Rawley Pty Ltd v Bell (No 2) - [2007] FCA 583

FEDERAL COURT OF AUSTRALIA
Rawley Pty Ltd ACN 009 027 454 v Bell (No 2) [2007] FCA 583
MISLEADING OR DECEPTIVE CONDUCT – applicant investors in a failed start-up company – claim to have been induced to invest by conduct in contravention of ss 52 and 59 of the Trade Practices Act 1974 (Cth), the Fair Trading Act 1987 (SA) and the Fair Trading Act 1987 (WA) – claims which involved investments in securities precluded by s 51AF of the Trade Practices Act 1974 (Cth) and s 995A of the Corporations Law
CORPORATIONS LAW – investors claim to have been induced to invest by conduct in contravention of s 995 of the Corporations Law – substantially the same claim as under the Trade Practices Act 1974 (Cth) – instances of misleading or deceptive conduct established – conduct did not induce the applicants to invest or was inconsequential
NEGLIGENCE – duty of care claimed to be owed by accountant – representations pleaded as breaching this duty were not relied upon by the applicants
FIDUCIARY LAW – fiduciary duty claimed to exist as between licensor and licensee or as promoters – alleged non-disclosure – no fiduciary relationship
INSURANCE – cross-claim made by insured against insurer – clause within the policy that if full payment of the premium was not made then there would be no cover – late payment – no insurance cover at the relevant time
Trade Practices Act 1974 (Cth) ss 51AE, 51AF, 52, 59(2), 75B and 82
Corporations Law ss 9, 92(2), 995, 995A, 1325
Fair Trading Act 1987 (SA)
Fair Trading Act 1987 (WA)
Australian Securities and Investment Commission Act 1989 (Cth), s 12BA(1)
Corporations Act 2001 (Cth) s 1041H
Insurance (Agents and Brokers) Act 1984 (Cth) ss 14 and 27
Insurance Contracts Act 1984 (Cth) Part VII
Trade Practices (Industry Codes Franchising) Regulations 1998 (Cth)
Wheeler Grace & Pierucci Pty Ltd v Wright (1989) 11 ATPR 40-940 cited
Yorke v Lucas (1985) 158 CLR 661 cited
Secretary of State for Trade and Industry v Deverall [2001] Ch 340 cited
Australian Securities Commission v A S Nominees Ltd (1995) 133 ALR 1 cited
Hughes Aircraft Systems International v AirServices Australia (1977) 76 FCR 151 cited
Lam v Austintel Investments Australia Pty Ltd (1989) 97 FLR 458 applied
Kabwand Pty Ltd v National Australia Bank Ltd (1989) 11 ATPR 40-950 applied
Travel Compensation Fund v Tambree trading as R Tambree and Associates (2005) 224 CLR 627 cited
Wardley Australia Ltd v Western Australia (1992) 175 CLR 514 cited
Ricochet Pty Ltd v Equity Trustees Executors and Agency Co Ltd (1993) 41 FCR 229 applied
Elders Trustee and Executor Co Ltd v E G Reeves Pty Ltd (1987) 78 ALR 193 applied
Pacific Brands Sports & Leisure Pty Ltd v Underworks Pty Ltd (2006) 149 FCR 395 cited
Hospital Products Ltd v United States Surgical Corporation (1984) 156 CLR 41 cited
Tracy v Mandalay Pty Ltd (1953) 88 CLR 215 cited
United Dominion Corporation Ltd v Brian Pty Ltd (1985) 157 CLR 1 cited
Gibson Motorsport Merchandise Pty Ltd v Forbes (2006) 149 FCR 569 applied
Pilmer v Duke Group Ltd (in liq) (2001) 207 CLR 165 cited
Commonwealth Bank of Australia v Smith (1991) 42 FCR 390 cited
Bertchnell v Equity Trustees Executor & Agency Co Ltd (1929) 42 CLR 384 cited
Chan v Zacharia (1984) 154 CLR 178 cited
Breen v Williams (1996) 186 CLR 71 cited
News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410 cited
Catt v Marac Australia Ltd (1987) 9 NSWLR 639 cited
Hill v Rose [1990] VR 129 cited
Meehan v Jones (1982) 149 CLR 571 cited
Waterman v Gerling Australia Insurance Co Pty Ltd (2005) 194 FLR 419 cited
Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2005) 223 ALR 560 cited
Ford’s Principles of Corporations Law, 22.450 (13^th ed 2007)
Meagher, Gummow & Lehane, Equity: Doctrines & Remedies, Ch 5 (4^th ed 2002)
Sutton, Insurance Law in Australia, 7.42 (3^rded 1999)
Finn, “The Fiduciary Principle” in Youdan (ed) Equity, Fiduciaries and Trusts, 10 ff, 1989
ALRC Report 20 Insurance Contracts, 1982
RAWLEY PTY LTD (ACN 009 027 454) AS TRUSTEE FOR THE TILTFORM UNIT TRUST & CONNOISSEUR HOLDINGS PTY LTD (ACN 009 441 007) v GEOFFREY YORK BELL, ROBERT RADOVAN SLADOJEVIC & TILTFORM LICENSING PTY LTD (ACN 083 878 666)
No SAD 80 of 2002
AMIN FRANCES CHEHADE v GEOFFREY YORK BELL, ROBERT RADOVAN SLADOJEVIC AND TILTFORM LICENSING PTY LTD (ACN 083 878 666)
No SAD 55 of 2002
FINN J
26 APRIL 2007
ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

SAD 80 OF 2002

BETWEEN:

RAWLEY PTY LTD ACN 009 027 454
AS TRUSTEE FOR THE TILTFORM UNIT TRUST
First Applicant

CONNOISSEUR HOLDINGS PTY LTD ACN 009 441 007
Second Applicant

AND:

GEOFFREY YORK BELL
First Respondent/Cross Claimant

ROBERT RADOVAN SLADOJEVIC
Second Respondent

TILTFORM LICENSING PTY LTD ACN 083 878 666
Third Respondent

CGU INSURANCE LIMITED ABN 2700 4478 374
First Cross Respondent

OAMPS INSURANCE LIMITED ABN 3400 5543 920
Second Cross Respondent

JUDGE:

FINN J

DATE OF ORDER:

26 APRIL 2007

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
(1) the application be dismissed;
(2)the cross-claim against the First Cross Respondent be dismissed with costs including reserved costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

SAD 55 OF 2002

BETWEEN:

AMIN FRANCES CHEHADE
Applicant

AND:

GEOFFREY YORK BELL
First Respondent/Cross Claimant

ROBERT RADOVAN SLADOJEVIC
Second Respondent

TILTFORM LICENSING PTY LTD
ACN 083 878 666
Third Respondent

CGU INSURANCE LIMITED
ABN 2700 4478 374
First Cross Respondent

OAMPS INSURANCE LIMITED
ABN 3400 5543 920
Second Cross Respondent

JUDGE:

FINN J

DATE OF ORDER:

26 APRIL 2007

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
(1) the application be dismissed;
(2)the cross-claim against the First Cross Respondent be dismissed with costs including reserved costs.

Note:   Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

SAD 80 OF 2002

between:

RAWLEY PTY LTD ACN 009 027 454
AS TRUSTEE FOR THE TILTFORM UNIT TRUST
First Applicant

CONNOISSEUR HOLDINGS PTY LTD
ACN 009 441 007
Second Applicant

GEOFFREY YORK BELL
First Respondent/Cross Claimant

ROBERT RADOVAN SLADOJEVIC
Second Respondent

TILTFORM LICENSING PTY LTD
ACN 083 878 666
Third Respondent

CGU INSURANCE LIMITED
ABN 2700 4478 374
First Cross Respondent

OAMPS INSURANCE LIMITED
ABN 3400 5543 920
Second Cross Respondent

SAD 55 OF 2002

BETWEEN:

AMIN FRANCES CHEHADE
Applicant

AND:

GEOFFREY YORK BELL
First Respondent

ROBERT RADOVAN SLADOJEVIC
Second Respondent

TILTFORM LICENSING PTY LTD
ACN 083 878 666
Third Respondent

CGU INSURANCE LIMITED
ABN 2700 4478 374
First Cross Respondent

OAMPS INSURANCE LIMITED
ABN 3400 5543 920

Second Cross Respondent

JUDGE:

FINN J

DATE:

26 APRIL 2007

PLACE:

ADELAIDE

THE RAWLEY CLAIMS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [10]
The Principal Actors and Background Information........ ........ ........ ........ ........ ........ ........ ....... [10]
(i)     Sladojevic........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [10]
(ii)     Bell........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [11]
(iii)    Benson........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [12]
(iv)    The Ilic WA investors/the Icon Group........ ........ ........ ........ ........ ........ ........ ........ ........ . [15]
(v)     Parker........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [17]
(vi)    Lee........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [18]
the tiltform technology, tiltform licensing agreements and associated documents........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [19]
The technology/patent issues........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [20]
Marketing and licensing documents........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [23]
THE MATTERS IN ISSUE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [30]
THE MISLEADING OR DECEPTIVE CONDUCT CLAIMS........ ........ ........ ........ ....... [37]
WITNESSES AND WITNESS ISSUES........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [45]
Sladojevic’s deceptive strategies........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [57]
Affidavits........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [63]
1.      THE 2 JUNE MEETING........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [64]
Findings and Conclusions on the 2 June meeting........ ........ ........ ........ ........ ........ ........ ........ .. [74]
2.      PERTH: 23-26 JUNE 2000........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [76]
Sladojevic, Bell and Benson in Perth........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [79]
3.      26 JUNE – 17 JULY........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [116]
(i)     The follow-up to the proposal........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [117]
(ii)     John Dawkins........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [124]
(iii)    The 12 July BDO projections........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [127]
(iv)    Raising of loan capital........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [134]
4.      THE 17 JULY MEETING........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [137]
Findings on the 17 July meeting........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [152]
5.      17 JULY – 11 AUGUST........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [158]
The later BDO projections........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [158]
6.      THE 7 AUGUST LETTER AND THE INVESTMENT........ ........ ........ ........ ....... [165]
Findings on the 7 August letter........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [184]
After the investment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [189]
OTHER MISLEADING CONDUCT........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [198]
CAUSATION AND RELIANCE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [209]
THE MISLEADING OR DECEPTIVE CONDUCT CLAIMS: CONCLUSIONS.... [238]
NEGLIGENCE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [243]
THE PROMOTER CLAIMS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [246]
CONCLUSION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [271]
THE CHEHADE CLAIMS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [272]
The Principal Actors, Issues of Credibility and Background Information........ ........ ........ ... [273]
(i)     Sladojevic........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [273]
(ii)     Bell........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [275]
(iii)    Benson........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [278]
(iv)    Chehade........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... [279]
THE MATTERS IN ISSUE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [281]
MISLEADING OR DECEPTIVE CONDUCT CLAIMS........ ........ ........ ........ ........ ...... [287]
Chehade as a witness........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [288]
(i)     The professional/business relationships........ ........ ........ ........ ........ ........ ........ ........ .... [290]
(ii)     Chehade’s skill and experience........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [296]
(iii)    Working at Greenhill Road........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [297]
(iv)    Tripodi’s employment by Bell Chehade........ ........ ........ ........ ........ ........ ........ ........ ..... [301]
(v)     The timing of Chehade’s investment decision........ ........ ........ ........ ........ ........ ........ .... [303]
(vi)    Bell’s offer to sell his practice........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [316]
THE MISREPRESENTATIONS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [326]
(i)     The first misrepresentation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [326]
(ii)     The second misrepresentation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... [334]
(iii)    The third and fourth misrepresentations........ ........ ........ ........ ........ ........ ........ ........ .... [341]
(iv)    The fifth misrepresentation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [343]
(v)     The other wrongful conduct pleaded........ ........ ........ ........ ........ ........ ........ ........ ........ . [356]
CAUSATION AND RELIANCE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [362]
The 7 August letter........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [363]
Chehade’s investment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. [373]
NEGLIGENCE........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [375]
CONCLUSION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... [376]
THE CROSS-CLAIMS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... [377]
The factual setting........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ [383]
Consideration........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... [389]
CONCLUSIONS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . [397]
REASONS FOR JUDGMENT

