Samarakoon v Commissioner of the Australian Federal Police (Application by Judd)
[2018] VCC 10
•25 January 2018
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMON LAW DIVISION CONFISCATION LIST | Revised Not Restricted Suitable for Publication |
Case No. CI-16-02340
| In the matter of the Proceeds of Crime Act 2002 (Cth) | |
| and | |
| In the matter of the suspect, NAYANAKA ARJUNA SAMARAKOON | |
| and | |
| In the matter of an application by DILESHWAR JUDD | Applicant |
| v | |
| THE COMMISSIONER OF THE AUSTRALIAN FEDERAL POLICE | Respondent |
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JUDGE: | HIS HONOUR JUDGE SACCARDO | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 31 October, 3 November and 13 December 2017 | |
DATE OF JUDGMENT: | 25 January 2018 | |
CASE MAY BE CITED AS: | Samarakoon v Commissioner of the Australian Federal Police (Application by Judd) | |
MEDIUM NEUTRAL CITATION: | [2018] VCC 10 | |
JUDGMENT
---
Subject: Application for exclusion order pursuant to s. 31
Legislation Cited: Proceeds of Crime Act 2002 (Cth)
Judgment: Application dismissed
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APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr I Upjohn QC with Mr T Best | Thomas Egan & Associates |
| For the Respondent | Mr N O’Bryan SC | Australian Federal Police |
HIS HONOUR:
1 On 3 June 2016 a restraining order was made pursuant to section 18 of the Proceeds of Crimes Act[1] (“the Act”), which applied to a number of properties including the property at 31 Britten Street Glen Iris Victoria (“the Property”).
[1] 2002 (Cth).
2 The respondents to the restraining order were:
(i) Nayanaka Arjuna Samarakaroon; and
(ii) Thilini Maheshika Kumari Ekanayake.
3 The order was registered on 6 June 2015. [2]
[2] Joint Court Book (JCB) Tab 33.
4 Mr Judd (“the applicant”) now applies under section 31 of the Act for an order to be made under section 29A of the Act that the sum of $750,136.99 from the balance of the proceeds of the sale of the Property be excluded from the restraining order.
5 It is asserted by the applicant that he is entitled to the order which he seeks on the grounds that at the time at which the restraining order was made he held an equitable interest in the Property in the form of an unregistered mortgage.
6 It is asserted that that mortgage was dated either 21 April 2016 or 19 January 2016.
7 The fact that the applicant asserts his entitlement to the Order on the basis of either/or situation with respect to these two mortgages which:
(i) apply to the same property;
(ii) arise by reason of the same alleged loan made by the applicant to the husband of the mortgagor; and
(iii) were in turn created some three months apart;
demonstrates the nebulous nature of the evidence relied upon by the applicant in this application.
8 For the reasons set out below, given the combination of:
(i) the uncertainty of the evidence as to the validity of the mortgage documents relied upon by the applicant in this instance;
(ii) my findings as to the lack of reliability of the evidence relevant to:
a) the date upon which the various mortgage documents were created; and
b) the date upon which those documents first came into the possession of the applicant; and
(iii) my findings as to the lack of reliability of the applicant as a witness, that reliability being in my view totally compromised by the findings which I will explain in due course which satisfy me that on some issues the applicant has been deliberately untruthful;
I am satisfied that the applicant has not made out his entitlement to the Order which he seeks.
9 In making the above statement as to the applicant’s lack of reliability, I do so on the basis of a combination of the discrete findings upon a number of issues which I will develop in the course of my reasons, the combined effect of which establish to my satisfaction that the applicant has sought to present himself as an innocent victim of the activities of a conman, namely Mr Samarakoon, the reality being however that the applicant assumed the position of an aider and abetter in the classic sense to some of those activities.
The unsatisfactory affidavit evidence
10 In the application Mr Judd has filed two affidavits, the first dated 20 October 2016 and the second dated 24 October 2017.
11 In his first affidavit the applicant states:
(i) that he first learnt about the making of the restraining order via a letter sent by the respondent on 19 July 2016 to his solicitor;
(ii) that on 23 November 2015 he entered into a written loan agreement with Mr Samarakoon whereby Mr Judd agreed to advance the sum of $500,000 by way of a loan to Mr Samarakoon to assist him in the purchase of units in a joint venture equity registered in Sri Lanka called ITConnect Sri Lanka Bartleet Joint-Venture;
(iii) That the funds for the loan agreement were sourced from the financial resources of Mr Judd, his family and his related entities;
(iv) that by reason of Mr Samarakoon’s failure to pay interest a default was triggered under the loan agreement such that the entire loan became due;
(v) that the applicant had subsequently agreed early in January 2016 to wave the default under the loan agreement and to extend the repayment of the monies with interest for a further 60 months on condition that Mr Judd receive a mortgage over the Property;
(vi) that in late January 2016 Mr Samarakoon telephoned Mr Judd to say that the mortgage and guarantee documents had been executed by his wife Ms Ekanayake with respect to the Property[3];
[3] In the course of his evidence in this proceeding the applicant amended the date upon which he received the telephone call from Mr Samarakoon from January 2016 to late April 2016.
(vii) that Mr Judd had attended the office of Mr Samarakoon and collected from the latter’s personal assistant Claudia the executed mortgage and a personal guarantee in his favour which appeared to have been executed by Ms Ekanayake and dated 19 January 2016;
(viii) that in April 2016 Mr Judd had begun to press for delivery of the executed documents;
(ix) that upon providing the January mortgage to his solicitor Mr Judd had been advised by his solicitor that that the mortgage appeared not to be an original but rather a photocopy or scanned document which could not be lodged for registration; and
(x) that “accordingly, my solicitor asked for and received on my behalf a further mortgage dated 21 April 2016 (“the April mortgage”). The April mortgage was an original document which appeared to me to have been properly signed by Ms Ekanayake and witnessed”[4].
The inconsistency between the statements by Mr Judd in his first affidavit as to the creation of the loan agreement and the documentary evidence upon that issue
[4] JCB Tab 10 p7.
12 There is no issue that:
(i) a total sum of $500,000 was assembled by Mr Judd and provided to Mr Samarakoon;
(ii) the statements made by Mr Judd in his first affidavit as to the circumstances in which the above sum was made available to Mr Samarakoon provides a history which has proven to be unreliable upon key issues, the most significant of which being that the loan document referred to by Mr Judd in his affidavit involved a single transaction between the applicant as financier and Mr Samarakoon as borrower on 23 November 2015 in the sum of $500,000.[5]
[5] JCB Tab 35.
13 In reality the date of this document is a fabrication and the creation of that document was preceded by the creation of a plethora of other loan agreements each of which bear dates which post-date the document, namely:
a) a loan agreement dated 24 November 2015 in respect of which the loan amount was $200,000[6];
[6] JCB Tab 40.
b) a loan agreement dated 24 November 2015 in which the loan amount was $200,000[7];
[7] JCB Tab 41.
c) a loan agreement dated 24 November 2015 in which the loan amount was $100,000[8]; and
d) a loan agreement dated 24 November 2015 in which the loan amount was $200,000[9].
[8] JCB Tab 42.
[9] JCB Tab 33.
14 None of these loan agreements were referred to by the applicant in his first affidavit.
15 In the course of his opening Mr Upjohn, Senior Counsel on behalf of the applicant, made the following statement with respect to the various loan agreements dated 24 November 2015:
Aanyway, Your Honour, these documents are signed as well and Mr Judd will give evidence that these were never acted upon (sic), this agreement, and some further ones dated 24 November. They were described by Mr Samarakoon as providing additional protection or I think the word is ‘Cushion’… “[10]
[10] T8 L10-15.
