Tjiong v Tjiong - [2010] NSWSC 578

No judgment structure available for this case.

CITATION: Tjiong & Anor v Tjiong [2010] NSWSC 578

HEARING DATE(S): 1 to 16 June and 14 to 18 December 2009

JUDGMENT DATE :
4 June 2010

JURISDICTION: Equity Division

JUDGMENT OF: Palmer J

DECISION: Declaration that Plaintiffs’ consent to establishment of trust procured by fraudulent misrepresentation; finding that Defendant fabricated evidence; costs to be argued.

CATCHWORDS: TRUSTS – FRAUD – PERJURY – Whether Plaintiffs’ consent to establishment of trust under control of Defendant procured by Defendant’s misrepresentation – whether Defendant fabricated evidence in support of his case.

LEGISLATION CITED: - Civil Aviation Act 1988 (Cth) – s 8
- Crimes Act 1900 (NSW) – Pt 7 Div 4
- Trustee Act 1925 (NSW) – s 70, s 85
- Wills Probate and Administration Act 1898 (NSW) – s 93

CATEGORY: Principal judgment

CASES CITED: - Black v Lipovac (1998) 217 ALR 386
- Briginshaw v Briginshaw (1938) 60 CLR 336

PARTIES: Katrina May Lan Tjiong (First Plaintiff, First Cross Defendant)
Lindsay Kuang Djin Tjiong (Second Plaintiff, Second Cross Defendant)
Richard Tat Tjhien Tjiong (Defendant, Cross Claimant)

FILE NUMBER(S): SC 2005/257959

COUNSEL: M.B. Evans, C. Lambert (Plaintiffs, Cross Defendants)
P. Hallen SC, J. Millar (Defendant, Cross Claimant)

SOLICITORS: O’Brien Lawyers (Plaintiffs, Cross Defendants)
Diamond Conway (Defendant, Cross Claimant)

2005/257959 Tjiong & Anor v Tjiong

JUDGMENT

4 June, 2010

Introduction

1 The Plaintiffs, Katrina and Lindsay Tjiong, are the only children of the late Dr George Tjiong, the brother of the Defendant, Dr Richard Tjiong. For the sake of convenience and without intending disrespect, I will refer to members of the Tjiong family by their first names.

2 On 23 December 2001 George, who was seriously ill with cancer, executed a will appointing Richard as his executor and leaving the whole of his estate equally to Katrina and Lindsay. Two days later, George suffered a massive stroke during surgery. He survived but was seriously incapacitated and was unable to deal with his financial affairs. Pursuant to an enduring power of attorney which had been executed by George on 29 March 1996 in favour of Richard and Katrina jointly and severally, Richard took over management of George’s investments.

3 On 15 December 2003, a trust deed was executed between Richard Tjiong’s wife, Kathryn, as settlor and Maroka Pty Ltd (“Maroka”) as trustee establishing the George Tjiong Family Trust as a discretionary trust (“Family Trust”). The directors of Maroka were Richard, Katrina and Lindsay. Using the power of attorney executed in 1996, Richard transferred assets of George into the Family Trust. The value of those assets was about $1.3M. Those assets would have formed part of George’s deceased estate, and would have passed under George’s will to Katrina and Lindsay. The assets left in George’s estate were worth between $700,000 and $1M. Katrina and Lindsay gave their consent to the transfer of assets into the Family Trust and they executed the Trust Deed as directors of Maroka. The beneficiaries of the Family Trust were George, Katrina and Lindsay and three sisters and one brother of George, Harry. The trustee had a discretion to appoint capital and income between the discretionary beneficiaries.

4 On 30 January 2004 George died.

5 By early April 2004, discord began to arise between Katrina and Lindsay on the one hand and Richard on the other as to the management and distribution of funds in the Family Trust. Richard wanted George’s brother and sisters to receive part of the capital because, he said, they had helped care for George during his last illness. Richard referred to the brother and sisters as “carers”. Katrina and Lindsay were not convinced that the carers had rendered any particular services to George worthy of financial recognition and they wished to have the Trust Fund distributed to them alone.

6 The discord escalated into open hostility. Katrina and Lindsay insisted on receiving money from the Family Trust. On 9 April 2004, with great reluctance, Richard gave each of them a cheque for $100,000 drawn by Maroka but post-dated to 22 April 2004.

7 On 14 April 2004 Richard, in exercise of the powers conferred upon him as appointor under the Family Trust Deed, removed Maroka as trustee and appointed himself as sole trustee. On the same day Katrina and Lindsay were requested to return the cheques for $100,000 given to them on 9 April. Katrina and Lindsay sought legal advice.

8 On 21 April 2004, according to Richard, he received a telephone call from a Mr Johnson who foreshadowed a large medical negligence claim against George’s estate. On 30 April 2004, Richard’s solicitor, Mr Peter Thornton, then a partner of Ebsworth & Ebsworth, received a letter from Rod Johnson foreshadowing a medical negligence claim against George made on behalf of Mr Johnson’s fourteen year old stepson, Kevin. Richard took the position that no distribution to Katrina and Lindsay could be made from George’s estate or from the Family Trust until the medical negligence claim by Mr Johnson on behalf of Kevin had been finally resolved.

9 Between 30 April 2004 and 29 May 2009 a further six letters were received by Richard’s solicitor or Katrina sent by Rod Johnson or Sharon Reeves, the mother of Kevin, vacillating as to whether the medical negligence claim would proceed. The foreshadowed claim was completely bogus – as Richard now concedes. There never was a Rod Johnson, Sharon Reeves or Kevin Reeves.

10 On 11 February 2005, Katrina and Lindsay commenced these proceedings. They sought:

– an order setting aside the Family Trust Deed so that the assets of the Trust Fund revert to George’s estate to be dealt with in accordance with his will;

– alternatively, an order removing Richard as trustee and appointor of the Family Trust and appointing Katrina and Lindsay in his place;

– an order revoking grant of probate of George’s will to Richard and granting Letters of Administration with the will annexed to Katrina and Lindsay;

– consequential orders for the transfer of assets;

– orders requiring Richard to make restitution to the Family Trust Fund for the costs of establishing the Fund and for the legal costs incurred by the Trust estate in dealing with the bogus Kevin Reeves claim;

– declarations that Richard, in investing or failing to invest assets of George’s estate under the enduring power of attorney and later as trustee of the Family Trust committed breaches of trust resulting in loss to the estate;

– orders for equitable compensation to the estate accordingly;

– a declaration that a distribution of $134,945.78 made from the Family Trust on or about 18 February 2005 was made in breach of trust and an order for restoration to the Fund accordingly;

11 The essence of the Plaintiffs’ case for setting aside the Family Trust Deed or for the removal of Richard as trustee and appointor is an allegation that in consenting to the establishment of the Family Trust and to the transfer of the assets of George’s estate to that Trust, Katrina and Lindsay relied upon statements fraudulently made to them by Richard during December 2003 to the effect that:

– if George died, his estate would be liable for a huge tax bill assessed according to the value of the estate, but if the assets of the estate were transferred to a trust before George’s death, the tax liability would be avoided;

– their rights in respect of George’s assets under the Family Trust Deed would be effectively the same as under George’s will;

– the inclusion of some other family members as beneficiaries under the Trust Deed did not matter because Lindsay and Katrina would be the majority directors of the trustee company, Maroka, and their decision as to what benefit should be conferred on other family members would prevail;

12 As additional grounds for setting aside the Family Trust Deed or removing Richard as trustee and appointor, Katrina and Lindsay alleged undue influence or unconscionable conduct on the part of Richard in procuring their consent to the establishment of the Family Trust.

13 The essence of the case for restoration to the Family Trust Fund of all legal costs incurred by the trust estate in dealing with the bogus Kevin Reeves claim is the allegation by Katrina and Lindsay that the letters sent by Rod Johnson and Sharon Reeves were in fact written, or procured to be written, by Richard himself for the purpose of making it appear that a substantial claim was threatened against George’s assets which would prevent distribution of those assets to Katrina and Lindsay so that the assets would remain under the control of Richard.

14 The essence of the case for equitable compensation to the Trust Fund for breach of Richard’s duty to act prudently as a trustee in investing the trust funds is that Richard realised income producing or growth assets and left the proceeds in interest bearing deposits rather than investing them in other growth assets or other assets producing a better income return.

15 The case for the restoration to the Trust Fund of $134,945.78 is that in January 2005 Richard procured the payment out of the Trust Fund of that amount to the “Oninama Charitable Foundation”, which was in fact a discretionary trust fund for the benefit of Richard’s mother and that neither that discretionary trust nor Richard’s mother was a beneficiary under the Family Trust Deed.