These two cases concern the attempts of investors in a failed start-up company, Tiltform Australia Pty Ltd, to recoup their losses from those who are said to have induced their investments or who were otherwise liable to them for their losses.
In the first proceeding, that initiated by Rawley Pty Ltd as trustee for the Tiltform Unit Trust and by Connoisseur Holdings Pty Ltd as a beneficiary of that trust, claims are made (i) against the first respondent, Geoffrey Bell, for negligent misrepresentation; (ii) against Bell and the second respondent, Robert Sladojevic, for declaratory relief and damages in respect of their being concerned in, or aiding and abetting of, contraventions of ss 52 and 59(2) of the Trade Practices Act 1974 (Cth) (“the TP Act”) and the equivalent provisions of the Fair Trading Acts of South Australia and Western Australia; (iii) as a result of a late amendment, against Bell and Sladojevic for declaratory relief and damages/compensation under s 1325 of the Corporations Law in respect of contraventions of s 995 of the Law; and (iv) against Bell and Sladojevic, for compensation for breach of fiduciary duty as alleged promoters of Tiltform Australia. No claim for relief is made against the company, Tiltform Licensing Pty Ltd, whom it is alleged contravened the above statutory provisions. The misleading or deceptive conduct claims made against Bell and Sladojevic relate nonetheless to conduct attributable to Tiltform Licensing.
In the second proceeding Amin Chehade makes like claims against Bell and Sladojevic although the conduct relied upon to found these claims differs significantly from that in issue in the Rawley matter. Nonetheless as the two proceedings share much in their factual substratum, it has been considered appropriate that they be dealt with together and it was ordered that the evidence in one, insofar as it was relevant and admissible, would be evidence in the other.
In both the Rawley and Chehade matters there are, additionally, cross-claims by Bell against CGU Insurance Ltd challenging CGU’s cancellation of his professional indemnity insurance policy. He seeks indemnification etc in respect of any liability to Rawley or Chehade in the present matters. The cross-claims will be considered in the last part of these reasons.
In both matters the conduct of which complaint is made occurred over roughly a three month period in 2000. Only one set of the representations impugned – those of Sladojevic of 7 August 2000 – is evidenced in a document. The rest were allegedly oral. Their having been made is disputed. Issues of credibility, of alleged reconstruction and of accuracy of recall beset this matter. As will be seen, I have rejected oral evidence of all of the principal witnesses in some degree.
In the event I have concluded that both applications and Bell’s cross-claims should be dismissed.
There is a bewildering array of corporate and other actors who have participated in the events leading to these proceedings. To assist understanding I have appended two schedules to these reasons. The first lists the various corporations mentioned in these reasons. Many have the word “Tiltform” in their name. The purpose of the list is to help in differentiating them. The second list is of the various natural persons to whom I will refer in these reasons. It indicates the respective positions of each person and his or her relationship to the companies mentioned in Schedule 1.
For ease in exposition I will deal with the general background and setting to the claims made in both matters in my consideration of the Rawley claims. The matters distinct to the Chehade claims will be deferred to my separate consideration of those claims.

I would add that the ready resolution of these matters was complicated by the unexpected duration of the hearing – the taking of evidence occupied 21 days – by Bell representing himself throughout, by Sladojevic changing his legal representatives when the trial had been adjourned after 11 days of hearing, and by the colourable character or uncertain provenance of some parts of the documentary evidence.
THE RAWLEY CLAIMS
The Principal Actors and Background Information
(i) Sladojevic
In 1997 Sladojevic, with Alex Vinet, developed a new concrete formwork system which was designed primarily for use in on-site casting of concrete wall panels and other concrete structures (“the Tiltform technology”). AR Tiltform Pty Ltd (“Tiltform”) was formed in 1998 to hold the intellectual property rights to the technology for which a patent application had been lodged. Between 1997 and 1999 Sladojevic and Vinet conducted the businesses of manufacturing formwork and concrete panels and of hiring out the formwork through a company, A R Tiltwall Services Pty Ltd. They were each directors and 50 per cent shareholders in both of the above companies. In March 1999 the manufacturing business was sold to Dino Pietrobon who had formed a company called Tiltwall Services Pty Ltd. In August 1999 Tiltform Licensing Pty Ltd (“Tiltform Licensing”) was incorporated for the purpose of conducting the hire business as trustee for a unit trust the beneficiaries of which were investment companies of Sladojevic and Vinet. Vinet and Sladojevic were directors and, indirectly, each 50 per cent shareholders in A R Tiltwall Services, Tiltform and Tiltform Licensing. Save for retaining a 25 per cent interest in Tiltform, Vinet resigned his positions and interests in these companies in September 1999 in circumstances to which passing reference will later be made. Sladojevic then held a 100 per cent interest in Tiltform Licensing. Prior to Vinet’s resignation it was decided to expand Tiltform Licensing’s hiring business and to market it throughout Australia. On the advice of Bell, who had previously been retained by Sladojevic and AR Tiltwall Services, it was decided to implement the expansion by licensing others to hire out the formwork system. So the process began of attracting licensees which resulted in these proceedings.
(ii) Bell
In 1997 Bell was the sole member of an accounting practice trading under the name Bell Partners. He had previously been a partner in an established firm. As at mid-1999, Bell Partners provided both accounting and business consulting services. Sladojevic retained Bell as his accountant and business adviser in early 1998. He was later engaged to provide services for Tiltwall Services and Tiltform and he incorporated Tiltform Licensing. In time Bell Partners became the accountants and advisers for the Tiltform group of companies which became the business’ major client. Bell engaged Amin Chehade as an accountant in 1997, Chehade providing the accountancy services and Bell the business advisory services of Bell Partners. In April/May 2000, Bell Partners moved to premises at Greenhill Road, Wayville. On the same relatively open-planned floor of the building were the offices of the Tiltform group and, later, Tiltform Australia’s office. Bell regarded this arrangement with Sladojevic under which they worked closely together and shared Bell Partners facilities as being mutually beneficial because that was “what was required of my involvement with the Tiltform Group”. In late July 2000 he offered to sell his practice to Chehade for, according to Bell, $200,000 and, later, for $50,000 with vendor finance. Chehade declined both offers. By August 2000 Bell had joined Tiltform Licensing as a director. He had earlier (September 1999) taken, indirectly, a 5 per cent share interest in the company. Chehade being unprepared to buy Bell’s practice, Bell sold Bell Partners in late 2000. He fell out with Sladojevic in early 2001 and resigned all his positions in the Tiltform group around this time.
(iii) Benson
Benson was the managing director of Tiltform Australia from its formation in May 2000 until it was wound up in April 2001. Though involved in some number of the meetings, etc in dispute in this proceedings, he is one of the few apparently disinterested principal actors in that he is not a party to these proceedings. The following skeletal outline of the circumstances giving rise to the formation of Tiltform Australia is not intended to represent findings. My purpose here is simply to provide background to the matters that are in issue. Benson controlled a company, Burnstop Pty Ltd, that supplied specialised building products to the building industry. His wife, Rita, had had previous business contact with Sladojevic and became aware that he was considering selling the hiring business. At the end of 1999 or early 2000 they met with Sladojevic at which meeting the Tiltform system was explained to them as was his proposal to licence it in each State. Benson apparently evinced an interest in the South Australian licence but was informed that there was an in-principle agreement with a Jim Brennan to take that licence and one other. He was also told that the WA licence was not available. Nonetheless he was supplied with “roll-out” booklets for each State except Western Australia containing details of the costs of the respective licence and forecasts of potential income. Benson then sought advice from an Andrew Lloyd, a financial adviser, who, having been shown the booklets, suggested that Benson proceed not only with the South Australia licence but should seek to obtain the licence for the whole country. Benson believed he did not have the capital to go into the purchase of the South Australian licence and needed somebody to assist him in raising funds to do so.
In the course of discussions involving Bell, Sladojevic, Benson and Lloyd in January (though all were not present at each discussion), the proposal for a licence for all of Australia (excluding Western Australia) was considered. After obtaining legal advice Jim Brennan was offered, and acquiesced in taking, the licence for New Zealand. By early February 2000 Bell was supplying Benson with draft documents for the national licence excluding Western Australia. On 10 February Bell indicated to Benson the details of the basis of any licensing arrangement with Benson. These included a payment of $890,000 for the Territories on offer (these included $90,000 for SA/NT and $300,000 for Victoria/Tasmania), $500,000 to be paid upfront and $390,000 on terms to be agreed, $50,000 would be required as a deposit. Benson subsequently indicated that he and Lloyd would proceed first with the SA/NT licence before the eastern States licences and offered $50,000 deposit for that licence. Bell continued to hold out for the upfront payment of $500,000.
The expected $50,000 deposit had not been paid by 24 February leading to Bell’s complaints about delay. By 2 March Benson and Lloyd had made advances to Bell of $50,000 of which Benson provided a total of $10,000. He had no recollection of making any other payments on his own behalf. Apparently on 13 March 2000 Benson took over Tiltform Licensing’s hire business. At that time he had not paid the SA/NT licence fee, nor had he paid a further $60,000 for the purchase of the SA formwork. Throughout April and May Bell and Sladojevic remained concerned that the moneys promised by Benson and Lloyd were not forthcoming. Bell complained of this on 26 April 2000. The response was a cheque drawn on the Lloyd Family Trust for $250,000 which was dishonoured on 7 June 2000. It was made plain to Benson that he needed a new investor if he was going to secure the licences. He ceased dealing with Lloyd and introduced Dr Ben Abraham as an investor. Ben Abrahams paid Bell $250,000 in early June. To backtrack, Tiltform Australia was incorporated on 1 May 2000. Benson was then its sole shareholder and director. Its licence agreement for South Australia and the Northern Territory was executed on 6 June 2000. By this time the first of the meetings giving rise to the Rawley proceedings – that of 2 June 2000 – had occurred. By at least early-mid July, Tiltform Australia’s offices were on the same floor of the Greenhill Road premises occupied by Bell Chehade and Tiltform Licensing.
(iv) The Ilic WA investors/the Icon Group
