Saffron, A.G. v Commissioner of Taxation

[1992] FCA 1023

l

JUDGMENT No. ........ ...... l o2s1 ,.,, .....,. ,,,. 9r I ,

IN THE FEDERAL COURT OF AUSTRALIA )

1

NEW SOUTH WALES DISTRICT REGISTRY ) NO. NG2021-6 of 1987

)

GENERAL DIVISION 1

BETWEEN:  ABRAHAM GILBERT SAFFRON

Applicant

AND:  COMMISSIONER OF TAXATION

Respondent

CORRIGENDA

Amendments to the reasons for judgment of his Honour M r Justice

I

Beaumont delivered 22 December 1992:

Page 69, second paragraph, second line, delete "contents" and insert "contends".

&c, %oAG--

Associate to Mr Justice

Beaumont

Date: 24 December 1992

JUDGMENT No.

IN THE FEDERAL COURT OF AUSTRALIA )

1

NEW SOUTH WALES DISTRICT REGISTRY ) NO. NG 2021-6 of 1987

)

GENERAL DIVISION )

BETWEEN :	ABRAHAM GILBERT SAFFRON
Applicant

AND COMMISSIONER OF TAXATION
Respondent

CORAM :  Beaumont J.

RECEIVED

m:  22 December 1992

REASONS FOR JUDGMENT

INTRODUCTION

Before the Court are several appeals by Mr. Saffron against decisions by the Commissioner to disallow objections against assessments of income tax and additional tax made by the Commissioner in 1984. The Commissioner claims that, in respect of several years of income, Mr. Saffron omitted to disclose certain income in his returns. The objections were,

in the first instance, forwarded to the Supreme Court of New	South Wales, which then had jurisdiction in such matters. The
appeals, now before this Court by virtue of s.4(3) of the Jurisdiction of Courts (Miscellaneous Amendments) Act 1987, were heard at the same time as several applications made by
Mr. Saffron to the Administrative Appeals Tribunal ("the
Tribunal"). These applications, made pursuant to 6.187 of the Income Tax Assessment Act 1936 ("the Act"), sought review of the Commissioner's decisions on objections to assessments made in 1987. Similarly, in the 1987 assessments, the Commissioner
assessed that Mr. Saffron omitted income from his returns.
THE ASSESSMENTS

The details of the 1984 assessments, which are

before the Court, are:

(i)     1976-7 vear

Omitted income assessed $12,000

(ii).    1977-8 vear

Omitted income assessed $71,000

(iii)   1978-9 vear

Omitted income assessed $37,140

(iv)    1979-80 vear

Omitted income assessed $187,489

(v)     1980-1 vear

Omitted income assessed $112,062

(vi)    1980-1 vear

Previous year's losses disallowed $24,748

(vii)   1981-2 vear

Previous year's losses disallowed $27,628

In respect of each of these years, the Commissioner

also assessed additional tax by way of penalty for the alleged
omissions.

The details of the 1987 assessments, which are

before the Tribunal, are:

(i)      1973-4 vear

Omitted income assessed

(ii)     1974-5 vear

Omitted income assessed

(iii)   1975-6 vear

Omitted income assessed

(iv)     1976-7 vear

Omitted income assessed

(iv)     1977-8 vear

Omitted income assessed

(vi)     1978-9 vear

Omitted income assessed

In respect of each of these years, the Commissioner also assessed additional tax by way of penalty for the alleged omissions.

THE ISSUES

Briefly expressed, the main issues for determination

are : 

(1) Did Mr. Saffron derive the income, allegedly omitted from his returns, from business activities carried on by him? (The 1984 assessments.) The Commissioner alleges that

Mr. Saffron was the proprietor of several restaurants and

nightclubs, and that he received in cash, but omitted from his returns, funds earned in the conduct of those businesses.

(2) Did Mr. Saffron derive, but omit to declare in his returns, income in the form of monies allegedly received in cash, in the first instance, by James McCartney Anderson? These monies were said to have been shared between Mr. Anderson and Mr. Saffron, in the proportion 60:40, and to have come from funds generated .by Mr. Saffron and Mr. Anderson operating several nightclubs and restaurants. (The 1987 assessments.)

The matters in dispute are essentially factual in their character and, subject to the application of any special rules as to onus in this area (cf. Federal Commissioner of Taxation v Dalco (1990) 168 CLR 614), their resolution will depend upon the weight to be given to the conflicting evidence which was tendered by the parties.

(Although not a major aspect of this dispute, it
should be noted that the Commissioner alternatively claims that

the "Carousel Cabaret", a restaurant/nightclub owned by Apsley

controlled by Mr. Saffron, one of its shareholders) made	Investments Pty. himited (a company alleged to have been
payments to Mr. Saffron which were deemed to be dividends by virtue of s.108 of the Act.)
The Commissioner provided particulars of the amounts assessed by him as the omitted income as follows:

AMOUNTS ASSESSED AS INCOME OF A.G. SAFFRON

(1) Amounts recelved from cash takinas of followinq niqhtclubs or restaurants

1973/4 1974/5 1975/6 1976/7 1977/8 1978/9 1979/80 1980/81 TOTAL

$ $ $ $ $ $ $ $ $

"Venus Room" 36,040 60,240 68,720 62,720 172,600 57,300 23,400 51,600 532,620

"Carousel Cabaretn 69 12,000 71,000 24,000 95,000 29,000 231,069

"La Bastille" 1,400 7,000 2,600 11,000

"Showbiz" 2,200 1,500 3,700

"G~lllgans" 1,700 1,700

(2) Amounts alleqedly received from followinq "sources"

"T. Teeman"
"Photographer"
"Tony ~ent/~ent"
"Venus Rent h Upstairs"
"Keith/~ridges"
"R. h P,"

"J~rn"

"Other" 1,542 1,542

TOTAL 37,740 60,240 68,789 74,720 243,600 87,840 191,588 123,280 887,797

The total income assessed ($887,797) was divided between the 1984 and 1987 assessments as follows:

Year Assessments Issued Assessments Issued Total

(2.3.84) (26.3.87)

To understand the context in which these issues arise, it is necessary to outline the main features of the evidence tendered by the parties.

THE EVIDENCE FOR THE TAXPAYER

1. Mr. Saffron's evidence

(a) Mr. Saffron's written statement

In the first instance, the evidence of Mr. Saffron consisted of a written statement which dealt with each item mentioned in the particulars provided by the Commissioner in the following fashion:

( i ) "Venus Room"

Mr. Saffron said that this was the name of a restaurant/nightclub conducted at 6-0 Orwell Street, Kings Cross, from 1974. The Orwell Street premises were owned by Abbey Investments Pty. Ltd.. ("Abbey"). Mr. Saffron was a director of Abbey. The Venus Room was originally owned by either James McCartney Anderson, or by him and his wife. Later, Maurice Ryan became a partner in the business. Subsequently, the business was sold to Thomas Edwards who changed its name to "The Raft". Mr. Anderson, and later M r . Edwards, paid rent to Abbey. Mr. Saffron denied that he had an interest in any of these businesses, and denied receiving any of their takings.

(ii)   "Carousel Cabaret"

Mr. Saffron said that this was the name of a
restaurant/nightclub, conducted at 2C Roslyn Street, Kings

Cross, owned by Apsley Investments Pty. Ltd. ("Apsley"). Mr.

Anderson and his wife) managed the business. Mr. Saffron	Saffron was a director of Apsley. Mr. Anderson (or Mr.
denied that he had any interest in the business and denied receiving any of its takings.
(iii) "La Bastille"
Mr. Saffron said that this was the name of a restaurant/nightclub conducted on the ground floor of premises at the corner of Darlinghurst Road and Barncleuth Square,

Kings Cross. This business was owned by La Bastille Restaurant Pty. Ltd. ("Bastille"). One of the shareholders of Bastille was Arcadia Securities Pty. Ltd. ("Arcadia"). Mr. Saffron was a director of Arcadia. The business was managed by Mr. Anderson. Mr. Saffron denied receiving any of the takings of the business.

(iv) "Showbiz"

Mr. Saffron said that a restaurant/nightclub was carried on under this name in the basement of the premises occupied by La Bastille. Mr. Anderson owned and managed this business. Mr. Saffron denied receiving any of the takings of this business.

(v) "Gilliaans" Mr. Saffron said that a restaurant/nightclub was

conducted under this name at 108 Campbell Parade, Bondi

Junction. Mr. Anderson owned and managed this business. Mr.

Saffron denied receiving any of the takings of the business.

(vi) "T. Teeman"

Mr. Saffron assumed that this was a reference to

Timothy Teeman. Mr. Saffron denied receiving any money from
Mr. Teeman.
(vii) "Photoarauher"

Mr. Saffron denied receiving money from a

photographer.

(viii) "Tonv Rent/Rentu'
Mr. Saffron did not know who "Tony" was, and denied

receiving any money from a Tony on account of rent or

otherwise.

(ix) "Venus Room & U~stairs"

Mr. Saffron said that the Venus Room business was conducted on the ground floor of the Orwell Street premises. There were rooms upstairs rented out by Abbey. Mr. Saffron did not "personally" collect the rent for the ground floor or the upstairs. All these rents were paid into Abbey's bank account. Mr. Saffron denied receiving any monies in these

respects.

( X ) "Keith/Fridaes "

Mr. Saffron assumed that "Keith" was Keith Parsons, who presented a "Les Girls" floor show at the Carousel Cabaret. Mr. Saffron denied receiving any money from Mr. Parsons for refrigeration equipment, or otherwise.

(xi) "R & P"

m. Saffron took this to mean "rent and police".

Mr. Saffron denied receiving funds in this connection, save

for monies deposited to Abbey's bank account.

(xii) "0"

Mr. Saffron assumed that this was a reference to Mr. Anderson. Mr. Saffron denied receiving funds in this connection, save for monies deposited to Abbey's bank account.

(xiii) "Other"

Mr. Saffron assumed this to be a reference to funds allegedly received, by way of income, from other sources. This was denied.

(b) Mr. Saffron's oral evidence

Mr. Saffron, questioned in chief about the item "Venus Room & Upstairs" in his written statement, said (Tr. 63-4) :

"The t h i r d sentence r e a d s ' I d i d not p e r s o n a l l y

collect the rent for The Venus Room or for the

u p s t a i r s rooms. ' What d i d you mean t o c o n v e y by

t h a t sentence?---Well, i t ' s grammat ica l l y incorrect.

I meant t h a t I d i d n ' t for my own benefi t p e r s o n a l l y .

I meant for the company's benefit I may have , yes.

S o t h a t you may have p h y s i c a l l y p i cked u p moneys

which a r e rents - - -?---Yes, I may have

o c c a s i o n a l l y p i cked u p - - -

- - -but not r e c e i v e d by you on your own b e h a l f b u t

r a t h e r on b e h a l f o f the company?---Abbey

Investments. "

I n c ros s - examina t i on , M r . S a f f r o n agreed t h a t the

r e s t a u r a n t cabare t Les G i r l s was a l s o de sc r ibed a s Carousel

Cabare t , but was p r i m a r i l y known t o the p u b l i c a s "Les G i r l s " .

He a s c e r t a i n e d , i n 1973, t h a t Les G i r l s was a v a i l a b l e f o r

purchase a t a low p r i c e . He completed n e g o t i a t i o n s a c q u i r i n g ,

v i a one o f h i s companies, A p s l e y , the b u s i n e s s and the l e a s e

o f the premises . However, he d i d n o t t a k e a n interest i n the

day-to-day o p e r a t i o n o f the b u s i n e s s , a l t hough he knew t h a t a

bookkeeper was employed i n an o f f i c e behind the s t a g e o f Les

G i r l s . H e went o n t o g i v e the f o l l o w i n g e v i d e n c e ( T r . 8 5 - 6 ) :

"You knew o b v i o u s l y enough t h a t one o f her t a s k s was

t o write u p books r e l a t ~ n g t o the b u s i n e s s o f

Carousel Cabaret or Les Gir ls?-- -Yes .

You knew you c o u l d go and l o o k a t a n y o f those books

a t a n y time?---I	c o u l d have i f I	was	going	t o watch
it on a	d a y t o d a y o p e r a t i o n .	I	d i d n ' t	hire or fire

anybody there.

Did you from t i m e t o t i m e receive payments r e l a t i n g

t o the invo l vemen t o f A p s l e y w i t h the b u s i n e s s o f

Carousel Cabaret?---No, the b u s i n e s s d i d n o t r e t u r n

very much money,	paid	o f f i t s l e a s i n g and	t h a t was
m y main concern .	The purchase p r i c e	was r e t u r n e d t o

me by way o f l e a s e .	I	s a y me t o the company.
W e l l , doe s t h a t mean you	d i d receive	some money a t

some t i m e i n connec t i on w i t h the a c t i v i t i e s o f what ,

i f I may, I w i l l c a l l the Carousel Cabaret?---I'd

have t o look u p the company r e c o r d s o f Aps l ey .

I see. Now, were there o c c a s i o n s when you were a t

keeper was when you were g i ven money?---For me	the premises o f the Carousel Cabaret where the book
p e r s o n a l l y , no. There cou ld have been the occas ion
t h a t I was g i ven r e n t a l money f o r a n o t h e r p r m i s e s .
W e l l , I am t a l k i n g about now, a c t u a l hand ing over o f
c a s h for whatever purpose?
H I S HONOUR:  B y who and where?
m. DOWNES:  Y e s , w e l l , I w i l l come to t h a t .
Did you ever have handed over t o you a t the premises o f Carousel Cabare t , namely the L e s G i r l s , the o f f i c e beh ind the s t a g e I think i t was, was it no t? -
--I believe it was, yes.
Did  you a t a n y s t a g e d u r i n g the time when you or
A p s l e y  I n v e s t m e n t s was a s s o c i a t e d w i t h the Carousel
Cabaret receive money i n cash a t t h a t premises?---I
don ' t  r e c a l l a n y p a r t i c u l a r occas ion , no .
Does  t h a t mean you a r e a b l e t o s a y t h a t you d e n y
ever  r e c e i v i n g a n y sum o f money?---I s a i d a m i n u t e
ago,  I cou ld have been g i v e n some r e n t a l money, b u t
I c a n ' t Now, i f  r e c a l l a n y p a r t i c u l a r occas ion .

you were g i v e n r e n t a l money, would t h a t have

been r e n t a l money a s s o c i a t e d w i t h the o t h e r

b u s i n e s s , the Venus Room?---That i s c o r r e c t .

