office for the purposes of signing the agreement having previously told Mr Low they were going to finish the sale and purchase (ts 836).
He said he did not prepare the agreement and did not know who had, however, he knew Mr Low had arranged for it to be there (ts 816 ‑ 817, ts 825 ‑ 827, ts 832). He said Mr Low was present when the agreement was signed.
Mr Susanto said he did not ask Mr Tanudjaja, Ms Kosasih or Mr Low about what should be included in the agreement (ts 835).
This was contradicted by his later evidence where he said he discussed with Mr Low the figures to include in the agreement before Mr Low wrote them down (ts 890) and he had discussed with Ms Kosasih and Mr Low the price and its breakdown.
He said the profit and loss was referred to, although he could not recall the time period that discussion related to.
He said Mr Low explained the agreement in full (ts 830) and then all three signed it.
He said Mr Low was speaking in Malay to Ms Kosasih (ts 832).
He said after the agreement was signed there were discussions with lawyers and the transaction proceeded on the basis that one share in Eden Pine would be held by him and the other by the plaintiff.
Mr Low said Ms Kosasih and Mr Susanto attended his office and he spoke to them in relation to the goodwill, plant, equipment and inventory and other assets referred to in the agreement.
He said the agreement was not translated (ts 1473), although he explained the agreement and asked Ms Kosasih if she wished an accountant to look at the books, however she declined.
He said he suggested the total price and whilst he had the agreement, he did not know who drafted it.
He said Ms Kosasih said she needed to sign the agreement quickly for migration purposes.
Mr Low claimed he said to Ms Kosasih on several occasions before this meeting that she should get a third party to examine the books before they purchased the business (ts 1461 ‑ 1462), however she replied that she was comfortable with him.
Mr Low agreed his written evidence‑in‑chief (exhibit 68.1, pars 45 ‑ 51) was incorrect because it referred only to that advice being given to Ms Kosasih on 17 April 2004 (ts 1461 ‑ 1462, ts 1468).

Mr Tanudjaja's visit to Western Australia in May 2004

Mr Tanudjaja said he made his first visit to Western Australia in 2004 between 23 May and 1 June (ts 170) to finalise the purchase of the business (ts 310).
He said he visited the shop with Silvy and did not notice any roadworks (ts 419 ‑ 422).
He said he told Mr Susanto that Silvy and Shirley's main priority was to study (ts 465, ts 466) and Mr Susanto told him the cooperation between the two families in running the business would start on 1 June (ts 466).
He denied Mr Susanto told him to call Mr Low to examine the books.
He said he met Mr Low and Mr Susanto on 31 May and gave Mr Susanto the cheque in Mr Low's presence (ts 419). Earlier in his evidence he said he saw Mr Low after he paid the balance of the money (ts 311).
He said Mr Low did not give him any documents (ts 310, ts 313) nor the opportunity to receive independent accounting advice (ts 314).
When asked if at any stage Mr Low suggested he see an independent accountant, he replied 'Never', and then conceded it was possible that it may have been mentioned but he had forgotten (ts 478).
Mr Tanudjaja said that although he had on other occasions asked Mr Low about other ventures including a post office, food franchise, pizza parlour, property development and vehicle importing business, he did not ask him about the profitability of the newsagency or seek access to the books or till receipts because he trusted Mr Susanto and believed what he had been told about the profitability of the business (ts 316 ‑ 318).
Mr Susanto's written statement says sometime between April and May 2004 Mr Low, Mr Tanudjaja and Ms Kosasih and their two daughters attended the business.
Mr Susanto accepted this was wrong. Immigration records (exhibit 3) show Mr Tanudjaja and Ms Kosasih were never in Australia at the same time and Mr Susanto conceded his memory about these things was not good (ts 812 ‑ 816).
He said there was an occasion between those dates when Mr Tanudjaja and the two girls visited the business. Although he could not remember exactly what was said, he remembered they discussed finishing the sale and purchase of the business and said Mr Tanudjaja wanted to inspect the profit and loss statement and wanted to get in touch with his accountant to inspect them. He said they discussed Mr Low being Mr Tanudjaja's accountant and providing help in the sale and purchase of the business.
Mr Low said on 31 May 2004 there was a meeting at Mr Lim's office attended by Mr Tanudjaja, Ms Kosasih, Silvy, Mr Susanto and Junaidy.
Although he could not recall exactly what was said, he recalled there was mention that Mr Chew had said Mr Tanudjaja and Ms Kosasih must complete the transaction by 1 June 2004 for migration purposes (exhibit 68.1, par 64).
Mr Low said he was quite shocked Mr Tanudjaja jumped in and committed to buy the business without due diligence (ts 1461).