Peter Ilic was an acquaintance of Sladojevic in Perth; his brother was Sladojevic’s friend. He and Sladojevic met up at a presentation of the Tiltform technology that Sladojevic gave in Perth in June 1999. Ilic then indicated that he would see if he could get together a group to acquire an exclusive licence for Western Australia: Sladojevic later told him that the upfront fee “for a period spanning the life of the patent”: Affidavit, par 34; was expected to be around $100,000. Ongoing royalties would also be payable. A company, subsequently called Tiltform Concrete Systems (WA) Pty Ltd (“Tiltform WA”) which was operated by Ilic, a Darren Jennings and Joe Barone executed an exclusive licence 20 March 2000. Barone, who seems to have been Ilic’s father-in-law, financed the investment through a $225,000 funding arrangement with Ilic apparently designed to get the business up and running. I note in passing that in December 1999/January 2000 Ilic, who had previously worked in Sydney with Sladojevic, worked in the Adelaide offices of Tiltform Licensing to learn the conduct of the hiring operations.
The licensing agreement reached with Sladojevic deferred payment of the $100,000 licence fee until 1 July 2000. Bell’s evidence was that the reason for the deferral was because the company needed to purchase formwork and Barone’s money was put into that. This was seen as “their most functional way of going”. A product launch which Sladojevic attended was held in Perth. After that demonstration a director of Icon Group Management Pty Ltd (“the Icon Group”), Guiseppe (“Joe”) Murabito, met Sladojevic. While impressed with the technology, he said he expressed no interest in it at that stage. He did tell another of the Icon directors who also was there – Renato Palmiero – that he thought Icon Group should approach Tiltform WA and seek some form of “preferred contractor” status. Murabito recommended the system as well to Gavin Lee, the company’s third director and to its accountant, Greg Parker. Shortly after Icon Group commenced hiring from Tiltform WA, discussions were initiated between Ilic and Icon Group regarding investing in Ilic’s company. There is some debate over whether Ilic approached Murabito and Icon Group at Sladojevic’s suggestion, or whether Icon Group approached Ilic. Be this as it may, it is clear that Icon Group decided it would be more economical for it to acquire the WA licence than to hire formwork from Tiltform WA. It was also known that Barone wished to withdraw his $225,000 from the business and that Tiltform WA needed working capital. Murabito raised the prospect of investing in Tiltform WA at a directors meeting on 26 May 2000 at which an investment proposal which probably emanated from Ilic was discussed. There had been some exchange of correspondence prior to that meeting. The proposal, according to Parker, was for Icon Group to take a 72 per cent equity interest in Tiltform WA for $505,000 plus a further $70,000 to pay out a director’s loan. Parker was asked by the Icon directors if he wished to review this investment opportunity personally, not as their accountant, as they were interested in looking at it as investors – Parker agreed to this. A week later he and Murabito were at their first meeting with Sladojevic and Bell in Adelaide.
(v) Parker
Though a central figure in the Rawley proceedings, all that need be noted of Parker at this point is that he was Icon Group’s independent accountant; he was the person to who Murabito, Lee and Palmiero looked to for financial advice relating to the proposed investment in Tiltform WA; he, with Lee, became the original trustees of the Tiltform Unit Trust in August 2000, that trust being the vehicle through which the investment in Tiltform Australia was made by Murabito, Palmiero, Lee, Parker (via his company Rawley), Airport Consulting Pty Ltd and Connoisseur Holdings Pty Ltd (collectively the “WA investors”); and he became a director of Tiltform in Australia in early September of 2000.
(vi) Lee
Reference has been made to Lee above. I would note additionally that he was involved in most of the events giving rise to the Rawley proceedings. He was an architect and builder and at or around the relevant times he was studying for, and obtained, an MBA. For a period shortly after the investment was made in Tiltform Australia on 11 August, he worked in Adelaide as General Manager of Tiltform Australia. He was appointed a director of Tiltform Australia on 4 September 2000 although that appointment was never formally registered.
the tiltform technology, tiltform licensing agreements and associated documents
What follows is an account of (a) the status of aspects of the Tiltform technology insofar as it is relevant in these proceedings and of disputes, real and contrived, involving the/a Tiltform patent; and (b) documents prepared for Tiltform Licensing relating to the marketing and licensing of the technology. It is convenient to deal with these matters here as they provide background and context, for an understanding of the principal events described later in these reasons.
The technology/patent issues
I have earlier given a description of the essence of the Tiltform technology. It was, to an extent at least, the subject of one or more patent applications as is evidenced in the Schedule to the SA/NT Licence Agreement. It seems that at least one patent was later granted in respect of it. It is also clear that the technology itself became the subject of litigation(s) between a company or companies associated with Gino Pietrobon (who purchased the manufacturing business of A R Tiltwall Services) and Tiltform Licensing. An aspect of these litigations was an alleged patent breach by a Pietrobon company of Tiltform’s “patent” – a breach which was witnessed by Sladojevic on 6 August 2000. There has been some controversy as to when Sladojevic became aware of the breach, although I am satisfied that it probably was on or about the date I have given. Both Bell and Benson were made aware of this matter when in New Zealand on 7 August although Benson may well have had prior knowledge of it. By 10 August 2000 Sladojevic and Bell were meeting with patent attorneys to discuss the breaches of patent. It is unnecessary for me to determine when the relevant patent was granted (it seems not to have been before the above date) although it does seem that, by later in the year, patent litigation was on foot and was continuing up to the time Tiltform Australia went into voluntary administration. There appears to have been communications between Sladojevic and at least Benson as to the sharing of the costs of the action against the Pietrobon company.
A difficulty I have with the evidence is that, despite insisting during oral evidence his solicitor had “drilled into him” to distinguish between a “patent” and a “patent application”, Sladojevic not only in his affidavit (see e.g. par 34) but also in documents he authored, used the term “patent” to describe both. I am not prepared to accept he was any more precise in oral communication. I will return to this. I should also add that there are documents, the provenance of the information in which can be traced back to Sladojevic, which create an entirely false impression of the patent litigation and its prospects. As I will later indicate these documents were contrivances designed to secure an advantage to Sladojevic in his subsequent dealings with Vinet in late 2000.
Benson’s evidence is that he learned of the alleged Pietrobon breach of the patent before the Rawley Unit Trust investors made their investment in Tiltform Australia. He could not recall if he told them about it. Parker’s evidence is that he did not become aware of this litigation before March 2001 and that mention of it did not find its way into board minutes of Tiltform Australia. It is clear from correspondence between Lee and Tiltform Australia’s lawyers of 14 and 19 September 2000 that Lee both was aware of the breach of patent proceedings and of Tiltform Licensing’s pursuit of a cost-sharing arrangement with Tiltform Australia for the litigation.
Marketing and licensing documents
There are four classes of document used by Tiltform in the conduct of its licensing business to which I need refer. These are (i) the marketing proposal booklets; (ii) confidentiality agreements; (iii) disclosure documents created in accordance with the Franchising Code of Conduct: see Trade Practices (Industry Codes Franchising) Regulations 1998 (Cth); and (iv) licensing agreements.
The marketing proposal booklets for the various State and Territory licences on offer had their genesis in a document prepared by Sladojevic (with assistance) at some time in late 1999. They were based on an assessment of the size of the Adelaide market and on actual trading results in Australia. These were extrapolated to determine the likely size and profitability of the markets in the other States and Territories. Copies of the booklets are in evidence. Apart from describing the virtues of the Tiltform system, each outlined the costs, the savings effected and the rental and sales rates and profitability in the Adelaide market and then went on under the heading “proposed roll out costs and returns for the [respective State] market” to provide an 8 year profit/loss projection for that State.
As I earlier indicated, Sladojevic provided Benson with copies of these booklets in late 1999/early 2000. In his affidavit Sladojevic stated he provided the copy relating to Western Australia to Ilic prior to Tiltform WA entering into the WA licence agreement. There is no evidence suggesting that either Ilic or Benson provided any of the Icon Group directors or Parker with such a booklet prior to their proposed investment in Tiltform WA or their actual investment in Tiltform Australia.
The confidentiality agreements were of a form routinely used in business negotiations. They were required to be signed by Murabito and Parker prior to their first meeting with Sladojevic and Bell in Adelaide on 2 June of 2000.
The disclosure document (prescribed by the TP Act s 51AE) is in evidence and was given to Benson and Lloyd for the proposed Australian licences (other than Western Australia). Of present relevance, the document outlines estimates of projected establishment costs and/or costs items to start up the hiring business in each State and Territory; the initial licence fee for each licence; and the ongoing licence fee of 7 per cent. In relation to “Earnings Information” it stated:
“The licensor does not give earnings information about any proposed licence. Any previously presented financial figures or projections of the licensor must (other than for actual trading figures) not be relied upon by the licensee (See Special Condition 14.1(a)) and have been put forward as a guideline only for the licensee’s own assessment with its accounting and other professional advisors.
Earnings may vary between licences.
The only actual earnings are that of the business in South Australia conducted by the licensor since February 1999, for which enquiries can be made direct with the licensor or its accountant and Item 20 hereof will provide some financial details of the same.”
It is Parker’s evidence (which I accept) that he received the above version some time prior to a meeting on 17 July to which reference is made below.
Several of the licence agreements (some signed, some not) are in evidence. They are in standard form. I will refer only to the SA/NT licence for present purposes. It contains clauses favourable to the licensor and intrusive powers to control the licensee which commonly are found in exclusive licences involving the use and exploitation of intellectual property. For present purposes I merely note the following. The licensee was obliged (i) to use a specified “Tiltform” business name and to have its corporate name regulated: cl 8.1; Sched cl 15.19; (ii) to have its advertising pre-approved: cl 8.4; (iii) to have its manager approved in writing: cl 8.7; (iv) to keep approved hiring and sales reports and to deliver these to the licensor as directed: cl 8.13; and (v) to keep approved books of accounts and records and to operate such accounting systems as the licensor prescribed and to permit the licensor and its agents to inspect etc the same when so requested: cl 8.14. Importantly, cl 11.2.4 provided:
“11.2.4If the Licensee is a corporation (whether in its own right or as trustee of any trust) there shall be:-
(i)no change in the directors of the Licensee;
(ii)no allotment of shares by the Licensee; or
(iii)no registration or any transfer of shares;
without first obtaining the prior written approval of the Licensor.”
The licence was unassignable without the prior written approval of the licensor: cl 12.1. A separate clause conferred a veto power on any allotment or sale by the Licensee of shares or of units in a unit trust which had the effect of transferring the effective control of the corporation or unit trust to a third party.
THE MATTERS IN ISSUE