16 By his Defence Richard denied the making of certain representations to Katrina and Lindsay. He asserted that the representations which he had made to them concerning George’s wishes for the establishment of a trust fund were true, notwithstanding the unqualified terms of George’s will. He opposed all relief sought.

17 However, by his Cross Claim, Richard sought relief under s 85 Trustee Act 1925 (NSW) in the event that he was found to have committed a breach of trust, on the ground that he had acted honestly, reasonably and ought fairly to be excused. Further, he sought an order that Perpetual Trustee Limited be appointed as trustee of the Family Trust if the Court considered it in the interests of the beneficiaries to do so.

18 On the third day of the trial Mr Hallen SC, who appears for Richard with Mr Millar of Counsel, informed the Court that Richard might be willing to resign the trusteeship of the Family Trust in favour of an entity controlled by Katrina and Lindsay. He said that Richard was defending the proceedings, not to retain control of the trust assets for himself, but because of the allegations of fraud and dishonesty which had been made against him. There was also the question of the very substantial amount of legal costs which had been incurred.

19 On the ninth day of the trial, 16 June 2009, Mr Hallen SC advised that Richard was ill and was in hospital so that his cross examination could not proceed. The trial had been listed to continue for the remainder of that week. The following day the proceedings were adjourned, part-heard, to a date in December and the following consent orders were made:

– pursuant to s 70 Trustee Act Katrina was appointed as trustee of the Family Trust and of the Oninama Charitable Foundation in the place of Richard;

– the grant of probate of George’s will to Richard was revoked and Katrina was appointed administrator of the estate with the will annexed;

20 Pursuant to the consent orders, Richard resigned as Appointor under the Family Trust Deed and Katrina and Lindsay gave undertakings to the Court that, pending the making of costs orders in these proceedings, they would not dispose of the assets of the Family Trust and of George’s estate. In short, full control of the Family Trust and of George’s estate was given to Katrina and Lindsay, subject only to the effect of the costs orders to be made.

21 The only relief which Katrina and Lindsay now seek is:

– a declaration that the consent given by Katrina and Lindsay to the establishment of the Family Trust was obtained by fraud or the wrongful exercise of undue influence or unconscionable conduct on the part of Richard;

– an order that Richard pay to the family trust an amount equal to all legal and other costs incurred by the Family Trust in connection with the Kevin Reeves claim, including the costs of proceedings 112652 of 2006 in this Court, whereby such claim was barred under s 93 Wills, Probate and Administration Act 1898 (NSW);

– an order that Richard deliver to Katrina as trustee of the Family Trust and administrator of George’s estate all of George’s assets, books and records;

– a declaration that the payment out of the Family Trust of $134,945 to the Oninama Charitable Foundation was made in breach of trust;

22 The declaration as to the establishment of the Family Trust, if made, requires no consequential order in terms of the administration of the Trust as Katrina and Lindsay now control the Trust. The declaration is sought as a foundation for a costs order against Richard on the indemnity basis. In short, Katrina and Lindsay say that, notwithstanding the consent orders ultimately made, they were compelled to bring these proceedings and that the conduct of Richard, both that which led to the commencement of the proceedings and his conduct of the proceedings thereafter, is such as to warrant an indemnity costs order.

23 The declaration as to the payment to the Oninama Charitable Foundation is sought in order that Katrina, as trustee of that trust, may properly repay the money to the Family Trust.

24 The orders relating to the Kevin Reeves claim require fact findings as to whether Richard wrote, or procured the writing of, the Kevin Reeves letters in order to prevent distribution of the Family Trust Fund and of George’s estate to Katrina and Lindsay.

25 Whether the allegations of fraud made against Richard are substantiated obviously has major cost consequences. If the allegations are unjustified, the cost consequences may be adverse to Katrina and Lindsay; if they are justified, the cost consequences will be adverse to Richard.

26 It is to be noted that Katrina and Lindsay no longer seek the relief founded on allegations of breach of trust by Richard in investing, or failing to invest, assets of George’s estate and assets of the Family Trust. Those allegations occupied many pages of the Amended Statement of Claim and a considerable amount of evidence was tendered in support and in opposition, although the issue occupied very little Court time. The cost consequences of the abandonment of these claims will have to be worked out after the issues to be considered in these reasons have been determined.

Family background and context

27 It is necessary to give some family background in order to understand the issues.

28 The Tjiong family, which is Chinese, comes from Indonesia. George, the second of nine children, was sent by his parents to Australia to study. He arrived in 1948, completed his secondary education and graduated in medicine from the University of Sydney in 1961. After working in hospitals for a few years, George established a general practice as a sole practitioner in Victoria in 1964. He married Margaret in 1962 and there were two children of the marriage, Katrina, born in 1963 and Lindsay, born in 1966. George and Margaret divorced in 1984.

29 Richard was born in Indonesia in 1942. He came to Sydney in 1957, completed secondary school and graduated in medicine in 1964. He worked in hospitals in Sydney and in England while he pursued his studies further. Richard married Kathryn in 1968. He became a Fellow of the Royal College of Surgeons Edinburgh in 1969. From 1971 to 1997 he conducted a private practice as an ear, nose and throat specialist at Taree.

30 Richard studied law and passed his law exams in 1991. He has never held a practising certificate.

31 Richard has been deeply involved with medical negligence insurance and medical defence for many years. He joined the Council of the New South Wales Medical Defence Union in 1986; he was chairman, from 1993 to 1997. He was founder and chairman of Australian Medical Insurance Ltd from April 1989 to June 2001 and of United Medical Protection Ltd from July 1997 to June 2001.

Issues of credit

32 The issue of credit has always been at the forefront in this case:

– Katrina and Lindsay say that they were induced to agree to the establishment of the Family Trust by Richard’s false representation as to the tax consequences for George’s estate if the Trust were not established, and by Richard’s false representation that George, when making his will of 23 December 2001, had told Richard that he wished Richard to establish the Trust;

– Richard denies making any representation about tax consequences for George’s estate and says that it is true that George made statements to him about wishing to establish the Trust;

– Katrina and Lindsay say that Richard wrote the Kevin Reeves letters in order to prevent distribution of the Family Trust Fund and of George’s estate to them by making it appear that those funds might have to be called upon to answer a large negligence claim;

33 The assertions of Katrina and Lindsay as to what Richard said to them are uncorroborated by contemporaneous documents. Much of what Richard asserts is supported by voluminous notes by him, said to be contemporaneous, and other records, said to be contemporaneous, such as a pilot’s log book.

34 Katrina and Lindsay say that these contemporaneous records have been fabricated by Richard for the purpose of misleading the Court in this case.

A fabricated pilot’s log book

35 I will begin with the most serious allegation of fabrication: that Richard has fabricated entries in a pilot’s log book for the period beginning 27 July 1984 (Exhibit D6(2)).

36 Richard gained a Restricted Private Pilot’s Licence in August 1977 and an Unrestricted Private Pilot’s Licence in January 1978. He purchased a private plane in 1979, a Beechcraft 358, which he sold a few months after 26 March 1996 – a date which has become of critical importance in the proceedings.

37 In her affidavit of 9 February 2005, Katrina explained the circumstances in which George gave an Enduring Power of Attorney to Richard and to her. She said that George, who was then living in Melbourne, suffered a stroke on 20 March 1996 and was taken to hospital. On 27 March, Richard came to Melbourne and she went with him to see George in hospital. She said that George could not speak properly. He could respond to others by nodding or shaking his head and could speak some words. After the visit she says that Richard suggested that George execute a Power of Attorney. On 29 March 1996, George executed the Power of Attorney which had been prepared by a solicitor instructed by Richard.

38 In his affidavit of 5 October 2005, Richard denied this account of events. He said that on 26 March 1996 he flew from Taree to Melbourne and went on his own to see George in hospital. He gave this evidence:

“On the morning of Tuesday 26 March 1996, I flew from Taree to Sydney Kingsford Smith Airport, in time to connect with Ansett to Melbourne. I proceeded from the Melbourne airport directly to Austin & Repatriation Medical Centre and saw George in the far right hand corner (as I walked in) of a four-bed ward. The curtain was partly drawn. I observed that he was lucid, able to recognise me readily and able to engage in meaningful conversation. He had some slurring of speech, but could speak well enough for me to communicate with him, he had some mild facial weakness on one side and weakness in his right arm. I saw that he was able to walk.

…

In George’s presence, I spoke to the doctor in charge of his care with words to the effect: ‘Doctor, I am George’s brother. I am an ear nose and throat surgeon, and I flew in from Taree in northern NSW this morning. How is George?’