Some other matters

Mr Tanudjaja denied that he was in a hurry or anxious to purchase the business to fulfil the visa criteria (ts 321) or because it was 24 months since the visa had been issued (ts 287).
He said his visa was valid for five years (ts 241) and he knew the department conducted surveys 24 and 36 months after his entry into Australia to see if he was genuinely participating in a business (ts 250, ts 282 ‑ 287).
He said his migration agent Mr Chew had told him it was better to get involved in a business within 24 months; however he understood they had 36 months within which to comply (ts 273, ts 298).
Mr Tanudjaja also said he paid $168,000 in total for the business because after the contract was signed further monies were paid to Mr Susanto for petty cash and a Lotto table on the promise that the money would be returned.

Events occurring after settlement of the business

The working environment at the business

Silvy gave evidence that the working environment at the business was far from cooperative or pleasant.
She said at first her and her sister were paid half of what the others received and within three weeks of commencing work Shirley was told to leave to reduce the wages bill.
Silvy said within five months she was forced to leave.
She said during the first two months she was at the business three to four times a week and although she had no fixed hours (ts 747) and did not work every day, she worked on average 15 hours per week at first and later twice a week.
She agreed she would sometimes not go to the newsagency because she was at school, other times she went before or after class. She said she was studying full‑time from 2003 until the end of 2004 and denied she had a second job (ts 747 ‑ 754).
She said over the five‑month period she worked, with the exception of the first three weeks (ts 745), Junaidy glared, shouted and threw items at her and slammed doors. She said she received the silent treatment as others would not talk to her.
She said her requests for information were met with the response 'talk to my dad'.
She said there were lots of things to do at the newsagency and she was keen to learn but wished to be shown how to do things more than once (ts 739).
She said she asked Junaidy to show her how to balance the cash register, count the money at the end of the day, buy cigarettes and do returns (ts 739, ts 747).
She said she was taken to Cash 'n' Carry on one occasion and participated in a two‑day course with Lotterywest (ts 740). Other than that, she was given no assistance or training in the duties she was expected to perform.
She said that when she tried to implement what she had been taught at Lotterywest, Junaidy told her she was wasting his time and said the Lotterywest information would not provide a complete picture of the business earnings (ts 751), and said the accounts would be provided by the accountant.
She said that although Junaidy and her started off as good friends (ts 755), the real problem started when she began to ask for information (ts 749, ts 755), particularly the end‑of‑day sales figures.
She said those figures were in the form of handwritten daily balance forms showing the daily sales figures and were given to her in the first two months (ts 740 ‑ 743), however after this period Junaidy refused to provide any further information and became angry and upset at her inquires.
She said she faxed the forms she received to her parents and still had the faxes at home (ts 742 ‑ 743).
She said she stopped working in the business in approximately October/November (ts 744) because Junaidy was intimidating and threatening and had refused to provide her with financial information, training or instructions on how to run the business.
Mr Susanto said Mr Tanudjaja had previously told him that Silvy and Shirley were both students and should stay focused on their studies and, accordingly, Silvy did not work every day and arrived at the business after it had opened and left before it closed and came to work as and when she liked.
He said she was told what she was required to do, which was basically to help his son and fill in the balances' forms. He said that she did not do as she was told and tried to boss his son around.
He said he first became aware of difficulties when Junaidy rushed home from work one day upset, but not angry, and told him that Silvy had sent him home because she wanted the daily balance sheets immediately and Junaidy said he did not want to go back to the shop.
Mr Susanto said he went and told Silvy they all needed to work together and not to boss his sons around. He said his relationship with Silvy at that time was normal.
Mr Susanto said that although there was an agreement that Silvy would be given the daily balance sheets, that did not mean that she could force Junaidy to come home and he felt that she was bossing Junaidy around (ts 858 ‑ 865, ts 885, ts 899).
Mr Susanto said all the daily balances forms were filled in by Junaidy daily and by August 2004 Silvy had stopped coming to work but was still being given all the daily balances forms that she requested.
Eventually he told her that they would not fill the daily balances forms out any more and she would have to do so herself. He said she did not come to the shop to do this task.
Junaidy said he was happy to find out the two girls were going to help in the business because he was working long hours from 9.00 am to 9.00 pm (ts 936).
He said Silvy had no fixed working hours and at first came every day before or after her classes, however after approximately one month she told him she had a second job, was too busy at school and lived too far away to come to close the shop.
He said she was still coming to the business in July and August of 2004 but then stopped attending.
He denied he told anyone to leave because they were cutting costs.
He said he considered her role was to help him serve customers, arrange magazines, and clean (ts 937).
He said he showed her how to balance the till, carry out Lotto transactions, buy and return supplies, and do the daily balance sheets.
He claimed she did not ask for the profit and loss statements, only for the daily balances sheets and said he printed out the Lotto sales for her.
He said she would not serve customers or help him and would be asleep at work and boss him around.
He denied he behaved in the way she alleged or made the work environment so intolerable that she would want to leave (ts 957 ‑ 958).
He said he did not request cash from her, other than an occasion when a new Lotto table was required.
He agreed that for most of the time she was working there, there were three Susantos and one Tanudjaja at the business (ts 951).
Jundy agreed he was not at the shop every day (ts 1118 ‑ 1147).
He said both Silvy and Shirley originally worked part‑time, however shortly after they started Shirley stopped coming to work.
He said Silvy would come to work sometimes but not always. He recalled an occasion when she said she was not coming to work because she had to study.
He denied he saw any untoward conduct by his brother towards Silvy and said she was not bullied (ts 1148).
He said Silvy was shown how to operate the tills, the Lotto and shop for supplies. He said Junaidy and Silvy did talk, although he did not talk to her much. He said he did not quarrel with Silvy and did not find her bossy.