There are four separate events or actions taken between 2 June 2000 and 7 August 2000 at, or in, which Sladojevic and/or Bell are alleged to have made actionable misrepresentations on behalf of Tiltform Licensing. These were:
(1) on 2 June at a meeting in Adelaide –
(i)Sladojevic represented to Parker that investment in the Tiltform group was a secure investment; and
(ii)Bell and Sladojevic assured Parker as to the commercial viability of claims made by and on behalf of the Tiltform Group with respect to the “Icon Group’s” proposed agreement to take a 72 per cent interest in Tiltform WA.
(2)on 26 June at a meeting in Perth –
(iii)Bell represented to the Icon Group directors and Parker that over $2 million in investment for Tiltform Australia had already been raised;
(iv)Sladojevic represented that there would be sufficient working capital in Tiltform Australia;
(3)on 17 July at a meeting in Adelaide with Benson, Parker and Lee –
(v)Bell again represented that the capital sum of 2 million dollars had already been raised for Tiltform Australia; and
(4)on 7 August Sladojevic sent a letter to Benson, intending it to be forwarded to Parker and the WA investors, which stated that:
(vi)unless they were to commit to Tiltform Australia within 48 hours the investment opportunity would be lost;
(vii)Tiltform Licensing had previously been offered the sum of $250,000 for the WA licence;
(viii)the funds were required within the 48 hours at which time negotiations with other investors who wished to invest in Tiltform Australia would be resumed; and
(ix)Sladojevic had spoken that day to Tiltform Australia Chairman, John Dawkins, and was certain that Dawkins could find replacement investors.
Additionally, because of the non-disclosure of information in relation to some number of matters, it is pleaded that Bell and/or Sladojevic engaged in other material instances of misleading or deceptive conduct. These, for the most part, have been abandoned. I will deal separately with the few remaining non-disclosure claims relied upon: see below “Other Misleading Conduct”.
The pleading translates the conduct of Bell and Sladojevic into claims under the TP Act in a rather circuitous and, to a degree, an unrevealing way. That conduct is said to have contravened s 52 and s 59 of the TP Act. The primary contravenor is said in the application to be Tiltform Licensing although no relief is sought in the proceeding against that company. Declarations and damages are sought against Bell and Sladojevic under s 82 of the TP Act on the basis that, for the purposes of s 75B of the TP Act, they were knowingly involved in Tiltform Licensing’s contraventions. Parallel claims are made against them under the equivalent provisions of the Fair Trading Act 1987 (SA) and the Fair Trading Act 1987 (WA).
Following amendments to the application and pleadings which I raised with the parties after the hearing of the matter, the same conduct of Bell and Sladojevic as was said to have contravened s 52 of the TP Act was alleged in the alternative to have contravened s 995 of the Corporations Law. Relief was sought under s 1325 of the Law. This amendment was a technical, but necessary, one. The reason I raised it with the parties is that the matter was founded on the premise that the alleged wrongs gave right to causes of action under Part V of the TP Act. Those wrongs were committed at various dates in 2000 and were related to dealings in the “securities” (i.e. shares) of Tiltform Australia. At that time s 51AF of the then TP Act stipulated that Part V did not apply to the supply of services that are financial services. Such “services” includes “securities”: see Australian Securities and Investment Commission Act 1989 (Cth), s 12BA(1) (“financial services”). Section 995 of Ch 7 Pt 7.11 of the Corporations Law as it stood in 2000 prohibited a person in connection with any dealings in securities from engaging in conduct that was misleading or deceptive or was likely to mislead or deceive (i.e. the same formula in part as in s 52 of the TP Act). “Securities” were defined in the Law to include “shares”: s 92(2). Relief could be granted under s 1325 of the Corporations Law in respect of conduct constituting a contravention of Pt 7.11. Finally, s 995A of the Corporations Law provided that the provisions of State Fair Trading Acts (defined in s 9 to include those relied upon in these proceedings) did not apply to dealings in securities. If the principal claims made in the Rawley – and for that matter the Chehade – matter were not to be dismissed on formal jurisdictional grounds, the amendment I raised was necessary.
A separate negligence claim is made against Bell who it is said owed a duty of care to the applicants in making representations to them in relation to their proposed investments in, first, Tiltform WA and the Tiltform Australia; reasonable reliance on those representations is pleaded, the representations being essentially the same as the misrepresentations and other misconduct pleaded against him in the Misleading or deceptive conduct claim. Breach of the alleged duty of care arose essentially because of the same factors that rendered the representations misleading or deceptive in the Misleading or deceptive conduct claim.
A further claim is made against Bell and Sladojevic as promoters of Tiltform Australia. The basis of this claim appears to be that they were promoting the taking up of shares in Tiltform Australia although, as put, much is made of the allegedly fiduciary character of the licensor (Tiltform Licensing) and licensee (Tiltform Australia) relationship. I would note here that, at the beginning of the hearing I indicated my difficulty with this claim. The supplementary submissions advanced after the end of the hearing have not dispelled my difficulty. The breach of fiduciary duty asserted arises from alleged non-disclosure of matters that relate in the main to dealings between Tiltform Licensing and Benson prior to the emergence of the WA investors in June 2000 although the non-disclosures also relate to conduct in issue in, or else relevant to, the misleading or deceptive conduct claims.
I will as a matter of convenience deal with the misleading or deceptive conduct claims first. They provide an appropriate vehicle through which to expose most of what is in issue in each of the claims.
THE MISLEADING OR DECEPTIVE CONDUCT CLAIMS
The applicants in this matter have not abandoned their TP Act and State Fair Trading Act claims notwithstanding that they have, in my view, been excluded by the then s 51AF of the TP Act and s 995 of the Corporations Law. Nonetheless, I will refer to both claims primarily because the substantial jurisprudence on what is misleading or deceptive, etc for TP Act purposes is generally applicable to s 995 (and its successor in s 1041H of the Corporations Act 2001 (Cth)): see generally Ford’s Principles of Corporations Law, 22.450 (13^th ed 2007).
By way of statutory background I should note, first, that a corporation contravenes s 52 of the TP Act if it engages in conduct in trade or commerce that is misleading or deceptive or is likely to mislead or deceive. It is not in dispute in this matter that the misleading or deceptive conduct alleged, if it occurred, was in trade or commerce. For present purposes, I need only note as well that conduct is misleading or deceptive if it induces or is capable of inducing error. Whether it has this character is a question of fact to be determined on the evidence as to the context in which it occurred and the relevant surrounding facts. So much is well established.
Though it has not loomed large at all in the applicants’ submissions I should also note s 59(2) of the TP Act the contravention of which has been pleaded in relation to alleged misrepresentations with respect to the profitability of, and the level of working capital available to, Tiltform Australia. It provides insofar as presently relevant:
“(2)Where a corporation, in trade or commerce, invites, whether by advertisement or otherwise, persons to engage or participate, or to offer or apply to engage or participate, in a business activity requiring … the investment of moneys by the persons concerned and the performance by them of work associated with the investment, the corporation shall not make, with respect to the profitability or risk or any other material aspect of the business activity, a representation that is false or misleading in a material particular.”
Section 75B for present purposes deems a person to be involved in a contravention of (inter alia) Part V (which includes s 52 and s 59 by a corporation if that person “has been in any way, directly or indirectly, knowingly concerned in, or party to, the contravention”: see s 75B(1)(c). This, as I earlier noted, is the vehicle relied upon by the applicants to impose liability on Bell and Sladojevic under s 82 of the TP Act in respect of the contraventions alleged against Tiltform Licensing by virtue of their conduct: see Wheeler Grace & Pierucci Pty Ltd v Wright (1989) 11 ATPR 40-940. Section 75B does not require that the participant knew he or she was participating in a contravention of the Act. What, though, is required is actual knowledge of the essential elements of the contravention and intentional participation in it: Yorke v Lucas (1985) 158 CLR 661 at 666 ff.
Section 82(1) provides:
“A person who suffers loss or damage by conduct of another person that was done in contravention of a provision of Part V may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.”
Turning now to the much more direct course laid open by s 995, subs (2) of that section provides that a person shall not, in or in connection with any dealing in securities engage in conduct that is misleading or deceptive or is likely to mislead or deceive. I would note that this provision applies directly to “a person” hence the lack of any need to pursue Bell or Sladojevic via accessorial liability provisions as is necessary under the TP Act.
Section 1325(1), insofar as presently relevant, empowers the Court to compensate a person who has suffered loss or damage because of another’s conduct that was engaged in in contravention of s 995 for the loss or damage so suffered.
While I will deal in turn with the principal events in which misleading or deceptive conduct is alleged to have been engaged in, I preface this with observations on the principal witnesses in this matter. The need for this will become plainly apparent given the issues of credibility and reliability I have already foreshadowed.
WITNESSES AND WITNESS ISSUES
It is clear both from their evidence and from their conduct in this proceeding that a considerable level of personal hostility came to exist – and still exists – between Sladojevic and Parker. Both are quite opinionated. Their personal styles are markedly different and their personalities clashed. I am not prepared to discount their animosity in my treatment of the evidence of either of them, but of Parker in particular. I consider the view he has of Sladojevic, of his personality and of his behaviour has on occasion coloured his evidence and the subject matter of his recall. In saying this I am not suggesting his evidence was deliberately dishonest or vengeful.
Bell’s relationship with Sladojevic is equally a matter of which account ought be taken in evaluating his actions as revealed in the evidence. He and Sladojevic clearly had a successful working relationship over a number of years to the point where Bell was prepared to forsake his professional practice and to join forces with Sladojevic in the Tiltform group. However, that relationship unravelled over a relatively short time. Bell’s own evidence is that he could be persuaded and/or dominated by Sladojevic to the extent of engaging in actions which he might otherwise have refrained from doing. That he would so act was demonstrated starkly in his participation in the successful strategy of September 2000 to get Vinet to agree to sell his shares in Tiltform which required the deliberate giving of false instructions to lawyers and to making of serious misrepresentations about the viability and poor financial position of the Tiltform group of companies. Bell knew this was a sham; he was unhappy about it; but he went along with it: see below, “Sladojevic’s deceptive strategies”. By November 2000 he was wanting to get out; he did not like the way things were going and the way business was being done; Sladojevic “stopped listening to my advice”; he was denied access to Tiltform Licensing’s books; etc. In January 2001 lawyers representing Sladojevic wrote to Bell on several occasions making serious imputations against him. The allegations were denied but this heralded the end of Bell’s relationship with Sladojevic. They each executed a deed of release on 5 March 2001. It emerged in Sladojevic’s cross-examination that the allegations made in the January letters were again “strategy” representations. Sladojevic conceded the instructions he gave were not true: such allegations “get made for leverage”. Bell, seemingly, was unaware of this when he gave evidence in the matter. I have recounted the above, not because Bell has given evidence sharply critical of Sladojevic (which he has not) but because the nature of his relationship with Sladojevic probably provides some explanation of his actions.
I equally should comment on Sladojevic’s relationship with Benson. This relationship needs to be considered bearing two matters in mind – first, Sladojevic’s tendency to domineer; and, secondly, his power over Tiltform Australia by virtue of the licence agreements Tiltform Licensing had with it. While Benson was, in the relevant period, within Sladojevic’s power vis-à-vis investments to be made in Tiltform Australia, the evidence is that at that time their relationship was cordial. I accept that Benson readily accepted and acted upon proposals and suggestions of Sladojevic relating to securing investment in Tiltform Australia. But I do not accept, and it has not been suggested, that Sladojevic was in essence a “shadow director” of Tiltform Australia: cf Secretary of State for Trade and Industry v Deverall [2001] Ch 340 at 354; Australian Securities Commission v A S Nominees Ltd (1995) 133 ALR 1 at 52-53. The evidence is that Benson had and relied upon his own financial advisers in relation to the formation and their operation of Tiltform Australia and that he was experienced in the conduct of his own businesses. I do not accept that he was simply Sladojevic’s cipher despite Parker’s occasional attempts to paint him as such.
As I have foreshadowed issues of reliability and credibility have loomed large in this matter. The critical events occurred five years before the hearing in this matter and occurred within a very short period (i.e. 2 June – 7 August 2000). None of the misrepresentations about which complaint is made (save that of 7 August) is evidenced, or even alluded to, in any way in contemporary documents. The three critical meetings (i.e. of 2 June, 26 June and 17 July) at which misrepresentations are alleged to have been made, are the subject of totally divergent and inconsistent accounts.
Because of the views at which I have arrived as to the reliability of the various witnesses, it is appropriate that I provide some explanation at the outset of why I regard them individually as I do.
Parker has obviously invested considerable time and effort in attempting to recall the events leading up to and the reasons for, the WA investment. There is nothing in his own contemporary notes to support his claims that the oral misrepresentations were made. I consider that significant parts of his evidence, particularly when describing what he says were his own opinions, judgments, understandings and motivations at the time, are unreliable. I am satisfied that those opinions etc, often represent after the event rationalisations and explanations for his own actions and they often ascribe significance to matters which those matters did not have to him at the time.
I do not consider Parker to have been untruthful. Rather he has in certain critical respects convinced himself that things were said or done which I have not found to be made out on the evidence before me. I accept in this that he was influenced by his motivation to do his best for the investors he had brought into the WA group and for whose loss he appears to feel a responsibility. This is understandable given the manner in which that loss was incurred.
Lee. This witness’ affidavit contained a significant number of annexures with the contents of which he had well familiarised himself. When taken away from these documents his evidence was far less convincing. I am satisfied that there was a significant degree of reconstruction in his evidence. What is clear is that he was unwilling to accept responsibility for financial decisions, the raising of financial concerns, etc. These were, he said, Parker’s responsibility. I am by no means satisfied that he was so blindly trusting as he sought to convey.
Murabito. Such was Murabito’s lack of recall of events, that I consider his recall of a few strategically significant matters (e.g. Bell’s “$2 million” assurance on 26 June 2000) should be treated with circumspection. In saying this, I am quite conscious of how fallible are memories and of the remoteness of the events about which Murabito was being questioned in close detail.
Benson. Given he was not a party to these proceedings, but was an actor in some of the events that are in issue, it might be expected that Benson would provide helpful, independent evidence of those events and their context. I have not found that to be the case. I do not regard his evidence as either full or frank. As his cross-examination progressed, he took refuge in his inability to recall matters. I am satisfied that this often was a contrived response. Even the applicants in submissions conceded that Benson sometimes gave the appearance of making no effort to recollect events. While it is the case that Benson is a disinterested party in the present proceedings, he was by no means a disinterested actor in the life and death of Tiltform Australia. I consider he was quite mindful of this and the implications of it in giving his evidence.
Bell. Bell sought to project himself as an ethical, detached professional adviser. Throughout this proceeding he represented himself. His evidence-in-chief was given in narrative form. From his business diaries and time sheets he could give what is probably a reliable account of objective facts such as where he was, who was there, etc. The diaries, though, yielded little by way of information as to what was discussed at meetings etc. Bell’s memory for the most part does not stretch far beyond his diaries and time sheets. He conveyed the impression of wishing to consign from memory a period in which he made judgments and took actions which he has come to regret. His oral evidence did not directly confront what had been put against him in the Rawley and the Chehade proceedings. However, he denied volunteering the $2 million representation. For a variety of reasons I do not regard Bell’s evidence as reliable. He was both dogmatic and counter-suggestive in cross-examination to the point on occasion of making assertions which either contradicted his own documents or else seemed contrived, adversarial responses. I am satisfied he has limited recall of some of the critical events in this matter despite his confident assertions concerning them. I equally am satisfied that he has reconstructed and rationalised his evidence in ways that best serve the interests of his case. I consider this to be particularly so concerning the meeting of 2 June 2000. I have disbelieved the evidence he gave concerning his actions during the day of, and at the meeting of, 26 June. His answers on occasion were designedly obfuscatory, as for example when he denied that the 26 June meeting was a meeting which later led him to distinguish between “formal” and “informal” meetings. He equally, but unconvincingly, created the impression of indifference to, or lack of interest in, matters with which he obviously had a real concern or interest. This was particularly so in relation to the financial affairs of Tiltform Australia and to the payment of licence fees. Though he claimed for himself roles and responsibilities in Tiltform Licensing he often enough disclaimed actual responsibility in matters which seemingly fell within his claimed sphere by asserting he was acting on Sladojevic’s instructions or that the matter had been taken over by Sladojevic. His claimed level of participation in the 2000 strategy to buy out Vinet typified this: see below.