16 Given that:
A. The loan documents dated 24 November 2015 to which I have referred above were executed between different parties namely:
(i) in the document at JCB tab 40, which was dated 24 November 2015, the lender was Education Service Providers Pty Ltd Ltd Super Judd Superannuation Fund and the borrower was Connect Pty Ltd;
(ii) in the document at JCB tab 41, which was dated 24 November 2015, the lender was FC Ventures Pty Ltd and the borrower was Connect Pty Ltd;
(iii) in the document at JCB tab 42, which was dated 24 November 2015, the lender was Dileshwar Judd and the borrower was Connect Pty Ltd;
(iv) in the document at JCB tab 43, which was dated 24 November 2015, the lender was Calvin Judd and the borrower was Connect Pty Ltd; and
(v) in the document at JCB tab 35, which was dated 23 November 2015, the financier was Dileshwar Judd and the borrower was Nayanaka Arjuna Samarakoon;[11] and
[11] In fact it is the evidence of Mr Judd that this document is a consolidation of the loan documents dated 24 November 2015 notwithstanding the fact that it predates those documents.
B. The fact that the total sums the subject of the various loan agreements arranged by Mr Judd and dated 23 and 24 November 2015 is $1.2 million;
the mis-description by Mr Judd in his first affidavit of the loan transactions executed by him, namely that one loan was executed for a total amount of $500,000, is in my view appropriately described as being breathtaking.
17 In fact, four loan agreements dated 24 November 2015 were created in respect of the single loan agreement described by Mr Judd in his first affidavit.
18 In reality the transaction described by Mr Judd in his affidavit involved the “consolidation” of four loan agreements into a document containing a single amount which was $200,000 less than the total sum of those four agreements.[12]
[12] T81L5 –T82 L4.
19 The fact that the date of the consolidating document predates the agreements which it allegedly referred to makes no sense and smacks of the presence of possible fabrication with respect to the timing of the creation of each of these documents.
20 In his second affidavit, dated 24 October 2017, Mr Judd was more fulsome in describing the various loan agreements executed in favour of Samarakoon.
21 At the time at which that affidavit was sworn the various loan agreements dated 24 November 2015 to which I have referred above had been exhibited in various affidavits prepared by Mr Dale Brennan on behalf of the respondent in October 2017.
22 In seeking to explain the totality of the loan documents in his second affidavit Mr Judd, at paragraph 32 of that affidavit, attests to the fact that the documents dated 24 November 2015:
“relate to a loan structure proposed initially by Mr Samarakoon as an additional protection for me or “cushion” as he described it but it was not pursued. The signatures do not bear the dates on which I signed them. I no longer recall when I signed them. I know that I signed loan agreement dated 23 November 2015 before I made the Advances. I believe that I also signed the other loan agreements, which postdate by a day the loan agreement I rely on in this matter, before I made the advances”.
23 In the course of cross examination Mr Judd was taken to each of the documents in the following passage of the evidence:
Question: There’s a lot of differences between your second affidavit and your first affidavit, Mr Judd and the fact of the matter is that there is nothing in your first affidavit that his honour could rely upon because you repeatedly tell falsehoods about the transactions between you and Samarakoon, don’t you?
Answer: They are not falsehoods. They probably not entirely-it does not entirely capture the full picture whereas the second affidavit we spent more time on and money to look into it very deeply and not that we were negligent in the first one but we felt that we got more time now and we should get fine details looked into on it.
Question: you accept, don’t you, Mr Judd,that it is totally misleading, totally misleading to suggest that the only transaction between you and Samarakoon in respect of the so-called loan is the document which you exhibited as DJ5. That is quite misleading, isn’t it?
Answer: I don’t believe so.[13]
[13] T64 L9-25.
24 I find the responses by Mr Judd to be totally unsatisfactory and a real issue arises in my mind as to whether, in the absence of the filing by the respondent of the material which exhibits the mortgage documents dated 24 November 2015, the existence of those document would ever have been disclosed by Mr Judd given the structure and content of his first affidavit.
25 It is Mr Judd’s sworn evidence that:
· he lent to Mr Samarakoon the sum of $500,000; and
· the loan was captured by the execution of a single loan agreement dated 23 November 2015 and a number of further agreements dated 24 November 2015 which as I understand his evidence were designed to provide him some sort of security or insurance with respect to the primary agreement.
26 There was no issue that the relevant loan agreements do not marry with the alleged transactions. The evidence upon this issue is so clear that it was not contented otherwise by Senior Counsel acting on behalf of Mr Judd in the course of his opening.[14]
[14] T13 L5.
27 Contrary to that position Mr Judd gave evidence that the loans reflected specific transactions carried out on those specific days and dates[15].
[15] T46 L24.
28 If the inconsistency between the evidence given by Mr Judd as to the loan agreement entered into between he and Mr Samarakoon were to be the only issue which arose as to Mr Judd’s reliability and honesty, it may in the final analysis not be determinative of any issue which arises in this case.
29 Given, however, the further issues which arise as to whether Mr Judd presents as a reliable or, for that matter, truthful witness, about which I will make further findings in the course of my reasons , I am satisfied that:
(i) the timing of the loan document referred to by Mr Judd in his first affidavit which he asserts was the basis upon which monies were made available by him to Mr Samarakoon; and
(ii) the existence of other loan documents for loans totalling $700,000 which were not disclosed
represent a willingness on the part of Mr Judd to prepare a sworn affidavit which is misleading on a very critical issue, namely the basis upon which he asserts he was entitled to a mortgage over the Property, and most probably an example of an untruthful witness choosing to provide a deliberately selective account of the facts to suit his own advantage.
30 In making my finding above I rely upon the evidence which I will describe in detail in due course that Mr Judd acquiesced to the preparation of a further loan agreement at the direction Mr Samarakoon which was to be executed between Mr Judd as the lender and Ms Ekanayake:
(i) which attested to the existence of a fictitious loan dated 23 November 2015[16]; and
(ii) which falsely recorded the fact that Mr Judd had advanced to Ms Ekanayake the sum of $1.6 million.
[16] JCB Tab 44.
31 As to that agreement Mr Judd explained in the course of his evidence:
Answer: …I was uncomfortable with it….I wasn’t going to sign them…[17]
[17] T51 L25-28; see also T49 L11-17.
Question: So you are perfectly willing to go along with instructions to this lawyer which you knew were false, correct?
Answer: I was unhappy with it
Question: But you did it?
Answer: I did it
Question: You did it?
Answer: Correct.[18]
The inconsistent statement as to the existence of any loan agreement made by Mr Judd in his correspondence of 15 August 2016
[18] T52 L6-10.
32 At all material times Mr Judd maintained his position that, regardless of the existence of the loan documents dated November 2014, he nevertheless made available to Mr Samarakoon $500,000 by way of a loan or loans and it was by reason of that process that Mr Samarakoon agreed to provide him with his asserted equitable mortgage in respect of the Property.
33 The above assertion by Mr Judd was however contradicted in an email which he authored on 15 August 2016 which was addressed to Mr Michael Caspaney, the Administrator of JD Invest Pty Ltd, a company which had been incorporated on 7 June 2016 of which Mr Judd was the sole director and company secretary (“the 15 August correspondence”).
34 The 15 August correspondence:
(i) arose in circumstances in which Mr Judd had placed that company into administration on 20 July 2016;
(ii) describes the advancement by him to Mr Samarakoon the sum of $500,00 for the purpose of acquiring a stake in a subsidiary of a blue-chip Sri Lankan listed entity.
35 In the course of cross examination Mr Judd gave evidence that:
· in preparing the 15 August correspondence his intention was to tell the administrator the truth;[19] and
· his reference in the 15 August correspondence to providing $500,000 for the purpose of acquiring a stake in a subsidiary of a blue-chip chip Sri Lankan entity involved the same $500,000 which was allegedly the subject of the loan agreement of 23 November 2015.[20]
[19] T 38 L22
[20] T 41 L7
36 The evidence given by Mr Egan, Mr Judd’s solicitor, in the course of his examination on 28 September 2017 is of further relevance as to whether a loan agreement was the basis for the advancement by Mr Judd of $500,000 to Mr Samarakoon.
37 The document being discussed in the course of the following passage of the evidence is the loan agreement dated 23 November 2015[21]:
[21] JCB Tab 35
MR O’BRYAN: Are you familiar with this documents (sic), Mr Egan?---I have read this document previously, yes.