Mr Tanudjaja's August 2004 visit

Mr Tanudjaja said that in August 2004 he visited Australia and attended the business and saw Silvy and Mr Susanto working in the business.
He said that whilst he did not see any road or flyover construction, he saw building construction (ts 419 ‑ 422, ts 467).
His evidence as to when he first saw the flyover construction was somewhat contradictory, saying he saw it before and after he had bought the business (ts 422).
He said he asked Mr Susanto (ts 412 ‑ 413) for the cash register till printouts when he visited Australia in August and Mr Susanto told him to ask Mr Low. When he did, Mr Low told him to ask Mr Susanto (ts 413).

Construction work in the vicinity of the business, April 2004 to July 2005

Mr Cartledge was the manager of major projects for the Public Transport Authority.
He said the Spencer Road flyover bridge construction works, necessary as part of the railway extensions, was in close proximity to the shopping centre and was commenced in April 2004 and substantially completed by July 2005 (exhibit 54) by which time there were no traffic restrictions.

He said a commitment was given to the shopping centre management to retain access to the centre, and traffic flow and access to the centre was assisted by a deviation road built in early 2004.
During the construction he said there were two entrances; one from a construction deviation road and the second from the Southdown Place slip entry road (ts 1168 ‑ 1170, exhibit 55).
Mr Tanudjaja said the construction of the flyover meant that the business was busier because more customers were coming in and buying (ts 468, ts 469) and he saw this every time he came to Australia. He agreed Mr Susanto told him there were less customers because of the flyover.
Mr Susanto said during construction of the flyover in 2004 trade was disrupted and traffic was difficult, and after construction the shopping centre was not visible to traffic travelling along Spencer Road which resulted in less customers coming to the business.
He said both Hungry Jack's (exhibit 56) and KFC increased the size of their signage, however the Stirling Village Shopping Centre did not.
Mr Susanto, Junaidy, Jundy and Mr Low all gave evidence of occasions occurring after the construction of the flyover when they missed the turn‑off to the shopping centre because of its reduced visibility.
Junaidy said in 2004 and 2005 during the course of the construction work sales were bad and after construction was completed in 2005 the position was worse.
Jundy's said less customers came after the construction of the flyover.
Mr Low said he was the accountant for five other businesses in the shopping centre and their takings significantly declined during the construction period.