Sladojevic. It is difficult to accept major parts of Sladojevic’s evidence. His affidavit evidence, even after amendment, was conceded to be reconstructed from documents and was in important details inconsistent with his oral evidence. The extent of this reconstruction is indeterminate. As a witness he was argumentative, evasive and obviously self serving in the gratuitous commentary in which he indulged. When one couples this with the deviousness and ruthless self interest he betrayed on at least four occasions in engaging in deceptive “strategies”: see below; reason for reserve about his evidence is clear. He has engaged in opportunistic behaviour and has resorted to falsehood. I am satisfied his evidence on any subject not corroborated by independent documentary evidence or a reliable third party ought be regarded with caution.
Sladojevic’s deceptive strategies
Sladojevic has admitted on three occasions in his evidence that he engaged in deception and/or known falsehood to secure perceived advantages for himself. One such occasion involved the making of false accusations against Bell via lawyers’ letters of January 2001 during the breakdown of their business relationship. Another, not conceded by Sladojevic related to the letter of 7 August 2000 he wrote nominally to Benson, but intending that it be sent to the WA investors. Later in these reasons I find that letter was, and was intended to be, misleading. The two other occasions in which he resorted to deception concerned separate dealings he had with Vinet in 1999 and in 2000. Given my concern with Sladojevic’s credibility it is appropriate that I refer to these two occasions.
First the 1999 dealing with Vinet. I have earlier noted that in September 1999 Vinet disposed of his interests in Tiltform and Tiltform Services (save for a 25 per cent interest in Tiltform) and resigned his directorship of both companies. The following is only a skeletal account of how Sladojevic sought to procure these actions.
Having concluded by May of 1999 that it was impossible for he and Vinet to continue working together, Sladojevic met with Bell and his solicitor, Richard Solomon, for advice on how to resolve the matter. He then evolved a strategy to get Vinet “to come to the table”. Wholly misleading accounts of the true financial position of Tiltform Licensing had been prepared such that it appeared to have considerable debts when it appears in fact to have been trading profitably. Those accounts, though were used by Sladojevic as part of a proposal put by him to get Vinet to sell his shareholding. Sladojevic equally communicated (falsely) to Vinet that his father who was in fact moving from Sydney to Adelaide to live with him because of ill health, had sold his house to relieve the cash flow problems of the Tiltform companies.
The proposals put to Vinet went through several iterations as the financial position of the companies were said to be “gradually getting worse”. In the result an agreement was struck under which Vinet sold most of his shareholdings and resigned his directorships. Sladojevic’s evidence is that he acted entirely of his own accord in this matter and that Bell was not involved in it.
The second Vinet strategy (in 2000) focussed on Vinet’s 25 per cent shareholding in Tiltform. That company was the owner of the Tiltform intellectual properties. It was proposed to have another Tiltform company, Tiltform Technologies Ltd, listed on the New Zealand stock exchange and central to this proposal was that that company owned all of the shares in Tiltform. Sladojevic, Bell and several other persons evolved a strategy to induce Vinet to sell. This strategy involved (inter alia) the knowingly false misrepresentations that (a) the Tiltform companies were unviable and in a poor financial position; (b) Sladojevic’s father was pressing for repayment of his loan; (c) Bell had threatened to wind up the companies because he was owed “a huge amount of money for fees and had to be issued shares in Tiltform Licensing in lieu; (d) Bell served a statutory demand on one of the companies in October 2000 (Bell in fact had such a document prepared) and that he refused to provide financial support to Tiltform; (e) the companies did not have the funds to protect the patent from Pietrobon’s breach of them and that four cases were on foot; and (f) patent attorneys had advised that Pietrobon’s copy of Tiltform’s system did not violate the patent, and this significantly decreased the value of the intellectual property. As a result of this strategy Vinet agreed to transfer his shares in Tiltform to Sladojevic’s father for no consideration provided he was given various warranties. In the event the listing in New Zealand did not proceed and the Vinet issue was “left hanging”. I should add that, while Sladojevic’s evidence is that Bell was complicit in this strategy, Bell sought quite self- servingly to distance himself from significant involvement in the strategy. The evidence suggests otherwise as witness his instructions to solicitors in October 2000 to prepare a letter of demand in respect of previously written off debts at Sladojevic’s suggestion, so enabling Sladojevic to point to it in relation to the supposed financial difficulties of Tiltform. I am satisfied that Bell was a knowing participant in this strategy.
One consequence of the strategies in relation to Vinet is that documents created for the purposes of them have added very significantly to misinformation relied upon in the conduct of this proceeding. Amendments were made to the pleadings and cross-examination conducted on the premise that the information conveyed in such documents was correct. This resulted both in time wastage and quite a deal of confusion and contradiction for which Sladojevic principally, but also Bell in some degree, bear responsibility.
Affidavits
I have referred above to my concern about the extent to which the evidence in this matter has been affected by reconstruction and for self-serving rationalisation. It is unfortunate that in the case management of this proceeding a direction was given that evidence-in-chief would be by way of affidavit. The giving of evidence in this form in this matter has added to the difficulty in determining on balance what occurred at, and what were the consequences that flowed from, meetings at which misrepresentations were allegedly made. Having heard the principal witnesses in cross-examination, I have considerable reserve about aspects of the affidavits of all of them on the scores of reconstruction and of self-serving rationalisation.
1. THE 2 JUNE MEETING
The background to the 2 June meeting has been mentioned above. After Parker had agreed to review the investment opportunity in Tiltform WA which had been discussed with the Icon Group directors on 26 May 2000, Parker (with Lee’s assistance), prepared forecasts of the Cash Flow, Profit and Loss and Balance Sheet of Tiltform WA for the 2001-2003 financial years. In doing this he relied upon a one page document prepared by Ilic which described the outlays, income and investment in the business in the period of its operation.
It is Parker’s evidence, which I accept, that at this time he did not have, or have access to, the WA licence agreement, the disclosure document or the WA market proposal booklet. While he had spoken to Ilic before 2 June, he did not look to him for significant assistance because, as he said of Ilic, “as far as business acumen is concerned … he lacks the certain qualities that one is required to have when talking about these particular numbers”. He also said that Sladojevic expressed a like view of Ilic at the 2 June meeting.
Parker saw his function at the time as being that of conducting a “due diligence”, and that in consequence the primary purpose of his visit to Adelaide to meet with Bell and Sladojevic on 2 June was to have the reasonableness of his financial projections confirmed. Sladojevic in his affidavit said that Parker stated at the beginning of the 2 June meeting that he was attending “to evaluate the proposed purchase of shareholding in Tiltform WA”. I note in passing that it was Lee’s evidence that the reason Murabito and Parker went to Adelaide on 2 June was because Sladojevic had to agree to any transfer of shares. Parker’s evidence on this was to the contrary. He was unaware of such an approval requirement at the time and had not by then been supplied with a copy of the licence agreement imposing it.
On 31 May 2000 Murabito rang Sladojevic. He informed Sladojevic that there had been discussions with Ilic in relation to purchasing a majority interest in Tiltform WA. He went on to say, according to Sladojevic, that they wanted to meet with him and Bell “to discuss the proposal and licensing issues with us”. The following day Sladojevic sent a fax to Murabito confirming the meeting on 2 June at Tiltform Licensing’s Greenhill Road offices. The facsimile noted, amongst other things, the following:
“Attending the meeting with me will be Mr Geoff Bell who is also an integral part of our organisation and responsible for the strategic planning of our organisation.”
The meeting was held on the afternoon of 2 June. Murabito and Parker, who had flown in from Perth, were required to sign confidentiality agreements. It is Parker’s oral evidence that Bell was introduced at the meeting as the accountant for Tiltform Licensing. He reiterated often in his oral evidence that he dealt with Bell “as an accountant”. Bell later had informed him he had previously been the senior partner of a firm named Bentleys.
Despite the descriptions above as to the purposes of the meeting, there is wide divergence between Parker and Murabito on the one hand and Sladojevic and Bell on the other as to what transpired at it. The only contemporary documentary evidence of the meeting was Parker’s notes of it. Significantly Bell denied that many of the matters referred to in the notes were discussed at all, or could be remembered by him. What he was insistent upon, contrary to Parker’s evidence, is that he was never shown the projections let alone approved them. Without actually being shown the Parker notes, Sladojevic nonetheless confirmed that he recalled discussing most of the matters noted by Parker. I would note in passing that Sladojevic did take issue with one notation referring to “patent documentation”. He emphasised there was at the time only a patent application.
It is unnecessary to reproduce the notes here. They refer to the technology and to its potential, and to the licensing agreement. Parker stated in cross-examination that he made the notes “while Sladojevic was talking” – “during his explanation of where Tiltform was at”. He went on to say:
“So what you are suggesting is that Mr Sladojevic was promoting the virtues of the system?---Most definitely. You can see from the notes that I have made that it was all good stuff.
He informed you that as the technology was further developed, it would be made available to licensees?---That is correct, and that the projections that I had prepared were really not of any consequence because these improvements – and you can see from the notes that I have made regarding door jambs, snap-on windows – they were just going to blow the projections out of the water.
He was there talking about proposed developments of the system which you, of course, took with a grain of salt until such time as they had been produced?---Oh no, it made me feel more comfortable that the projections that I had prepared which when I looked at them from an investor’s point of view, were quite satisfactory. All I was hearing now was better news but I thought no more of it other than that.”
The notes are almost entirely silent on matters which could be said to be related either to Parker’s projections or to Bell’s confirmation of their reasonableness. Parker nonetheless claims he provided Bell with copies of them and that the detail of items in them were discussed. He did, though, make the following acknowledgement in cross-examination by counsel for Sladojevic:
“You have got no note that Bell confirmed the accuracy of your projection?---No, I don’t but that doesn’t mean that he didn’t. I don’t have a habit of noting absolutely everything that takes place in a meeting, bearing in mind this was a meeting at which we were discussing financial projections and we went down the various items composed in that, more particularly the profit and loss.
Do you have a note in relation to that?---No.
You are telling us that the confirmation of the financial projections was the prime purpose of the attendance?---It was my primary purpose of coming to Adelaide, yes.
You don’t have any note of Bell confirming the accuracy of your projection?---No, I don’t.”
Parker equally has said in his affidavit that Sladojevic stated that the projections actually underestimated what was achievable. For his part Sladojevic denies having said this. He equally denies that the projections were tabled or discussed at the meeting. Murabito in contrast said that Parker discussed the projections with Bell while he was more in discussion with Sladojevic about the technology and its applications. Sladojevic confirmed that Bell and he were engaged in separate conversations.
Notwithstanding the applicants’ pleading that misrepresentations were made as to an investment in the Tiltform group being a secure investment (Sladojevic) and as to the commercial viability of claims made by the Tiltform group as to the proposed investment in Tiltform WA (Sladojevic and Bell), neither of these loomed large in the evidence or in the applicants’ submissions. They were not put explicitly and unequivocally to either respondent. Rather the applicants now contend that this meeting had “limited significance”, this being that it showed that Parker was carrying out a “due diligence process” and that Sladojevic and Bell engaged with him in that process. This last is relied upon in aid of the applicants’ distinct claim that Sladojevic and Bell conducted themselves as promoters.
Findings and Conclusions on the 2 June meeting
I am not satisfied that the alleged misrepresentations were made. And I do not understand the applicants to be now relying upon them to establish their claims. As to the evidentiary use which they now seek to make of the meeting itself, I agree with their submission that the meeting has limited significance. The evidence given in relation to it is far from satisfactory. I do not consider that Bell has any independent recollection of what transpired at this meeting: cf my comments upon him as a witness. I equally do not consider Murabito’s evidence to be reliable.
I am satisfied that Parker’s primary reason for attending the meeting was as he suggested, i.e. to have confirmed the reasonableness of his projections. Given the very limited information to which he had access when he prepared them, it was understandable that he would seek such confirmation and from Sladojevic and his accountant. While I am satisfied that he discussed those projections with Bell – and to this extent reject both Bell’s and Sladojevic’s evidence – I am not satisfied that he did so in real detail. I consider that Parker’s evidence to the contrary is unreliable and was probably a reconstruction elicited by the form of the cross-examination on that very matter. I equally am satisfied that he derived some reassurance about the investment from the meeting, but that Sladojevic’s explanations of the technology, its applications and prospects contributed significantly to this. I do not consider that the absence of reference to the projections in Parker’s notes is significant in this particular instance.
2. PERTH: 23-26 JUNE 2000
Having returned to Perth after the 2 June meeting, Parker had discussions with the directors of Icon Group and with other business associates who, collectively, were potential investors in Tiltform WA. By 12 June 2000 the funds required to acquire the 72 per cent interest had been raised. The participants were to be Rawley Pty Ltd ($100,000), Icon Group directors ($175,000), Airport Consulting Pty Ltd ($75,000) and Connoisseur Holding ($225,000). These I will refer to as the WA investors. On the same day Murabito wrote separately to the directors of Tiltform WA and to Barone accepting their respective offers to sell shares to these investors. The agreement with Barone (which also involved discharging a debt of $70,000 owed to him by Ilic and an agreement by Ilic in turn to repay that amount to the investors) would result in his original $225,000 funding arrangement being paid out. It was envisaged by the Investors that a unit trust (“the Tiltform Unit Trust”) would provide the vehicle for their investment. Arrangements were then made to meet with Tiltform WA’s solicitors to formalise the share transaction. A meeting to that end was held on 22 June 2000.
Between 23 and 27 June Sladojevic, Bell and Benson each spent some time in Perth. The dates of their so doing (in the cases of Bell and Benson) and their respective reasons for their so doing are disputed. Meetings were conducted between variously one or more of Sladojevic, Bell and Benson, the directors of Tiltform WA, the Icon Group directors and (on 26 June) Parker. These resulted in the emergence of a new proposal which was put to the Icon Group and Parker at a meeting on 26 June. This was that the WA investors (who at that time probably were taken by Bell and Sladojevic to be simply the Icon Group) would take an interest in Tiltform Australia and Tiltform Australia would take over Tiltform WA. It was at the 26 June meeting that the two misrepresentations (one by Bell, one by Sladojevic) are alleged to have been made.
The evidence as to what transpired over this period is marked by sharp contradictions. To understand these I will deal first with the questions of when and why Sladojevic, Bell and Benson were in Perth. By way of backdrop to this I would emphasise that at the beginning of this four day period it was the understanding of the WA investors that they had committed themselves to an investment in Tiltform WA and that an investment in Tiltform Australia had not been canvassed.
Sladojevic, Bell and Benson in Perth
It is convenient to deal first with Benson. He gave contradictory evidence as to why he went to Perth. In his affidavit he states he attributed his trip to Perth to the suggestion of Sladojevic that he meet the investors who were looking to buy into Tiltform WA. Sladojevic denied this was the case in cross-examination. In Benson’s cross-examination, he said he was in Perth to look at a trade show that Tiltform WA was putting on in its warehouse. He went to the show “by arrangement” (seemingly with Ilic); Sladojevic was there; and he was then told of the WA investors in Tiltform WA. It is unnecessary for me to make a positive finding about this matter, but I would indicate that the latter explanation for his trip probably is closer to what occurred than the former which I disbelieve. What is clear is that Benson left Perth on 25 June 2000. I say this so as to emphasise he was not at the 26 June meeting at which, as I find, a proposal under his name was distributed.
Bell. His evidence, supported by his office time-sheets, is that he was in his Adelaide office until 1.30 pm on 24 June. He flew to Perth on Sunday 25 June arriving late in the afternoon and he returned to Adelaide on 27 June. He said the purpose of his trip was to inspect the books of Tiltform WA to confirm the royalty payment that “we were due to receive”, as also to facilitate the process of dealing with the change of the owners. Bell’s positive disclaimer that he was in Perth on 24 June contradicts the contrary evidence of Sladojevic, Lee, Benson and Murabito. In relation to this matter I consider Bell’s time-sheets are more likely to provide guidance as to his whereabouts than the evidence of those I have just listed.