And it is a loan agreement dated 23 November 2015 between Judd, who’s identified as the financier, and Samarakoon is identified as the borrower and states that:
The financier has agreed to lend to the borrower, and the borrower has agreed to borrow, $500,000.
?---Yes.
The purpose said to be to facilitate the purchase of units in the IT Connect Sri Lanka Bartley Joint venture in Sri Lanka?---Yes.
When did you first see this agreement?---My – I don’t recall exactly. I believe I may have first seen it in December. If not, then in early 2016 – in December 2015 – if I didn’t see it in December 2015, I was certainly told about it in December 2015.
By whom?---By Judd Dileshwar.
And what did he tell you about it?---He’d advanced a tranche of $800,000 to – several tranches to Mr Arjuna Samarakoon and he was concerned about the transaction.
And this happened in December 2015 or in early 2016, did it?---That’s correct, or both those times.
And where did this conversation take place?—In my library once again.
In your library in Kew?---In Kew, yes.
Just you and he were present?---Yes.[22]
[22] JCB Tab 26, page 13 lines 9 -42.
38 Relevantly, the sum of $800,000 referred to by Mr Egan as being advanced by Mr Judd to Mr Samarakoon bears no relationship to the sum the subject of the alleged loan of 23 November.
39 It is put by Senior Counsel for Mr Judd that his statement to the administrator that he was an investor in the company was truthful because at that time Mr Judd was intending to convert his loans to an investment. I do not accept that position, but even if I did, it would never the less establish the willingness of Mr Judd to lie to the administrator in order to gain some potential benefit.
40 The issue as to the validity of any of the documentation relevant to the creation of any loan agreement between Mr Judd and Mr Samarakoon in November 2015 is further clouded by the content of the email addressed by the latter to the former in July 2016:
If anyone asks why u lent me 500k.. that was because you wanted to buy into / buy BPO Connect.
Kind regards,
Arjuna Samarakoon.[23]
[23] JCB Tab 71 page 220, email from Arjuna Samarakoon <[email protected]> to Judd Dileshwar <[email protected]> dated Wed 13/07/2016 10:28am.
41 Further, in the course of his evidence Mr Judd conceded that his advance of the $500,000 to Mr Samarakoon involved a transaction in which an immediate interest was created for Mr Judd in the entire IT connect group.[24]
[24] T79 L30.
42 That evidence also supports the position that the transaction was a business transaction rather than a mere loan which is in turn consistent with the description of the transaction by Mr Judd in the letter to the administrator.
43 If there were to be no other evidence which calls into question whether or not Mr Judd ever made funds available to Mr Samarakoon by way of a loan, the inconsistency in the statements by Mr Judd in the 15 August correspondence would raise such a level of doubt in my mind as to whether any such loan was made that I would be hesitant to make a finding in favour of Mr Judd upon that issue.
44 When, however, the creation of JD Invest is considered in the context of the flow of emails between Mr Judd and Mr Samarakoon to which I will refer in due course, the existence of an ongoing business relationship of considerable complexity between Mr Judd and Mr Samarakoon is suggested.
45 For this reason I do not accept the evidence given by Mr Judd that his relationship with Mr Samarakoon involved merely that of a lender\borrower and not an investor.
46 Whilst I give due weight to the submission made by Senior Counsel for Mr Judd that the receipt by Mr Judd of some interest payments is consistent with the fact that a loan was executed between Mr Judd and Mr Samarakoon, in my opinion this is the only extrinsic evidence which would tend to support the existence of such a loan.
47 The totality of documentary evidence to which I have referred, however, makes it clear that, at the very least, some of the loan agreements dated 23 November 2015 and 24 November 2015 were a sham notwithstanding their execution.
48 Further it is clear that there is no necessary relationship between the dates upon which those documents were created and the dates which the documents bear.
49 It is clear that Mr Judd made inconsistent statements as to the nature of the money made available by him the subject of the alleged loan when he reported supposedly truthfully to the administrator in the course of the 15 August 2016 correspondence.
50 Further, in May 2016 Mr Judd acquiesced in the creation of a bogus loan (“the bogus loan”) which was backdated so as to record its creation on 23 November 2015[25].
[25] See the loan agreement signed by Ms Ekanayake who was the partner of Mr Samarakoon, which recorded advancement of $1.6 million by Mr Judd to Ms Ekanayake “from November 2015.” I am satisfied that the email dated 29 May 2016 at JCB 65 contained the directive responsible for the creation of this document which is clearly fictitious in that no such loan was ever made. Further, the comment in the email “And the date is to be an appropriate date” is telling upon the willingness of Ms Ekanayake to execute a document which contains dates of falsity and have no probative value, about which I will address further comment and analysis in due course.
51 In taking into account the totality of evidence upon this issue, when considered in the context of the other issues which arise as to the reliability of Mr Judd as a witness to which I will refer in due course, I am not satisfied that Mr Judd has established the existence of any loan made by him to Mr Samarakoon which gave rise to an obligation by the latter to honour the loan by providing security in the form of a mortgage over the Property.
52 In making that finding I wish to make it clear that for the reasons which I will develop in due course, I am satisfied that Mr Judd was deliberately not truthful in describing his relationship with Mr Samarakoon as one merely confined to that of a financier and a borrower.
53 When making that finding and any other finding as to dishonesty by Mr Judd, I do so adopting the Brigginshaw[26] standard of proof and applying the caution required of me before I make a positive finding of dishonest behaviour on the part of Mr Judd, given the gravity of such a finding.
The presentation by Mr Judd as a naive and simple man who has been taken advantage of by a fraudster
[26]Brigginshaw v Brigginshaw (1938) 60 CLR 336.
54 In the course of the hearing Mr Judd repeatedly sought to present himself as a simple, naive man who has been taken advantage of by a fraudster. That position was first mentioned by Senior Counsel for Mr Judd in the course of his opening[27] whose words were taken up by Mr Judd on a number of occasions.
[27] T5L28.
55 Given:
· the advice provided to Mr Judd by his solicitor Mr Egan in December 2015 that the behaviour of Mr Samarakoon “sounds like a fraud”;
· that Mr Egan’s position at that time that “the very idea that somebody can be a financial advisor and an auditor is impossible. It its preposterous”;
· Mr Judd’s concerns expressed to Egan at that time that he “didn’t have 100% faith in Arjunga Samarakoon”; and
· Mr Egan’s evidence as to Mr Judd’s level of concern namely “and that concern was markedly increased following the meeting with me”;[28]
[28] See the transcript of Mr Egan's evidence JCB Tab 26 P15 L15 onwards.
I find the subsequent behaviour of Mr Judd in:
a) continuing to maintain his relationship with Mr Samarakoon, notwithstanding the warning by Mr Egan;
b) travelling to Sri Lanka with Mr Samarakoon in February 2016;[29]
[29] See the statement by Mr Judd in the August 2016 letter which is Exhibit 1.
c) making positive statements encouraging Mr Samarakoon to believe he would acquiesce to acts designed to assist Mr Samarakoon to relocate his assets;[30]
[30] See the email chain of 3 April 2016 at JCB 60.
d) making no statement to Mr Samarakoon that he was not prepared to engage in the fraudulent activity of creating the bogus loan in May 2016; and
e) involving himself in the creation of JD Invest Pty Ltd
to be the antithesis of the behaviour expected of a naive individual who had been preyed upon by a conman about whose behaviour he had been warned.
56 In reality, I am satisfied that even the most naive of individuals would have been alerted to the fact that the continued involvement in any financial dealings with Mr Samarakoon carried significant risks and should be abandoned.
57 The combination of these facts, when considered in the context of Mr Judd’s “curriculum vitae” which attests to the fact that he:
· has practised as an accountant and financial controller in Australia;
· is registered as a fellow of IPA;
· has practised as a management accountant since 1974; and
· is qualified in the UK and in Australia as an MBA
causes me to be satisfied that I should not accept the evidence given by Mr Judd that he is in any way unworldly or naïve in business to the extent that he required Mr Egan to give him advice as to the risk which arose to him in creating an unsecured loan to Mr Samarakoon and that it was that advice which was responsible for the creation of the loan agreements.