Do you was $225 p e r week?---I s a y t h a t the r e n t a l money for the Venus Room

think t h a t was the rent.

You had , d i d you n o t , an interest i n the b u s i n e s s o f

the Venus Room?---No, n o t i n the b u s i n e s s .

Was there some pe r iod o f t i m e when you had an

interest i n the b u s i n e s s o f the Venus Room?---

P e r s o n a l l y , no . A company c a l l e d P.H. E l e c t r i c a l

d i d , a t one s t a g e , have an interest i n the

b u s i n e s s . "

Mr. Saffron said that P.H. Electrical, one of his companies, owned the Venus Room for about 12 months, probably

prior to 1975.

Mr. Saffron agreed that, for a long time, the Venus Room kept an account with the A.N.Z. Bank, to which he was a signatory. He also guaranteed that account.

M r . Saf fron was shown the bank's signature card

dated 28 February 1972 for the Venus Room account (Ex . l).

The address o f the account was stated t o be 6 Orwell Street , Potts Point, and the nature o f the business that o f a licensed restaurant. Any one signatory alone could operate the

account. The signatories . were stated t o be M r . and Mrs.

Anderson	and	M r .	Sa f f ron, whose	specimen	signatures were
endorsed	on the card.	Beside	each	signature,	i n d i f f e r e n t
handwriting,	there	appeared,	under	the	sub-heading

"Designation", the word "Partner".

M r . Saf fron denied that he was a "Partner". He said

that t h i s writing was not on the card when he signed it.

M r . Saf fron gave the following evidence ( T r . 88):

"Can I ask you i f you had no in teres t i n that business a t the time you signed t h i s document why i t was that you came t o sign it?---I guaranteed the account for some considerable money. A lease had been given t o Anderson and h i s wife and I was

concerned with my guarantee. You had not guaranteed the account a s a t the date o f	t h i s document, namely 28 February 1972, had you?---I
can't remember when the guarantee went i n to force,
b u t the lease would have been prior t o that.
Well, now, can I a s k you what commercial advantage you considered - I am sorry. Can I ask you what purpose you considered there was i n being one o f three signatories on the business account o f t h i s business i f your only in teres t was that a company o f yours was a lessor o f the business?---I was asked t o sign it by Jim Anderson.
Are you i n the habit i n your business a f f a i r s , irir. Saffron, o f doing things for others merely because you are asked to?---In certain cases, yes.
Did you not on this occasion give consideration to whether that was a sensible or appropriate thing to do, namely to be a signature on an account of a business you had nothing to do with?---I wished to assist Jim Anderson and his wife in the occupation of the premises.
And is that because you had an interest in the premises yourself?---No.
Now, would it be fair to say - - -
HIS HONOUR:  In the premises or the business?
MR. DOhWES: I am sorry, in the business itself 7 I said in the premises, Mr. Saffron?---I thought you said business.
I think you understood me as saying business?---Yes, I thought you said business. I am a little hard of
hearing.  "

Mr. Saffron agreed that, on a number of occasions, he discussed the Venus Room account with Mr. Jones, the bank manager then responsible for the account. (On his retirement from the bank, Mr. Jones was employed by Mr. Saffron.) Mr. Saffron had these discussions because he had given the guarantee. Mr. Saffron agreed that his businesses had a

number of accounts with the A.N.Z. Bank.

Mr. Saffron said that his company paid $30,000 for

the building, and it received $225 rent per week.

Mr. Saffron agreed that, in late 1973 or early 1974, he asked the bank to meet certain cheques drawn on the Venus Room account. He said that he regarded himself as doing this on behalf of Mr. Anderson. Mr. Saffron said that he did not sign any of the cheques drawn on this account.

Mr. Saffron agreed that, in 1975 and 1976, he may have discussed the state of the account, and projected expenditure for the operation of the Venus Room, with the bank manager. He further agreed that in 1978 he asked the bank for $10,000 finance for six months, to assist with renovations and increased stock purchases for the Venus Room. He acknowledged that in 1978 he executed a guarantee of the account up to $10,000. He said that this was done to assist Mr. Anderson, as the tenant of his company.

Mr. Saffron was cross-examined about the registration of the business name "The Venus Room" (stated to be a "restaurant cocktail bar" carried on at 6 Orwell Street, Kings Cross). Cross-examination referred to three documents (part of Ex. 2) as follows:

(1) A statement for renewal of the registration of a business name, lodged with the Registrar of Companies on 29 March 1971. The registration, due to expire on 15 February 1971, was to be renewed to 15 February 1974. The proprietors of the business were stated to be Brian John Buckett, James McCartney Anderson and Maurice Ryan.

(2) A statement for renewal of the above registration from 15 February 1974 to 15 February 1977, lodged with the Corporate Affairs Commission on 7 February 1974. It was stated that Messrs Buckett and Ryan had ceased to be proprietors, and that Mr. Saffron had commenced, and with Mr. Anderson, continued to carry on the business. Mr.

Saffron made a statutory declaration on the form that the particulars stated were correct.

(3) A notice of cessation of business lodged with the Corporate Affairs Commission on 1 July 1979, which stated that the business had ceased on 1 June 1979, signed by Messrs Anderson and Saffron.

Mr. Saffron was cross-examined on an unsworn statement made by him in criminal proceedings (Ex. G). In that statement, Mr. Saffron said that in 1959, he bought through his company, Abbey, the building which later "housed" the Venus Room. He stated that he suggested to Mr. Buckett that Mr. Buckett "try [his] hand" at a restaurant in the Orwell Street premises. Mr. Buckett agreed to open such a restaurant, but said he would need financial assistance. Mr. Saffron told Mr. Buckett that, although he was not interested in putting money into the restaurant business, he would lease the premises for "a very low rental". Mr. Buckett started to

Mr. Saffron agreed, through his company, P.H. Electrical, to	carry on the business, but also developed business interests in Fiji which meant that he had to "give up" the restaurant.
take over the Venus Room. Mr. Buckett introduced Mr. Saffron to his manager, Mr. Anderson, who in turn managed the business for P.H. Electrical. Later, Mr. Anderson and his partner, Mr. Ryan, took over the business. When the business name registration was transferred from Mr. Buckett to Mr. Anderson,
Mr. Saffron signed the document "because [he] wanted to
protect the name of the Venus Room to stay with that building". Subsequently, after Mr. Anderson had approached him for assistance, Mr. Saffron agreed to execute several guarantees of Mr. Anderson's bank account for the Venus Room. Thereafter, Mr. Saffron agreed that Mr. Anderson could collect the rentals for the upstairs rooms in the Orwell Street premises, and bank them in Abbey's account. In late 1979, because the Venus Room had received adverse publicity, Mr. Anderson introduced Mr. Edwards as a suitable person to take over the restaurant, to which Mr. Saffron agreed, provided another name was used. The business thereafter was carried on by Mr. Edwards under the name "The Raft".
In cross-examination, Mr. Saffron agreed that he was handed money by Mr. Anderson from time to time, representing rent for the Venus Room and the upstairs rooms. Mr. Saffron said that he regarded this as Abbey's money.

Mr. Saffron was cross-examlned about a letter dated

21 September 1979, written on letterhead entitled "Venus Room 6 Orwell Street Potts Point" (Ex. 116). The letter was admitted into evidence provisionally, subject to Mr. Saffron's objection to its tender and subject to relevance. I will deal with its admissibility later in these reasons. The letter was signed by a person, known for reasons to be explained, as "Bookkeeper X". Mr. Saffron agreed that "X" was bookkeeper for the Venus Room and the Carousel Cabaret. The letter, addressed to a firm of solicitors which, Mr. Saffron

acknowledged, was retained by him, referred to the change of

name for the Venus Room and stated:

" M r . Saffron has asked f o r the name "APPOLLO ROOM"

t o be sought a s he wants t o get away from the

"Venus" a1 together .

I f you could keep me up t o date with proceedings, I

would appreciate i t . "

Mr. Saffron said he was not aware that this letter had been written, although he agreed that the name "Appollo Room" was being considered at the time.

Mr. Saffron was also cross-examined on his unsworn statement concerning the Carousel Cabaret. In that statement, he said that in 1973, through his company Apsley, he purchased the Les Girls restaurant cabaret and, at that time, arranged a lease with the owners of the building. In February 1973, Mr. Saffron appointed Mr. Anderson manager of Les Girls. In 1974, Mr. Saffron noticed a bookkeeper ("X") working at Les Girls

that Apsley would pay "X" her remuneration. Because "X" was	and, having raised the matter with Mr. Anderson, it was agreed
also doing work for Mr. Anderson, it was agreed that he would reimburse Apsley $80 per week for her services.
Mr. Saffron agreed that "X" gave him money from time to time for rent, and that "occasionally, not frequently", she gave him money to pay accounts due by Carousel Cabaret.
In the course of cross-examination, Mr. Saffron was shown a book entitled "Carousel Cabaret" (Ex.15 - described in evidence as a "takings book" in respect of the period January
1975 to February 1976). The book was admitted subject to Mr.
Saffron's objection, and I. will deal with its admissibility later in these reasons. Other takings books for Carousel Cabaret were admitted on the same basis (Ex. 16 - in respect of the period February 1976 to June 1976; Ex. 17 - in respect of the year ended 30 June 1977; Ex. 18 - in respect of the year ended 30 June 1978; Ex. 19 - in respect of the year ended 30 June 1979; and Ex. 20 - in respect of the year ended
30 June 1980). It was suggested to, but denied by, Mr.
Saffron, that he had received typed copies of the pages of these books on a regular basis over these periods.
Mr. Saffron gave the following evidence about his dealings with bookkeeper "X" (Tr. 169-170):

"Do you a g r e e t h a t you saw Bookkeeper X r e g u l a r l y i n

19777---No, I d i d n ' t .

Did you go into the o f f i c e where she was then w o r k i n g s o m e t i m e s once a week , some t imes once a mon th a t t h a t per iod?- - - I d o n ' t believe there were many times a t a l l , l e t a l o n e once a mon th or once a week.

HIS HONOUR: T h a t was i n 1977.

MR	DOWNES:	Y e s , y o u r Honour.
When Bookkeeper X	gave you money from	t i m e t o t i m e

d i d she t a k e i t from a c a s h t i n i n a s a f e a t the

Carouse l Cabaret?---I c a n ' t remember.

There was such a s a f e a t the Carousel Cabare t , was

there not?---I	believe there was a s a f e i n t h a t
a rea .

Was	there	a	c a s h	t i n	i n s i d e	the	safe?-- - I	don ' t
know.

On o c c a s i o n s you	t o l d Bookkeeper X	t h a t you	wanted
moneys pa id	t o v a r i o u s peop l e ,	d i d you	not?---There

cou ld have been an odd occas ion or two when I would have s a i d t h a t somebody t e l ephoned me for an account

t o be pa id .

And on from her for t h a t purpose from time t o time?---No, o c c a s i o n s such a s t h a t d i d you receive money

I

c a n ' t remember have been one o r two. a n y p a r t i c u l a r o c c a s i o n s , there cou ld

The person t h a t wanted the

money would have gone	u p t o c o l l e c t the money I
presume.

D o you i n s t r u c t i o n s t o Bookkeeper X a g r e e t h a t from t i m e t o t i m e you gave

about payment o f moneys

on b e h a l f o f Carousel Cabaret t o persons you

nominated?---I would have s a i d t h a t somebody

t e l ephoned me	about	an account	and	had	she	a t t e n d e d
t o i t .

Did you g i v e s i m i l a r i n s t r u c t i o n s t o her i n

connec t i on w i t h T h e Venus Room?---No.

Now, d i d you know someone named Dianne

Lichteneggez-7---I l e a r n e d l a t e r her second name, I

knew a g i r l c a l l e d Dianne.

h%. DOWES: you knew a s Dianne was, i n f a c t , S o you a r e s a t i s f i e d t h a t the person

the person whose

name was Dianne know i t a t the time?---Yes, L i ch t enegger , a l t hough you d i d not

I believe so.

And Dianne L i c h t e n e g g e r i s now deceased, i s she

not?---That i s correct.

She was k i l l e d i n a c a r accident?-- -That was the

report.

She gave you t y p e d c o p i e s from some o f the pages o f

the books t h a t have j u s t been marked MFI	15 t o 20,
d i d she not?---That	i s incorrect. "

M r . Sa f f ron was also cross-examined about

several books, described i n evidence as dai ly takings books

"V3 " "V4 "

for the Venus Room (Exs. " V l " , uv2 U I I , "V5" and

"V6" , for the years ended 30 June 1975, 1976, 1977, 1978, 1979

and 1980 respect ively) . These books were admitted subject t o

Mr . Saf fron 's objection and the i r admissibil i ty i s also dealt

with la ter i n these reasons. I t was suggested t o , but denied

by, M r . Sa f f ron, that he had received typed copies o f the

pages i n these books.

Mr . Saf fron agreed that he saw " X " working i n an

o f f i c e i n the Carousel Cabaret premises. He then gave t h i s

evidence ( T r . 174-5):

" D i d the o f f i c e thereafter move t o a place called

Barncleuth Square?---I am aware o f that.

You went there from time t o time?---I don't believe I went there on more than one, perhaps two occasions.

I suggest t o you you went there frequently?---I've
j u s t answered the question.

Thereafter i t moved t o Westfield Towers, d i d i t

not7---Yes, I am aware o f that.

You went there from time t o time, d i d you not?---

Very, very rarely.

I suggest t o you you went there frequently?---That

i s incorrect.

I suggest that a t each o f these places you picked up typed sheets o f the dai ly takings for both The Venus

Room and the Carousel Cabaret7---That i s incorrect.

I suggest t o you that you went t o the Westfield

Towers o f f i c e a s o f ten as once a week?---That i s incorrect.

And t h a t a b o u t once a week?---That you wen t t o the B a r n c l e u t h S q u a r e o f f i c e

i s a l s o incorrect.

Now, there was a time, was there not, when

Bookkeeper X became a s i g n a t o r y t o the M Z Bank

a c c o u n t	o f The	Venus Room?---Yes,	I	was	i n f o r m e d o f
t h a t .

Who i n f o r m e d you?---I c a n ' t r e c a l l .