She replied with words to the effect: ‘As you know George is a diabetic. As you could see, he has had a mild CVA [stroke]. We think it is in his left subcortical involving the left middle cerebral artery. With treatment his prognosis is good. But George does not want specific treatment. He seems to have given up on life.’ The doctor then described to me the specific treatment she had in mind.

I spoke to George and we had a conversation in words to the following effect: ‘You know that you had a mild CVA. Your doctor confirmed that your prognosis is good. With treatment and a bit of rehab, we expect that you will probably live a relatively normal life – you may even be able to go back to some medical practice. But I think that you should consider retiring and move to Sydney. There are more of us in the family there. You will be not so lonely in Sydney.’

George said: ‘I’m not giving up my medical practice so I won’t be moving in the near future.’

I said: ‘Then make sure you accept medical treatment, and also make sure you have medical insurance.’

George said words in Indonesian to the effect: ‘Sure, but I want you to promise me that in the event I develop a complication or further stroke at any time in the future, you make sure that no one makes any medical intervention. I want you to let me die.’

At around the same time, he asked me with mixed Indonesian and English words to the effect: ‘Under the circumstances, I think I should get you to hold a power of attorney for me. Could you please arrange for that to be done?’

I responded with English words to the effect: ‘You won’t need me to be your attorney right now. I guess you are concerned that this may become necessary if you take a turn for the worse?’

He replied in Indonesian with words to the effect: ‘That is right. And I want you to contact Macquarie Bank and my accountant so that they know who you are. You will find Macquarie Bank at Collins Street. My accountants are the firm of Walker Varney. You should also know that I have an account with Commonwealth Bank at Greensborough.’

I then said to him words to the effect: ‘I will do all that. But I think you should also appoint Katrina as co-attorney. That will be more practical as she lives in Melbourne.’

George said words to the effect: ‘OK, but make sure you work with her.’

I flew back to Sydney that afternoon, and returned to Taree.”

39 Richard exhibited to his affidavit a photocopy of a diary page, which he said was his diary entry for 26 March 1996. With the abbreviations filled out, the entry recorded: “Taree – Sydney – Melbourne”, a visit to George and “Melbourne – Sydney 4pm”.

40 In his affidavit of 24 June 2008, Richard amplified his evidence about his visit to George on 26 March 1996. He said that he arrived in the ward about midday before lunch was served and was with George during lunch. After lunch, he said, they left the ward and walked around the hospital grounds. Their conversation is set out at length and in detail, particularly George’s directions to him to manage his financial affairs and to arrange a Power of Attorney. Richard said that he spent about three hours with George that day.

41 Katrina’s lawyers checked the accuracy of these statements. Subpoenaed airline records showed that Richard had not flown from Sydney to Melbourne on Ansett Airlines on 26 March 1996. Records subpoenaed from George’s hospital, the Austin Repatriation Hospital at Heidelberg, contained detailed nursing notes which showed that on 26 March 1996 George was visited by Katrina who took him out of the hospital on day leave. The last entry for 26 March shows that George returned from day leave and had an uneventful night. There is no reference to a visit by Richard or to George and Richard walking around the hospital grounds.

42 The nursing notes appear to record family visits as a matter of course. There are such entries for 23 March, when Katrina visited on her own, 26 March when Katrina visited to take George out of the hospital on day leave, 28 March when a visit by “family” is recorded and 29 March, when George is recorded as returning “from afternoon leave with his family”. It was on this last occasion that George was taken by Richard and Katrina to execute the Power of Attorney in the solicitor’s office.

43 The detailed account given by Richard in his affidavits of his visit to George on 26 March 1996 was, therefore, contradicted by independent contemporaneous records. Nevertheless, Richard asserted that his evidence was true.

44 When the trial commenced, Mr Hallen SC was given leave to lead further evidence from Richard in chief. Richard said that he wished to correct the evidence which he had given about his flight from Taree to Melbourne on 26 March 1996. He said that he had recently found some documents which enabled him to say that rather than flying his private plane from Taree to Kingsford Smith Airport and connecting with an Ansett flight to Melbourne, he had flown his plane from Taree to Sydney, and had then flown on from Sydney to Essendon. In the afternoon of 26 March, he said, he had flown from Essendon to Taree without stopping.

45 The document supporting this evidence which Richard said that he had recently found was a photocopy of a two page document headed “Daily Inspection Certificates and Aircraft Time-in-Service”. The photocopy of the document was of poor quality. It showed three entries for “26.3”: “TRE SY ES”, “ES SY”, “SY TRE”. Richard said that these entries recorded his flights from Taree to Sydney to Essendon and from Essendon to Sydney on 26 March 1996.

46 Richard said that he did not have the original of the document. He said that the original document, as a whole, had remained with the aircraft when he sold it in 1996. He said that the photocopy document which he exhibited was only part of the record of “Aircraft Time-in-Service” for his plane but it was the only part that he could find: T 283.3-.18.

47 As I have noted, the photocopy of the document was of poor quality. Everyone knows that it is reasonably easy to make an alteration to a document, and produce a photocopy of that document which makes the alteration to the original difficult, or impossible, to detect. That is why the Court usually insists, when the authenticity of a document is in question, that the original be produced.

48 The document, even though a photocopy, showed that a number of alterations had been made to various entries. For example, at the top of each page there is a space provided under the words “brought forward” to show the total time-in-flight of the aircraft up to the date of the last entry on the previous page. At the top of the page, apparently starting from 29 October 1995 (the first page), a “brought forward” figure of 1,395 hours and 50 minutes appears. It is clear enough that this number has been written on top of some other number. On the next page – the page on which the questioned 26 March 1996 entries appear (“the second page”) – the “brought forward” total time-in-flight appears to be 1,421 hours and 15 minutes.

49 However, on the third page the “brought forward” figure of total time-in-flight was originally shown as 1,395 hours and 50 minutes (the same figure as appears on the first page) but this figure has been crossed out and “1,448 hours .03 minutes” has been written in. In other words, the total figure originally written on the third page suggests that not as many hours had been flown as would be consistent with the second (questioned) page and that the total figure on the third page was later amended to be consistent with the hours flown as shown on the second page.

50 Mr M.B. Evans of Counsel, who appears with Mr Lambert of Counsel for the Plaintiffs, asked Richard about these entries:

“Q. Now if you look over the page at page 3 you will see there alongside ‘brought forward’ in the shaded box the numbers 1395 50?
A. Yes.

Q. How did that number occur there?
A. Your Honour, as of this moment I do not hold an answer to that, but there is an honest, factual answer to that question. I cannot honestly right this minute give that answer.

Q. Might it be, Dr Tjiong, that it was your practice to write the progressive figure in those first two shaded boxes so that the number 1395 50 is in fact the correct progressive figure on page 3?
A. That is not so.

Q. If I take you back to the numbers 1395 50 on the first page, I suggest to you that those numbers look as though they have been written over?

A. I see where you are coming from. I have no comment to make, your Honour, on that point.”

51 When some other inconsistencies between the appearance of pages one and three, on the one hand, and page two on the other hand, were put to Richard. He was unable to explain them. He then said: “It is quite obvious I have to keep looking for other maintenance releases, photocopies or whatever, to do with the aircraft”: T 287.43.

52 This part of Richard’s cross examination took place in the morning of 5 June 2009. Shortly before the luncheon adjournment, Richard said that he was feeling dizzy and that he would rather not proceed with his cross examination that afternoon. That request was granted.

53 On the next day of the trial, 9 June, Mr Hallen advised that Richard had gone to hospital for observation. He remained in hospital under observation until the last day of the hearing, 19 June. Other witnesses were examined during that time, and the trial had to be adjourned, part heard, to 14 December 2009.

54 After the adjournment, the Plaintiffs’ solicitors served on Richard’s solicitors a Notice to Produce Richard’s pilot log books. There was a delay in production and the Plaintiffs’ solicitors complained in a directions hearing on 14 September. Mr Hallen said that, according to his instructions, Richard was looking for the pilot log books and the search was still continuing.

55 When the trial resumed on 14 December, Richard was re-called to conclude his evidence. Mr Hallen produced two pilot log books in response to the Notice to Produce, the first covering the period from August 1976 to July 1984, the second covering the period between 27 July 1984 and 10 October 1997. They were admitted, without objection, as Exhibits D6(1) and (2). I will call them Book 1 and Book 2.