58 Rather, I find his evidence that he was a vulnerable and gullible victim of Mr Samarakoon not only to be disingenuous but in reality to lack any semblance of truthfulness.
The incorporation of JD Invest
59 There is no issue that JD Invest was incorporated on 7 June 2016, three days after the making of the restraining order in this instance and that Mr Judd occupied the position of sole director and company secretary.
60 The report from the administrator of JD Invest dated 17 August 2016 [31] reveals that Mr Samarakoon was acting as a director of the company despite not being registered with ASIC and comments that he was:
“…the controller of each and every receipt and payment that was transacted by the company’s bank account. Dileshwar Judd (Judd) was not controlling the receipts and payments to and from the company’s bank account. When payments were made, they were made on the in instructions of Arjuna”.[32]
[31] Exhibit 4.
[32] Exhibit 4.
61 Given the controlling position occupied by Mr Judd in JD Invest it would seem unlikely that the above state of affairs could have existed without his acquiescence in them.
62 In commenting upon the transactions of JD Invest and the description by Mr Judd in those transactions the administrator states:
“The nature of the transactions and the description provided by the director, Judd, are unusual. It is not common for a potential purchaser of a business to have monies paid into their bank account by the potential vendor just so the purchaser can see the volume of business being conducted by the vendor.
I don’t believe the company provided any services to clients…for which it has received monies into its bank account, especially when the services being invoiced were mainly professional regulated services of registered tax agents and registered SMSF auditors. It is also not conceivable that the company validly incurred any expenses for which it has been charged for the monies going out of the company.”[33]
[33] Exhibit 4.
63 The report by the administrator in my opinion calls into question the evidence given by Mr Judd as to his involvement in JD Invest and his motivation to be appointed as the sole director of that company.
64 I find it more likely that Mr Judd agreed to become involved in JD Invest for the purpose to allow Mr Samarakoon to divert monies from Connect IT Holdings into the hands of Mr Judd.
65 It is put that the appointment by Mr Judd of a liquidator of JD Invest suggests that his evidence as to his involvement with JD Invest should be accepted at face value and to his credit. I am not satisfied that I should accept that position given the plethora of evidence that Mr Judd was prepared to involve himself in complicated financial processes orchestrated by Mr Samarakoon for reasons which are not apparent.
66 In my view the involvement of Mr Judd in JD Invest, and his acquiescence in Mr Samarakoon acting for all intents and purposes as its controller and director, reflects adversely upon the issues of Mr Judd’s honesty and credibility.
The lack of reliability in the evidence of the three essential players in the creation of the mortgage documents
67 In my opinion, a close analysis of the numerous exhibits contained in the joint court book and the evidence given by Mr Judd in the course of this application leaves no room for doubt that:
1) Mr Judd;
2) Mr Samarakoon; and
3) Ms Ekanayake
were each prepared to engage in dishonest behaviour in commercial dealings to further either their own interests or the interests of others to whom they felt allegiance.
68 In justifying that comment in so far as it applies to Mr Judd, I do so relying upon the numerous findings made by me in the course of this judgement, which speak for themselves and which call into question the veracity and credibility of Mr Judd.
69 Those findings operate so as to satisfy me to a comfortable degree of satisfaction that Mr Judd has made inaccurate statements on oath with a dishonest intention to mislead the court in order to advance his case and further his own potential for financial gain.
70 It was for that reason that in the course of submissions I made the repeated statement that the evidence of Mr Judd was so unsatisfactory that I would not accept any statement made by him which was not corroborated by the presence of other independent and persuasive evidence.
71As to the honesty and reliability of Mr Samarakoon, I base my statement upon his conviction and subsequent imprisonment upon having pleaded guilty to numerous offences involving dishonesty.
72As to the honesty and reliability of Ms Ekanayake it is clear that in the course of her examination on 11 September 2017[34] Ms Ekanayake made a number of admissions which discredit her as a witness of truth, namely that:
[34] JCB Tab 24.
(i)she acquiesced to the use of a guarantee and indemnity signed by her knowing that it bore a false date and had been backdated and that her signature had been witnessed by someone who had not been present when she signed that document;[35]
(ii)it was her desire to create an effective security by way of mortgage for Judd with respect to the Property; she was prepared to go out of her way to assist him in this respect, including by allowing him to pretend that the backdated January mortgage was valid;[36]
(iii)she made false statements in her affidavit that she had made mortgage repayments on the Property;[37]
(iv)she was prepared to swear her affidavit which contained material inserted by her husband without checking the truthfulness or validity of that material merely because he had asked her to do so.[38]
The nature of relationship with Mr Samarakoon and Mr Judd and the knowledge by Mr Judd of the claim made against Mr Samarakoon by the ATO
[35] JCB Tab 24T53, L20 – T54, L15.
[36] JCB Tab 24T30-35.
[37] JCB Tab 24T62, L25.
[38] JCB Tab 24T66, L10-40.
73 It is not an issue:
· that on 23 March 2016, Mr Samarakoon received a notice from the Australian Taxation Office of his liability to pay in excess of $2.5 million of tax and penalty;
· that on 3 April 2016, the following emails were exchanged between Mr Samarakoon and Mr Judd as follows[39]:
[39] JCB Tab 60.
§ At 9:47am Mr Samarakoon emailed Mr Judd as follows:
“Subject; Re; I need two people
person to take over directorships of companies we want to keep … Maybe you?
One person to take over directors of companies we do not want to keep…?”
§ At 10:06am Mr Judd responded;
“Subject; Re; I need two people
Item 1 no worries
Item 2 can find
How quick?
When do you want caveat done.”
74 The coincidence in timing between the notification received by Mr Samarakoon from the Australian Taxation Office and his email of 3 April to Mr Judd satisfies me that the purpose of that email was to seek assistance in order to restructure Mr Samarakoon’s assets in the context of the claims being made against him by the Australian Taxation Office.
75 It is Mr Judd’s evidence that:
· he was never aware of those claims; and
· even as at approximately May 2016, Mr Samarakoon had advised him that his liability to the tax office was in a sum less than $400,000 and that this liability imposed no hardship upon him, it would be resolved through discussions between the tax office and his lawyer.
76 I find that position to be unlikely given the coincidence in timing between the ATO notification and the two emails which are referred to above when considered in the context of:
· The questionable legality of the exercise suggested by Mr Samarakoon; and
· Mr Judd’s immediate response acquiescing to the process suggested by Mr Samarakoon in the absence of any query by Mr Judd as to why the process should be undertaken.
77 Mr Judd explained his thought processes as to this exchange as follows:
“I think he was restructuring his business and when I asked him more questions and I said “why do you want to do that” he didn’t say a word – finished.”[40]
[40] T85, L9-12.
and further:
A:“I told him I don’t want to do it and he said “ok, let us do the caveat”. Actually in March he had already asked me.
Q:When did you tell him you did not want to do it?---
A:On the same day I told him I don’t want to do anything there, in this respect.
Q:His Honour will not find any record, written record, whatsoever of you declining to do these things, will he, Mr Judd?---
A:No.”[41]
[41] T86, L3-11.
78 I find the explanation by Mr Judd as to this process, namely that he employed the words not in response to the request that he find new directors but rather as to the timing of a proposed caveat to be executed by Mr Judd, to be unconvincing to the degree that it is untruthful.
79 On 28 April 2016, Mr Samarakoon sent to Mr Judd an email in the following terms:
“Subject; Juddie
Can you become director of three entities with propertie (sic)?
Crystal, can you give judd the two Pakenham properties.. so that he gets the surplus.. I owe him
Make him sole director..
Also Crystal can you make Don and u directors of cypruss Ceylon and take me off? Call juddie and tell him what happened.”[42]
[42] JCB Tab 63.
80 On 22 May 2016, Mr Samarakoon sent an email addressed to both his wife and Mr Judd in which he identified Seragoon in Singapore as seeming like a good area to in which to live, which email concluded with the following statement:
“Judd – if I can get the employment pass sorted before July then I can get the Visa organised asap.”[43]
[43] JCB Tab 64.