Events leading to the sale of the business

Mr Tanudjaja said that by July or August 2004 he had discovered there was never a profit of between $2,000 ‑ $3,000 per week (ts 380) and when he protested by saying to Mr Susanto 'where's your promise, where's your promise', he received the reply 'later, later' (ts 380, ts 381).
Mr Tanudjaja said he always wanted to see the daily sales figures.
He explained that although he received faxed copies of the handwritten daily balance forms from Silvy (exhibit 4.1, pp 52 ‑ 122), he wanted to see the actual till printouts (ts 389) to ascertain the real sales.
Mr Tanudjaja said that he was upset from June 2004 about not getting the till printouts and kept asking Silvy to get them (ts 412).
He denied that he had received documents in October 2004 showing the newsagency lost $3,483 for June (ts 416).
He said towards the end of 2005 Mr Susanto told him the business was losing money, to which he replied that he wanted to see the books and told him that if there was a profit it would be shared and if there is a loss they would take responsibility (ts 467).
He said he queried how the business was losing money because when he saw the shops they were crowded.
He told Mr Susanto it was okay to sell if he could get a sufficient price (ts 469, ts 473).
Ms Kosasih says she became aware the business was not profitable in 'maybe' June to October 2004 as a result of what Silvy told her (ts 631).
Silvy says after Mr Susanto's visa was extended in or about 2004/2005 he said he wanted to sell the business.
Mr Susanto said he spoke to Mr Tanudjaja on the phone, at a time which appears to have been late 2005, and told him the business was losing money and he would need to contribute money towards the loss. He said Mr Tanudjaja did not respond.
Later he said Mr Tanudjaja told him he would come to Perth to discuss matters but never did.
He said there was a suggestion that the business be run in two‑week periods, alternatively by Silvy and he, however there was no response to that suggestion.
Eventually he said he could not wait any longer to sell his share of the business. His sons did not want to work due to the long hours and he decided to get help in preparing the resolution to sell the business.
Later Silvy offered to buy his half‑share for $20,000 and offered to sell Nasional's half‑share for $130,000. He would not agree to this and all parties agreed to sell the business (exhibit 30.1, pars 142 ‑ 162).
The business was sold in November 2006, and the net proceeds of $78,790.14 placed in a solicitor's trust account pending the resolution of this matter.