56 In cross examination, Richard was asked why he had taken so long to produce the log books. He said that they had been archived amongst 253 boxes of materials at Surry Hills, he had not been in good health, it had taken him some time to go through the boxes, and he had discovered the books only fairly recently:

“… or log books in plural, and then I did not discover both pilot log books at the same time, either. I discovered volume 1 first and some considerable time later volume 2. And, your Honour, may I at this juncture, at the risk of speaking too much, draw your Honour to the attention …

His Honour: No, please, Dr Tjiong, confine yourself to answering Mr Evans' questions.

A. Thank you.”

57 I quote this passage for three reasons. The first is that Richard said that he had discovered the two log books at different times – Book 2 “some considerable time later”. Book 2 contains the critical entries for 26 March 1996. This evidence is significant in the light of later evidence, as will appear.

58 The second reason is that Richard referred to his ill health during the period as a reason for delay. Later evidence showed that no diagnosis had been made of Richard’s claimed illness while he was in hospital and that after his discharge (on the last day of the hearing) he was well enough to drive his car and to compete in the World Masters Games in October in the Centre Fire Pistol event.

59 The third reason is that even at this very early stage of his cross examination about the log books, Richard was perceptibly anxious to meet any attack on the truth of his evidence and attempted – as he had done on many previous occasions on other topics – to launch into a long and obviously carefully prepared narrative which would, so he hoped, cover all points of possible objection and deflect the cross examiner’s attack. In the light of previous experience with such self-serving digressions, I stopped Richard from doing so again.

60 Mr Evans’ cross examination proceeded with an examination of Book 1, beginning in 1976. Richard agreed that whenever he made flights he would enter the particulars in the log book either on the day of the flight or within a few days afterwards: T 452.36-T453.6. Mr Evans continued:

“Q. Then if we go to the second book. I take it, Dr Tjiong, the first log book having been filled up, you then got another log book. Is that right?
A. Yes.

Q. And that's the log book you have in your hands now?
A. Yes.

Q. And so if you look at the first flight recorded in that log book, that's a flight in 1984 on 27 July. Do you see that?
A. Yes.

Q. And you made that entry?
A. Yes.

Q. And roughly when would you have made that entry?
A. I don't recall.

Q. Well, would it have been the case that you made that entry on the day or shortly after making that flight?
A. Again I would be guessing, your Honour.

His Honour:
Q. Would your normal practice then have been to make the entry on the day or within a couple of days after the day in question?
A. My normal practice would have been to do it either on the day or within a few days afterward.

Q. Mr Evans is asking you whether you can recollect whether you departed from your normal practice in this particular instance?
A. That's where I do not remember.

Evans:
Q. You might recall, Dr Tjiong, that the last flight noted in the first book was 13 July 1984 and the date of the first flight recorded in the second book is 27 July 1984. Was it the case that you obtained the second book at some time between 13 July and 27 July?
A. I do not recall, your Honour.

Q. So you don't recall the point at which your first pilot log book ran out?
A. As the entry said, I think it was said, your Honour, Mr Evans said 10 July, I haven't got the log book.

Q. Take it from me the last entry in the log book was 13 July.
A. I can say that I obtained this log book after 13 July 1984.

Q. And then if you look down the entries for that first page from July 27 1984 to what appears to be January 1985, those entries are all in your handwriting, are they, that is, the entries that commence on 27 July 1984 and continue to the 19th of the following January. Do you see those?
A. Yes.

Q. Those are all in your handwriting?
A. Yes, they are.

Q. It was the case, was it, that those entries were made if not on the day within a few days after each of those flights?
A. Your Honour, that was my normal practice. I cannot be pinned down by way of recollection as to whether that was the case with regard to this specific page.

…

Q. Did you carry the log book with you when you flew ?
A. In my early days where volume 1 applied in the first few years, yes, I carried my log book .

His Honour:
Q. That is in the plane ?
A. In the plane, yeah .

Q. And it was kept there, what, in some compartment or other permanently ?
A. It was kept in my flight bag together with my other flight books and at the end of each flight I would take it home and return it to the aircraft the next time I flew .

Evans:
Q. In the case of this second book, where would you keep that ?
A. From toward the end of the volume 1 I started the practice of keeping the log book at home .

Q. So when you returned to Taree from a flight would you then write up the log book ?
A. Some time after I returned I would write the log book up .

…

Q. Just so that we are clear on your evidence here, doctor, it is not as though you would go for weeks or months at a time without filling out your log book. Is that the case?
A. Mostly yes, that would be the case. In this instance I was away overnight at Lismore and there were other times when there were an interval of a few days or even weeks when I returned in my plane.

Q. Can you assist the court at all by giving an indication of when at the latest you would have made the entries that appear on that first page in 1984?
A. The absolute latest, when my instrument flight rating licence was due for renewal.

Q. And when would that have been after, say, July ’84?
A. In 1984 it would have been – I have to consult my pilot licence, your Honour.

Q. Is that the licence that is in the back of that book, Dr Tjiong?
A. It is the licence, yes.

Q. And perhaps if you consult that, what does it say?
A. Okay. The closest date after July '84 we were talking about, weren't we? No, October '84. The relevant date, your Honour, was 1 January 1985 my instrument rating was renewed and at that time of the renewal this log book was inspected by the departmental examiner as a requisite to the renewal of my licence.

Q. So you presented that log book to a departmental examiner on or about 1 January 1985, Dr Tjiong?
A. Correct.

Q. Then if we go through you will see the next page is identified as the year 1985 and commences on 24 January and then there are flights recorded down to 27 July.
A. Yes.

Q. Can you tell his Honour, with consideration of your pilot's licence document, the very latest you would have recorded those flights into the log book?
A. The 30th of – sorry, correction. The 8th of August 1985, as my licence says.

Q. And this was the book that you presented to a departmental examiner on 8 July 1985, correct?

A. To be precise, to answer that question properly, I presented to the departmental examiner what is required in the inside page of every log book, evidence of my flight, i.e. currency. To the best of my recollection I presented to the departmental examiner this log book.”

61 Mr Evans then established that all of the entries of the flights in the two log books were in Richard’s handwriting. He continued:

“Q. And when at the latest would you have completed those entries?

A. I can answer that question with respect to the last page, 1986, September 19th. Then I would say the absolute last time I would have had to complete entry into my log book or a log book, a pilot log book, would have been 30 November 1986 as shown on my licence.”

62 It was becoming obvious to all in Court that Mr Evans was taking care to commit Richard firmly to his evidence that he had made these entries in his own handwriting in Book 2 within a short time after the flights were made. The gates were being shut, as Richard could tell. He made an attempt to keep an escape route open:

“Q. This was the log book you were keeping at the time, wasn't it, Dr Tjiong?
A. To the best of my knowledge, yes.

Q. You didn't have two log books, did you?
A. No, I did not.

Q. Why do you say to the best of your knowledge?
A. At some stage in my career, your Honour, I had things stolen from my plane when it was parked at Bankstown Airport. I don't recall when that was and I don't recall what was stolen from my aircraft so I am just trying to be as helpful to the court by being specific, and to the best of my knowledge I have been keeping right from the beginning to now.

His Honour:
Q. Are you saying it's possible that the log books you were currently keeping were stolen and that you had to get new log books and fill them out from scratch all over again?
A. Not all of it.

Q. Are you saying it is possible?
A. Possible, yes.

Q. And it is possible that the original log books were stolen and then, having discovered that theft, you had to write out all your log books all over again from scratch?
A. No, not all of the log books, your Honour.

Q. The two that we have been looking at now, is it possible that that's what happened with those two log books?
A. The first one, no. The second one possible, not likely.

Q. I understand this, Dr Tjiong. If you had –
A. What I mean is –

His Honour:
Q. If you had discovered your log book stolen and then had to recreate a new log book from scratch, that is something that would have cost you a great deal of effort to reproduce would it not?
A. Not if there were only one or two pages that were written into the log book and that log book then gets stolen.

Q. Do you have any recollection at all of your second log book being stolen and you having to recreate entries in it ?
A. I don't have that recollection your Honour. But later on as we progress you would see this log book is the correct log book from a certain date onward when it has a stamp from an examiner. That could not be reproduced, the stamping of the log book to validate the log book .

Q. I'm concerned about your evidence when you said it was possible that the second log book, the original, had been stolen and that you had had to reproduce what had been in it in a new book. That is what I think you told me ?
A. It is possible .

Q.

Do you recollect that actually happening

?

A.

No

.”

63 Mr Evans drew attention to some folded pages in Book 2:

“Q. Right. The folded pages do not represent a point in that log book marking a point were the earlier entries in the log book are a reconstruction entered into the log book some time well after the dates they record, is that correct?
A. Not quite. If they were a reconstruction then what Mr Evans says, said, would be correct, your Honour. I am not accepting that I had done, I'm not saying this has been reconstructed. For me to say yes to Mr Evans's question would be to concede yes, I reconstructed an earlier part of this log book.