81 In cross examination Mr Judd was asked whether it seemed strange that an email of this type would be addressed by Mr Samarakoon to both his wife and also Mr Judd.
82 He responded “I didn’t notice that. Now I am noticing it.”[44]
[44] T100 L5-6.
83 The personal nature of the email, and what I found to be an unconvincing response by Mr Judd to the question to which I have referred above clearly gives rise, in my view, to a suggestion of an ongoing relationship involving considerable intimacy between Mr Samarakoon and Mr Judd notwithstanding the warning of which Mr Judd had received from Mr Egan to which I previously referred.
84 On 29 May 2016, Mr Samarakoon sent to Mr Judd and Anne-Marie Cade an email in the following terms:
“Anne-Marie, I want to get this caveat on tomorrow first thing please. Loan amount is 1,600,000million Dileshwar Judd is the lender. The borrower is Thilini Ekanayake. You have a full details. And the date is to be an appropriate date. I just need the bank to be paid and the rest to go to Judd/ He was transfer accordingly.”[45]
[45] JCB, Tab 65.
85 On 30 May 2016, Mr Samarakoon sent to Mr Judd an email in the following terms:
“Judd, Anne-Marie has sent this and we need to complete it? Can you ask a different lawyer, and not Mr Egan to get this done?”[46]
[46] JCB, Tab 66.
86 On 20 June 2016, Mr Samarakoon sent to Mr Judd and Anne-Marie Cade an email in the following terms:
“Subject: Your Deed Agreement
You are right. This was made by Sidney Mendis, not Egan. However, we are not using the loan agreement with Mrs. We are using Egan deed of guarantee n indemnity, which is ok. Date should be 23 Nov 15 but I can’t get a cleAr printed copy. I will call to office tomorrow to get Katie to print a clear copy of it and the section 74. will pick them up and get Claudia to attest signature.”[47]
[47] JCB, Tab 69.
87 As I have said, it is clear from the evidence of Mr Egan before the examiner on 2 October 2017, that by late 2015 or early 2016 Mr Egan had advised Mr Judd that he thought it likely that Mr Samarakoon was acting fraudulently and that Mr Judd should have no more to do with him.
88 Notwithstanding that advice I am satisfied that the above exchange of emails demonstrates the probability:
(i) that a business relationship existed between Mr Samarakoon and Mr Judd;
(ii) that Mr Judd was trusted by Mr Samarakoon as being someone who would take temporary custody of his assets and that Mr Judd was prepared to do so; and
(iii) that Mr Judd was complicit at the very least in the dishonest plan of Mr Samarakoon’s by failing to discourage his suggested preparation of a the bogus loan agreement by Sydney Mendis which was then executed by Ms Ekanayake and was a complete sham.
89 Although Mr Judd gave evidence that he had advised Mr Samarakoon that he would not be party to the above process, when he was asked by myself where his relevant response might be found he responded:
“I didn’t respond to that”[48]
[48] T101 L10.
90 I find the totality of the above behaviour of Mr Judd, to be the behaviour of a dishonest man.
When was the mortgage document with respect to the Property executed?
91 I am satisfied that a pro forma mortgage document was created by Ms Naneyakara on or about 15 April 2016.[49]
[49] See paragraph 5 of the affidavit of Saradha Naneyakara dated 25 October 2017.
92 I accept the evidence of both Mr Egan and Ms Naneyakara that those documents were provided upon instructions being given to them by Mr Judd in April 2016 and that Ms Naneyakara prepared the mortgage document at that time.
93 It is clear that the substantive issue for my determination involves not the timing of the creation of the pro forma mortgage document but rather as to the timing of the execution of that document by Ms Thilini Ekanayake and its delivery to Mr Judd.
94 Essentially those issues turn upon whether I am satisfied that Mr Judd has established that a valid mortgage was signed by Ms Ekanayake and came into his possession prior to the date upon which he first became aware of the restraining order that had been made in this instance.
95 This in turn involves an analysis of the sworn evidence and the drawing of inferences, as to the timing of the execution and delivery of that document.
96 The sworn evidence as to the creation of the original mortgage is that of Mr Judd’s solicitor Thomas Francis Egan and Ms Sasadah Naneyakara to which I have earlier referred, which I accept.
97 The timing of the execution of the mortgage and its receipt by Mr Judd however is largely dependent upon the evidence of Mr Judd and Ms Ekanayake together with any inferences which are appropriately drawn.
98 Insofar as any such inferences should be drawn as to whether Ms Ekanayake executed the mortgage in April 2016 before she left Australia it is put on behalf of Mr Judd that such an inference should be drawn by reason of the combination of the evidence given by Ms Ekanayake that she signed a mortgage document in April 2016 and:
(i) the existence of a mortgage document of 21 April 2016 which bears the same date as that upon which Ms Ekanayake executed an enduring Power of Attorney in favour of Mr Samarakoon;
(ii) the fact that Mr Sidney Mendez, an Australian legal practitioner, on 8 July 2016 certified a copy of a mortgage dated 21 April 2016 as being a true and complete copy of the original;
(iii) that Ms Ekanayake was in Australia on 21 April 2016 and left Australia for Sri Lanka where she remained until 28 August 2016;
(iv) the evidence given by Ms Ekanayake to the effect that she did sign a mortgage document in April 2016.
99 Firstly, I am satisfied that the fact that the document bears the date 21 April 2016 should be accorded no probative value whatsoever.
100 I make that statement given the practice of both Ms Ekanayake and Mr Samarakoon to rely on documents which have been backdated, namely:
I. the two mortgages dated 19 January 2016 with respect to the Property; and
II.the loan agreement signed by Ms Ekanayake which supposedly recorded the fictitious advancement of $1.6 million to her by Mr Judd “from 23 November 2015”.[50]
[50] JCB Tab 44.
101 I am satisfied that the email dated 29 May 2016 addressed to Anne-Marie Cade and Mr Judd from Mr Samarakoon[51] was responsible for the creation of the above loan agreement which was clearly fictitious in that no such loan was ever made. Further the comment in the email “And the date is to be an appropriate date” is telling upon the willingness of Ms Ekanayake to execute a document which contains a date which is false and has no probative value.
[51] JCB Tab 65.
102 It follows, for these reasons, that I am not satisfied that the fact that a document signed by Ms Ekanayake bears a particular date should be accorded any probative value upon the issue as to the date upon which the document was actually signed.
103 It is put on behalf of Mr Judd that there was a valid reason why the mortgage document prepared through the office of Mr Egan in April 2016 bears the date 19 January 2016, namely that it was the intention of the parties to give effect to an obligation which arose by reason of the alleged loan made to Mr Samarakoon by Mr Judd in November 2015.
104 In my opinion any persuasive value for that position is irreparably damaged by the evidence of Mr Samarakoon as to the dating of the 19 January mortgage which was raised in the course of the questioning of Mr Samarakoon on 20 September 2017 as follows:
[Mr. O’BRYAN:] Your wife also signed a mortgage at your request – I need that one back, thank you. Your wife also signed a mortgage at your request at the same time in favour of other lenders, didn’t she?---Mr Judd.
Yes, in June she signed it and emailed it back to you, didn’t she?---Yes, she signed it in June, yes.[52]
...
You are perfectly well familiar with that document, aren’t you?---I have seen this document.
Yes, and you know perfectly well, don’t you, that this document was returned back by your wife while she was in Sri Lanka on or about 20 June 2016 by email as a scan, and then it was falsely witnessed in Melbourne by Claudia Lianaga and a false date was put on it. You know all of that, don’t you?---Just give me the date again, Mr O’Bryan.
It’s under your nose, Mr Samarakoon?---No, know this date but which date you - - -
It was on or about 20 June 2016 that it was emailed back to you and you sent it on to Judd, agreed?---It was in June, I agree.[53]
...
And it is utterly false to suggest that this document was executed on 19 January 2016. You know that, don’t you? You don’t need to be an expert in witnessing documents to know that it’s a false date?---I’m not sure why they have that January date on the document.[54]
[52] See a transcript of the evidence of Mr Samarakoon at JCB Tab 25 page 71 lines 4 – 9.