The accounting evidence

Two accountants gave evidence, Mr Low and Mr Oudejans.
Mr Low is a qualified professional accountant who had worked for PricewaterhouseCoopers, as a chief financial officer for a listed company in Malaysia, and as a senior accountant in Western Australia.
He is a registered tax agent and has run his own practice since approximately 2003.
He met Mr Tanudjaja and Ms Kosasih in approximately 2002 and assisted them in setting up the plaintiff company and by March 2003 was its secretary, tax agent and accountant.
He met Mr Susanto in 2003 and, through his company, LSM Corporate Services, became the accountant for the business. Since that date he has prepared the business activity statements, financial statements and tax returns based on the material Mr Susanto provided to him.
He said there were difficulties getting information from Mr Susanto.
He also said Mr Susanto would take cash from the till to pay salaries and other expenses and then provide him with a list of the cash taken and the purposes for which it was used.
Mr Low explained that Eden Pine Tree Pty Ltd acted as trustee for the Susanto Family Trust alone until 31 May 2004, and from that date the corporate structure was altered so that Mr Susanto held one share in the company for the SFT and the other share was held by the plaintiff.
Accounts (exhibits 7.1, 7.2) prepared by him claim that in the month of June 2004 the trading account showed a gross profit of some $22,290 and a profit from ordinary activities of $21,528, whereas exhibit 90.2 also prepared by him show a gross trading loss of $2,710 for the year ending 30 June 2004 for Eden Pine Tree Pty Ltd (the trading entity after settlement)and a loss from ordinary activities of $3,482, and exhibit 90.1 showed a gross loss from trading of $5,536 and a loss from ordinary activities of $9,669 for Eden Pine (the trading entity before the settlement) for the same period.
He agreed that exhibit 90.3 titled 'Eden Pine t/as Spencer Village News Ledger Entries Report For The Year Ending 30 June 2004' should have read 'Eden Pine Tree Pty Ltd' and were really the financial statements of the latter for the month of June 2004 with the depreciation schedules added.
He said that when he copied and pasted information from Eden Pine as trustee for the SFT (the trading entity before the settlement) to Eden Pine Tree Pty Ltd (the trading entity after settlement) he did not realise other irrelevant information came with it (ts 1687 ‑ 1688).
In addition to being the business's accountant, Mr Low was present at various meetings with the parties, and his evidence in respect of those meetings has previously been summarised.
The plaintiff called Mr Oudejans, an accountant, as an expert witness.
He had not given evidence as an expert very often (ts 1376).
Mr Oudejans had qualifications in accounting from Edith Cowan University, a degree in mathematics and had been a practising accountant since 1991, starting off in a chartered accounting firm, then moving into commercial accounting and for the last six or so years had run his own practice (ts 987, ts 1303 ‑ 1304).
He had also performed accounting services for the legal practice of the plaintiff's solicitor (ts 1304).
Mr Oudejans was a registered tax agent and a member of the National Tax Accountants Association (ts 1303 ‑ 1304) but not a qualified auditor, nor a member of the Institute of Chartered Accountants.
He pointed out the accounts show the gross profit from trading activities for Spencer Village News for the year ending 30 June 2002 was $123,170 (exhibit 50), in 2003 was $135,610 (exhibit 48), and for 2004 was $24,486 (exhibit 86).
Mr Oudejans said his experience, which included accounting for five or six other newsagencies, did not lead him to conclude newsagencies were seasonal, and said there was no reason why a newsagency would have large fluctuations in terms of the overall profitability (ts 1346, ts 1351, ts 1378).
He examined actual trading stock, which he said was running at a loss, by isolating the Lotto component (ts 1349) which involved excluding Lotto sales and purchases (ts 1071).
When he did this he said no explanation was provided as to why the trading profit (excluding Lotto) for Spencer Village News had gone from $70,796.90 in the year ending 30 June 2002, and $74,216.60 in the year ending 30 June 2003 to a trading loss, as calculated by him, of $32,263 for the year ending 30 June 2004. Although his report (exhibit 43.4) refers to a loss of $57,263, he accepted the correct figure was a loss of $32,263 (ts 1072).