His Honour:
Q. Doctor, you offered the evidence that it was possible that the second log book had been stolen, the original that is, and that you had had to fill out another log book, what Mr Evans is calling a reconstruction. You said it was possible?
A. (Witness nodded.)

Q. You also said that you could not recollect such a thing ever happening. Why did you volunteer the evidence about it being possible that the log book had been stolen?
A. Your Honour, I'm a witness here facing a very hostile cross examination and I wanted to be absolutely accurate so that there is no come back saying later on, oh gee, I made a mistake in saying something earlier on, it would have been thus.

I don't feel in this witness box I am being questioned as a witness to simply give the truth. Whatever truth I'm propounding to your Honour is being adversarially attacked from every angle as if every evidence I'm giving to your court as honestly as I can is to be destroyed. That is the answer why I have been so particular in answering Mr Evans' questions.

Q. Is it the case that you thought you had better add evidence that it is possible that the log book had been stolen and that you had filled a new one in just in case, although you could not remember that happening, just in case it was suggested to you that the entries in the log book at some stage were not contemporaneous records. Is that what you thought?
A. That might have been 50 per cent of it, your Honour.

Q. What is the rest?

A. The rest is just simply generically I'm trying to be as accurate as I can given a very hostile examination.”

64 Richard’s evidence as to why he volunteered the possibility of his logbook being stolen was utterly unconvincing. It seemed clear to me that he had been attempting to keep open an escape route, if needed.

65 After the luncheon adjournment, Mr Evans continued:

“Q. If we can return to your pilot's log. If you go through to 1996 and in particular to the entries you recorded for March of that year, particularly 26 March, do you see that page?
A. Yes.

Q. When did you make that entry, Dr Tjiong?
A. Prior to my next flight on 29 March, within three days in other words, or two and a half days.

Q. In 1996?
A. Correct.

Q. And I take it it is still your evidence that the entries prior to that date, particularly the entries from 1984 on, were made within a reasonable time after those flights being taken, is that correct?

A. That is my evidence. Your Honour, before lunch my mental state was that I was getting a bit more confused. I was not sharp mentally and the evidence I gave before lunch was not I have made any re-entry to the pilot book. My evidence is that some entries were made late but not re entry, as in repeat entry, as it were. I was confused because of the recollection of this stolen goods and so forth. So the answer to Mr Evans' question – your question, sir, was?”

“Q. Just so I can understand the evidence you are giving now, if you go back to the first entry in the book, the entry that commences in the year 1984 where the first entry is 27 July. Is it your evidence that that entry was made at some reasonable time after July 1984?
A. Yes.

Q. I note that you have opened your pilot's licence booklet, so you are now certain that that entry was made at least before the next certification check?
A. Yes.

Q. And just for the record, that certification check, by reference to your pilot's licence booklet, was when?
A. Yes.

Q. If you just read the certification date, the next certification date from that licence book again?
A. 31 December 1984 is what my licence renewal – well, to be precise, what the licence renewal record says was 1 January '85.

Q. So the entries that appear on that page were made in that book prior to that date; correct?
A. Yes.

Q. Then if you go over to the next page, 1985, commencing January 24th. If you look down the page is it your evidence that those entries were made in that book?
A. The entries were made in that book in –

Q. And what date were they made by?

A. At the latest, looking at my licence, 8 August 1985.”

66 Mr Evans continued to take Richard through entries in Book 2 showing dates in 1985, 1986 and 1987 and Richard reaffirmed that the entries were made by him on or shortly after the dates shown.

67 Mr Evans then drew attention to Book 2 itself. It was issued by the Civil Aviation Authority of Australia. On the front cover it bore the imprinted notation “R 1/89”. Mr Evans continued:

“Q. Perhaps you might explain to his Honour how it is that you were making entries in a log book in 1984 that was issued by an authority that did not come into existence until 1988?
A. By an authority that was in existence in 1988? I don't understand.

Q. That did not come into existence until 1988?
A. Say that again?

Q. By an authority that did not come into existence until 1988?
A. Which authority is that?

Q. The Civil Aviation Authority.
A. I don't know that, your Honour.

Q. When you were studying law you would from time to time have had regard to the Commonwealth statutes?
A. Yes.

Q. Let me read to you from Act number 63 of 1988, the Civil Aviation Act of 1988, in particular section 8: ‘There is established by this Act an authority by the name of the Civil Aviation Authority’ . The Civil Aviation Authority, Dr Tjiong, did not come into existence until the Civil Aviation Act of 1988 was given assent, as recorded in the Commonwealth statutes on 15 June 1988. Dr Tjiong, the document you have presented to the court is a fabrication, and all the evidence you have given about those entries are lies?
A. No, your Honour, I refute that. This was my reference to you early on about my state of mind before lunch, that I was losing my sharpness and I was confused and I did refer your Honour to an event of having had things stolen from my aircraft at Bankstown.

His Honour:

Q. You now remember that there was something stolen from your aircraft, do you?

A. Oh, I have remembered something was stolen from my aircraft some time, some 25 years ago, and before lunch what I was saying was there was a possibility that this log book – a log book, not this log book – might have been stolen. But on rethinking during the lunch time I did say a moment ago that my thinking was that I remembered having late entries to this but I don't remember putting a re entry as in to put a second entry. But is that possible? I have to think about that because what my recollection of when this book was issued is quite different from what counsel now says and this book is no longer available, your Honour, for me to be fabricating. The book that's currently available is not by Civil Aviation Authority, it is by CASA, Civil Aviation Safety Authority, and I have got a copy of that new book because I somewhat thought that I might be challenged as to rewriting a book. You can't buy this book, your Honour.”

68 My overwhelming impression on hearing this evidence and in observing Richard’s demeanour in giving it was that Richard had been caught out in the most flagrant act of fabricating evidence. Confronted with the obviously falsity of his evidence that Book 2 was a contemporaneous record of his flights, he had immediately launched into a babble of explanation – obviously pre-prepared – about suddenly remembering that the original Book 2 had been stolen – contrary to his earlier evidence that he had no recollection of such an event actually occurring. As I have noted, before beginning his cross examination, Richard had prepared that escape route for use, had tried to lay the groundwork for it (see [62] – [64]) but when he was given the option of saying that Book 2 was a reconstruction he had chosen to affirm it as the original document because its fabrication had not yet been exposed and he did not then know if Mr Evans had the means of exposing it.

69 To refute the suggestion that Book 2 was a fabrication, Richard pointed to certificates of flying time written in Book 2 bearing dates from April 1990 onwards, over the rubber stamp “Gowings Flying School” and apparently bearing the signature of a Mr David Gowing. Mr Gowing was not called to authenticate his signatures in the log book. Because of the obvious care Richard took in the fabrication of the log book and the blatant contradictions in his evidence, I can attach no weight to this uncorroborated signature.

70 Richard’s re-examination did not commence until he had had the opportunity of an over-night conference with Mr Hallen SC. Mr Hallen began by taking Richard to Book 2:

“Q. … It seems clear from the evidence that has been given by you that to the extent that there are notations in that pilot log book prior to 1989, they couldn't have been written contemporaneously. You now accept that, I think?
A. I do.

Q. Since you were cross examined have you had an opportunity to reflect upon the events that occurred and the obtaining of that pilot log book?
A. Yes, I do.

Q. Firstly, during the course of your cross examination you raised what you described to his Honour as a possibility that the original of what I will call the second pilot log book had been stolen. Do you remember giving that evidence?
A. I do.

Q. And when asked by his Honour about that you said that it was a possibility?
A. Yes.

Q. Since that time have you had an opportunity to reflect on that?
A. Yes.

Q. And are you able to tell his Honour whether the possibility has changed, the answer that it was a possibility has changed?
A. Yes, it has changed.

Q. And can you tell his Honour why?
A. The possibility has changed to certainty, I lost my pilot log book. On inspecting for the first time in recent years a diary, a pocket diary of mine of the year 1989, I inspected that diary for the first time for a number of years last night in the chamber of my Senior Counsel.

Q. In relation to that pocket diary, what is your understanding of where it was found and by whom?
A. It was found in the storeroom of my apartment where there were a number of archive boxes that had been transferred from the Seven Hill commercial storage space. It was discovered by my wife.

Q. And to the best of your understanding what did she do with the diary when she found it?

A. She tried to inform me at around 6.00am yesterday that she had found something relevant to my flying, and I said to her,

.”