[53] See a transcript of the evidence of Mr Samarakoon at JCB Tab 25 page 72 lines 1 – 15.
[54] See a transcript of the evidence of Mr Samarakoon at JCB Tab 25 page 72 lines 40 – 43.
105 This statement by Mr Samarakoon that he is not sure why the mortgage document bears a January date makes it clear in my opinion that there was no intention on his part to recognise the fact that the date of 19 January bore any relationship with the date of any loan agreement executed between himself and Mr Judd.
106 There can be no issue that there is considerable inconsistency in the evidence of Ms Ekanayake as to the date upon which she executed the relevant mortgage document when account is taken of the totality of the evidence given by her in the course of her examination on 11 September 2017.[55]
[55] PCB Tab 24.
107 It is put that her initial response in which she nominated the signing date as being April 2016 was the most reliable statement made by her upon this issue and that other statements made by her in the course of her cross examination were responses to leading questions and were therefore less reliable.
108 I do not accept this position.
109 Immediately after Ms Ekanayake nominated that date of April 2016 she qualified that position in the following passage of evidence.
Question: April 2016 is that right?
Answer: I’m not 100 per cent sure
Question: That’s the best you can do, is it? April 2016
Answer: Or June, when it was settled-going to be settled.[56]
[56] JCB Tab 24 p44 L30-33.
110 I will refer to the further evidence of Ms Ekanayake on this issue in detail in due course, however it is appropriate at this point that I make known my view that:
· whilst it is true that the questioning which evoked the inconsistent responses by Ms Ekanayake upon the issue as to whether she ever signed a mortgage in April 2016 were leading, it could hardly be said that it involved an aggressive challenge to her; and
· I am satisfied that the immediate response by Ms Ekanayake in qualifying her position as to when she signed the document as being June 2016 was no less reliable than her nomination of the date as being April 2016.
111 In reality, having considered the totality of the responses of Ms Ekanayake in the course of her examination I am satisfied that she was guessing as to the date in respect of which she had no clear memory.
112 Further I find it more likely if Ms Ekanayake had indeed executed a mortgage document on the same day upon which she had executed an enduring Power of Attorney, she would have been able to remember that both of those documents had been signed by her when she was present in Australia.
113 Given that the evidence establishes that the pro forma mortgage documents were not created until April 2016 it is clear that the mortgage documents dated 19 January 2016 were backdated so as to suggest that they were executed approximately 3 months prior to the date they were prepared by Ms Nanayakara.
114 The balance of the evidence relevant to the timing of the execution of the Exhibit 11 document does little to establish the assertion by the applicant that it was either executed or delivered to him prior to the date upon which the restraining order was made in this instance.
115 In the course of her evidence Ms Naneyakara said:
(i) that she is a solicitor who provides locum services to Mr Thomas Egan, including property law services and in that capacity on 15 April 2016 she engrossed a Mortgage and a Deed of Guarantee and Indemnity which she gave to Mr Egan who provided them to Mr Judd to have them executed; and
(ii) that on 29 April 2016 both she and Mr Egan examined a mortgage document provided by Mr Judd for approximately 15 or 20 minutes[57] and having completed the examination they both agreed that the document did not appear to contain an original signature, the result being that they informed Mr Judd that he needed to produce the original to them.[58]
[57] It is not an issue that the document the subject of this examination was dated 19 January 2016 and is Exhibit 9.
[58] T134 L6.
116 It is not an issue that the document the subject of this examination was dated 19 January 2016 and is Exhibit 9.
117 I accept the evidence by Ms Naneyakara that her examination of Exhibit 9 which she undertook with Mr Egan caused them both to reject that document and I am satisfied on the basis of that rejection that the document is not an original document.
118 In making that finding I do so having no reason to doubt the opinion of these two witnesses as to the validity of that document.
119 Given the absence of any note, however, as to the timing of that examination and no explanation as to how the date of that examination might be fixed in the absence of the presence of a note I am not satisfied that the evidence establishes the date of the rejection of Exhibit 9 with sufficient specificity.
120 Ms Naneyekara said that she subsequently saw a second document which both she and Mr Egan were satisfied was an original document and that this document was seen by her on the 28th or 29th of June.[59] There is no issue that this document was also dated 19 January 2017 and that the document is Exhibit 10.
[59] T137 L13. There is no issue that this is Exhibit 10.
121 Having examined Exhibit 10 and Exhibit 11 it appears to me that Exhibit 10 is a photocopy as the typeface is smaller than the typeface in Exhibit 11. Both the signatures in Exhibit 10 appear to me to be photocopies rather than original signatures.
122 In the absence of any expert evidence as to the probity of Exhibit 10, notwithstanding the opinions expressed by Ms Naneyakara and Mr Egan to the contrary, I am not satisfied that Exhibit 10 bears original signatures.
123 Whilst it appears to me that Exhibit 10 to likely to be a photocopy of Exhibit 9 it is not necessary that I make any finding as to that issue.
124 Having examined Exhibit 11, I accept the position that the appearance of Exhibit 11 is consistent with the document being an original document. In the absence of expert evidence as to that issue however, I am not satisfied that I should make a definitive finding as to that issue.
125 Ms Naneyakara gave evidence that on the morning of 29 June 2016 she had made a note that Mr Judd wished to have a caveat lodged that day which would have priority over any other lodged caveat “…today or tomorrow… ‘He will get Thilini… to sign another mortgage and have it witnessed and email to us …’ ”[60].
[60] T138 L16-20 (emphasis added).
126 This statement makes it clear that as at the morning of 29 June 2016 Mr Judd was not in possession of an original mortgage and that he had not provided Mr Egan with a mortgage which Mr Egan was satisfied contained original signatures.
127 The note by Ms Naneyakara makes it clear that the production of Exhibit 10 occurred after the above mentioned conversation with Mr Judd which she described in her evidence as occurring between 11.30am and 12.47pm.[61]
[61] T139 L23-28
128 It follows that prior to that time Mr Judd was not in possession of Exhibit 10.
129 Further, given that as at 29 June 2016, Ms Ekanayake was in Sri Lanka, it is clear that Mr Judd could not have obtained an original document from her which he could produce to Mr Egan on 29 June as that document would have been a copy of any mortgage signed by Ms Ekanayake, that day, in Sri Lanka.
130 In the course of the evidence given by Ms Ekanayake during her examination on 11 September 2017, she gave the following evidence as to the date upon which she signed the various mortgage documents:
Now let me ask you about this mortgage document when do you say you signed it?
I do not remember Sir.
Well tell the senior member of the month in which she signed it.
Mortgage document for Britten Street?
The mortgage document for your home in Glen Iris.
Britten Street
…
How many mortgages have you signed for, for that property?
That is the one I’ve for, as I remember.
When did you sign it?
2016, in April if I am not mistaken.
April 2016, is that right?
I am not 100 percent sure.
That is the best you can do is it? April 2016?
Or June when it was settled-going to be settled.
June 2016?
Yes.
Where were you when you signed the document?
I was in Shri Lanka.
You were in Sri Lanka in June 2016 when you signed the mortgage document, is that correct?
Yes.
It had been emailed to you, is that right?
It has been emailed to me, yes
Who emailed it to you?
Claudia Lianage, from Australia
…
And she emailed to you the form of mortgage whilst you were in Sri Lanka in June 2016?
Yes. [62]
[62] P44 L14- P45 L2 of the evidence given on 11 September 2017.
No. You signed it and you scanned it and you emailed it back to your husband, correct?
Yes.
So the original version that you signed, where is that original version today?
I brought it back with me.
You brought the mortgage, did you from Sri Lanka?
The original-sorry the original document the one that I signed I brought it back with me.[63]
[63] P46 L40- 47 of the evidence given on 11 September 2017.
And further:
You signed two versions of mortgages in favour of Dileshwah Judd, didn’t you in 2016?
Yes
When did you sign the second one in favour of Dileshwah Judd?
I don’t remember. It was either April or June
Either April or June 2016?
Yes
You gave evidence a few minutes ago of signing it in June 2016 while you were in Sri Lanka, correct?
Yes
So the second one could not have been signed in April, could it, before you signed the first one, correct?