Bookkeeper X a s k e d you i f you would a l l o w M Y Edwards

and herself t o both become s i g n a t o r i e s t o t h a t

a c c o u n t ,	d i d she	not?---I	c a n ' t	r e c a l l	t h a t .
T h a t	i s a	p o s s i b i l i t y i s it?---I	d o n ' t	believe	so.

I	d o n ' t	believe she would a s k me.
I s u g g e s t t o you s o m e t h i n g	t h a t there was a	time when you had

a d i s a g r e e m e n t w i t h Bookkeeper X over w h e t h e r

had been p a i d t o you or w h e t h e r s o m e t h i n g

had been p a i d t o someone else?---I d o n ' t r e c a l l such

a d i s a g r e e m e n t . "

Mr. Saffron was shown a book with the letters "A.S." written on it (Ex. 31). Again, the admissibility of this document is dealt with later in these reasons. The pages in the book are carbon copies. It was suggested to Mr. Saffron, but denied by him, that from time to time he received cash wrapped up in sheets of paper, carbon copies of which are in

Ex. 31.

Mr. Saffron was cross-examined about his business dealings with Mr. "Tosha" Maksimovich, a builder who carried out construction and renovation work for Mr. Saffron from time to time. Mr. Saffron agreed that he and Mr. Maksimovich were also associated in two restaurants, one at Bondi, the other at Bondi Junction. Mr. Saffron gave the following evidence (Tr.

184-5) : 

"Did Tosha c a l l a t the p r e m i s e s from time t o time

[ a t ] the t w o r e s t a u r a n t s w i t h wh ich the t w o o f you

were a s s o c i a t e d t o collect c a s h takings?---He would

be	there a t those	- I	think i t c o v e r e d t w o d i f f e r e n t
p e r i o d s ,	b u t he	was	there.

H e was a l s o the manager o f these r e s t a u r a n t s , was

he?---Well, it was two d i f f e r e n t p e r i o d s o f time,

b u t yes,	he	d i d look a f t e r the b u s i n e s s .
Did	he b a n k the t a k i n g s ,	for example?---Yes.

Did he g i v e t o y o u , from t i m e t o t i m e , money from

the takings?---No.

Did he, from time t o time, d o t h i n g s t h a t you a s k e d

h i m t o d o a p a r t from t h i n g s a s s o c i a t e d w i t h the t w o

r e s t a u r a n t s w i t h wh ich you were a s s o c i a t e d ? - - - I n

r e g a r d t o r e n o v a t i o n work?

N o , i n r e g a r d I n c l u d i n g b u i l d i n g work?---Renovation t o a n y work a t a l l7 - - -Renova t ion work.

work.

Did you a s k him, from time t o t i m e , t o go t o the

C a r o u s e l C a b a r e t or the Venus Room o f f i c e s t o d o

a n y t h i n g on y o u r behal f?- - -No.

Did he	ever d o a n y b u i l d i n g work a t the Venus Room
or the Carouse l Cabaret7---As	f a r a s I know, yes.

A t w h i c h p l a c e would s a y both, among others. d i d he d o i t or both o f them?---I

And was t h a t a t y o u r reques t?- - -As f a r a s the

Carouse l	it	c o u l d	h a v e been	or	i t	c o u l d	h a v e been
Anderson	a s k e d	him	t o d o	s o m e t h i n g ,	I	j u s t	d o n ' t
know.

. . . I s u g g e s t t o you t h a t on many o c c a s i o n s Tosha

gave t o you c a s h wrapped u p i n pieces o f paper7---

T h a t i s u n t r u e .

I s u g g e s t t h a t on many o c c a s i o n s he gave y o u c a s h

wh ich you b e l i e v e d r e p r e s e n t e d t a k i n g s from the

C a r o u s e l Cabaret?---That i s u n t r u e .

I s u g g e s t o c c a s i o n t o you t h a t he d i d i t on a t l e a s t one

w i t h t a k i n g s you b e l i e v e d t o be from the

Venus Room?---It i s u n t r u e .

And would y o u r answer be the same i f I s u g g e s t e d t o

you that the moneys only partly represented takings from the Carousel Cabaret and represented other

things as well ?---Well, he didn't give me money.

Thank you. At all?---No, not at all.

Ever?---Not at all. "

Mr. Saffron agreed that in June 1982 he had a personal secretary whose name was Terrie. Mr. Saffron said (Tr. 186):

"She was your personal secretary, was she?---Yes.

At the time Bookkeeper X ceased to work in connection with the Carousel Cabaret she took a number of books to your office where Terrie worked, did she not?---No, I don't believe she did, they were delivered there but I don't believe that X delivered them there.

And she explained to your secretary, Terrie, to your knowledge, how the books were kept, did she not?---

That is incorrect. "

It was suggested to Mr. Saffron in cross-examination
that he had an interest in Gilligans Restaurant. He was shown

another A.N.Z. Bank signatory card (Ex. 3), dated 23 October

1972 in respect of "Gilligans Restaurant" stated to be "C/-

Venus Room" at 6 Orwell Street. It was stated that the nature of the business was a "restaurant", and that any one signatory alone could sign. The names of those authorised to sign were stated to be Mr. Saffron and Mr. Anderson (in that order). Both Mr. Saffron and Mr. Anderson signed the document and beside each of their signatures appeared, in handwriting (not their handwriting) the word "partner". On another card, which was annexed to the signatory card, the signature of Mrs. Anderson appeared.

Mr. Saffron said, in his evidence, that he could not remember signing the signatory card. He repeated his earlier statement that he had no interest in Gilligans Restaurant.

In the course of his re-examination, Mr. Saffron gave the following evidence concerning his secretary (Tr. 228) :

"This morning my learned friend, Mr. Downes, asked you some questions about the books which were delivered to your secretary, Terrie, in 1981 or

1982. What books were delivered to your secretary?-
--Carousel books, the only books that I knew of
there.

Were any of the books which have been marked for identification I think in these proceedings amongst those which were delivered to you?---They were not.

Now, there was a reference to your secretary named

Terrie?---Yes.

Is she still your secretary?---Yes.

Where is she now?---She's overseas at present.

For [how] long has she been overseas?---About three weeks.

And when does she return?---About four or five

weeks. "

(2) Mr. Maksimovich's evidence

The evidence of Todor ("Tosha") Maksimovich in his written statement (Ex. TMl), and in his oral evidence, was to the following effect:

(a) The written statement

Mr. Maksimovich said that in 1978 Mr. Saffron became his partner in a discotheque at Bondi Beach, but that Mr. Saffron bought him out in 1979 or 1980. In 1979, for a short period, he and Mr. Saffron carried on a discotheque restaurant business at Bondi Junction. Also, from 1979, at Mr. Saffron's request, Mr. Maksimovich did building maintenance work on premises owned by companies controlled by Mr. Saffron, who paid him for the work by cheque.

Mr. Maksimovich said that he met Mr. Anderson in

1979 and that he, or his sub-contractor, did building work for

. Anderson at premises including "Jim's Showbiz" and La

Bastille in Barncleuth Square, and at the Carousel Cabaret in Darlinghurst Road. Sometimes, Mr. Anderson would pay him personally, but usually Mr. Maksimovich would collect what was due to him from bookkeeper "X" in her office. "X" usually gave him the amount due in cash with "a rubber band around it and a little written note showing the amount of the money she

was giving me and the total that she had given me up to date for the particular job that she was giving me money for."

Mr. Maksimovich said that the money given to him by

"X" was "always in cash and was between $2,000 and $5,000 each

time." He said that he discussed building work at the Carousel Cabaret with Mr. Saffron and Mr. Anderson, but he never saw Mr. Saffron collect money from "X" or otherwise, nor was he ever given money for Mr. Saffron.

(b) Mr. Maksimovich's oral evidence

In cross-examination, Mr. Maksimovich said that he did not have any records relating to the maintenance work done for Mr. Saffron. Mr. Maksimovich stated that he did not prepare invoices for the work done, nor did he render any bill to Mr. Saffron; rather he merely told Mr. Saffron what was due, and Mr. Saffron, or his secretary Terrie, would give him a cheque.

With respect to his dealings with "X", Mr. Maksimovich gave the following evidence (Tr. 947-8):

"When you wen t t o the one or the other o f f i c e d i d

you a l w a y s s p e a k w i t h Bookkeeper X?---I a l w a y s came t o see here, Jim t o l d me t o go see her there, b u t I would s p e a k t o other p e o p l e who was i n the o f f i c e

too.

W h e n you went there d i d you a s k her anyth ing?-- - I

c a n ' t r e a l l y remember every c o n v e r s a t i o n what I had

w i t h a person b u t I a l w a y s used t o come for one

p a r t i c u l a r r e a s o n t o see her.

Yes?---Because J i m t o l d me t o go and g e t the money

f o r the work what was g o i n g on.

Did you tell her why you were there?---She k n e w why

I was there.

B u t d i d you t e l l her?---She k n e w why I was there.

Did you t o l d her b u t she k n e w I t e l l her? - - -L i s t en , I d o n ' t remember what I

was coming.

Did you tel l her how much money you w e r e e x p e c t i n g

t o collect?---Most	o f the t i m e she	k n e w e x a c t l y or I
t o l d her, Jim s a i d 3, 2, 5000 ,	4000,	a l l depends how
much p e o p l e	n e e d	t o g e t .

So, i s this the p o s i t i o n t h a t before you went there you a lways knew how much money it was t h a t you were go ing t o collect?---Yes. But n o t n e c e s s a r i l y t h a t I

would g e t pay, but I knew how much they shou ld pay. t h a t much money, how much was n e c e s s a r y t o

And you statement?---No, d i d n o t go a l o n g w i t h an i n v o i c e o r a

I - n o s t a t e m e n t , no i n v o i c e ,

n o t h i n g .

You knew it i n y o u r . head?---No, I had somebody

always w r i t i n g a l i t t l e for me or I w r i t e i n

S e r b i a n , you know. I w r i t e i n S e r b i a n - t h a t

person, c a r p e t , and t h a t much. You know, i n S e r b i a n

I w r i t e and I t e l l them the f i g u r e . I tell t o J im

th is weekend you mus t - h a v e t h a t much money and J im

would s a y you go and see Bookkeeper X .

Was it a lways Bookkeeper X t h a t you saw t o g e t the

money?---I go t from J im somet imes , I go t a c o u p l e o f

t i m e s , a f ew t i m e s from Lionel. "

Did you see where she go t the money from?---

Sometimes from s a f e - I d o n ' t remember not e x a c t l y

where t h e money come from, I r e a l l y don ' t remember,

she t o o k somet imes from s a f e , i t was a s a f e there,

sometimes she had r e a d y ,	i t ' s - you know.
Did you ever a s k her for a cheque?---I'm	sorry?

Did you ever a s k her f o r a cheque?---As f a r a s I

remember J im s a i d he wants t o p a y a l l these tradesmen i n cash and on the end he s a y he w i l l p a y

me,	b u t he never d i d .
When the money was handed over it was j u s t a bund l e ,
was i t? - - -The	money was, you know, money and it w i l l

s a y on the p i e c e o f paper - j u s t l i t t l e p i e c e o f

paper - s a y , Tosha, $3000 and was how much a l r e a d y

she gave me b e f o r e .

What d i d you d o w i t h the note t h a t was on the b u n d l e

o f money?---Throw i n the r u b b i s h .

Did you ever a s k her why she gave you the note a s w e l l a s the money?---No. I assume she wants t o k e e p

for herself how much money she i s g i v i n g me.

But you had [ n o ] interest i n the n o t e t h a t was

a t t a c h e d t o the b u n d l e , i s t h a t r ight?---She j u s t s a y , Tosha, 2000, or 3000 or 4000 or 5000 or whatever it i s and s a y underneath r e c e i v e d s o much.

I already have this written in Serbian therefore for me I just see it is correct my way."

THE EVIDENCE FOR THE COMMISSIONER The Commissioner called or tendered evidence to the

following effect.

(1) Anne Marie Von Stroheim's evidence

(a) The written statement

In her written statement dated 7 March 1992 (Ex. 5), Ms. Von Stroheim said that in September 1972 she was employed by Mr. Anderson to write up the books of the Venus Room. In early 1973, at the request of Mr. Anderson, she began counting the daily takings from the safe. She identified the Venus Room daily takings book for the period 28 October 1973 to 9 March 1975 (Ex. Vl). Her handwriting appeared on the cover and she wrote many of the entries, including amounts which were there described as payments to "Jim" , i.e. Mr. Anderson. These payments were made on his instructions, and she left them in the safe, marked with his name. The monies were	usually left in two separate bundles, one of approximately	$1,200 minimum (possibly $1,285) and the other approximately
$500 minimum (possibly $585). These were bundled together with a rubber band. Shortly before she ceased this employment (at the end of 1974), Mr. Anderson gave her instructions that he be paid $500 for eight weeks and then no more. She made a notation to this effect against the entry for the week ending 29 December 1974 for the benefit of her successor "X". In respect of each of the eight weeks in the period from 1
September 1974 to 20 October 1974, there appears, in her writing, the notation, "Mr S. $360". This was a reference to an additional amount, separately bundled up, which Mr. Anderson instructed her to leave in the safe marked "Mr. S.", together with the two other bundles.

Later, in 1975, she replaced "X" for two months when

"X" was in hospital. She identified the Venus Room daily

takings book for the period between March 1975 and June 1976 (Ex. V 2 ) . In the period 27 March 1975 to 25 May 1975, most of the entries in this book, referred to by Mr. Anderson as "the Bible", were written by her. The system was the same as before.

In her statement, Ms. Von Stroheim went on to say
that when the Carousel Cabaret opened in Roslyn Street in

December 1973, Mr. Anderson asked her to keep its books also.