Mr Oudejans said, to examine whether the business was making $2,000 ‑ $3,000 profit per week, it was necessary to pull the accounts apart thereby enabling an examination of every aspect of the business (ts 1350).
Four of his reports were prepared before he was aware Mr Low had included opening stock in the accounts and he was concerned this omission resulted in overstated profits (ts 1025).
When he became aware opening stock had been included in purchases, it invalidated his previous conclusions (ts 1024 ‑ 1025) and it became necessary to prepare a new report.
When he did so (exhibit 43.4) he reconstructed the trading account (for Psalm 68 SFT for the year ending 30 June 2004) and said the result was a loss from trading of $514 rather than a trading profit of $24,486 as shown in the accounts prepared by Mr Low.
This difference occurred because he removed closing stock of $25,000, which he said should not have been included as the business had been sold and therefore there was no closing stock (exhibit 43.4, ts 1075).
He also examined profit from ordinary activities before income tax (for Psalm 68 SFT for the same period) and said capital gains of $29,742 should be excluded because it was not an ordinary activity of running a newsagency and its inclusion creates a false illusion of the profitability of the business. Once this was done and the loss from the trading account of $514 was considered, it resulted in a loss of $18,564 from ordinary activities and not a profit of $36,178 as reported in the accounts prepared by Mr Low (exhibit 43.4).
Mr Oudejans said it was appropriate to separate capital gains so that the true profitability of the business could be seen (exhibit 43.4). He said it should be re‑introduced as an extraordinary item in the accounts, however it needed to be removed from the ordinary activities so the true profitability of the business from ordinary or trading activities could be seen (exhibit 43.4).
Mr Oudejans pointed out that exhibit 7.2 show sales from Lotterywest of $92,583. He compared that with the sales figures provided by Lotterywest (exhibit 66) and examined monthly sales either side of June 2004 and noted the average of sales for those three months was $70,107.32, a figure significantly different from exhibit 7.2.
He said he could not calculate how the figures used by Mr Low were obtained (exhibit 44.2).
He agreed Lotto sales had seasonal spikes and troughs (exhibit 66, ts 1352).
He also pointed out that purchases exceeded sales in 2006 by $57,089, for which there appeared to be no explanation, and in 2005 there was stock of some $5,607 unexplained (exhibit 43.2, ts 1011).
He agreed a possible explanation was that stock was sold under value (ts 1327), although he said this would not be normal and he could not imagine why it would occur (ts 1318 ‑ 1321).
He said it was unlikely obsolete stock was being sold, but could not say it was not possible (ts 1393).
Mr Oudejans also extrapolated the monthly profit figure in exhibits 7.1 and 7.2, demonstrating this resulted in a net yearly profit in the vicinity of $267,000 (ts 1032, exhibit 43.3).
This figure is completely at odds with profit figures in other financial documents prepared by Mr Low and, not unsurprisingly, Mr Oudejans concluded the extrapolated yearly profit figure is a gross overstatement (exhibit 43.3).
He said exhibits 7.1 and 7.2 were management accounts because they related only to a one‑month period (ts 1032) and therefore were not required to be proved in terms of normal accounting practice (ts 1014).
He said management accounts were to give management an idea of how they were performing, and were more for management than the tax office (ts 1014 ‑ 1016).
He also examined exhibit 71, the Psalm 68 accounts, for the period 1 October 2003 to 31 March 2004. This is the exhibit Mr Low says he gave to Ms Kosasih at the meeting on or about 12 April 2004.
Exhibit 71 shows a net profit from ordinary activities before income tax of $24,774 which extrapolates to a yearly profit of $49,548, or a net profit of $952 per week and, even adding back wages, extrapolated to $9,376 for a year still produced a weekly profit of only $1,133 (exhibit 43.4).