71 The diary produced was a pocket diary for 1989 (Exhibit D14) and showed an entry for 18 August “Lost F bag HP Bk”. Richard said that that entry meant “lost flight bag, Hawker Pacific Bankstown”.

72 Richard then gave this evidence:

“Q. Going back to the pilot log which is exhibit D6(2), having located that diary and the information contained thereon, what, if anything, are you able to tell his Honour about the writing up of the pilot log?
A. Well, the first thing I had to do was to obtain a new pilot log book, which obviously is quite different from the one previous production wise. Then I was faced with the problem of do I simply prospectively start from that date, 18 or 17 of August, in term of my entry or what do I do with the lost pages from the original second lost log book. I was obliged by the aviation authority to keep a complete log book so I have to retrieve data and restore. I chose to restore the old entries into my newly acquired log book.

Q. And how did you do that?
A. The contemporaneous record of my daily flights in my case are contained in the maintenance release documents, single leaf document. That document is the first point of entry of my contemporaneous notation of daily flights. My habit, even before then, as I think I had said to the court yesterday, to your Honour yesterday, that I made an entry to my pilot log book which was at that relevant time kept at home from the maintenance release, so the short answer to counsel's question is I restore the lost pages or the lost entries for the previous five years from the maintenance releases of the previous five years which contain contemporaneous record of my flights.

His Honour:
Q. You have a clear recollection of doing that, do you?
A. I do, your Honour.

Q. You are absolutely certain of that recollection?
A. I am certain of most of my recollection, given my –

Q. Are you certain of the recollection that you have just given me now?
A. I have a clear –

Q. That the book was lost; is that right?
A. Yes.

Q. That you obtained another book from the Civil Aviation Authority and you yourself in your own handwriting copied out from other records all the entries which had been made in the lost log book from 1984 up to 1989. You are clear in that recollection, are you?
A. I am clear in that recollection.

Q. You are clear in that recollection. I want you to have no doubt about it in your answer. Are you clear or not clear in that recollection?
A. I am clear and no doubt, your Honour.

Q. You vividly now recall in your mind's eye writing down each of the entries in the new log book starting from a date in 1984 and going through to 1989?
A. Yes.

Q. And did you do that in one sitting or a couple of sittings?
A. Oh, many sittings, your Honour, and I do recall the time line of those exercises.

Q. Tell me about it.
A. I had to restore my log book prior to my next following instrument flight renewal flight test by department's examiner.

Q. When was that, by the way, can you remember?
A. That would be about October/November that year.

Q. So you remember that?
A. So I had about 10 weeks, yes. And that is an entry in the flight pilot licence. You will find an entry from the Department of Aviation that stamped the renewal of my licence.

Hallen:
Q. Would you be good enough to go to your licence and tell his Honour precisely the date of that entry?
A. My recollection of the – let me just find it first. The 1st of November, 1989, your Honour, date stamp, somebody by the name of Vance, who is himself examiner, I recall, signed a name and date stamped it, and on the first column it says command class, as in C class as in command class instrument rating.

Q. Would you hand up the document to his Honour so his Honour can look at it.
A. Yes.

(Licence handed to his Honour)

Q. In relation to the entries that follow, do you remember what you did in relation to the writing of those entries?
A. After I acquired the new log book, my new flights were recorded in the log book the way I have been doing for a number of years, ie transcribe the entry, the daily entry, contemporarily made in the maintenance release, given that the log book stayed at home normally.

Q. And when did you do that?

A. I would do that either a day or two, sometimes a few, a week or two, and on one occasion I remember not updating until some five months until the next instrument flight test was due.”

73 Richard was saying that he now had a clear and detailed recollection of an event which, two days previously, he said he could not recall actually happening.

74 Richard’s wife, Kathryn, who is said to have found the 1989 pocket diary in their apartment, could have corroborated this chance finding which Richard said had restored his recollection. Kathryn was frequently in Court during the trial and had earlier given evidence. Mr Hallen did not seek to re-call Kathryn or to call Richard’s solicitor, who could have verified when and in what circumstances the diary was given to her. It would have been very easy for Richard to write a corroborating entry in his 1989 diary before it was given to his solicitor. Without reliable corroboration of the entry in the 1989 diary, I cannot place any weight on it.

75 Mr Evans was given leave to cross examine Richard further. He began by referring to the evidence which Richard had just given that Book 2 was in the flight bag which he lost at Bankstown Airport on 18 August 1989. He reminded Richard that two days earlier he had said in his evidence that Book 1 of the flight book was originally kept in his flight bag, but that Book 2 was kept at his home: see paragraph [60]. The impossibility of Book 2 being in the “lost or stolen” flight bag was immediately evident to Richard.

76 The examination proceeded thus:

“Q. Dr Tjiong, you might recall yesterday giving evidence that your first pilot log you used to carry with you in your flight bag but that the second pilot log was kept at home. Do you recall giving that evidence?
A. I do and that's not entirely accurate description of what I said.

Q. So were you not telling truth when you gave that answer, doctor?
A. No, I'm saying you are not restating what I said, with respect, correctly. What I said yesterday was with respect to the first pilot log book, in the beginning, in the period covered by that first pilot log book I did carry the first pilot log book with me when I flew most of the time. But toward the second half or in the second half of that period covered by the first log book I adopted the practice of leaving the log book behind at home and entering contemporaneously my flight record into the maintenance release document which is not a document for entering flight data.

Q. So where did you keep the maintenance release document?
A. I keep it in the aero – in my flight bag which would be in the aeroplane and each time I would go home I would take the flight bag home with me.

Q. But what you lost from the plane, on your evidence this morning, was the flight bag. Wouldn't the maintenance release record be in that and thus gone?
A. Normally the answer is yes, except on this occasion. The aircraft was at Hawker Pacific undergoing maintenance and it is a necessary practice as well as usual practice for the maintenance engineer, as soon as it receive the aeroplane into its possession to take the maintenance release out because the front page of the maintenance release bottom half or second half would show the problems with the aircraft that is in need of repair.

His Honour:
Q. And that is what happened on this occasion?
A. Yes.

Q. And you can clearly remember that?
A. I can recall that.

Q. You clearly remember that?
A. Yes.

Q. That is what happened?
A. Yes. Because when I came back to the plane and realised my bag was missing I had to ask Hawker Pacific what happened to my bag.

Q. Who was the person you asked, do you remember?
A. A man.

Q. Was it in the morning or the afternoon?
A. It would, that I cannot recall absolutely but usually it would be in the afternoon because it was on my flight back.

Q. This incident is very clearly etched in your memory, isn't it?
A. Oh, not fully, not all the details of it.

Q. The fact that the aircraft was with Hawker Pacific?
A. Yes.

Q. That the material was stolen while it was in the custody of Hawker Pacific and that is how on this one occasion the maintenance records did not happen to be in the flight bag. That is all clearly etched in your memory, isn't it?
A. It is. It is –

Q. Is it or is it not?
A. It is so.

Q. Thank you.
A. Your Honour, arising from the aide memoire that came back yesterday afternoon.
His Honour: Thank you.

Evans:

Q. Are you saying that the bag was lost or the bag was stolen?

A. I'm saying the bag was lost presumed to be stolen because I remember now, after seeing the, the, the new aide memoire a flood of memory came back as to the circumstance. Because I found my aircraft door wasn't properly locked. At the time I saw the door wasn't locked with the aircraft sitting outside Hawker Pacific. It didn't trigger any concern because after all the maintenance hangar is immediately next to it, but when I opened the door and the first thing I need to do of course is to access my, my, my flight bag, to ascertain that the maintenance release after the Hawker Pacific engineers had repaired the aircraft had been returned to my, my flight bag. I couldn't find the flight bag so I said, I went back into the Hawker Pacific hangar, spoke to the engineer or chief engineer or assistant chief engineer. My, my bag's not there.”

77 Richard’s sudden and voluble rush of minutely detailed recollection about an event which he had, only two days before, emphatically said he could not remember actually happening – coupled with his demeanour when giving that evidence – convinced me that Richard was simply making his evidence up on the spot. Further, when asked about the conflict between his earlier unequivocal evidence that Book 2 had been kept at home and his later evidence that it was stolen from his flight bag at Bankstown Airport, Richard evaded the questions by saying that it was the maintenance release document which was kept in the flight bag. Then he said that that document was not in the flight bag when it was stolen, so that he was able to reconstruct Book 2 of the pilot log from the maintenance release document. But Richard had not explained why it was necessary to reconstruct Book 2 from the maintenance release document if Book 2 had been kept at home and was not in the flight bag when it was stolen.