Chehade denied that the photocopy he produced came into his possession at a later date.
Sladojevic denies seeing Chehade at all on 16 September. He was at the office at about 8.30 am for a meeting with Dennis Davis from SABC and Bell. The meeting lasted for about half an hour. He later spoke to Tripodi and left about 10 am. Of his meeting he said in his affidavit:
“At the above meeting on 16 September 2000, a diagram was drawn on the whiteboard with input by Bell, Davies and myself. The diagram was left on the whiteboard for the following week continuing discussions and changed from time to time over that period.
The diagram was concerned with setting up a finance company for myself and Bell to run side by side Tiltform Licensing, which would be used by Tiltform Licensing to raise funds and provide capital to Licensees. (This company was ultimately incorporated and named ‘Tiltform Capital Pty Ltd’ …). Davies had advised myself and Bell that it would be beneficial for Tiltform Technologies to acquire a stake in its head licensee company at this would (sic) assist in the back door listing of Tiltform Technologies because it would show to investors that we had faith in the Technology. The diagram was not, as alleged in Chehade’s affidavit, drawn to explain how the funding for Tiltform Australia would work.
Document 268, is a true copy of the whiteboard diagram. Early during the following week, I added to the whiteboard diagram, the words ‘Compliments from: “The Loudmouth, Shithead, Unprofessional Neanderthal”. I wrote this as Parker and Lee had previously called me such things and I sent the diagram to them to show how this ‘neanderthal’ was going to help organise funding for Tiltform Australia.
The diagram was not prepared for Chehade’s benefit and did not involve him or his investment.”
(Emphasis in original.)
The whiteboard diagram referred to is one of several diagrams that were contained in the whiteboard.
In his oral evidence Sladojevic indicated that some of the handwriting on the document as printed out was Davies; he photocopied the printout immediately after the meeting and then inscribed it as he intended to give it to Parker; he denied giving it to Chehade; and he gave it to Parker at a meeting on 20 September. Sladojevic gave a relatively detailed explanation of the diagram. It was part of a sequence of diagrams created over several weeks. This particular one was conceptual in character. The principal companies were yet to be formed. As he said of the diagram in cross-examination:
“I had a meeting with Mr Parker, Mr Lee and Mr Benson on the 13^th where we suggested that we as licensors would look at ways of generating income to try to fund to them their formwork materials. This here is phase one of that, in that first graph, to establish an investment company as a part of a group, and how we would first raise moneys into that investment company, and this diagram depicts that we were going to use licence sales from international licences to generate income into Tiltform International, which didn’t even exist at the time, which is a company we were looking at floating. That would have a finance agreement with the investment company as such, which was at that stage just a hypothetical, generic name called Tiltform – as you can see, in someone else’s handwriting next to it – Investment Company. So that investment company there would then have a licence agreement – a formal agreement with Tiltform International so they did have security over the funds. The money from there would be passed to Tiltform Manufacturing which in turn would then provide the equivalent amount of value of formwork to the licensee. This was done so that the funds would only be used for formwork, not other purposes, and that way we have security over the material and the licence itself.”
Bell had no specific recollection of this meeting, though he did recall a number of Saturday meetings with Davies around September that were concerned with funding arrangements. I would note that Davies was not called to give evidence.
For my own part, I accept Sladojevic’s evidence as to the provenance of the photocopied document and his explanation of it. Such evidence as there is of the Tiltform group of companies would seem to confirm that the principal entities referred to in the diagram were not yet formed. For this reason, if no other, the diagrammatic representation seems a wholly inappropriate vehicle to explain the funding of the rollout by Tiltform Australia.
Given Chehade’s obvious indifference to making inquiries as to the financial circumstances of Tiltform Australia prior to his “committing” to the investment, I find it quite improbable that at this late date he made this particular inquiry, the more so given his oral evidence (which I do not accept) that Sladojevic had previously told him how the rollout was to be funded (“there was many discussions”). While there is no obvious explanation of how Chehade came to have the inscribed photocopy of the diagram, I accept Sladojevic’s evidence that it was produced for Parker (it reflected the sometimes less than tasteful communications he had with Parker) and that he did not give it to Chehade.
Because I am not satisfied that the alleged meeting ever took place, I do not accept that the pleaded representations were made as alleged.
(v) The other wrongful conduct pleaded
The conduct said to be misleading or deceptive relates to nine alleged instances of non-disclosures by Bell and/or Sladojevic. There has been no attempt in submissions, oral or written, to explain why these non-disclosures were actionable in Chehade’s case. All that the combined written submission does is to make the uncontroversial but unhelpful comment that silence may constitute misleading or deceptive conduct. Unsurprisingly I do not intend to deal in detail with these allegations both because of my findings on the alleged misrepresentations but also because, in light of the fact that most of the allegations were abandoned in the Rawley matter, I am entitled to assume that the same allegations have been abandoned in the present matters.
In the Rawley matter I indicated that the question whether conduct in a given instance is proscribed by s 52/s995 is to be determined having regard to all the relevant circumstances. Silence can render conduct misleading or deceptive if in all the circumstance the party complaining of the non-disclosure was reasonably entitled to expect that if the matters in question existed, had occurred, or were contemplated, they would be disclosed: see Hughes Aircraft Systems International at 198-199.
Seemingly the “duty to disclose” in Chehade’s case was founded in his “trust in Robert and Geoff”. I have earlier commented on that trust. I would simply reiterate that to have trust in another person for whatever reason (be it reasonable or fanciful) does not as of course result in the imposition of an obligation on that other to act in accordance with the dictates of that trust. If such trust is to have any significance at all in a particular matter (I exclude from this relationships of undue influence), there must ordinarily be reason in the relationship of the parties either in that matter or arising from past or present dealings that properly could give rise in the circumstances to the expectation that the disclosure of the information in question would be made if it was known to the trusted party.
The short answer to the Chehade case is that neither Bell nor Sladojevic on my findings so conducted themselves in relation to Chehade’s investment decision that they could properly be expected to disclose information to Chehade. As I will indicate below, I am satisfied Chehade did it his own way. He was the author of his own harm. His trust may have been in Bell and Chehade making the investment a profitable one given their commitment to the Tiltform enterprise and its success. That was not a trust that could author a liability of the type claimed here.
I should add that the professional respect Chehade had for Bell may have provided some basis for having the requisite trust in Bell in respect of a particular dealing, if Bell had sufficiently intruded himself into that dealing. On the evidence and my findings I am not satisfied that he did. It is unsurprising that Chehade gave little by way of oral evidence of Bell’s involvement in his investment.
I should also indicate that complaint has been made in Chehade’s “Promoter Claims” of non-disclosures by Bell and Sladojevic of all of the instances relied upon for the s 995 claims. I simply note here, as I earlier foreshadowed, that there was no proper basis for these claims in the Rawley matter. The position in the Chehade case is even less tenable.
CAUSATION AND RELIANCE
There are two separate matters with which I should deal here. The first relates to the 7 August letter which, as I have found, contained two misrepresentations. The second relates more generally to Chehade’s bases for making his investment.
The 7 August letter
Sladojevic has called into question both whether Chehade ever actually received this letter (it took the form of an email from Benson to Chehade) and whether it had any influence on his putting in money. The Chehade Statement of Claim does not allege that Chehade ever received the letter, let alone when he received it. In his affidavit, Chehade stated that Benson “gave him a copy”. Benson went to New Zealand on 7 August; and was in transit that day, though had telephone and email communications with Sladojevic.
In his oral evidence, when asked whether Benson gave, or emailed, him the letter, Chehade said it was forwarded to him by email. He could not recall whether there was an accompanying letter. He was then asked in cross-examination:
“Did he [Benson] speak with you about that email?---Yes, he did.
And was the effect of the conversation that you better make up your mind as to whether you were going to be making the investment or not?---It was along the lines of, Robert has sent me an email and then he is not happy with the delays at which at that point I hadn’t even had the funding. I said, well I – you know, there is nothing I can do at this point. I will do my best. And then I read the email.
And as a result of reading the email did you decide that you either better invest or lose the opportunity?---Yes.
And rather than lose the opportunity, you put in your $10,000?---Yes, that is correct.
Without making further inquiries?---Yes, that is correct.
Without even knowing whether the Western Australian group were going to come up with the money?---Yes, that is correct. I had made enough inquiries with Geoff and Robert to convince myself that the investment was fine.”
The email letter, in form was directed to Benson. It was forwarded to Lee in Western Australia as an attachment to an email sent by Benson to him that email being dated “Monday, 7 August 2000 20:20”. Chehade had as an attachment to his first affidavit, a copy of Sladojevic’s email. It was not accompanied by any covering letter. Nor did it otherwise indicate that it had been forwarded by Benson.
Chehade paid his $10,000 to Tiltform Australia’s bank account directly by cheque on 7 August 2000. He was cross-examined on this payment:
“You have told us that on 7 August you paid $10,000?---Yes.
Into the account of Tiltform Australia?---Yes.
Either on that day or a day or so before, did you have a conversation with Benson and tell him that you were going to put that $10,000 in?---Yes, from what I can recall. Yes.
Tell us about that conversation, what was said?---I mentioned that I could put a deposit down or pay – I can’t remember exactly what I mentioned but I mentioned the fact that I had to get the funding and I would try to source the funding and I put a deposit down to secure the investment, subject to me getting the funding.
Was that at his request?---No.”
I note in passing that if this was the 7 August conversation Chehade earlier said he had with Benson, no mention is made of the letter of the same date.
Benson’s evidence is that he forwarded the email to Chehade. He could not recall when Chehade paid his $10,000. Sladojevic’s evidence was that he sent the email to Benson “late evening” on 7 August.
The Chehade submissions do not seek to engage in any way with the evidentiary issues raised by Sladojevic’s. It is merely said that I should have no hesitation in finding that Chehade received the letter as Sladojevic intended and that it clearly had an impact on him as on the same day he put down the deposit of $10,000 “to confirm his intention to proceed”.
As to Chehade’s receipt of the letter, I am satisfied, though with some misgivings, that the letter was sent to him by Benson. As to the alleged influence on him of it, I am not so satisfied. In particular I am not satisfied on balance that the $10,000 deposit made on 7 August was made after Chehade received the forwarded email from Benson. Given that (a) Benson went to New Zealand on that day from Sydney; (b) Sladojevic sent the email to him “late evening”; and (c) Benson’s email to Lee was in turn an evening email – it would be appropriate to infer that the email forwarded to Chehade was sent at around the same time as that to Lee. If such was the case, even accepting that Chehade spoke to Benson after he received it (which I do not), it is improbable that the deposit was made after his receipt of the letter and was influenced by it. In the circumstances I cannot be satisfied that the two events – the making of the deposit and the receipt of the letter – were not simply unrelated events. Further, I consider it likely that, before 7 August, Chehade had informed Benson that he would put a deposit down to secure the investment. Chehade gave evidence as to such a conversation on or before 7 August. I consider there must be a real question as to whether it occurred on 7 August given Benson’s travels on that day and the issue of timing to which I have referred.
Despite Chehade’s evidence to the contrary, I am satisfied that he placed no reliance on the 7 August letter in making his deposit and that it was not causative of any loss.
I have dealt with the above on the basis that Chehade made his commitment on 7 August. As I earlier indicated, I am satisfied he had contracted with Tiltform Australia subject to a performance condition probably prior to 17 July 2000.
My conclusion above is fatal to Chehade’s s 995 case which must in consequence be dismissed.
Chehade’s investment
It is strictly unnecessary for me to make any finding on Chehade’s decision to invest and on what informed it. I intend to do so shortly because I do not consider that any of the wrongdoing he alleges in the Corporations Law and negligence claims was causative of the loss he suffered by the failure of his investment in Tiltform Australia.
The most probable explanation of his investment on the evidence I have heard is that, as a consequence of what he already knew about the Tiltform group, and because of the enthusiasm and expectation generated in his workplace about the prospects of the overall Tiltform venture, he desired to participate in that enterprise. He was impressed by Sladojevic’s knowledge of, and enthusiasm for, his business and its prospects. He was comforted and encouraged by Bell’s growing commitment to the Tiltform group. And he expected an excellent return on the investment. He conducted no due diligence in the fashion of Parker for the WA investors. He sought no information. He invested blindly, enthusiastically, relying on Sladojevic and Bell to deliver. He was the author of his own harm.
NEGLIGENCE
This claim, as I have indicated, is made against Bell. All I need say of it in light of my findings relating to Bell’s relationship with Chehade in the matter of the investment decision is that it was incapable of giving rise to a duty of care. Bell owed no obligation to Chehade in respect of his investment. I am not satisfied in any event that he made to Chehade what has been called the Second Misrepresentation. And, as I have indicated above, I consider Chehade was the author of his own harm.
CONCLUSION
I will order that Chehade’s application be dismissed.
THE CROSS-CLAIMS
In both the Rawley and the Chehade proceedings Bell made cross-claims against his insurance broker and agent, OAMPS Insurance Ltd, and against his insurer, CGU Insurance Ltd.
The claims made against CGU were in respect of a policy of professional indemnity insurance said to be effective from 28 February 2001 to 28 February 2002. Bell was notified of the Rawley and Chehade claims on 27/28 June 2001. He notified OAMPS of these in early July. He was informed by OAMPS on 25 July that CGU declined to indemnify him and had cancelled the policy on 15 June for non-payment of the premium.
In his cross-claim he contests the validity of that cancellation; he claims various breaches of the terms of his policy; he alleges an infringement of s 52 of the TP Act in consequence of his expectation of notice before cancellation; and he seeks a declaration that he is entitled to be indemnified for any liability to the Rawley applicants and to Chehade. Damages and other orders are also sought.
It is unnecessary to outline his claims against OAMPS which have been settled, other than to note that they allege breach of contract, negligence and an alleged contravention of s 52 of the TP Act and that they relate generally to the circumstances of his policy’s cancellation.
CGU’s defence is multi-layered. The principal ground of defence for present purposes is pleaded as follows:
“5.4.1It was a term of the policy contained in clause 2.1 thereof that the first cross respondent would not be liable to indemnify the cross-claimant until full payment of the Gross Premium stated in the Schedule to the Policy had been made and it was further a term of the Policy contained in clause 2.5 thereof that if full payment of the Gross Premium was not made to the first cross respondent there would be no cover under the policy.
5.4.2The Cross claimant failed to pay the full amount of the Gross Premium to the first cross respondent by 8 June 2001 and accordingly the cross claimant is not entitled to any indemnity under the Policy.”
I will later refer to the other defences raised. The above, in my view, is a complete answer to the cross-claim.
The factual setting
The above quotation from CGU’s defence accurately describes the burden of clauses 2.1 and 2.5. The CGU policy was arranged through OAMPS as Bell’s agent. The full amount of the premium was $3,461.70. CGU accepted that in consequence of the provisions of ss 14 and 27 of the Insurance (Agents and Brokers) Act 1984 (Cth) – it is unnecessary here to refer to their terms – the premium was payable within 90 days of the inception of the cover on 28 February 2001.
Bell had arranged with a Mr Milford of OAMPS to pay the premium in three equal monthly instalments payable at the end of March, April and May 2001. The March and April instalments were paid to OAMPS. The third instalment was not paid within the 90 days – i.e. by 29 May 2001.
On 8 June 2001 a Mr Partridge, a senior underwriter with CGU, authorised that a letter and a facsimile be sent to OAMPS c/- Milford by way of notice of cancellation of the policy. Having referred to Bell’s non-payment of the premium, each stated (inter alia) that if the premium was not received within seven days or some prior arrangement has been agreed, the policy would be cancelled.
Having received the facsimile on 8 June 2001, Milford advised Bell on 15 June by telephone that final payment of the premium was required immediately. On 18 June 2001 Milford sent a facsimile to CGU advising that Bell had already paid $2,311.70 of the premium and would pay the balance in a few days. It was requested that the policy be maintained pending payment. On 20 June OAMPS sent a further letter to CGU indicating it was continuing its efforts to collect the outstanding premium. This was received on 26 June. CGU responded on that day indicating that “cover will not be held” but “a new quote could be arranged” once payment had been received.