The effect of the Department of Immigration's 24‑month survey

Mr Grey had been the manager of the Department of Immigration and Citizenship Partner and Business Skills Migration branch since 22 June 2010 and previously worked in the immigration section of the Australian Embassy in Bangkok.
He did not have any experience in assessing business skills subclass visa applications and produced records from the department.
When asked whether it was important for a business migration visa holder to acquire a business for the purposes of the 24‑month survey he replied that he could not give a definitive answer.
It seems to me the more important issue in this case is the parties' belief of the department's requirements not the department's actual requirements.

Credibility

Clearly the central issues in this case turn on questions of credibility.
English is not the native tongue of Mr Tanudjaja, Ms Kosasih, Silvy, Mr Susanto, Junaidy, Jundy, Mr Low or Mr Chew for which I make due allowance.
Mr Tanudjaja, Ms Kosasih, Mr Susanto and Jundy were assisted by interpreters.
I am entitled to either accept or reject a witness' testimony in its entirety or accept part of what the witness says and reject other parts.

Mr Tanudjaja

The defendants say Mr Tanudjaja's evidence lacks credibility and should be rejected either in its entirety or at least insofar as it relates to whether the representations were made and relied upon.
They say Mr Tanudjaja lacks credibility, inter alia, because his evidence was internally inconsistent, inconsistent with what he had said on other occasions out of court, inconsistent with the pleadings and inherently implausible.
They say Mr Tanudjaja read and understood English at a level far greater than he portrayed in court notwithstanding his request to use an interpreter, and point to a number of examples where he directly answered questions without the interpreter's assistance.
They illustrate this by drawing my attention to an occasion in cross‑examination where Mr Chew's statement was in front of Mr Tanudjaja and, without the question being interpreted, he pointed to the statement effectively saying that Mr Chew said in it that he did not know Mr Tanudjaja had bought the business until 2005.
When the cross-examiner explored how the question could be answered without the statement being interpreted, Mr Tanudjaja replied he could remember precisely what was in par 10 of the statement even though he could not remember the contents of any other paragraphs (ts 288 ‑ 295).
In closing submissions the defendant drew my attention to at least 20 other occasions where they say Mr Tanudjaja provided direct answers without the questions being interpreted.
I accept Mr Tanudjaja has a greater knowledge of English than he was prepared to reveal.
The defendant points out that Mr Tanudjaja initially said the agreed purchase price was $168,000 (exhibit 2, par 31), which is the price referred to in the statement of claim (exhibit 15), the amended statement of claim (exhibit 17), and the further further amended statement of claim (exhibit 18). Under cross‑examination, Mr Tanudjaja said the agreed purchase price was $160,000 (ts 322, ts 461).
The defendant says Mr Tanudjaja reconstructed the purchase price of $168,000 from documents or, at best for him, it shows his recollection is unreliable and, as he cannot be relied upon on a fundamental issue such as the purchase price, it must cast doubt over the entirety of his evidence.
The evidence establishes the agreed purchase price was $160,000, although with subsequent adjustments the price actually paid was $168,000.
I do not consider it to be that unusual for a witness being asked about the agreed purchase price to answer the price actually paid. In my opinion this is not a telling blow to Mr Tanudjaja's honesty; it does, however, demonstrate imprecision in his evidence.
Another example is that when cross‑examined over the further amended statement of claim, he said Silvy had not explained it to him (ts 372), then said she had (ts 372).
Mr Tanudjaja variously referred to the business migration application as 'his', 'his wife's' or a 'joint' application (exhibit 2, pars 10, 11, ts 179 ‑ 180, ts 186 ‑ 189, ts 193). This is not unsurprising in circumstances where he is required to provide information for, and sign, an application and its success would result in a visa being granted to him, his wife and other family members.
He was criticised for annexing only part of that application (exhibit 6), to his evidence‑in‑chief (exhibit 2), which it was said, showed he was trying to mislead the court into thinking it was his and not his wife's application.
I reject that submission.
Exhibit 6 clearly describes Ms Kosasih as the 'main applicant' and that is apparent to anyone examining the exhibit.
Nor do I accept the proposition that Mr Tanudjaja represented to the department that he performed the activities numbered 1 to 8 under 'Major Management Responsibility and Activities' in the application (exhibit 6). The application was signed by Ms Kosasih above the designation 'main applicant' and she declared she carried out those activities. This is also apparent to anyone examining the exhibit.
I do not consider those matters adversely affect his credit.
However, Mr Tanudjaja's said he and his wife were the joint owners of the business (ts 231) and ran and worked the business together and made all the decisions jointly (ts 181 ‑ 182).
This was contradicted by Ms Kosasih who described her role as serving customers and helping to order goods.
Additionally Mr Tanudjaja had previously represented to the Department of Immigration that his wife was the 'sole proprietor of the business' and told them he helped her place the orders, although she made the decisions (exhibit 26).
Mr Tanudjaja said he told the department Tokyo Nasional was owned by his wife because she was younger and would gain more points on the visa application.
These are matters which adversely affect his credibility.
It establishes he is prepared to tell lies to advance his interest.
Numerous inconsistencies between Mr Tanudjaja's evidence and the pleadings were established.
In the 2007 statement of claim (exhibit 15) it is said the plaintiff would receive an income of between $2,000 ‑ $3,000 per week as their distribution of the profits derived from Eden Pine.
Mr Tanudjaja agreed he told Silvy to tell this to the lawyers (ts 327, ts 330) and said when she interpreted that statement of claim to him he was happy with it (ts 327).
Notwithstanding this, Mr Tanudjaja's consistent evidence was the representation was that $2,000 ‑ $3,000 net profit per week would be earned by the business (ts 333, ts 342, ts 345) and the plaintiff was to obtain a half‑share of that profit. That is broadly consistent with the later pleadings (exhibits 17 and 18 of the further further amended statement of claim).
The defendant says the change in position from the 2007 pleadings to his 2010 evidence was tailored to suit the plaintiff's case. I reject this. I note the pleadings were first amended in April 2008 (exhibit 17) in a manner broadly consistent with Mr Tanudjaja's later evidence, and his evidence was also that when Silvy translated the 2007 pleadings she translated it as the business' net income per week (ts 352).

Insofar as other matters raised by the parties in relation to the costs in general, I make the following rulings and observations.
In respect of those matters in which I do not make rulings I provide observations, not to bind, but to assist the taxing officer.

Financial accounts relating to the business

The plaintiff made an application on 17 October 2007 to the principal registrar for orders that the defendants provide information relating to the accounts.
There is already a costs order in relation to that interlocutory matter. The order was that costs be in the cause. The plaintiff did not seek to appeal that order and he cannot now go behind it.
Accordingly no further order in relation to that matter is or should be made.

Reports of Mr Oudejans

The defendants do not dispute Mr Oudejans' reports were necessary for the action. This is a matter to be dealt with by the taxing officer in the usual way.

Forensic examination of computers of Mr Low

During the trial, the defendant called Mr Low as a witness.
In the course of his cross-examination, the plaintiff successfully applied for an order that computers used by Mr Low be forensically examined by their expert. That order was granted.
The forensic expert was not called to give evidence.
The plaintiff's own cost submissions state (PS 34 (l)) 'the expert witness carrying out the forensic examination was unable to assist the court by advising the court precisely when the data was inserted into the computer, the decision was made to not call the expert witness at the trial who carried out the forensic examination'.
There was no evidence that the entries on the computer were in any shape or form other than as stated by Mr Low.
Simply put, the plaintiff went 'fishing' hoping to find something useful to their case. They were unable to.
Therefore the defendants should not be ordered to pay the costs of that application and examination.