78 These contradictions in Richard’s evidence, again coupled with his demeanour in the witness box, strengthened my impression that he was simply making his evidence up as he went. In those circumstances, I thought it fair to give him the opportunity to pause, reflect on the consequences and withdraw his evidence:

“His Honour:
Q. Doctor, I regret to have to inform you that my present impression is that you have been perjuring yourself shamelessly. Repeatedly perjuring yourself. And this last piece of evidence is a complete fabrication. I am giving you the opportunity now for you to say what you want to say about that?
A. I am horribly and regrettably, I am horrified by your Honour's impression.

Q. You deny it?

A. I deny it your Honour.”

79 Richard resolutely persisted in his evidence, adding a short time later that he did not have an invariable practice of keeping Book 2 at home and that he was sure it was in the lost flight bag. He could even recall, with remarkable detail, all of the other items in the flight bag.

80 I bear in mind that, although for the purposes of this case I am not required to be satisfied of perjury according to the criminal standard of proof, nevertheless a finding of such gravity requires a correspondingly high degree of satisfaction: Briginshaw v Briginshaw (1938) 60 CLR 336. My findings on this aspect of the case are as follows:

– Richard has recently fabricated the second pilot’s log book, at first asserting it to be the original book in which he made entries supporting his evidence that he flew to Melbourne on 26 March 1996 and there visited George in hospital;

– Richard’s later evidence that the second log book was created by him in 1989 after the original was stolen on 18 August 1989 is deliberately false;

– Richard’s evidence as to a conversation with George on 26 March 1996 is not supported by the nursing notes for that day and is contradicted by the evidence of Katrina, whose evidence is supported by the nursing notes;

The Kevin Reeves letters

81 By April 2004, Katrina and Lindsay were insisting that they receive a distribution from the Family Trust Fund and Richard was insisting that George’s brother and sisters receive some part of the capital. On 9 April 2004, after some acrimony between the parties, Richard gave each of Katrina and Lindsay a cheque for $100,000, drawn on the Family Trust by Maroka, but post-dated to 22 April 2004.

82 Clearly, Richard soon afterwards repented of his decision to accede to the demands of Katrina and Lindsay. On 14 April, in exercise of the powers conferred on him as appointor under the Family Trust Deed, he removed Maroka as trustee of the Family Trust and appointed himself as sole trustee. On the same day, he requested Katrina and Lindsay to return the cheques for $100,000 which he had given them. They declined and sought legal advice.

83 The cheques could be presented and the funds drawn on 22 April. Obviously, Richard did not want that to happen.

84 On 21 April, entirely fortuitously and unforeseen, according to Richard, he received a telephone call at his home from a man who identified himself as Mr Johnson. In his affidavit of 5 October 2005, Richard said:

“The largest claim against the estate relates to Kevin Reeves, a child patient that is alleged to have been treated by George around 1995. I received a phone call on or around 21 April 2004 from a person who identified himself as a Mr Johnson from Melbourne. He then said words to the effect:

‘I want to get to Dr George Tjiong’s medical records on a patient he had treated some ten years ago. The chemist at Briar Hill told me your name and I found your name and phone number through the medical directory.’

I referred him to the estate lawyer, Peter Thornton, and gave Mr Johnson the name of Peter Thornton’s legal firm and its address. I advised Peter by email, of this phone call on the same day.

A few days later, Peter Thornton forwarded to me copy of a letter which he had received from Mr Johnson.

There have been other correspondences from Mr Johnson since that first letter. Peter Thornton advised me that in view of the potential size of the damages arising from the Johnson matter, a successful claim in this matter would bankrupt the estate, and the trustee in bankruptcy may have an interest in tracing the assets of the late George Tjiong to the GT Tjiong Family Trust. I received a preliminary advice from Peter Thornton on 22 April 2004, and a formal advice on 23 April 2004, that I should suspend distribution of the trust fund, as well as the estate, for the time being.”

85 It is significant that between 9 April, when Richard gave the cheques to Katrina and Lindsay, and 21 April, when he received the call from Mr Johnson, Richard sought advice from Mr Thornton, resulting in the removal of Maroka as trustee. The reason which Richard gives for taking this step is given in paragraph 103 of his affidavit of 24 June 2008:

“I took this step because I was greatly concerned, among other things, that if Katrina and Lindsay had remained on the board of Maroka, they could use their majority power to force the board to provide more distributions to themselves or even to vest the trust at a time when the estate was not yet cleared of claims and when tracing would have been a remedy for an unsatisfied claimant to the estate. Removing their power to make such distribution removed my concern over this danger. I could then focus on managing the estate and the trust lawfully.”

86 In accordance with his usual practice, Richard made an extensive file note for himself on 30 April 2004. It states:

“1. In the light of an emerging claim from an ex-patient that has the potential of bankrupting the estate, the following is a review of my investment plan for the Estate and the Trust funds.

2. This claim or notice of potential claim relates to an incident in 1994/95. George told me of this incident whilst in Austin Hospital late in March 1996 when he expressed a desire to return to medical practice but refused to take out any form of medical indemnity. When pressed re the danger of a claim, he related an encounter with a child patient with uncanny similarity with the facts in Black v Lipovac. I personally do not think much of the substance of this claim given my view and the view of UMP claims managers and lawyers re Dr Black case before taking into account recent tort law reforms including the statutes of limitation. I intend to manage this claim aggressively and defend George rigorously, and I expect a high prospect that it will be resolved in George’s favour.

3. Following PT’s expressed advice, the distribution of the Estate needs to be delayed until all the claims are resolved; it is reasonable to expect that the Johnson claim may be resolved within two years. No distribution from the Trust is to be made before December 2005 on the expiry of the relevant s 120 period in the Bankruptcy Act.”

87 There are seven letters emanating from Mr Johnson or Sharon Reeves concerning the Kevin Reeves claim. They must be set out in full to understand the import of the other evidence.

– this letter is addressed to Mr Thornton and states:

“Dear Mr. Thornton,

I recently married Sharon Reeves who has a 14 year old son, Kevin, from a previous marriage and have only become aware of the following facts not long ago.

My step-son Kevin was taken to see Doctor G. Tjiong at his Mountain View Road rooms in Briar Hill Victoria, sometime in January 1995 because he was suffering with a chest infection and had a temperature. He was given some medication which included a suppository.

Since then he has developed fits and has continued to have a good deal of neurological problems.

Sharon was hesitant to do anything about Kevin’s condition as she was not aware that anything could be done.

Both my doctor and my lawyer believe that my step-son’s problems may have started with the episode of the chest infection and the treatment prescribed by his doctor at that time.

I believe that Dr Tjiong has since retired and moved to Sydney. His brother has suggested that I contact you.

May I please have the medical records of this case.

We will be away for the next 3 to [sic] months but mail can be sent to me at 2 Narambi Avenue, Ingle Farm, 5098 in South Australia.

Yours faithfully,

Rod Johnson”

There is a signature “Rod Johnson” above the typed name. There is no residential address for Mr Johnson shown at the top of the letter. The only means of contacting Mr Johnson is at the address in South Australia.

25 August 2004

“Dear Mr. Thornton,

My family and I have been travelling around and are now in South Australia where we are thinking of settling down.

I sent you a letter on the 30 ^th of April 2004 asking for information about Doctor G. Tjiong treating my step-son Kevin in 1995.

As yet I have not received this from you.

My lawyer needs to have this in order that he can begin proceedings. Please send his medical records to me at 2 Narambi Avenue, Ingle Farm, 5098 in South Australia.

Yours faithfully,

Rod Johnson”

There is a signature “R. [not Rod] Johnson” . Again, no residential address for Mr Johnson is shown and no other contact details are given except the address in South Australia.

9 December 2004

“Dear Mr. Thornton,

Thank you for your letter dated 16 ^th November 2004. My friend gave it to me when we returned to Adelaide last week.

We have since had communication with people in Melbourne and are finding this whole matter is a lot more complicated than we thought.

As Kevin suffers from severe handicaps it is likely that we may have to take him to a specialized unit in Europe for treatment because of a specific aspect of his brain damage.

Opinions from experts indicate that he is likely to live a fairly normal life span and costs of caring for him in the future are likely to exceed $5 million.

There are a number of people and at least one hospital that are implicated in my step-son’s disabilities. In the absence of proper records from Doctor Tjiong, our lawyers have some difficulties in assessing accurately the role played by him.

Under the circumstances, we have decided not to institute a claim against Doctor Tjiong but will pursue our rights against other health care entities.