What I’m still trying to determine is whether I actually signed the mortgage document in June before that, Sir. I’m just trying to see if I can recall that sequence…
…
You’ve given evidence of having received an email with the mortgage attached to it, correct?
Yes.
You were in Sri Lanka at that time, correct?
Yes.
in June ? I was in Sri Lanka yes.
And you signed it and you’ve scanned it and you emailed the signed scan back to Australia, correct?
Yes.[64]
[64] P48 L4- 31 of the evidence given on 11 September 2017.
In the course of her evidence Ms Ekanayake was taken to Exhibit 11, the mortgage dated 21 April 2016, and the following questions were asked:
Now there is a second version of the document which we’ll give you now which has another date on it. We’ll give you that one now. This one Ms Ekanayake, again has been countersigned by what looks like the same person, although her name is not written there. Do you recognise Claudia Liyange’s signature?
Yes
And do you confirm that appears to be her signature?
Yes.
Now you have signed two versions of mortgages or has this second version in fact been created from the same document that you email back from Sri Lanka?
There was a second one.
There was a second one. When was it created?
I can’t recall Sir, sorry.
Well do your best please
Okay.
Was it in 2016 or was it later?
2016.
So it was after June 2016, wasn’t it?
Yes. Do you recall when it was created in 2016 after June?
I think in the same month it has to be the same month of June because I don’t recall anything in July or August when I came back.
It was also created in June 2016 was it? Two versions of the mortgage in the one month, is that correct?
That is my understanding.
And did you receive this also by email in Sri Lanka?
Yes.
Who sent you the email?
Claudia.
Claudia did?
Yes[65]
[65] JCB Tab24 page49 L4-L35.
…
Who had told you to expect it?
My husband.
When did he tell you that?
Just before it was sent.
In June 2016?
Yes
What did he say to you?
That she’ll be sending the document.
Did he tell you why she would be sending the document?
Yes because of the settlement that we have to do to Judd and the involvement in relation to the settlement that we have to make for Judd we have an amount owing to him and that’s why we are mortgaging the house. So I knew the circumstances for it, leading up to it.[66]
[66] JCB Tab24 page 50 L16-L28.
131 I am satisfied that this passage of evidence establishes that:
(i) Exhibit 11 was signed by Thilini Ekanayake while she was in Sri Lanka most probably after she signed a mortgage dated 19 January 2016 the original of which has never been produced;
(ii) Two versions of the mortgage document were created by Ms Ekanayake while she was in Sri Lanka; and
(iii) Ms Ekanayake brought the original mortgage documents back to Australia with her on 28 August 2016.[67]
[67] See the evidence at JCB Tab 24 p 46 L 45-6 in conjunction with p 47 l20-25 T45, L15; T49, L30.
132 Whilst Ms Ekanayake maintained her position that it was probable that she signed the relevant mortgages in June, I find that evidence given by her, when considered in the context of the totality of her evidence, to be no more than merely guesswork on her part and for that reason I am not satisfied that the date upon which any mortgage was signed by her has been fixed with any degree of persuasive precision.
133 Given:
(i) the file note made by Ms Naneyakara on the morning of 29 June 2016 which I am satisfied records an admission by Mr Judd that he was not in possession at that time of any mortgage other than that which is Exhibit 9; and
(ii) the nebulous evidence of Ms Ekanayake as to the date upon which she signed a mortgage document which is made more uncertain having regard to the file note dated 29 June by Ms Naneyakara
I am not satisfied that the applicant has identified the precise date upon which any mortgage relied upon by him in support of his asserted equitable interest was actually signed.
134 Given the evidence by Ms Ekanayake as to the date upon which she signed Exhibit 11, namely in June while she was in Sri Lanka, I reject the position put on behalf of the applicant that:
· Exhibit 11 was in fact created on the date which it bears, namely 21 April 2016, and that it was signed by Ms Ekanayake before she left Australia for Sri Lanka; and
· Exhibit 11 was somehow misplaced which thereafter led to the creation of the originals of Exhibits 9 and 10 which bear a date earlier than the mortgage which it is asserted they were created to replace.
135 I am further satisfied that the original of Exhibit 11, and most probably Exhibit 9, most probably found their way to Australia after the making of the restraining order, namely when they were brought back to Australia by Ms Ekanayake.
136 There is no issue that on 8 July 2016 Mr Mendez certified a copy of the original Exhibit 11, namely the mortgage document dated 21 April 2016.
137 Mr Mendez was not called to give evidence and I find myself presented with yet another unexplained contradiction in dates which arises by reason of the evidence of Ms Ekanayake as to the date upon which she signed Exhibit 11 and its purported sighting by Mr Mendez.
138 Given the conflict in the evidence as to this issue, and the absence of any evidence from Mr Mendez, I am not satisfied that I should regard the certification by Mr Mendez as being probative given:
(i) the history of the production of photocopies of mortgage documents which were presented as being originals; and
(ii) the possibility that Mr Mendez may have made the same mistake in examining Exhibit 11 and attesting to its authenticity as Mr Egan made when examining Exhibit 10 and attesting to its authenticity.
139 In paragraph 24 of his second affidavit Mr Judd states that he produced to Mr Mendez the original of Exhibit 11 on 8 July 2016 and thereafter produced the original and certified extract to Mr Egan. He does not however attest to the date of the production of those documents to Mr Egan.
140 Given:
· the alleged preoccupation of Mr Judd to gain possession of a valid mortgage document as set out in each of his affidavits; and
· his production of a mortgage document dated 19 January 2016 to Mr Egan which is rejected by him as not being valid;
there is good reason to think that Mr Judd would have made available to Mr Egan any mortgage document in his possession which he considered to be an original and thus valid document as soon as it came into his possession.
141 In the course of his evidence on 28 September 2017 Mr Egan was questioned as to when he first saw the document certified by Mr Mendez on 8 July 2016.
142 The passage of evidence below satisfies me that Mr Judd first produced to Mr Egan the document certified by Mr Mendez months after Mr Judd became aware of the existence of the restraining order, probably in or after October 2016:
[Mr O’BRYAN:] Now let‘s get this clear, the document which I’ll show you now dated 21 April 2016, when did you obtain that document?---I obtained that after the commencement of my client’s application in the County Court. I believe after the commencement of my client’s application, some 12 months ago in the County Court. In a call to my client to produce everything, howsoever remotely relevant, that he may have in relation to these dealings.[68]
[68] JCB Tab 26, page 4 lines 30 – 35.
...
When did it come to you?---I’d have to work from memory. I believe after the commencement of that proceeding and in the context of me asking my client for all documents and if I – now that you ask that question, I think it may have been in response to the direction to my client to produce all of his documents to the – to the AFP and a copy was certainly provided to the AFP, this original. When I received my notice to produce all documents, this is an original which is on my file and it is brought in. Some documents have dribbled in over time. This is a document that the client has brought in. It has come in at the same time as the certified copy of the same document which is certified from memory by the solicitor Mendis on 8 July 2016, 2016. So it’s certainly sometime after that date.
What month did this happen?---What month? What month could what be happening, sorry?
What month did you receive the document?---Well, I don’t recall exactly when I received the document, except that it was certainly after the date of the – of the certification by that other solicitor, and to the best of my recollection, after the commencement of the application by my client in October 2016.[69]
[69] JCB Tab 26, page 5 lines 10 – 29.
143 In my view the delay which occurred between the alleged production by Mr Judd of this original document to Mr Mendez and its subsequent production by Mr Judd to Mr Egan, is totally inconsistent with Mr Judd believing the document to be probative in any way to his entitlement to make a claim with respect to the Property.
144 Even though I have little faith in the overall veracity of Ms Ekanayake for the reasons I have earlier expressed, I am satisfied that she had no reason to lie as to the date upon which she signed the relevant mortgage documents or the date upon which the original of those documents returned with her to Australia. For these reasons I prefer her evidence on that issue to the untested evidence of Mr Mendez.
145 It follows, on the basis of my finding above that Exhibit 11, if it is an original document, must have come into the possession of the applicant after the date upon which he became aware of the restraining order, namely on or about 20 July 2016.