She identified the Carousel Cabaret wages book (five columns) for the period 1974/5 (Ex. 113), in which she wrote up the	entries until 12 January 1975, when "X" took over. She also
identified another Carousel Cabaret (five column) wages book (Ex. 21) for the period January to June 1975. She made the entries for the period 30 March to 25 May 1975 when "X" was away.
Ms. Von Stroheim further identified a daily takings book for the Carousel Cabaret (Ex. 15) which she had kept in the period March to May 1975. This book, covering January 1975 to February 1976, was written up by "X" for the balance of this period. The takings referred to in the book were left in the night safe at the A.N.Z. Bank, Kings Cross, and collected by Ms. Von Stroheim on the following day when she entered the details in the book. The cash was held in the safe until the wages were paid and other cash payments were made. She recorded in the book all payments of cash made from this source. The residue was banked.
In her supplementary written statement dated 21 July 1992 (Ex. 6), Ms. Von Stroheim said that Mr. Anderson also asked her to do the books for Gilligans nightclub at Bondi. She did this, following the system used for the Venus Room books. She identified a photocopy of Gilligans daily takings book from October 1973 to July 1975 (Ex. 1E). She said that
she made the following entries in the book for the weeks ended
3 February, 10 February and 17 February 1974:

"Mr. Saff	$500.00"
"Mr. Saff	$500"
"Mr. Saff	$700. "

(b) Ms. Von Stroheim's oral evidence

Ms. Von Stroheim gave oral evidence in chief to the
following effect. The entries made in respect of the three
weeks in February previously mentioned were entered on the

instructions o f M r . Anderson. Mr . Anderson also gave her

instructions t o bundle up the money with a notation on it i n

the terms set out above and t o put it i n the sa fe .

Ms. Von Stroheim was cross-examined as follows (Tr.

"M? SULLIVM: MS Von Stroheim, i n your statement

you r e f e r t o whilst you	were working a t The Venus
Room, putting moneys in to the safe?---That's	r ight .

Do I take i t what the system was that you would be told by h2. Anderson that certain moneys were t o be put i n the safe?---Yes, he gave me instructions - whatever was l e f t i n the safe was under h i s

instruction. There were certain amounts that were

l e f t i n there.	The wages	were	sometimes	l e f t i n
there.

MS Von Stroheim, i f you look a t exhibit 5 , [her written statement dated 7 March 19921 the second page o f i t , the paragraph numbered 3, you w i l l see a reference t o you f i l l i n g i n for a person who i s named there?---Yes .

When you f i l l e d i n for that person [i .e . " X " ] was the system about putting the money i n the safe the same a s it had been when you had previously worked there?---Yes.

And no changes you had notice[d]?---Not that I can remember.

Thank you. And was there a time when you were working with that person you have mentioned i n the

you were both i n the o f f i c e together a s opposed t o	first l i n e o f paragraph 3 together i n the sense that
you just can't recall whether or not that d i d occur. f i l l i n g i n while she was not there?---I

I don't

think so.

Well, the time you are referring t o in paragraph 3 o f your statement, I take i t that when you arrived you - the system which you've referred t o about moneys being placed i n the safe - - -?---Yes.

Did not a p p e a r t o you t o h a v e a l t e r e d since you had

p r e v i o u s l y worked	- -	-?---No.
Thank you .	And	w h i l s t you were there, by the way,

who were the p e o p l e who had keys t o t h a t sa f e? - - - J im

Anderson , m y s e l f and - a t The C a r o u s e l ?

Y e s . O h , sorry, w e l l i n paragraph 2 you t a l k a b o u t

the s a f e a t T h e Venus Roont.	F i r s t o f a l l who	had
the keys	t o the	s a f e a t T h e Venus Room?---The

Manager had a	key, m y s e l f and J i m Anderson .
Y e s , who was the manager?---At	the time a c h a p by
the name o f John Drununond.
Thank you .	I am sorry, y o u h a v e made a reference t o

The C a r o u s e l C lub . I f you look a t paragraph 3, and

correct me i f I am wrong, I t h o u g h t you were

r e f e r r i n g t o i n paragraph	3	T h e Venus Room	again?---
N o ,	I	was a t The C a r o u s e l by	t h a t s t a g e .

I see, and there was a s a f e there, was there?---It

was s a f e - yes, there was a s a f e there.

And the same p r o c e d u r e a s happened t h a t Mr Anderson

would t e l l y o u , p u t m o n i e s i n b u n d l e s i n the sa fe? - -

T h a t ' s r i g h t .

And who had keys t o t h a t s a f e , t o y o u r knowledge?---

W e l l , t o m y knowledge , a p a r t from m y s e l f , only Jim

Anderson .

And not t o p u t too f ine a p o i n t on the m a t t e r - a l l

th is time, Mr. Anderson was a p e r s o n who was y o u r

boss a s f a r a s you were concerned?-- -That ' s r i g h t . "

(2) The evidence of "X"

(a) "X"'s written statement

The written statement of "X" (Ex. XI) was to the following effect. She kept the books for the Carousel Cabaret and Venus Room from about December 1974 until June 1982, whilst employed by Apsley. She worked in an office behind the stage in Roslyn Street until 1979, when the office was moved to the Barncleuth Square premises. In about March 1980, the office was moved again to Westfield Towers in William Street.

On starting, Ms. Von Stroheim explained the bookkeeping system to her. "X" saw Mr. Anderson during the first week of her employment and also met Mr. Saffron at that time.

She kept, for the Carousel Cabaret, two wages books (one 5 column and one 3 column) and two takings books. She identified the 5 column wages books: (a) for the period 1 July 1974 to 19 January 1975 (Ex. 113), the last two pages of which she had written up; and (b) for the period 19 January 1975 to 30 June 1976 (Ex. 21), about half of which she had written up, the balance being Ms. Von Stroheim's work. She made up pay packets for Carousel Cabaret staff and noted the amount of each packet in the column in the books entitled "Total". However, the amounts included in the group certificates were only the amounts in the first 3 columns.

Takings were entered each day in a takings book.
Expenses taken out were noted. She used to pick up the night

safe wallets at the A.N.Z . Bank, Kings Cross, take them back

contained the night's takings from Carousel Cabaret, together	to the office and count what was in them. The wallets
with a sheet recording the takings and any expenses that had been taken. She checked this, wrote up the takings book and put the cash in the safe. She noted in the takings book any cash that she took from the safe to pay wages or bills. In addition to these payments, she paid some of this cash to Mr. Saffron and Mr. Anderson from time to time, noting this in the book. If a bill were paid by cheque, it was recorded in a cheque reconciliation book. She identified the Carousel Cabaret daily takings book, known as "the Bible", for the period January 1975 to February 1976 (Ex. 15). She identified her entries and those of Ms. Von Stroheim. She typed up two copies of each page of the book. Initially, she gave both copies to Mr. Anderson. Later, one copy went to Mr. Anderson, the other to Mr. Saffron. She further identified the Carousel
Cabaret daily takings books for February to June 1976 ( E x . 16)
and for the year ended 30 June 1977 ( E x . 17), both of which she kept. One of her entries for 10 April 1977 was:

"Expenses AS. 1000.00"

She said that "AS" was a reference to Mr. Saffron.

One of her entries in respect of the week ended 17

April 1977 was:

"ABE* 1000.00''

She said that this too was a reference to Mr. Saffron.

She referred to other entries she made as follows:

Week ending	Descri~tion
1 May 1977	"To AB. SAFFRON 2000.00"
8 May 1977	"ABE 1000.00"
15 May 1977	"ABE X l 1000.OO"
22 May 1977	" *ABE 1000.00"
29 May 1977	"ABE 1000.00"
5 June 1977	" *ABESAF 1000.00"
12 June 1977	"ABE *
19 June 1977	"ABE .
26 June 1977	"ABE*

She referred also to a final page in the 1976-77

book as follows:

"&E.

10.4.77 17.4.77

1.5.77 8.5.77

15.5.77

22.5.77

29.5.77
5.6.77
12.6.77
19.6.77

26.6.77

She typed up two copies of each page of this book

and gave a copy to Mr. Anderson. She said in her statement:

" I cannot b e s p e c i f i c about the o ther . However, I

saw Abe Saffron r e g u l a r l y i n 1977. H e would come

i n t o the o f f i c e , sometimes	once a week o r sometimes
once a month. "

Concerning one of her entries referring to Mr.

Saffron, she said:

"This would have been money I had been instructed to take out of Carousel Cabaret's takings by either Jim Anderson or Abe Saffron.. .Any money I had to give over was generally either given to Jim Anderson or

to Abe Saffron. "

She then identified the Carousel Cabaret daily takings book kept by her for the year ended 30 June 1978 (Ex. 18). She typed up copies of the entries in the book each week and gave one copy to Mr. Anderson. She referred to one of her entries for the week ended 3 July 1977 as follows:

"ABE* 13. 1000.00"

She explained that her reference to "13" , "signifies

the 13th amount that has come out.	I made that notation just
for my own recollection."

She referred to similar entries for each of the weeks between the week ended 10 July 1977 and the week ended 12 February 1978. For instance, for the last-mentioned week,

"X" noted the following:

"ABE 45 1.000.00"

She also made a note in the takings book in terms of

UABEW or WAS" , but in the sum of $2,000, for each of the weeks

between 19 February and 25 June 1978.

She then identified the Carousel Cabaret daily takings book for the year ended 30 June 1979 (Ex. 19), most of which was kept by her. Some of the entries, e.g. those for the week ended 2 July 1978, were made by the late Dianne

Lichtenegger, who also typed up copies of the entries each week. "X" commented on entries in this book, referring to "A.SU in the sum of $2,000 each week up to, and including, 27

August 1978. (In respect of the week ended 3 September 1978,

a note "AS 2,000.00" was crossed out.) She referred to a
note, with respect to the week ended 20 May 1979 as follows:

"AS 1000.00"

A similar note was made in respect of each week that followed, to the end of the financial year.

,U X to further identified the Carousel Cabaret daily

takings book for the year ended 30 June 1980 (Ex. 20), most of which was kept by her; again, the balance was kept by Ms. Lichtenegger. Copies of the entries in the book were typed up each week by Ms. Lichtenegger. l,Xu referred to a note "AS 1,000.00" in respect of each week between 1 July 1979 and 9 September 1979. In respect of the week ended 16 September 1979, and thereafter for each week up to 29 June 1980, the sum of $2000 was noted beside the initials "AS".

"X" explained her method of keeping of the Venus Room books as follows. She "kept daily takings books, wage books and cheque books, that is, basically the same books as I kept for the Carousel Cabaret...The system by reference to which I wrote up those books was the same system I used for the Carousel Cabaret." She identified the Venus Room daily takings book for the period 28 October 1973 to 9 March 1975

(Ex. Vl), in which she made entries between 12 January and 9 March 1975. She further identified a similar book for the period 16 March 1975 to 27 June 1976 (Ex. V2), in which some entries were made by her and others by Ms. Von Stroheim. (In respect of the week ended 20 June 1976, there appears, at the top of the page, a note in pericil - "Mr. SAF 1000".) She referred (subject to an objection by Mr. Saffron) to one of her entries, for the week ended 27 June 1976, as follows:

"Jim, Rent * 585.00"

She explained that this entry was intended to record money given to Mr. Anderson, in part as rent for the Venus Room. She referred to her earlier weekly entries, in 1975 and 1976, of "Jim 2285.00" and explained that these entries recorded cash paid to, or taken out for, Mr. Anderson. She explained her note " To C C 3200.00" on the page of entries for the week ending 15 June 1975 as meaning that $3,200 had been passed over to the Carousel Cabaret. Over objection, "X" gave the following explanation of some of her entries in the

book between March and June 1976: 

"Looking a t the page r e l a t i n g t o t h e week ended 7

March, 1976, t h e r e i s an e n t r y 'JIM $585'. T h i s

r e c o r d [ s ] money taken o u t and given t o Jim Anderson.

Looking	a t	t h e page	r e l a t i n g t o t h e week	ended	27
June,	1976,	t h e r e i s an	e n t r y ' J i m r e n t	$585'.	Th i s

i s i n m y handwri t ing and, again, i t records money

given t o Jim Anderson. The r e f e r e n c e t o ' r e n t '

records t h a t par t o f the money was rent for the Venus Room. I n t h e week ended 1 4 March, 1976, to 20

June, 1976 (15 weeks) , except for 1 week, namely,	t h e week ended 9 May, 1976, when t h e payment was
$2,985, t h e add i t iona l $700 represen t ing an amount owing t o Jim from t h e week ended 7 March, 1976,
t h e r e were weekly payments o f $2,285 to Jim
Anderson. However, t h e same e n t r y does not appear
for t h e week ended 27 June, 1976. A t t h e t o p o f the
page r e l a t i n g t o t h e week ended 27 June, 1976, t h e r e
i s an e n t r y ' O w e s ABE $2,000' which i s a l s o i n my
handwri t ing. 'Abet i s Abe S a f f r o n . There i s a l s o
an entry t h e r e 'Owe Jim $700'. 'Jim' i s Jim
Anderson. F o r t h a t week, I had not taken o u t t h o s e
p a r t i c u l a r amounts f o r each o f them. A l so , t h e r e i s
no entry ' J i m $2,285' recorded f o r t h e week ended 7
March, 1976 b u t on ly . a payment t o Jim o f $585
recorded. "

"X" identified the Venus Room daily takings book which she kept for the year ended 30 June 1977 (Ex. V3). Over objection, she gave the following explanation of some of the entries :

" I n t h e weeks ended 4 J u l y ,	1976 t o 15 August,	1976
( 7 weeks) week ly payments	o f $585	t o Jim were
recorded a s 'Jim'	and/or ' r en t ' .	In t h e week ended

22 August , 1976, i n a d d i t i o n t o t h e $585 payment

recorded a s 'rent ' , t h e r e was a f u r t h e r payment o f

$700 made t o Jim. I n t h e weeks ended 29 August ,

1976 t o 6 February, 1977 (24 weeks) , t h e r e were

recorded week ly payments t o Jim o f $2,285 i n t h i s

book. In t h e week ended 13 February, 1977, t h e r e i s

recorded a payment t o t a l l i n g $2,285 t o Jim i n

separate amounts a s , r e s p e c t i v e l y , 'Jim' and 'rent' . In t h e weeks ended 20 February, 1977 t o 26 June,

1977 (19 weeks) , t h e r e a r e recorded week ly payments

o f $2,285

t o Jim i n t h i s book."