On 27/28 June 2001 Bell received notification of the claims in the Rawley and Chehade matters from their legal advisers. It is Bell’s evidence that he then telephoned OAMPS and made arrangements for payment of the outstanding instalment of $1,150.00 by means of a payment authority given OAMPS. On 3 July, and by facsimile on 4 July, he sent OAMPS written notification of the claims. On 5 July Bell paid the final premium instalment to OAMPS. On 16 July 2001 Milford sent Bell’s 4 July facsimile to CGU notifying the claims.
On 17 July 2001, Partridge telephoned Milford and told him Bell’s policy had been cancelled for non-payment. Partridge further indicated he need not respond to Milford’s request to extend the cover made in his 18 June facsimile. On 19 July 2001 CGU returned Bell’s claim documents to Milford given that the policy had been cancelled. On 25 July 2001 Milford advised Bell of this.
Consideration
Bell’s case, as I understand it, is that CGU was “estopped” from denying insurance cover until either he was notified that his policy might be cancelled, or he was afforded the opportunity to obtain alternate cover. His submission, in other words, appears to be founded on those provisions in Part VII of the Insurance Contracts Act 1984 (Cth) dealing with cancellation of a policy.
It is the case that CGU’s contemporary correspondence with OAMPS referred to “cancellation” of the policy for non-payment of premium. Its defence, likewise, pleaded cancellation as one of its grounds of defence. That ground, though, has not been pursued.
The ground of defence presently under consideration is concerned, not with cancellation of the policy for non-payment, but with the cover to be provided by the policy not being operative by reason of non-payment at the times the Rawley and Chehade claims were notified to Bell in late June. This distinction is reflected clearly in the language of the Policy itself.
I have already referred to cll 2.1 and 2.5 of the Policy which link the provision of the cover to full payment of the policy, cl 2.5 providing that if full payment of the gross premium is not made, “there is no cover”. By way of contrast, cl 11.1(a)(v) of the Policy acknowledges the insurer’s right to cancel the policy under s 60 of the Insurance Contracts Act where (inter alia) the insured “failed to pay the premium for this policy”. This distinction between what I will call “cessation of cover” on the one hand and cancellation of the policy on the other is recognised explicitly in the Act in the manner in which it regulates instalment contracts of general insurance: see s 39 and s 62; and see generally Waterman v Gerling Australia Insurance Co Pty Ltd (2005) 194 FLR 419; Sutton, Insurance Law in Australia, 7.42 (3^rded 1999).
It is a question of construction of the policy, admittedly under the shadow of the Insurance Contracts Act, as to whether in the circumstances Mr Bell had the cover provided by the CGU at the time of notification of the claims, i.e. 27/28 June 2001. Apart from recognising the difference between cessation of cover and cancellation, the Act does not apply to or regulate directly provisions such as cl 2.5. On its face that sub-clause is a self-executing one. Once the contingency on which it is premised occurs, the cover ceases. The cover may later be revived by the making of payment in full, assuming an election to cancel for non-payment had not by then been made. Unless and until that occurred, there would be no cover notwithstanding that the Policy itself may remain on foot. Far from throwing any doubt on this construction the policy itself supports it.
I have not considered it necessary to give detailed consideration to the principles applied in the construction of contracts of insurance. These have recently been essayed by Brereton J in Waterman’s case. For my own part, I respectfully agree with his Honour’s conclusion in that case. It deals with the very issue raised here though with a clause not quite as unmistakeably explicit as here. I would merely wish to emphasise that while I well understand that an automatic cessation of cover might have the same undesirable policy effects as the Australian Law Reform Commission identified in relation to automatic cancellation: see ALRC Report 20 Insurance Contracts, 1982 [246]-[247], I agree with Brereton J that there is nothing in the Insurance Contracts Act, that Report and the now accepted principles of interpretation of contracts: see e.g. Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2005) 223 ALR 560 at [71] ff; affd (2006) 156 FCR 1; that would permit the torturing of the clear and coherent terms and text of a contract so as to effectuate that policy in some way. That is a matter for the legislature to address.
Accordingly, I am satisfied that there was no insurance cover on 27/28 June 2001; that CGU’s defence has been made out; and that the cross-claims must be dismissed with costs.
I do not intend to consider the other defences raised by CGU, given that the only live issue between CGU and Bell is costs (having regard to my findings in the Rawley and Chehade matters). However, I should indicate this much. Those defences called into question (i) whether Bell’s actions giving rise to the claims against him arose from the conduct of the business planning consultancy covered by the Policy, it being contended that he was acting in the management of Tiltform Licensing by June and July 2000; (ii) whether he was relevantly acting as an “officer of Tiltform Australia and so subject to an express exclusion of the Policy”; (iii) whether Bell’s conduct fell within the “unintentional dishonest” acts or omissions exception to the Policy; (iv) whether the policy was voidable under s 28 of the Insurance Contracts Act on account of fraudulent representations contained in the proposal for insurance, or else CGU would have been entitled to reduce its liability to nil. I am of the view in respect of each of these that CGU had a reasonably arguable defence on the material before me.
CONCLUSIONS
I will order that:
(i) in SAD 80/2002, the application be dismissed;
(ii) in SAD 55/2002, the application be dismissed; and
(iii)in SAD 80/2002 and SAD 55/2002 the cross-claim against the First Cross Respondent be dismissed with costs including reserved costs.