Lottery West

The defendants do not dispute that the plaintiff subpoena to Lottery West was a necessary action and it is to be dealt with by the taxing officer in the usual way.

The applications for security of costs

The costs of the first application for security of costs were reserved by order of Registrar Kingsley on 4 June 2009.
A second application, for further security of costs, was dismissed by Registrar Kingsley on 13 August 2010 and the defendants were ordered to pay the plaintiff's costs of the application in any event, with liberty to apply.
The defendants' appeal against that decision was dismissed by Judge Goetze on 1 October 2010 with an order that the 'defendant (sic) pay the plaintiff's costs to be taxed'.
A third application, for further security for costs, was made before me on 12 November 2010 and granted with an order that costs follow the event.
A fourth application, for further security of costs, was made before me on 24 February 2011 and granted with an order that the plaintiff pay the defendants' costs of and incidental to the application.
I order the costs reserved by Registrar Kingsley on 4 June 2009 follow the event.

Transcripts

The plaintiff's application for costs of the court transcript is allowed, subject to proof of the expense to the taxing officer. In light of the length of the trial that was a reasonable expense.

The plaintiff's application for the costs incurred by solicitor attending and selecting interpreters

The costs incurred by the plaintiff's solicitor attending and selecting interpreters must be considered in light of the obligation on the party calling a witness to ascertain the dialect the witness speaks and advise the court of that dialect.
To simply advise the court that the witness speaks Indonesian was not sufficient.
The court provided an interpreter who had 20 years experience.
The original listing of the trial in May 2010 before his Honour, Judge Wisbey was adjourned for reasons already stated.
In applying to adjourn the trial the plaintiff's counsel said that if the adjournment was granted they would like to 'speak to the new interpreter to ascertain they spoke the same dialect as the witness who had a Chinese background' (ts 78). This was a very sensible suggestion. The plaintiff's solicitors should have ensured it occurred before the May trial commenced.
Further orders were made by the court that the plaintiff ensure the next interpreter was satisfactory to the plaintiff's witnesses and the defendants.
Such an order was necessary only because the plaintiff had not ensured the interpreter originally obtained by the court spoke the dialect of its principal witness.
In those circumstances I do not allow the costs incurred by the plaintiff's solicitor attending and selecting interpreters

Fees for translation of documents

The plaintiff has not provided me with sufficient detail relating to which documents they are referring to and this matter is left to the discretion of the taxing officer.

Travel to and from Indonesia

The plaintiff seeks costs for 29 airfares for its directors and shareholders travelling to and from Perth.
The defendant does not dispute that costs of the trips required as a result of attendance at the trial are allowable, but disputes the other travel.
There is insufficient information provided as to which trips were necessarily incurred in the conduct of the litigation and these matters are best dealt with by the taxing officer.

Plaintiff's response to defence and counterclaim

The defendants' counterclaim was withdrawn by consent orders filed on 14 April 2009 and on 17 April 2009 Registrar Hewitt ordered the defendants pay the plaintiff's costs in the counterclaim to be taxed.
No further order is necessary in relation to the counterclaim.
Insofar as the plaintiff's response to the defence the party‑to‑party costs order against the first defendant would cover that item. The taxing officer will tax the quantum in the normal manner.

Security for costs

The following securities for the defendants' costs have been provided by the plaintiff:
(a)$70,000 on 6 November 2009;
(b)the plaintiff's share in the monies held by Sue & Co being, as I understand it, half of $78,951.08 as at the date of the order;
(c)a caveat in favour of the defendant in the sum of $20,000 lodged against Mr Tanudjaja's property being certificate of title volume 2193, folio 624.
There should also be orders releasing the plaintiff from some of the security obligations.
The orders I make are:
1.The first defendant do pay 90% of the plaintiff's party-to-party costs to be agreed or taxed, such costs not to include the plaintiff's costs of the application for and examination of the computer of Mr Low, nor the plaintiff's solicitors costs of attending and selecting an interpreter.
2.The plaintiff do pay the second defendant's costs which I fix at 10% of the first and second defendant's taxed or agreed party‑to‑party costs.
3.$25,000 of the amount paid into court on 6 November 2009 by the plaintiff shall remain as security for the second defendant's costs, all other securities are to be released to the plaintiff and the defendant shall within 31 days remove the caveat lodged on the plaintiff's property.
4.There is liberty to apply.