"X" identified the Venus Room daily takings book for the year ended 30 June 1978 (Ex. V4) most of which was kept by her, the balance being Ms. Lichtenegger's work. Over the objection of Mr. Saffron, she gave the following explanation of some of her entries:

"Th i s book records t h a t f o r t h e weeks ended 3 and 10

J u l y , 1977 ( 2 weeks) t h e r e was weekly payments t o

Jim o f $2,285. In t h e weeks ended 17 J u l y , 1977 t o 11 December, 1977 (22 weeks) , week ly payments o f $2,285 a r e recorded a s having been made t o Jim b u t ,

i n a d d i t i o n , t h e r e i s an add i t iona l 'JIM' payment o f

$1,000 p e r week, e x c e p t i n the week ended 24 J u l y ,

1977, a l t h o u g h , i n the week ended 31 J u l y , 1977, a

$2,000 a d d i t i o n a l payment i s recorded . F o r the weeks ended 18 December, 1977 t o 15 January , 1978 (5 weeks ) , i n a d d i t i o n t o a r e g u l a r w e e k l y payment o f

$2,285 t o ' JIM' , the a d d i t i o n a l ' J I M ' payment o f

$1,000 p e r week i n c r e a s e d t o $2,000 per week, w i t h a

s h o r t f a l l payment f o r the week ended 25 December,

1977 made u p w i t h an .add i t iona l $1,000 payment i n

the week ended 1 January, 1978. I n the week ended

22 January , 1978, t h e a d d i t i o n a l w e e k l y payment t o

'JIM' i n c r e a s e d from $2,000 t o $3,000. From the week ended 29 January, 1978, the 'Jim' payment o f $2,285 i n c r e a s e d t o $2,400. T h i s con t i nued u p t o the week ended 25 June , 1978 (22 weeks ) .

" X " i d e n t i f i e d t h e Venus Room d a i l y t a k i n g s book for

t h e year ended 30 June 1979 ( E x . VS), which she and M s .

L ich tenegger	k e p t .	She	gave	the	f o l l o w i n g e x p l a n a t i o n o f some
o f	t h e entries.	(On b e h a l f	o f M r .	S a f f r o n , t h i s	e v i d e n c e was

o b j e c t e d t o . I t was admi t t ed a s e v i d e n c e o f the sy s t em or

p r a c t i c e , and n o t a s e v i d e n c e o f any s p e c i f i c payment . ) :

"Dianne and I shared d o i n g th i s book . E i t h e r she or

I made the payments. Payments t h a t were t a k e n o u t

were u s u a l l y t a k e n o u t and e i t h e r pu t i n the s a f e or

pa id over a t the p a r t i c u l a r time they were t a k e n

o u t . She and I had the keys t o the s a f e . Jim

Anderson a l s o had a key t o one o f the s a f e s . W e

moved o f f i c e s and go t a new s a f e . The f i r s t s a f e

was i n the f i r s t o f f i c e we had a t the Carousel

Cabaret . The second was i n the o f f i c e a t W e s t f i e l d

Towers. There i s w r i t i n g i n r e d on t h e l a s t page o f

the o r i g i n a l o f the book which i s a l s o mine . In the

weeks ended 2 J u l y , 1978 to 16 J u l y , 1978 (3 weeks ) ,

the 'JIM' payments were $2,400 and $3,000 each week. In the weeks ended 23 J u l y , 1978 t o 19 November,

1978 (18 weeks ) , the 'JIM' payments o f $2,400 were

made, b u t not a n y a d d i t i o n a l payments. I n the week

ended 27 Augus t , 1978, an a d d i t i o n a l payment o f

$3,000 was made t o Abe S a f f r o n and recorded a s a

payment t o 'A .S . ' . ' A . S . ' refers t o Abe S a f f r o n .

I t r e c o r d s money t o be g i ven t o him. t h a t was t a k e n o u t o f t h e t a k i n g s

To m y best recollection, it was

m y p r a c t i c e a t t h a t time t o g i v e moneys t o be pa id

t o Abe S a f f r o n t o Jim Anderson. In the week ended 19

November, 1978, an a d d i t i o n a l 'JIM' payment o f $500

was made. The ' J I M ' payment i n the week ended 26

November, 1978 was only $1,400 and, t h e r e a f t e r , i n

the weeks ended 3 December, 1978 t o 24 June , 1979

(30 weeks ) the ' J I M ' payments dropped t o $400 p e r

week. T h i s payment o f $400 i s v a r i o u s l y d e s c r i b e d a s

JIM' or ' J I M ( R & P ) ' . [There was o t h e r e v i d e n c e

t h a t th is meant " r e n t and p o l i c e " . ] A l s o , i n the

weeks ended 25 March, 1979 t o 22 A p r i l , 1979 there

were a d d i t i o n a l payments t o I o f $150 p e r week

and then $175 per week u p t o the week ended 24 June,

1979. Abe S a f f r o n ' s e a r l i e r r e g u l a r w e e k l y payment

o f $1,000 recommenced i n the week ended 10 June ,

1979 and con t i nued for the rema in ing 2 weeks o f t h a t

f i n a n c i a l y ear . "

"Xu i d e n t i f i e d the Venus Room d a i l y t a k i n g s book f o r

the year ended 30 June 1980 ( E x . V 6 ) . A l though she made some

o f the e n t r i e s i n the book , most o f t hem were M s .

L i c h t e n e g g e r ' s .

" X " went on t o g i v e the f o l l o w i n g e v i d e n c e i n her

s ta t emen t ( o v e r M r . S a f f r o n ' s o b j e c t i o n ) :

"When I first s t a r t e d t o g i v e a t y p e d c o p y o f each

page o f those books to Abe S a f f r o n , I was work ing a t

the o f f i c e a t the Carousel Cabaret . The o f f ice was
there when I first s t a r t e d and was still there when

Dianne s t a r t e d work. When the o f f i ce moved t o Barnc l eu th Square , I was there about 12 t o 18

months. The o f f i c e i n W e s t f i e l d Towers was on the

18th f l o o r . I think i t moved there a t the b e g i n n i n g

o f 1981. I t was still there when I l e f t i n June,

1982. W h i l e the o f f i c e was l o c a t e d i n the Carousel

Cabare t , Abe S a f f r o n c a l l e d a t the o f f i c e on

o c c a s i o n s w i t h n o p a r t i c u l a r frequency t o p i c k u p

t h i n g s , namely , the t yped sheets o f the d a i l y

t a k i n g s and a n y money I had t o t a k e o u t t o g i v e him

or t o f i n d o u t how e v e r y t h i n g was going. H e a l s o

s i g n e d	cheques	when	he	wanted	bills pa id .	Abe
S a f f r o n	a l s o	v i s i t e d	the	Barnc l eu th	Square	o f f i c e ,

maybe once a week, t o come and g e t papers , namely,

the t yped sheets and o c c a s i o n a l l y bill f o r the

Carousel	Cabaret f o r h im t o check	over,	a s w e l l	a s
a n y money from	the c l u b s I	had	t o g i v e him	and,

o c c a s i o n a l l y , I t h i n k , t o see J im Anderson t o

c o l l e c t a n y t h i n g t h a t was Abe's. Also, Abe S a f f r o n

visited the Westfield Towers office, maybe once a week, to come up and collect anything that was his, namely, his typed sheets and any moneys from the clubs that were his. "

,,X" further stated that later, at the time when Mr. Edwards became the licensee of the Venus Room, she asked Mr. Saffron to allow Mr. Edwards and herself to become signatories to the Venus Room account at the A.N.Z. Bank, Kings Cross.

. Saffron agreed. She identified a bank signatory card (Ex.

H) dated 15 August 1979 where the following particulars are

given: Name of Account - "Venus Room.. .No. 2 Temp. ", Address - "6 Orwell St. Potts Point. ", Nature of business: "Licensed Restaurant", How to sign: "Any two of authorised signatories." Then follows the names, and signatures, of Thomas Edwards, "X" and Dianne Lichten[egger]. Mr. Edwards' "Designation" was shown as "Partner", but this has been crossed out and "Sole Prop." appears. The designations of "X", and of Ms. Lichten[egger], are "partner". On the back of the card, under the printed words "Medium of Introduction/Source of Account/Reason for Opening" appears the

following: 

"KNOWN MR. SAFFRON" .

Q V X v, stated that she wrote the letter to the

solicitors dated 21 September 1979 concerning the change to
the name "Appollo" (Ex. 116) previously mentioned.

"X" identified a book known as the "A.S." book (Ex. by "X" to signify Mr. Saffron. The book covered the period 3 June 1979 to 1 March 1981. "X" stated that she kept the book "so I knew exactly what I had given Abe Saffron." She gave the following explanation, over Mr. Saffron's objection:	31).	The book has on its cover the initials "A.S.", written
"The  'A.S. ' book was a d u p l i c a t e book . A carbon

c o p y o f each page c o u l d be made. I wrapped the

o r i g i n a l sheets around an amount o f money t h a t was

w r i t t e n on the sheet. I gave both the money and the

sheet around i t u s u a l l y t o Abe S a f f r o n . P a r t o f

the	book	i s i n Dianne's	handwr i t i ng .	I	d i s c u s s e d
w i t h her	the p r a c t i c e	t h a t was	to be	adopted	w i t h

respect t o th i s book . I j u s t s a i d : ' I am go ing t o

s t a r t a book up' and I d i d s o . Par t o f the book i s
completed i n her hand because she used t o enter it

up t o o . To my o b s e r v a t i o n , she wrapped the sheets

t h a t had been e n t e r e d up i n her h a n d w r i t i n g around

the b u n d l e s . E i t h e r o f u s handed the b u n d l e s t o Abe

S a f f r o n . I cou ld have handed t o h im a b u n d l e which she had w r i t t e n up and she cou ld have handed him a b u n d l e which I had w r i t t e n up. Apar t from Abe

book wrapped around the cash on occas ion t o a chap	S a f f r o n , I handed the o r i g i n a l s o f sheets i n t h a t
c a l l e d Tosha [Mr. Maksimovich], whom I unders tood was a b u i l d e r . H e was q u i t e o f t e n w i t h Abe S a f f r o n and sometimes he used t o come and collect the b u n d l e s for Abe.. .The money was a lways paid t o either Abe h i m s e l f or Tosha. Apar t from th is book ,
there was a f t e r the comp le t i on of a n o t h e r book w h i c h I k e p t for a pe r iod

the first book. I d i d so i n

the same manner a s f o r the first book."

"X" explained some of her entries in the "A.S. "

book. Page 11 of the book, which, in her examination in chief

"X" said was written partly by Dianne Lichtenegger and partly

by herself (Tr. 718), was in this form:

"A.S. W.E. 5.8.79

VENUS
CAROUSEL
VENUS U/STAIRS
RENT & P
PHOTOGRAPHER
T. T.

GRATHAM LODGE.

LESS (XMAS SPECIAL EXP) 160.00

(STARS, PERSIAN, TINA'S ETC. )

BED COVERS VENUS UPSTAIRS 60.64

L e s s	B. M.	90.00
"	GRAmM	60.00
"	JIM	400.00

TOTAL $2331.16"

u ~ u e x p l a i n e d , over M r . S a f f r o n ' s objection, these

entries :

"The entries on t h a t page a r e j u s t entries

e x p l a i n i n g where v a r i o u s amounts o f money have come

from, and v a r i o u s amounts o f money paid o u t o f those

moneys, l e a v i n g a ba lance pa id t o Abe S a f f r o n .

'VENUS $1,000' would be $1,000 t a k e n f rom the Venus

Room	t a k i n g s .	'CAROUSEL	$1,000'	would	be	$1,000
t a k e n from	the Carousel	Cabaret	t a k i n g s .	'RENT	&	P

$400' would be money t a k e n from the Venus Room

t a k i n g s . 'PHOTOGRAPHER $38' was money t a k e n from

the	Carousel	Cabaret	t a k i n g s and	paid	i n by a
photographer	who	roved	in to	e s t a b l i s h m e n t s	i n Kings
Cross,	i n c l u d i n g the	Venus Room	and	the Carousel

Cabaret . 'GRANTM LODGE $163.80' r e f e r s t o a

board ing house . 'T.T. $500' s i g n i f i e s T h y

Theeman. Then, be low, t h e r e a r e v a r i o u s amounts

pa id o u t . The $160 was, I t h i n k , money t a k e n o u t a t

J im Anderson 's r e q u e s t . The $60.64 was f o r new

bedspreads f o r t h e f l a t s above the Venus Room. 'BM'

s i g n i f i e s B i l l Murray. H e was an e l e c t r i c i a n who

used	t o r e p a i r t e l e v i s i o n s and	t h i n g s and	th is entry
r e f e r s t o a payment	t o him.	I t was deducted	from
moneys	t o be paid	t o Abe	S a f f r o n because B i l l Murray

would have r e p a i r e d televisions or someth ing a t

Grantham Lodge and g i v e n me the bi l l . 'GRAmMf was

a c l e a n e r working u p s t a i r s above the Venus Room.

H i s amount was deducted from moneys d e s t i n e d t o Abe

S a f f r o n because he was paid from the Venus Room

u p s t a i r s . h im was 'JIM' deduc ted from moneys payable was J im Anderson. The $400 paid t o

t o Abe S a f f r o n

a t the r e q u e s t o f someone."

(b) "X"'s oral evidence

In her oral evidence in chief, "X" said that she

explained to Ms. Lichtenegger the "daily running6 of the

office". "X" went on to say (Tr. 647-8):

" W e l l , what i s the best r e c o l l e c t i o n you have o f

what you s a i d t o her about t h o s e matters?---Kind o f

we collect the money, you check the money a g a i n s t

the sheet t h a t i s i n the b a g from the bank , you

enter i t i n th i s book , t a l l y it u p f o r the week, p u t

i t i n t h a t t i n , p u t it i n the s a f e t o make s u r e ,

because the d i f f e r e n t c l u b s had s p e c i f i c t ins . Make

o u t the wages, a t the end o f the week c o u n t i n g money

up, d o whatever had t o be done w i t h i t , v i r t u a l l y

e x a c t l y what I was d o i n g m y s e l f .

Now, d i d you s a y a n y t h i n g t o her about making

payments t o anyone?---I t o l d her what we d i d a t the

end o f the week. Wages were bundled u p i n to groups

and g i v e n t o v a r i o u s managers o f the c l u b s t o be

pa id t o the s t a f f . Var ious o t h e r moneys were p u t i n

s e p a r a t e b u n d l e s t o be g i v e n t o Mr. Anderson o r Mr.

S a f f r o n or whoever came t o collect them.

Now, d i d you receive i n s t r u c t i o n s from time t o time

a s t o how you w e r e t o c a r r y o u t y o u r duties?---Yes,

I r e c e i v e d i n s t r u c t i o n s .