146 For the reasons which I will develop in due course however, even if I were to be mistaken as to my reasoning above I am satisfied that it is likely that the applicant became aware of the existence of the restraining order well before 20 July 2016 and in reality shortly after the date upon which was made.
147 I make that finding for the reasons set out below.
When did Mr Judd first become aware of the making of the restraining order
148 There is an extraordinary coincidence in timing between:
(i) the making of the restraining order of 4 June 2016; and
(ii) the incorporation of JD Investment Pty Ltd some three days later on 7 June 2016, in which Mr Judd was the sole director, company secretary and shareholder, which in turn received income identified by Mr Judd as involving hundreds of thousand dollars[70] from the operation of BPO Connect, one of the companies controlled by Mr Samarakoon.
[70] T107L 22 – 24.
149 At first glance, such a coincidence in timing suggests that the two are related and that the motivation behind the incorporation of the company JD Invest and the appointment of Mr Judd to the various positions he held was the combination of:
(i) the making of the restraining order; and
(ii) an attempt to insulate the assets of Mr Samarakoon from the effects of that order.
150 Given the email correspondence passing between Mr Judd and Mr Samarakoon relevant to not only the activities of JD Invest but also the movement of assets from the companies in which Mr Samarakoon had an interest to JD Invest, when considered in the context of the previous findings I have made, I do not accept the evidence of Mr Judd:
(a) that there was no relationship between he and Mr Samarakoon other than that of borrower\lender; or
(b) that he declined to be a party to the deceitful behaviour suggested by Mr Samarakoon in the emails to which I have previously referred.
151 I make that statement given:
· the responses to the emails addressed by Mr Samarakoon to Mr Judd which confirmed his willingness to engage in the various dubious financial activities suggested by Mr Samarakoon to which I have previously referred; and
· the absence of any independent evidence to support the assertions by Mr Judd in the course of his evidence that he had indicated his intention not to be a willing participant to those activities.
152 It is put on behalf of Mr Judd that his attendance upon the office of his solicitor on 20 July upon receiving a phone call which alerted him to the fact that a restraining order had been made supports the position that he first became aware of the making of the order on that day.
153 I am not satisfied that the behaviour of Mr Judd on 20 July is anything more than that which might be expected of a dishonest man seeking to create support for a fictitious assertion that it was not until he was notified by his solicitor on 19 July that he became aware of the existence of the restraining order.
154 The fact that Mr Judd attended the offices of his solicitor on one about that date July 2016 is not corroborated by independent evidence which I would have expected, namely some file note or the evidence of Mr Egan.
155 Given the timing of this attendance which is relied upon by Mr Judd as fixing the date upon which he first became aware of the restraining order, the failure to adduce corroborative evidence is in my opinion a significant one in respect of which the appropriate adverse inference should be drawn.
156 In any event even if such an attendance did take place I am not satisfied that it would be at all beyond Mr Judd to feign surprise to Mr Egan in order to seek to establish some corroboration for the fact of his awareness of the restraining order so as to ensure that that awareness post-dated his access to the original mortgages which had still not made their way from Sri Lanka to Australia in the hands of Ms Ekanayake.
157 Given the lack of reliability of Mr Judd, when considered in the context of the self-interest which Mr Judd has in establishing that a valid mortgage was signed prior to the date upon which he had actual notice of the making of the restraining order, I am not satisfied that I should accept this evidence as being probative of the date upon which Mr Judd first became aware of the existence of the restraining order.
158 In reality I am satisfied that it is probable that Mr Judd would be prepared to say anything in evidence which he considered necessary to assist him in establishing his case in this instance notwithstanding that in doing so he would be required to lie.
159 Independently of what I have referred to as the extraordinary coincidence in timing as to the incorporation of JD Invest, the history of the relationship between Mr Judd and Mr Samarakoon as established by the emails which passed between them on a regular basis during 2016 gives rise, in my opinion, to strong bases upon which to make an inferential finding as to the timing of the date upon which Mr Judd first became aware the restraining order.
160 For the following reasons I am satisfied that it is likely that Mr Judd became aware of the making of the restraining order very shortly after Mr Samarakoon became aware of its existence:
(i) firstly, the timing between the issuing by the Australian Tax Office of its 23 March 2016 notice and the chain of emails passing between Mr Judd and Mr Samarakoon suggest that Mr Samarakoon had a tendency to advise Mr Judd of issues which might affect his access to his assets within a very short time of those issues arising;
(ii) secondly, the timing of the raid upon the premises of Mr Samarakoon on 20 May 2016[71], when considered in the context of:
[71] PCB Tab 76
a) the email addressed by Mr Samarakoon to Mr Judd and his wife Ms Ekanayake on 22nd May 2016 in which Mr Samarakoon raises the prospect of relocating to Singapore[72]; and
[72] PCB Tab 64
b) the emails addressed by Mr Samarakoon to Anne-Marie Cade and Mr Judd on 29 May 2016 in which Mr Samarakoon instructed Ms Cade to prepare documentation attesting to a fictitious loan executed between himself and Mr Judd in the sum of $1,600,000;
suggests that Mr Judd was an intimate confidant of Mr Samarakoon and that the latter wasted no time in updating Mr Judd of impending changes in his financial plans;
(iii) thirdly, the timing between the issuing of the restraining order on 3 June 2016 and the incorporation of JD Invest some 3 days later appears to be a repetition of the behaviour of both Mr Judd and Mr Samarakoon when the latter had been presented with the March 2016 ATO letter; and
(iv) fourthly, the power which Mr Judd is the sole director of JD invest allowed Mr Samarakoon to exercise in the operation of that company which caused the administrator to describe Mr Samarakoon is acting as a director of the company[73].
[73] See exhibit 4- the report by the Administrator of JD invest dated 17 August 2016
161 The above pattern of behaviour in my view makes it extremely likely that Mr Samarakoon would have wasted no time in consulting Mr Judd upon the gathering of “storm clouds” which might affect the former’s financial independence.
162 When that behaviour is considered in the context of the level of business and personal relationship which existed between Mr Judd and Mr Samarakoon, which is evidenced by the repeated emails authored by Mr Samarakoon to Mr Judd to which I have referred earlier, I find it to be extremely likely that:
· Mr Samarakoon would have wasted little time in advising Mr Judd of the existence of the restraining order; and
· Mr Judd most probably knew of the existence of the order well before he attended his solicitor’s office on the morning of 29th June 2016, to which I have referred earlier, when he was clearly not in possession of a valid mortgage.
163 I make that finding given the synergistic effect of the combination of the above factors upon the likelihood of Mr Samarakoon making known to Mr Judd the existence of a restraining order which would stymie his ability to deal with his assets, without delay upon the making of that order.
164 I make such a finding being satisfied that I should be cautious in arriving at such an inferential finding and that I should not do so unless I am satisfied that the Briggenshaw standard has been satisfied.
Conclusion
165 It follows for the reasons set out above that:
(i) I am not satisfied that the applicant has established that he entered into the loan agreement alleged by him with Mr Samarakoon, which in turn was the basis upon which his entitlement to the mortgage with respect to the property was founded;
(ii) I am not satisfied that the applicant has established that the only relationship between he and Mr Samarakoon was that of lender and borrower;
(iii) I am satisfied that the applicant was a confidant of Mr Samarakoon and by reason of that relationship was aware of the making of the restraining order within a short time of the order being made;
(iv) I am not satisfied that the applicant has established the date upon which Ms Ekanayake signed a mortgage with respect to the property;
(v) I am not satisfied that the applicant has established that he ever came into possession of a valid mortgage document with respect to the property;
(vi) Even were the evidence to be such as to establish that the applicant came into possession of a valid mortgage document, I am satisfied that the he could not have done so prior to 28 August 2016 when Ms Ekanayake returned to Australia from Sri Lanka, well after the date upon which the applicant was aware of the making of the restraining order.
166 For the reasons set out above I am not satisfied that the applicant is entitled to the order he seeks in this application.
167 I will hear the parties as to the order which I should make in this instance, and also as to costs.
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