I certify that the preceding three hundred and ninety-seven (397) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn.
Associate:
Dated: 26 April 2007
No SAD 80 of 2002

Counsel for the 1^st and 2^nd Applicant: Mr Heywood-Smith QC and Mr Harms

Solicitor for the 1^st and 2^nd Applicant: Montgomery & Co

Counsel for the 1^st Respondent/Cross Claimant: The 1^st Respondent/Cross Claimant appeared in person.

Counsel for the 2^nd Respondent: Mr C Munt

Solicitor for the 2^nd Respondent: von Doussas

Counsel for the 1^st Cross Respondent: Mr Trim QC and Mr Crocker

Solicitor for the 1^st Cross Respondent: Minter Ellison

No SAD 55 of 2002

Counsel for the Applicant: Mr Heywood-Smith QC and Mr Harms

Solicitor for the Applicant: Montgomery & Co

Counsel for the 1^st Respondent/Cross Claimant: The 1^st Respondent/Cross Claimant appeared in person.

Counsel for the 2^nd Respondent: Mr C Munt

Solicitor for the 2^nd Respondent: von Doussas

Counsel for the 1^st Cross Respondent: Mr Trim QC and Mr Crocker

Solicitor for the 1^st Cross Respondent: Minter Ellison

Date of Hearing: 17, 18, 19, 20, 24, 26, 27, 28, 31 October 2005
1 & 2 November 2005
4, 5, 6, 7, 8, 11, 12, 13, 14, 15, 25, 26 September 2006

Date of Last Submissions: 15 March 2007

Date of Judgment: 26 April 2007

Schedule 1
LIST OF CORPORATIONS
Tiltform Australia
Incorporated on 1 May 2000. Company set up as national licensee to hire out Tiltform formwork system. Company went into liquidation in April 2001.
Tiltform Licensing
Company formed to own the exclusive license agreement for the commercialization of the Tiltform technology. Sladojevic sole shareholder following resignation of Vinet. Bell given 5% shareholding of company in September 1999. Bell appointed Director in August 2000.
Tiltform Pty Ltd
Company set up to own the intellectual property for the technology in 1998.
AR Tiltwall Services Pty Ltd
Company commenced by Vinet and Sladojevic in 1997 for the purpose of manufacturing and hiring the Tiltform technology. Hire business sold to Dino Pietrobon in March 1999.
Tiltwall Services Pty Ltd
Pietrobon company that bought the panel manufacturing business from Vinet and Sladojevic. Continued to hire formwork from Tiltform Concrete Systems SA/Tiltform Australia until some time in early to mid-2000. Company allegedly involved in breach of Tiltform patent in early August 2000.
Tiltform Concrete Systems SA
Company operated by Nigel Benson as from February/March 2000 for SA operations of Tiltform hire business. Taken over by Tiltform Australia in May 2000.
Bell Partners/Bell Chehade
Bell Partners was an accounting and business consultancy practice set up in 1997 by Bell as sole partner. Firm became business adviser and accountants for Tiltform group of companies from 1998. Name of firm changed in April 2000 to Bell Chehade following appointment of Chehade as salaried partner.
Tiltform Manufacturing
Company incorporated in April 2000 for the purposes of manufacturing components for the formwork system. Components then supplied to licensees of the formwork. Bell, Benson and Sladojevic all Directors as at December 2000.
Tiltform Technologies
Company set up on the advice of Dennis Davies to facilitate a back door listing of a Tiltform company in New Zealand. Company owned all of the shares in the “licensor” group of companies, said to be, Tiltform Management, Tiltform Technologies, Tiltform Manufacturing, Tiltform Capital, Tiltform Unit Trust, Tiltform and Tiltform Licensing.
Tiltform Capital
Incorporated in October/November 2000 to raise investment funding which could be lent to Tiltform Australia to fund the hire of formwork components.
Tiltform Management/Administration
Incorporated in September/October 2000 to pay for the rent, fit-out, lease and running costs of the office shared by Tiltform Licensing, Tiltform Manufacturing and Tiltform Australia.
Tiltform Concrete Systems (WA) Pty Ltd
WA Licensee of the Tiltform system run by Peter Ilic, Darren Jennings and invested in by Joe Barone. Company hired formwork to Icon Group who then proposed to invest in the company. Eventually taken over by Tiltform Australia.
Icon Group
Company established in Perth in 1992. Business involves “top end” residential commercial and concrete construction. Company initially hired Tiltform system from Tiltform WA but ultimately sought to acquire the licence.
Connoisseur Holdings
The second applicant and an investor, unit holder and beneficiary under the terms of the Tiltform Unit Trust.
Airport Consulting Pty Ltd
Currently holds ordinary units in the Tiltform Unit trust.
Tiltform Unit Trust
Trust set up by WA investors to facilitate the investment in Tiltform Australia.
Rawley Pty Ltd
The first applicant and trustee of the Tiltform Unit Trust. Is an investor, unit holder and beneficiary under the trust.

Schedule 2
LIST OF NATURAL PERSONS

Ben Abrahams

Benson’s replacement financier.

Simon Abraham

Independent accountant for Tiltform Australia.

Joe Barone
Investor in Tiltform Concrete Systems (WA).

Geoffrey Bell

Sole member of Bell Partners accounting and consultancy practice. Director of Tiltform Licensing from August 2000. Business adviser to Robert Sladojevic and Tiltform Group from mid-1999 onwards. 5% shareholder in Tiltform Licensing from September 1999.

Nigel Benson

Managing director of Tiltform Australia from May 2000 – April 2001. At the time of Tiltform Australia’s incorporation, was its sole shareholder and director.

Amin Chehade

Employed by Bell Partners in 1997 and appointed salaried partner in July 2000. Practicing accountant involved in accounts for Tiltform group. Invested in Tiltform Australia in mid-2000. Appointed financial controller of Tiltform Australia in September 2000 and a director in March 2001.

John Dawkins

Chairman of Tiltform Australia from mid-2000 onwards. Appointment never formally recognized.

Peter Ilic

Director of Tiltform Concrete Systems (WA). Involved in negotiations for sale of shareholding to Tiltform Australia in Perth during late June 2000.

Darren Jennings
Investor in Tiltform Concrete Systems (WA).

Gavin Lee

Director of Icon Group and supervised provision of marketing and architectural services. Worked as General Manager of Tiltform Australia from August 2000. Appointed Director of Tiltform Australia on 4 September 2000. Joint trustee of the Tiltform Unit Trust with Gregory Parker.

Andrew Lloyd

Financial adviser to Nigel Benson during initial negotiations for Tiltform Australia. Provided some finance for deposit on licence agreement. Ultimately replaced by Ben Abrahams.

Joe Murabito

Director of Icon Group. Joined Icon because of expertise in concreting and manages large tilt-up projects for the company. Recommended use of Tiltform Technology to Icon and involved in meeting in Adelaide regarding investment into Tiltform WA, and meeting in WA regarding investment into Tiltform Australia.

Renato Palmiero

Director of Icon Group. Oversaw all construction projects undertaken by Icon.

Gregory Parker

Independent accountant for Icon Group. Provided financial advice to Icon Group directors relating to investment in Tiltform WA and then Tiltform Australia. Appointed director of Tiltform Australia in September 2000. Joint trustee of the Tiltform Unit Trust with Gavin Lee.

Gino Pietrobon
Purchased panel manufacturing business from AR Tiltwall Services to become Tiltwall Services. General Manager of that company from September 1999. Company involved in alleged patent breaches of Tiltform technology in August 2000.

Robert Sladojevic

Developed concrete “tilt-up” system. Director and/or shareholder of each company in Tiltform Group with the exception of Tiltform Australia.

Richard Solomon

Legal adviser to Tiltform Licensing group at time of proposed investment by WA investors in Tiltform Australia.

Alex Vinet

Helped develop the titlform technology with Sladojevic. Former director/shareholder of Tiltform Group of companies until late 1999. Sold final shareholdings in late 2000.

Schedule 3

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 80 OF 2002

BETWEEN:	RAWLEY PTY LTD ACN 009 027 454 AS TRUSTEE FOR THE TILTFORM UNIT TRUST First Applicant CONNOISSEUR HOLDINGS PTY LTD ACN 009 441 007 Second Applicant
AND:	GEOFFREY YORK BELL First Respondent/Cross Claimant ROBERT RADOVAN SLADOJEVIC Second Respondent TILTFORM LICENSING PTY LTD ACN 083 878 666 Third Respondent CGU INSURANCE LIMITED ABN 2700 4478 374 First Cross Respondent OAMPS INSURANCE LIMITED ABN 3400 5543 920 Second Cross Respondent
JUDGE:	FINN J
DATE OF ORDER:	26 APRIL 2007
WHERE MADE:	ADELAIDE

IN THE FEDERAL COURT OF AUSTRALIA
SOUTH AUSTRALIA DISTRICT REGISTRY	SAD 55 OF 2002

BETWEEN:	AMIN FRANCES CHEHADE Applicant
AND:	GEOFFREY YORK BELL First Respondent/Cross Claimant ROBERT RADOVAN SLADOJEVIC Second Respondent TILTFORM LICENSING PTY LTD ACN 083 878 666 Third Respondent CGU INSURANCE LIMITED ABN 2700 4478 374 First Cross Respondent OAMPS INSURANCE LIMITED ABN 3400 5543 920 Second Cross Respondent
JUDGE:	FINN J
DATE OF ORDER:	26 APRIL 2007
WHERE MADE:	ADELAIDE

Counsel for the 1^st and 2^nd Applicant:	Mr Heywood-Smith QC and Mr Harms
Solicitor for the 1^st and 2^nd Applicant:	Montgomery & Co
Counsel for the 1^st Respondent/Cross Claimant:	The 1^st Respondent/Cross Claimant appeared in person.
Counsel for the 2^nd Respondent:	Mr C Munt
Solicitor for the 2^nd Respondent:	von Doussas
Counsel for the 1^st Cross Respondent:	Mr Trim QC and Mr Crocker
Solicitor for the 1^st Cross Respondent:	Minter Ellison
No SAD 55 of 2002
Counsel for the Applicant:	Mr Heywood-Smith QC and Mr Harms
Solicitor for the Applicant:	Montgomery & Co
Counsel for the 1^st Respondent/Cross Claimant:	The 1^st Respondent/Cross Claimant appeared in person.
Counsel for the 2^nd Respondent:	Mr C Munt
Solicitor for the 2^nd Respondent:	von Doussas
Counsel for the 1^st Cross Respondent:	Mr Trim QC and Mr Crocker
Solicitor for the 1^st Cross Respondent:	Minter Ellison
Date of Hearing:		17, 18, 19, 20, 24, 26, 27, 28, 31 October 2005 1 & 2 November 2005 4, 5, 6, 7, 8, 11, 12, 13, 14, 15, 25, 26 September 2006
Date of Last Submissions:		15 March 2007
Date of Judgment:		26 April 2007

Ben Abrahams	Benson’s replacement financier.
Simon Abraham	Independent accountant for Tiltform Australia.
Joe Barone	Investor in Tiltform Concrete Systems (WA).
Geoffrey Bell	Sole member of Bell Partners accounting and consultancy practice. Director of Tiltform Licensing from August 2000. Business adviser to Robert Sladojevic and Tiltform Group from mid-1999 onwards. 5% shareholder in Tiltform Licensing from September 1999.
Nigel Benson	Managing director of Tiltform Australia from May 2000 – April 2001. At the time of Tiltform Australia’s incorporation, was its sole shareholder and director.
Amin Chehade	Employed by Bell Partners in 1997 and appointed salaried partner in July 2000. Practicing accountant involved in accounts for Tiltform group. Invested in Tiltform Australia in mid-2000. Appointed financial controller of Tiltform Australia in September 2000 and a director in March 2001.
John Dawkins	Chairman of Tiltform Australia from mid-2000 onwards. Appointment never formally recognized.
Peter Ilic	Director of Tiltform Concrete Systems (WA). Involved in negotiations for sale of shareholding to Tiltform Australia in Perth during late June 2000.
Darren Jennings	Investor in Tiltform Concrete Systems (WA).
Gavin Lee	Director of Icon Group and supervised provision of marketing and architectural services. Worked as General Manager of Tiltform Australia from August 2000. Appointed Director of Tiltform Australia on 4 September 2000. Joint trustee of the Tiltform Unit Trust with Gregory Parker.
Andrew Lloyd	Financial adviser to Nigel Benson during initial negotiations for Tiltform Australia. Provided some finance for deposit on licence agreement. Ultimately replaced by Ben Abrahams.
Joe Murabito	Director of Icon Group. Joined Icon because of expertise in concreting and manages large tilt-up projects for the company. Recommended use of Tiltform Technology to Icon and involved in meeting in Adelaide regarding investment into Tiltform WA, and meeting in WA regarding investment into Tiltform Australia.
Renato Palmiero	Director of Icon Group. Oversaw all construction projects undertaken by Icon.
Gregory Parker	Independent accountant for Icon Group. Provided financial advice to Icon Group directors relating to investment in Tiltform WA and then Tiltform Australia. Appointed director of Tiltform Australia in September 2000. Joint trustee of the Tiltform Unit Trust with Gavin Lee.
Gino Pietrobon	Purchased panel manufacturing business from AR Tiltwall Services to become Tiltwall Services. General Manager of that company from September 1999. Company involved in alleged patent breaches of Tiltform technology in August 2000.
Robert Sladojevic	Developed concrete “tilt-up” system. Director and/or shareholder of each company in Tiltform Group with the exception of Tiltform Australia.
Richard Solomon	Legal adviser to Tiltform Licensing group at time of proposed investment by WA investors in Tiltform Australia.
Alex Vinet	Helped develop the titlform technology with Sladojevic. Former director/shareholder of Tiltform Group of companies until late 1999. Sold final shareholdings in late 2000.