From whom d i d you receive those i n s t r u c t i o n s ? - - -

E i t h e r from Mr. Anderson o r from Mr. S a f f r o n .

Could you remember a n y p a r t i c u l a r i n s t r u c t i o n s you

r e c e i v e d from Mr. S a f fron?---In r e g a r d s t o a n y t h i n g

s p e c i f i c ? I mean - - -

Could you remember a n y occas ion on which he gave you

i n s t r u c t i o n s about something, any th ing?

MR SULLIVAN: I o b j e c t t o t h a t , y o u r Honour. The question which t h i s comes from i s - have you r e c e i v e d a n y i n s t r u c t i o n s a s t o how t o c a r r y o u t

your d u t i e s . Now, m y l e a r n e d f r i e n d ' s next q u e s t i o n

i s - a n y i n s t r u c t i o n from Mr. S a f f r o n abou t a n y t h i n g

- I t a k e it it i s a n y t h i n g i n r e l a t i o n t o the

c a r r y i n g o u t o f d u t i e s i s the intention.

H I S HONOUR:  Y e s , t h a t i s how I i n t e r p r e t i t . Yes ,

I w i l l a l l o w t h a t .

MR DOWNES:	Can you answer the ques t ion , please?---
You j u s t	lost me.

Do you remember any occasion i n which you rece ived some p a r t i c u l a r i n s t r u c t i o n s from Mt. S a f f r o n about something t o do w i t h the bus iness?

MR. SULLIVAN: I o b j e c t t o t h a t , your Honour, it i s

d i f f e r e n t t o carry ing o u t d u t i e s .

HIS	HONOUR:	Y e s ,	s l i g h t l y	d i f f e r e n t .	I	w i l l	a l l o w
it.

THE WITNESS: I c a n ' t remember s p e c i f i c d a t e s or

diary, shows that Mr. Anderson and Mr. Saffron acted in

ultimate power and responsibility in the decision-making	concert in these .matters and that Mr. Saffron held the	processes required to be carried out in the operation of these business ventures.
In short, the inference is available that where Mr. Anderson gave a direction, it was done with the authority, express or implied, of Mr. Saffron. Moreover, the inference is

.	,
-	I i

6 8 . :i i

available, and in my view should be drawn, that the amounts	1	1 :
described in these entries were received by Mr. Saffron as income.
Some further details of the amounts assessed by the Commissioner are as set out in the written submission of the Commissioner which is annexed to these reasons.

I am further of the opinion that the evidence of "X"

about her dealings with Mr. Maksimovich to the effect that he acted as the agent of Mr. Saffron in collecting monies from "X" for Mr. Saffron, should be accepted. I reject the suggestion to the contrary in the testimony of Mr. Maksimovich that all these monies were received by him in discharge of debts due to him for building and maintenance work carried out. It will be noted that there was no documentation, of any kind, of these alleged transactions. By contrast, all three bookkeepers kept careful and detailed contemporary records of the dealings now in issue. I accept their evidence, and their

recollection of Mr. Maksimovich, which was unaided by any	records, as reliable material in preference to the
notes or other documentation, of events that took place many years ago.
So far as the assessment in respect of Gilligans is concerned, it will be recalled that the bank signatory card (Ex. 3) showed Mr. Saffron as the first signatory and a partner in the business with Mr. Anderson. Despite doubts initially raised by Mr. Saffron as to the authenticity of the bank's records, no sufficient basis for treating these statements as unreliable has, in my view, been demonstrated on behalf of Mr. Saffron. In my opinion, Ex. 3 warrants the inference being drawn that Mr. Saffron was a proprietor of this business.
In respect of the takings of the Venus Room, the Commissioner conteds, inter alia, that Mr. Saffron was entitled to a share of the amounts of $2,285 recorded in the books as an amount discharged weekly to "Jim". It is contended, for the Commissioner, that these regular payments of $2,285 designated "Jim" were allocated as follows:

Mr. Saffron	$1,000
Mr. Anderson	700

"Rent " 585
$2.285

Although the Commissioner accepts that rent in the amount of $225 was payable to Abbey as the proprietor of the	freehold, he contends that of the $585 entitled "rent", Mr.
Saffron received $360, the balance of $225 being paid to Abbey.

Support for the Commissioner's contention is found

in the notations in -

(1) The Venus Room takings book (Ex. V2) for the week ended 27 June 1976: "owes ABE $2000

owe Jim 700"

(2) The Carousel Cabaret takings book (Ex. 16) (at the back

of the book):

" Jim	$5,600
Abe	$10,000"

This material is consistent with a profit-sharing arrangement between Mr. Saffron and Mr. Anderson with respect to the operations of the Venus Room. But it is not necessary that I express a concluded view on the question whether the Commissioner has demonstrated that, in every respect, his assessments were correct. As has been noted, the taxpayer accepts that he must show that the assessments were excessive. In seeking to demonstrate this, the taxpayer has, in truth, tendered a single "black and white", as it were, issue for determination. That issue, as has been seen, is whether he had any interest in the subject businesses. The taxpayer's

case was that persons, natural and corporate, other than

himself, owned these businesses and were entitled to the

profits of their conduct. Not only has the taxpayer failed, in my view, to establish this contention on the ordinary standard of proof but also, if it were necessary, I would find that the Commissioner has demonstrated, in my opinion, that

Mr. Saffron had an interest in these businesses and in their

profits.

For these reasons, I have concluded that the taxpayer has failed to discharge the burden imposed on him by s.l90(b) of the Act to prove that the assessments are excessive.

I have been asked by the parties to defer dealing with the assessments of additional tax at this stage. If necessary, I will hear argument on this matter and on the question of costs, later.

I direct the parties to bring in short minutes of

orders in accordance with these reasons. The matters are
stood over to 2.15 p.m. on 23 December 1992 for mention only.

I certify that this and the preceding seventy

(70) pages are a true copy of the Reasons for Judgment herein of his Honour . Justice Beaumont .

Associate b k

Dated:  22 December 1992

Counsel and Solicitors	Mr. A. Sullivan Q.C. and Mr. F.P.
for Applicant:	Carnovale, instructed by Messrs Walker and Raphael

Counsel and Solicitors Mr. G.K. Downes Q.C. and Mr. S.W.

for Respondent:	Gibb, instructed by the Australian Government Solicitor
Dates of hearing:	5 June 1991, 20, 22-24, 27-31 July and 3-7, 10-14 August 1992

Date Judgment delivered: 22 December 1992

DIARY NOTE

m s mobi Name of Account

I

1 5/5/1972

Cheque $225-00 creates excess $18240 &'	16/5/1972
DD S19240 drawing 510)OO increases excess. bR/
Dnwings totelllng $1059 increases excess.
Dramggs for S263 Increases excess. r
22/5/1972 '
:~ccount 1n order. P .

1 /6/1972

-36  

Drawings for 5290 Increases excess. d	5/6/1972
Accouut in order 4
O/D $2611- Drewxng $2,819 creates excess which is covered by savings bank funds held.
,	O/D 8266/- Drawings S6 increase excess.
28/8/72 Account in order.
0/d 476/-
Draumgs 53,672 creates excess.
26/10/72
0/d 518/- Drewmg S42 increeses excess.
I
: ,W/-	j Drawing 533 incraases excess. b.
I

Tlx'LIS moll

Name of Account

m O/d 729/-

Dra~nngs %M8 increases excess.

7/11 /72

iccount m order.

13/11 /72

O/d 285/-

Dra~rings S458	creates excess,f
14/11 /72

.?ccount i n order.

23 / l 1 /72

O/d 1,709/-

D r z i ~ n g s $2,609 creates excess.

27 /l 1 /72

o/a :.,m/-

grz~rings $760 increase excess.	b
O/D	288/-

Dra\nrg $10 Increases excess.

O / a $391/-

%swing $103 Increeses excess.

13/12/72

Xccomk i n order.

23/12/7

nbe Saffron t o say t h a t cheque $4,900 odd has CO be issued f o r addi t iona l l iquor

a

y r c h a s o s f o r C!rristmss, l b w Year period should run off L?y	24/1/74.	W i l l it be OK.
Agreed.

9'

?z&zk	-?
m

-

1 5 / 2 4 1

Bbe Saffmn called. Has issued cheques f o r s h c w which will take a c c o d u p $6,850. !

I Hay take up t o three months t o run down from takings.

I Please record Limit $7,000 Review 15/5/74.

I

I	Prepare unlimited G to be executed by h . Ssffmn.
!	I l l 6 7 ,

. - - -- - --

DIARY NOTE VENUS R001.1

Name of Account

G u r r a n t o r c a l l e d t o s i g n g u a r a n t e e , b e f o r e s i g n l n g t h e d o c u m e n ~ h e W 2 5 g i v e n t h e

o p p o r t u n i t y of reading t h e document.

,

tie t h e n s t a t e d t h a t h e was f u l Q a w e r e and u n d e r s t o o d h i s l i a b i l i t i e s t h e r e u n d e r .

He t h e n s i g n e d t h e ~ u a r a n t e e i n t h e p r e s e n s e of Mr D. J o n e s ( M ~ n a g e r ) and M r D.J . Eraham

(Advance	C l e r k )	who	t h e n	w ~ t n e s s e d h i s s i g n a t u r e .
3R9,183/7,000	-	Account h a s been i n and o u t of	o r d e r s i n c e 15/2	end a t d s t e r e a c h e d

i b o v e f i g u r e . I h a v e n o t been a b l e t o c o n t a c t M r S a f f r o n d u e t o h i s t r s v e l l i n g ove r -

s e s s and	Sack end	f r o t o	P e r t h	and	Ade le ide .	C a l l e d t o d a y ,	h e i~ill	i n v e s t i g a t e	s e t
up	a s t o why	t h i s a c c o u n t	h a s	n o t c l e a r e d	e s s n t l c l p e t e d .	He	h a s	f e e l i n g	t h a t t h e y

-r

have been s u b s i d i z i n g C z r o u s e l and r r i l l b r l n g c c c o u n t I n t o o r d e r , may p o s s i b l y t a k e

~ h r e e months end a s k s t h e t l i m i t t e r m be e x t e n d e d f o r t h a t p e r i o d . E x c e s s w i l l s h o r t l y

c l e a r .	l/
Therge LEF and e x t e n d l i m i t till 15/6/74.
20/8/7A.

Account	h a s r e v e r t e d	t o a	c r e d i t o r b a s i s E m i r h a s now	been	c a n c e l l e d .
' 8/8/75

s p o k e t o Flr 5 - f f r o n -,rho 9 0 1 1 1 s r r znc je c l e a r ? n c . e 1cL.i'cr..

2.9.75.	*
Pccoun t overdr?-n	:6.958 b!y o=:ment $0 Toohe:.rs 511 ."C R ~ n g Fr ~ n d e r r o n as Abe

s a f f r o n n o t a v = i l ? b l e h e is n o t t h e r e S X " s e c r e t s r y s = i d s h e -.-ould l e w e m e s s q e

I n o r d e r t o pay X / f

192 ,75 P c c o u n t up t o !11.636. J 4nde r son h a s been c o n t a c t e d (Abe i s ?v.aey h e st-tss

t h q t s l t e r e t l o n s have t o b e c a r r i e d o u t t o s~tisf:! t i r e Borad end l . ~ h o l s t same

i s b e l n g done b u s n i e s s i s d o ~ m t o o r a c t i c e l l y n o t h l n g a c c o u n t s h o u l d c1e.r

by 15.16 O c t o b e r m e a n t m e c e r r y on E x c e s s b a s l s .

20.10 Cev Abe h e h e s n o t y e t r e c e i v e d f u l l o u o t e s f o r a l t e r e t i o n s o s aboe

b u t 8 , ~ h i l s t t h e s e r e p a i r s a r e b e i n g a c c i r e s o u t w i l l d o t h e o l s c s up c e n e r a l l y

E s t i m a t e d t o p n e e d s 514.15.000for f e w months. A

4c c o u n t h a s been c o n t i n e o s l y e x c e s s and now t o t o p it off o r d e r s f o r Xmas b e e r and s p l r i t s

have t o b e met. Estimate p e a k 315.000 O/D by end of November Abe is l e a v i n g t h e

a f f a i r s t o J a n d e r s o n who is managing t h e V e n i s He i s l i k e t h e s c a r l e t p i m p e n e l t o t r y and

p i n down.

, .

19.12.	75.	Sat? Abe	and	J i m a 1 1 is now	comple t ed	end	a c c o u n t s h o u l d p r o c e e d	t o	r e d u c e
r a o i d l y .
12.1.76.	4be	d e f i n i r e l y	o r c m i s e s	c l e c r a n c s t i t h i n	x.oeeks	f rom	ncv,	c e r r ! ~ on	E x c e s s

b a s s	rneentlme	s a f e t y undoubted . /
- --A--

/ - -

l	-	VENUS ROOM	(3'	, ,
1	"
'	'6.3.76	, ,
I	_

Esp t?nd i tu r s of t

, pbe c - l l e d re Venus Room Account -.,hdch h s been i n 0.D f o r some time due t o

38.800 on s e t t i n g up neSvTvls r e c o r d s and I n s t s l l a t i o n t o g e t h e r w i t h g e n e r a l goung o v e r h45 !

' .~

c r e a t e d c e s h s h o r t e g e on sccoun t . He h a s been p ~ o m i s e d f i n a n c e f rom Merc Credi-s f o r above be- '

I s u g g e s t e d t h a t S e p a r a t e Loon a c c o u n t i n name o f Venus room Machines be opened snd repayment

of 5450 p.m. from Venus Room b e made i n r e d u c t i o n He would b e more t h a n s e t i s f i e d i f s u c h =n ?.

ar rangement c snbe made. A t h z s i s w i t h i n DL I agreed t o same. I n v o i c e s s i g h r e d from

t I

Dynese rv ie

i I
&c

Ad Sec. \

Open a& A/C Venus Room Machines A/C.Prepare PP $450 ?.m. working A/C t o mechines ,Transfer I ,

38.000 t o Venus Room from Machines A/C,Record l i m r t S450 p.m. Chsrge LEF t o "

working h/C.New 5/0 Card o t h e r p u r p o s e s (Green) Required.

f Ir

24.3.77

Wkg D= 2230 Machines D r 3854/8800 r e v i e w w i t h M r . S a f f r o n . working accoun t h a s been

i n e x c e s s on many o c c a s s i o n s d u r i n g y e a r b u t f u l l y f l u c t u a t e s . ' T h e y have done major a l t e r t i o n t

t o c l u b d u r i n g y e a r and f u n d s have been used t o a s s i s t w i t h C a r o u s e l a l t e r a t i o n s t h a r accoun t I

i s now working on a n o s t s a t i s f a c ~ o r y b a s i s and w i l l s z a r t t o r e i n b u r s t Venus i n n e a r !

f u t u r e . Machines accoun t r e d u c i n g a s a r r a n g e d and will. c o n t i n u e t o do s o by pp. I

e x c e s s on working accoun t w i l l c l e a r soon l i m i t on machines accoun-e t o r e d u c e t o 94200 -o r

coming	term t o c o v e r i n t e r a s t .	J"	i
I

hlkg a / c C- 526,197 Machines a /c C= 51,073/4200

Account 1s now o p e r a t i n g on a c r s d i z o r b a s z s and lmit may now be c a n c e l l e d . I t l i m i t $800

is t o be	r e c o r d e d	on	conpuzer	f o r a	f o r t h e r
Advences

P l e a s e a t t e n d .

-, 16/78 D r . $1575 Mavhine a c ! Zr. ; l949

;?bt on o r d a / c a l l a w e d i n vielv~ o f s a fe t ! r , connec t ion and a n t i c i l a t i o n o f e a r l y

23/6 /78 Ord ? /c Dr.34a90

C:us~ri p r e s s r l t a t i o n of cheques t o t a l l i n ? 30940. P ~ r t o f v3111ed ~ o r l n e c t i q n an.

:a-ly c l e a r a n c e ? n t i c I ; ~ ~ t e d . 'Yil1 fnll3vl 8-12 i f n o t c l e a r 4 ~ n r i t h i n s h r t

!30/6/76 D r . $9489

3 e b t h a s i n c r e a s e d t o above f i g u r e . P a r t o f v a l u e d c o n n e c t i o n and o u r 7 o s i t i o n i s

t o g a t h e r f u n d s q u i c k l y . However w i l l s p e a k w i t h ?Ar,Anderson e a r l y

n e x t	week.
I 9!7/7r!	9r. 915775

i??bt	i n c r e a s e d b y 7ayment	of	365W	l i c e n s e f e e and	$1998 e l e c t r j c i t y .	P a r t of
i \r31ued c o n n e c t i o n b u t	it	i s most	1~nl iL .e them	t o d r a ~ v	l v i t h o u t	a r r 3 n o e v n t ,

I :- ? ? s j + . i c n	i s ~ a f e	2nd	r n r r e c t i \ r c ? T ~ ~ A S I ~ T P S	* . J ~ I I be	t a k e n	earl : ) i.hi.5	vleelc.
l

!

I	DIARY NOTE
I	I_ . . ROCPL

Name of Account

2 /l 1/72	-
O/d 729/-
Drermgs W 8 Increases excess. II

,	7n1/72
Account i n order. a J
O/d 285/- Drawings $458 creates excess,,f
o/a 1 ,709/-
Drzwings 52,600 creates excess.
0/d 2,469/-
3ra~1mgs $760 increase excess.
o/D 2%/-
D r a b r i n g $1 0 Increases excess.

m fi*/12m.

Drawing $103 Increeses excess.	O/D $391/-
13/12/72 dccowbt 1n order.
23/12/7

m	>:be	Saffron t o say t h a t cheque S4,900 odd has t o be issued f o r eddi t ional l i cuo r
m

nurchascs f o r CZlristnas, New Year period should run off by 24/1/74. V i l l it be OK.

; Agreed.

99'

zr;csi9#	-,	.
m

15/2/7L. a

Abe Saffmn called.	Has issued cheques f o r stockii?g which w i l l take account'up %,850.
/	May take up t o three months t o run down fmm taldngs.
!	Please record Limit $7,000 Review 15/5/74. . 1
Prepare unlimited G to be executed by h. Seffmn.
DIARY NOTE

.. .

I Name of Account

, 7/73 Qr.	$!.7664	-
S

Ir l t .er~rie~~r?d	!,Isssrs S?-ffrorl	- - - - - W W a n ~ - ~ . ~ ~ ~ - r s ~ ? n , - J ~ - e ~ ~ - a n n ~ l ~ ~ ~ s ~ - < -	W W	f o r	7 3 5	jt~--,.,	-	-
s u q l a i h ~ r l €hXt-%hGi-have	had	a r r anaed	axkrax	an o u t s i d ?	loan of	:dn,3;?	and	35~":

- -- -

rl e h t wog i d -.be< L+ a re&--?-?on-pa &-U+- 'tnav--,?rnr~ nrfs --fie ,

- --

- -- a - - - - U -- - - - - - - - -- - - - - W - - - - - - - - - - - - - - - M - - - - - W - W - - - -

8.9.78 - - - - - - - -- -- - - - - -- - - - --W - - - - -- --W -- -- -- - - --W - - -- - - - -- - - - -- - - - -- --

C 'i9,134

- - - - - - - -- - - - - - - - - - - -- M W -- - - W - - - M - - - - - - --

i l e s s r s . S a f f r o n B Anderson c a l l e d and r e q u e s t e d a s s a a n c e t o 510,000 f o r 6 -months t o a s s i s

- - - - - --- - - - - - - - - - - - - - - - - - - - -- -

l r i t h t h e c o s t of r e n o v a t i o n s and i n c r e a s e d s t b c k purchases .

- - -.--- -- - - ---- -- - - - - - -- - - - - - - - - -

R e l a t i v e d e b t w i l l b e c l e a r e d w i t h i n t e rm from-#nas t r a d e a& 'Gel l a s n o r m a l ' t r a d ; deoos?;ts.

- - - - - -- - - -- - - - - -- -- - - - ,-- - - - -* .- - - - - - -- - -

Account normal ly c a r r i e s gooci c i e d l t o r f u p a s and-agreed t o r e q u e s t fiovi'dinc i.irW. S i f f r o i ;

- -W --

- - - - - - - - - - - - - - - -- - - - - - - - --

e x e c u t e s an u n l i m i t e d g u a r a n t e e i n f a v o u r of t h e E i rn .

- - -- - - - - - - - - - - - - -- - - -- - - - -- - - -- - - - - - -

A-vances

- - - ------ - - -

P l e a s e p r e p a r e unl i rh i ted G/- i n f a v o u r o f - t h e f i r m t o be execu ted by M r . Saffyon. On

, -- -- - M - - - - - - - - --W - - - . -. -- - - - - ---- - - - - - - - - - - - - - - - -- - - - -

complet ion p l e a s e r e c o r d l i m i t 510,000 e x p l r i n g 8.3.79. Charge LEF S50,%es.

- - - - - - - - - - -- - - -- -- - m ---W - - - - - - M - -- - - - - - - - - - --- - - - - - - - - - - -- -

L a t e r Flr. A. G. S a f f r o n c a l l e d t o e x e c u t e a n u n l i m i ~ e d g u a r a n r e e i n i a v o u r o f t h e f i r m

-- - - - - - - - - - - - -- - - - - --- - - --W - - - - - - - - - -- - - - - - - - - - - - --- - - -

of Venus Room. Before s l g n i n g r h e document t h e p u r p o r t o f it was d i s c u s s e d wi th him by

- - - - - - - - - - - -- - - - - - -- -- - - - -- . - - -- - --- - - -

Mr. G. S. Dav i s Flanager and i n t h e p r e s e n c e o f A. J. Forss t rom, Advance Clerk . He was

- - - - - - - - -- -- ---- - -- -- - W M - W - W -- - - - -- - - - - - - -

given t h e o p p o r t u n i t y to t a k e t h e g u a r a n r e e away t o s e e k l s q a l a d v i s e which he d e c l i n e d t o

- - - a m - - - - - - -- - M - - - -- - -- - - W - - - - - - - - - - -- - - . - - - - --

Before e x e c u t i n g t h e document he s i g n ~ d t h e acknowledgement of u n d e r s t a n d i n g t h e p u r p o r t

- - - - - - - - - -- - - - -- - -- - - - - .- -- - - - -- - - -- - -- -- - - - ----

o f ~ h e document. He t h e n execuzed t h e g u a r a n t e e i n t h e p r e s e n c e of t h e a fo rement ioned

- - - - - - -- -- - - - - - - - -- - - - - - -- - - - - - -- - -- -- - - - - - - - --

sank 0 5 i c a r ~

xco-SS a l lowed-	sterdays-date	dus- to-	conn+ct ion,	safety	-and- a n t i t l ~ a t ? ~ r r	o'
a r l y	c l ea rance .	-	- -	-	- - -	- --- --

- - -- - - - - - - - - - -

24/1/79- D	.	:	$i ie&j /~b	,-jgcj- -
<c:ss-	caused- under-yzsterelays-	d a t e -by	-of	-brewery- eheq -for -55747;-

-'owevcr -d-e~osit--o_f__S?-6_5-3.--1-?1!ge_d-th-i~- - - - - --W - ---

~ -.

- --- - -- - --- -- - ---

ibn df brewery cheque f or$6952. ------ - - -- - - - - -

M - ---

-steak- w i t h - 3im Arrderson t h i s week re-ori.ti9r

- -- -- - - - - - - - -- - - - - - - - - - - - - W - - - -

1 1 - VENUS ROOM (-3' l...

l -

1 '6.3.76

>be c = l l e d re Venus Room Account a~zhich h s been i n 0.D f o r some time due t o C r p r n d i t u r e o i

m SE.800 on s e t t i n g up n e s v t T ~ l s r e c o r d s end I n s t a l l a t i o n t o g e t h e r w i t h g e n e r z l goan: o v e r h e s

c r e a t e d c a s h s h o r t a g e on account. He h a s been promised f i n a n c e from Merc C r e d i t s f o r ebove b c

I s u g g e s t e d t h a t S e p e r n t c Loan a c c o u n t i n name of Venus room Mechines be opened end repeyment

of 3450 p.m. from Venus Room b e made i n r e d u c t i o n He would b e more t h a n s a t i s 7 i e d if s u c h sn

ar rangement cenbe made.	A	t h i s i s w i t h i n DL	I	agreed	t o same.	I n v o i c e s s i g h s e d i rom
Dynese rv ie

~d s e c . @c

:	Open n a A/C Venus Room Machines A/C.Prepare	PP $450 p.m.	erom working A/C	t o mechines ,Transfer
liB.BOO	t o Venus Room i rom Machines A/C.Record	l i m i t 58.800	educ ing S450 p.m.	Cherge LEF t o

working A/C.llew	510 Cerd o t h e r p u r p o s e s	(Green) Required.	$
24.3.77

Wkg D r 2230 Machines D r 3854/8800 r e v l e w w i t h M r . Sa f f ron . working accoun t h a s been

i n e x c e s s	on	many	o c c a s s i o n s d u r i n g	y e a r b u t	f u l l y f l u c t u a t e s . ' ~ h e ~	have done major	a l t e r t i o n
t o c l u b d u r i n g y e a r	and	funds	have	been	used	t o a s s i s t w i t h	C a r o u s e l a l t e r a t i o n s t h a t accoun t

i s now working on a most s a s i s f a c z o r y b a s i s and \ r i l l s z a r t t o r e i n b u r s t Venus i n n e a r

f u t u r e . Machines accoun t r e d u c i n g a s a r r a n g e d and w i l l c o n t i n u e t o do s o by pp.

s x c e s s on working accoun t w i l l c l e a r soon l i m i t on machines accounT t o r e d u c e t o

coming	t e r m t o c o v e r	interssz.
28.3.78
1:lkg	a / c Cr. 525,197	Machines a / c C= 51,073/4200

Account is now o p e r a t i n g on a c r e d l t o r b a s ~ s and l i m l t may now b e c a n c e l l e d . I G l i m i t $BOO

i s t o be	r e c o r d e d	on	computer	f o r a	i n r t h e r ~ e r r n .	A
Advencos

P l e a s e	a t t e n d .
/6/78	D r . $1575
-,	Manhive a,/c S r . j1949

+ b t on o r d a / c a l lowed i n v i ew of s a f e t ! r , c o n n e c t i o n and a n t i c i 3 a t i o n o f e a r l y

- I o a r a n c e .

13/6/75 Ord a /c 9r. 34400

C s u s ~ r )	p r e s s r l t a t i o n	of	cheqves	t q t a ' _ l i n n 39940.	P a r t	o f	v311113d	~ o n n e c t i q n	3~
:a-2y	c l e a r a n c e	a n t i c i p a t e d .	' V i l l	fc~l.13~~1	I J ~	i f	n o t	c l e e r e r l	la*i+.hin s b r t
i

30/6/78 D r . 39489

3 e b t h a s i n c r e a s e d t o above f i g u r e - P a r t o f v a l u e d c o n n e c t i o n and o u r ~ o s i t i o n i s

s a f e . A r e a b t o g a t h e r f u n d s q u i c k l y . However w i l l s p e a k w i t h Mr.Anderson e a r l y

I n e x t v ~ e e l c . l

I 1/7/78 3r. 519776
l

~"'bt i n c r e a s e d by payment of $6598 l i c e n s e f e e and $1998 e l e c t r i c i t y . Part of

, ' \ , a l u e d c o n n e c t i o n b u t it i s most u n l i k e them t o dralv l v i t h o u t a r r a n n r t l s n t .

: % :nsj t , icn i s s a f ~ an-] r l7?rc?~t , j \ rc? ?PASI>TPS ill be t 3 k e n e?r1;1 thi.5 q y o e l ~

?IENUS ROOM

. . . .. .

Name of Account 1

/ "15.3.79 >

- - - - - - - - L- - - - - . - w e - - U - - - - - - - - - -

Accocnt due :or annua l review L

- - - -- - - U - - --

- - - - - - - - - - - - - - - - - - -- ---- - - - - - - - -- -

Has been f l u c t u a t i n g f u l l y i n terms of arrangements , a l t hough e x c e s s e s have been 2 f e a t u r e o:

- - -- - -- - ----

- - - - -- - -- - -- - - - - - - - - -

, t h e account of l a t e . !I,

.-. -. -- -----A - -- - ---A----- &?P--wl----- - -- - -- --- - - - --

However A/C is p a r t of valued Anderson/SaffronJ- 2nd l e n d i n g is cons idered !

- - - -- - - - -- - - - - -- - - - - - -- - -- - - - - - - - -- - - - - - - - -- - -

I 1

undoubted ,

- - - - - , I

- -- - -- - - - - - - - - - - - - - --. - - - -- - - - --

ADVANCES:  P l e a s e renew b a s i c OD l i m i t 510000 and I G l i m i t $800 u n t x l 8.3.80 /

-- - - - - - - - - - - - - - - - - - - --- - - - - -- - - - - -- J l:

Recorded on 11 5 ! . !

-- -- -- - --- -

8 R. i

.25/5/74 - - - - - - - -- - - . - - W - -- - - - - - -- i

I* ~ 1 1 . 6 1 8 - 3 9 ~ r / 1 0 . ~ ) 3 9 l

B y p r e s e n t a t i o n of dravrings 32171, .:'li1 I. speak ta ivh, -Anderson this l<, !:

Considered s a f e . i '

---- -- - - - -- ----- --- - - - -- ---- - - - -

34-aW. --

- - -- ----- - - m - - - -

- - - - - -- - - - - - - - - - !

? l . ' ~ / 7 9 , r . - .-bra!>an G i l 5 e r t s a f r ' r 3 ~ r z l l l d -c3 .?x?cl-i:s zn t . l - l i ,~ l t ed y J a r a p t ~ e f i ( '

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - --

. 2 " 2 t b e d3cu"f?ct ?.:fay tc S??> 1~)22l c d y i r ~ - - lhicIl h e - $ e c l j - ~ < -t? &. q? j h - e ~ - I

?-.;?PC!	t h e ? c ~ r l ~ ~ ; ' l e c I ~ ~ ~ ~ ~ ' I f	I;)?	- 1 1 ~ 1 ~ e r s ~ ~ d . i n ~	t h e ?ur??r t	35 -?l?:	:.>.?r?-ntqo, - .-	-	!
i

e i ? r e e ~ 3 c u t i n o +--53115 - - - kef3-ze + h e - a f ? ; ~ ~ ~ l t & ? n ? c ! c ~ f f i c ~ r s -,-- - - - - --------- ---

D e o o s ~ t of -$39_57,96 on ?6/6/69-and 916@-0? 21/_6/79 were-wrc~ngly - - - - de3so i t ed - - -. - t o

3rd' account and a t t h e i r r eq j e s t w i l l r eve r se today. Bc~th a c c o u i ~ t s w l r l t hk - i i -

- - - - - - - --W -- --

lolr? sma l l -2xcesses -which - w i l f be ad jus ted- -tonorrow. Safe. ,

--

- - - - - - W - - - - - - ---- - -- X- - - -

gr

--- - -- - W ----a-- -- ---

19/9/79 Dr. $11340/-10;000- - -

ynd-e-y-yesterdays d a t e ha$--been- cavered this-mokning . b y - a l i m ~ s i t

of $3206.

M

, , - -qr -- - - - -- - ----- - - ---- --- - - - - - --------

./9!79-~r.-~11108/10,0a~ --W- - M - - W - m - -W - - - - ----------- -

honed 'oX'u r e e x c e s s caused under y e s t e r d a y s d a t e . ; d i l l cover today. safeQgr

----A-- -- -- -- - --- - -- - --- -- ---- -- -- --- --- --- - - -- --- ----- ---

1

2 61-1017 9-Ilr,B137-5-9/!WCO ---- - - - - - ---- -- - - - - - - ------W

T r i e d t o c o n t a c t ' X " r e exces s eaysed under ye s t e rdays d a t e b u t unsuccess fu l .

i o w e v ~ r account furms p a r t - o f - v a l u e d conilectfon and e a r l y

i n o t c l ea red e a r l y - n e x t week w i l l c o ~ t a c t . -

DIARY NOTE

. . . VENUS ROOM

Name of Account

- e x t e n d e d f-0-r -a-furthe-c-?2_-months.-- L i m i t - - i s - r e ~ ~ - i r e d t o - - - M --

-

/

meet flyct-u_ati_nq- ire-inen_t_s,--?gyged c o n s i d e r i n g

- -- - - - ---

th-e	y g i u e d	c o n n e c t i o n
--	- - --	-

RDV. 1

- - - . - - - ------ - m-- - - -- - - -- - - - -- -- --- -

C/ - - - - - --- - - - -- --

2 3/3/53 D f . $13227 f 19,933 ---- --- -------- --

- .-

= xcs 5s c a clsed by :xs-,-e~takim. a:.-c hl l r- tat,c?l l ih 55230. :-DLL-a chr. ' o r ?l

' jvour of Tooheyc~ L t d . Phoned " X " ~ h o a ~ o l o g i s e d fclr > q s i t l o ~ b:*t " J Q - J ~ ~

l o d a iho- coc@rika -Funcis--T.omorfbW;-- Tn--Vr%v --of - c o m e cti7~n-and-saf~-iy-'~rl-i-~ I?PI.

- --L - -- - - - - -- - -- - - -- -- - ----- - -- ---- C 3 3 . r

?!4/3'3 9r. 5i1133719;969

?:?m& "X" a; + c c o u a t hsj--rl~:- - ?P t =ert-%d tr orde r -?is ?rev3 us-l-y l ~ ~ f sd-. ;he---

s z u r z s that banking this *.vee!( !v111 z d ~ u ~ t t , ' SSa2, m-- -

- - -- - - - -- - - - - - - - - - ---- - - - ----- --- '

W

,/k+,,f/'81 J)r.$q@+.4fqQ~~ - - - - -- - - - - - -- - - - -- - -

;awlngs $55kl .Phoned "xi' .has appro,: $6000- to lodge.,.l;oday--with fllrwer b -

>-morrow t o c l e a r excess.Safe i n view o f connection.

I - - - --- - - - - -- ---- - - - - - -- -- - - - - - -- -&, - - - - - -- - - - - -

! - - - - - - - - --- - -- -

) 3 3 f w 1 5 2 6 2 f 1 0 0 0 0 - - U W -- W W - -- --F-- - - - W - - --W - - - - -- -- -- - - -- - - - - - -- --

' A c c o u n t - o n z e f e r e n c e -- ---- --- - due - m - - - t o !?p-irztion - --- ---- o f - l i m i t . - - - - - W - - - - - - - - - - - - - - W - - - - Customer h a s r e q u e s t e d -------W--

! h a s shown - good f l u c t u a t i o n s d u r i n g p a s t 12 m o n t h s , a g r e e d . C o n s i d e r e d

- - ---- - - - - - - - - - - - - -- - - - - ---- - - --- - --- - -- --- - --W - - --- -L - - ----

quite	s a f e
9 / 3 / 8 2 .	A dv .

I - -_ - _ -_ _ - _ -_ - I--

- - - - - - -- - -- ----------p

2&/&//3t- Dr.$i3725/70000- --

ilraw~nzs	-SSQ79.	Shoned-
I	apgrox..$~;3~00-	to bank Coday--with -res&due--eovsed

by end o f this week.Safe. - .- . - - - . . ... . --.. . . - - . --- ----

v

I'lgr

q/6/*8 '-T24U31ToG*o - - - -- - - - - --- --- - - - ---

I ..;p

$rti'~.zr?gs	-&70.4,Ehoned-."Xb .~bakil2g.	:d~tiAn next- aa>--or-- tyo - w l - l l cov_ec._jaf g-in - - s e ~ ~
',l	L .

- c O 1 l e c b O 1 l -- - - - - - - W ------ - - - - - - - - - - - - - - - -

---- -- ---- --- m - - - - -- --- -- - - -- - -- --- - - --

-P

I /7je1-	D ~ . S I 01 6/10000
:rdT,Tngs $372G-papXiit	; Saf 2 i n TLShl OT c-Oi'medtio~l &rrd--;aFI'Ig

c l e a r a n c e - - - - - M - - - --. -- - ---

1. DIARY NOTE

I Venus 300Z

Name of Account

. j f i /ZI 3r.*132q6/i0000 - . I

l - j

: =,&St-o,lal d~a:dlng of *l%O. I-honed a d	spo;e	iili,;l Liianne.	, d i l l kz Ldagi:?g g>-;;	,
: I
;

I

:L/S/Sl Chq f o r $7134 ir. favour of Independent L i ~ ~ o o j i l p p l ~ e s =r/esenzed f o r

I-:

. ?eczl l uzswer. Gnable t o conatc iir.Saffron ;.?h0 i s cu r r en t ly oseys(Gtor) 2nd !

LE the c l rcuns tmces cnq returned-no arrangements-refer t o & p e r . l

I I D r . $1 06j2/10000

2 - ' - . ~ . Y L E ~ s $2jk9.Fho~1ed 3 i m l e tnac aeekly depos:~ i.io-dd. be -odgec? ;oC

L

,... LC-l	; r l i l	11?01?5 ~hzCi cover. &?S.	i
I '
I
::/l	0/81	D r . $?438/10000	'

-d	l
.-	,-

\ = ~ = l v e d phone c d ; from gwntor - i~~- : .G.Saf f ron .Jn t l l fuzther go t ice Coes noi, I

eccount :itl?out 31s' t i~tiiorizj- . i

7 : / i.

4/1/82 DR $9 ,437 /10 ,000

1 . G $800.00 f a v o u r A u s t r a l i a n Gas L i g h t C O Re tu rned .

f o r c a n c e l l a t i o n .

Advances

C a n c e l I G L i m i t

A@ H~87~ J/ -a .

Am- c = L z s &L( -

- - - - m

- ctLv d M4:acro---./

-&-V- -G /jr/~/dp~ .A&

&& - + d==L-u

-

=3-,"

20/5/82	D i s c u s s e d	a q i R a	w i t h	Mr	S a f f r o n .	Promised	t o p l a c e A/c	i n o r d e r
on	21/5/.	W i l l p u t	a	r e d u c t i o n	p r q f f i i t i o n t o us	i n n e x t	week	o r s o .

Meantime t o r e g u l a r i s e A/c l i m i t e x t e n d e d u n t i l 13/6/82

Adv. P l e a s e a t t e n d . A D V .

4-t

?,,G:  rm.

DIARY NOTE VENUS ROOM I2-L L I ,

Name of Account

- i-

6/9/82. Answer to AA o f 19/8/82 has been received. Account has been

11 COLUMN l COLUMN 2 COLUMN 3

1979 YEAR OF TNCOMF

Exhibit "19"	Carousel Cabaret 1
Exhibit "VS"	Venus Room 2
Exhibit "3 1"	"La Bastille Special Expenses" 3
"Showbiz Special Expenses" 4 "Tony Rent", "Rent"
"R & P"
"T Teeman", "T.T.", "TT" "Rent Venus" &"Venus Upstairs" "Photographer"
TOTAL

2980 YEAR OF INCOME

Exhibit "31"	$ 95,000.00	"Carousel", "C.C." 5
$ 31,400.00	"Venus" 6
$ 7,000.00	"La Bastille", "L B 7
$ 1,500.00	"Show Blz" 7
$ 39,600.00	"R & P"
$ 12,250.00	"T.TheemanW, "T.T.", "TT", "T.Teemann,
"Tim Tee7',"Tim T.", "Tlm Th "

$	4,805.00	"Rent Venus", "Venus Rent", "Venus Upstairs",
Venus U/StairsW, "Venus U/S", "Venus Rooms",
"V.Room Rent"

$ 1,517.00 "Photographer". "Photog"

$	1,048.24	"Onvell St", "Rent Orwell", "Orwell"
$	1,474.00	"Tony S. Venus", "Tony Samuel", "B.Tony", "Tony's Rent", "Tony S ", "Rent"
$	300.00	"Ralph"
$	163.80	"Gratham Lodge"

$ 3,50000 "JI~" , "Jlm C.?!."

30 00 "Re B M

TOTAL	$199,588.04
Less:	%  8.OOO.OQ "Jim"
TOTAL	$191,588.04

1981 YEAR OF INCOME

Exhibit "31"	$ 29,000.00	"Carousel","Carousel Cabaret" 8
$ 51,600.00	"Venus", "Venus L W 9

$ 2,600.00 "La Bastille P", "La Bastille (P)", "La Bastille Special'', "Bastille Special Exp", "Bastille" 10

$ 25,900.00	"R & P", "Venus R & P"
$ 6,500.00	"T.T', "T.Teemann, "Tim Tee"

$	130.00	"Photographer"
$	4,00000	"Jlm"
$	550.00	"No 11 Rent"

$ 3.000.00 "Friges", "Keith Friges"

TOTAL $123,280.00

1: Exhibit 31 begins week ended 3 June 1979. .In the penod to week ended 24 June 1979

Exhibit 31 contains weekly enmes marked "Carousel $1.000". Exhibit 19 contains a

corresponding entry marked "Abe", "AS" etc "$1,000" for each of these weeks.

2: Exhibit 31 begins week ended 3 June 1979. In the period to week ended 24 June 1979

Exhibit 31 contains an entry marked "Venus $1,000" in each of the 3 weeks ended 10

June 1979 - 24 June 1979. Exhibit V5 contains a corresponding entry marked "Abe",

"AS" etc "$1,000" in each of these weeks.

3:	Exhibit 27A, La Bastille daily takings book, conmns enmes marked "Special Expenses" in corresponding amounts for correspondmg weeks.
4:	Exhibit 106, Showbiz daily takings book, contains enmes marked " J I ~ " or "Jim P" in
corresponding amounts for the corresponding weeks.

5: Exhibit 20, Carousel Cabaret daily takings book, shows $95,000 paid to "Abe", "AS", etc.

6: Exhibit V6, Venus Room daily takings book, shows $34,000 paid to "Abe", "AS",	etc. It
also shows $5,000 paid to "Jim & AS".	These enmes are each in the amount of $1,000
per entry. Corresponding enhies in Exhibit 31 (marked "Venus")	are initially also in the

amount of $1,000 per entry, however for 19 weeks (weeks ended 30 December 1979 - 23 March 1980 and weeks ended 25 May 1980 - 29 June 1980) the amounts drop to $600 per week.

7:	La Bastille and Showbiz daily takings books are combined from January 1980.
8:	No daily takings book in evidence for Carousel Cabaret for year ended 30 June 1981.
9:	No daily takings book in evidence for Venus Room for year ended 30 June 1981.

10: No daily tahngs book in evidence for La Bastille for year ended 30 June 1981.