Yours faithfully,

Rod Johnson”

There is a signature “R. Johnson” which looks quite different from the two previous signatures. Again, no residential address or other means of contacting Mr Johnson is shown.

12 July 2005

“Dear Mr. Thornton,

Sharon and I are taking Kevin to Massachusetts General Hospital for further treatment. Kevin’s has been fitting more in recent months, despite all the good medicines from the local doctors in Australia. Also, Kevin has developed other disabilities, which the doctors said tie in with his fits.

There is a new operation which may fix Kevin’s problems. Australian surgeons are not yet experienced in this operation. Kevin will undergo a lot more tests before the doctors will operate on him. After the operation, we have been told to stay on for rehabilitation. We are likely to [sic] away for a few months, and fortunately we have the support of a local community group, which has arranged for us to stay near the hospital. We do not yet know the address.

In the mean time, two experienced American specialists have told us that the damage to Kevin’s brain was very likely to be due to ‘toxic level of a drug such as Aminophyllin in a child’. Our mind right now is fixed on getting Kevin better as caring for him has taken a lot of Sharon’s time and our resources. Later this year, when we return, we will go for compensation. Our American specialists have advised us that we have a very strong case and we should make a claim against the doctor who gave Kevin the Aminophyllin, as well as the hospital. We have chosen the firm of Maurice Blackburn Cashman. We will engage them to act for Kevin and Sharon when we return. You will hear direct from them then.

We are on our way to Boston, and I am posting this letter during our Qantas stop over in Melbourne. You may wish to send your reply (we are not expecting any) to care of Massachusetts General Hospital, Fruit Street, Boston MA 62114-2622, USA. We have told Kevin’s fans to send their letters to care of Poste Restante, Boston, Massachusetts. I shall write when we return to Melbourne.

Yours faithfully,

Rod. Johnson”

There is a signature “R. Johnson” which resembles the signature on the second letter but not on the third letter. No residential address or contact details are given.

20 August 2007

“Katrina

My husband “Rod Johnson” has recently told me what has been going on. I am very upset over his action. A number of medical specialists assessed my son’s condition some years ago, and they all said that Dr. George Tjiong’s treatment had nothing to do with my son’s condition. Lawyers inside and outside the firm I used to work did not think we had ground to make a claim against any one. Your father was aware of most of these opinions and I reassured him before he moved to Sydney.

We have a good and respectable name in Melbourne. Your father did a lot of good things for my parents, and my father owed his life to him. If there were a claim to be made against any body, I would have made it without your help and I would not have used some false names and address let alone the story you made up for “Rod”. You should not have dangled some reward and my husband should not have taken the bait. You could not possibly get “compensation money” for medical negligence that did not happen. Whatever your personal agenda may be, I am extremely upset that you have involved my family. I expect you to put an end to this business immediately.

Sharon Reeves”

There is no signature on the letter nor is there any address or means of contact shown.

21 August 2007

“Dear Mr Thornton

I write in relation to the estate of the late Dr. George Tjiong. I recently came across some letters among my husband’s business papers addressed to you and signed by “Rod Johnson”. My husband has given me some explanation and I have written to Katrina Tjiong (copy enclosed). I would like to convey the facts to you and end my husband’s claim. I was surprised and very upset to learn of his involvement with Katrina.

My son was already suffering from asthma while his father and I were in Africa doing medical mission work, which we did for some years. A visiting pediatrician prescribed Ventolin inhaler and syrup, and Aminophylline suppositories to be used under medical supervision. We used the suppositories twice in Africa when my son was not able to use the inhaler or swallow his Ventolin syrup.

His asthma was one of the reasons we decided to leave Africa and settle in Melbourne in late 1994. In our second month back, my son got sick with bronchitis. He was feverish, wheezing and unable to take his medications. When I could not get our GP, I rang Dr. Tjiong who lived close by. He gave an antibiotic injection, used one of our suppositories for the wheezing, tepid sponging to get the fever down (we were already doing this) and suggested Panadol in addition to his usual asthma medications as soon as practicable. There was some question about putting him in hospital if he got worse.

My son had a turn an hour or so after Dr. Tjiong had left. My late husband (a nurse) thought that it was a fit, which did not last long. I rang Dr. Tjiong who suggested that we get an ambulance and take the child to the hospital. As I was about to phone for an ambulance, our own GP arrived. He thought that our son might have had a febrile convulsion and gave him Valium solution rectally and half a Panadol tablet as suppository. We continued tepid sponging him, and our GP waited until his fever settled in the following hour. There was no more drama for the rest of the night, and he recovered within a few days.

“Q. Do you remain of the belief that it is not a genuine claim?
A. I do.

Q. Yes. And by that you mean that the incident the subject of the claim, that is the injury to this Kevin, is a total fabrication?
A. To Kevin, yes.

Q. There never was a Kevin who suffered an injury?
A. Yes.

Q. You believe that?
A. I do.

Q. There never was a Kevin treated by your brother George who suffered an injury at George's hands, correct?

A. A Kevin?”

“a Kevin?”

“Q. There never was a child suffering, who was treated by your brother George, who suffered some brain damage and was the subject of this claim, is that right?
A. Your Honour wants simple answer. I believe there was an incident of injury. I do not believe that there is a child with severe injuries that is the, that could be the subject of a genuine claim.

If I may clarify, your Honour. I believe what my brother told me on 30 March 1996 was right. That was what he said and I believed that till now. Is there now a severely injured child out there, result of that? Well, I don't know that.

Q. Are you saying it is a coincidence that your brother told you about an incident treating a child who could have suffered this sort of damage, and somebody happened fraudulently to make up a claim incorporating the same events. It is a coincidence, is it?

A. I believe it is not a coincidence. I believe it has happened by way of someone doing so with motives that I do not know … i.e. I have no evidence as to motive but I believe somebody did this as part of a scheme of something.”

106 Richard tried to have it both ways: it was true that George told him of an incidence of injury to a child but the Kevin Reeves’ claim was bogus, having been made up by someone as part of a “scheme”.

107 Mr Evans then put squarely to Richard the following suggestions:

“Q. Dr Tjiong, I suggest that by December 2005 you were becoming concerned that this little claim you had fabricated had got out of hand and that is why you wrote in the 9 December letter that Mr Johnson had decided not to pursue a claim against George's estate. That's correct, isn't it?
A. No, incorrect.

Q. And that in 2005, proceedings having been taken against you, you tried to deflect attention away from the claim by creating the letter of July 2005 saying that Kevin had gone off to Massachusetts. That's correct, isn't it?
A. Not correct.

Q. In that letter you also included a new mail address of Poste Restante, Boston, to deflect attention from the Narambi Avenue address contained in the original correspondence. That's correct too, isn't it?
A. I did not do so.

Q. And that since then, particularly as this matter appeared headed for a hearing, you created the later string of letters in an attempt to place or direct attention in this matter in the direction of Katrina. That's correct, isn't it?
A. That is not correct.

Q. And that is why you created and caused to be sent to Katrina the Sharon Reeves letter of August 2007; correct?
A. Not correct.

Q. And when Katrina, having received that letter, did not disclose it to you in the proceedings you organised for a private inquiry agent to go to Melbourne and set up a meeting on a false basis for the purpose of leaving a copy of that letter with her in circumstances where there would be a witness, didn't you?

A. Not correct.”

108 I am satisfied that each of Richard’s denials was false. I am satisfied that he either wrote, or directed someone else to write, the Kevin Reeves letters and that when he realised that the Plaintiffs were suspicious of the letters and of his part in the emergence of the Kevin Reeves claim, he tried to remove suspicion from himself by casting it onto Katrina and Margaret. My reasons for those conclusions are as follows.

109 First, the bogus claim had the effect of preventing distribution from the Family Trust and from George’s estate to Katrina and Lindsay at a time when Richard strongly wished to resist their demands for distribution. The claim emerged shortly before Katrina and Lindsay would be able to present the cheques for $100,000 which had been given to them by Richard on 9 April 2004.

110 It would have been utterly irrational for Katrina, or Margaret, to have prevented the distribution which Katrina and Lindsay so urgently sought by making the bogus claim. Indeed, if they had made the bogus claim to ensure Richard’s removal as executor and the quick distribution of the Trust Fund and of the estate, they would have exposed damning facts – such as Richard’s connection with the return mailing address given in the 30 April 2004 letter – much earlier than has occurred in these protracted and expensive proceedings.

111 Second, Richard’s evidence as to how Mr Johnson came to know his telephone number was contradictory and implausible.

112 Third, the facts of the bogus claim were copied from Black v Lipovac, a case of medical negligence with which Richard was very familiar, having written several articles about it: T259-.29 to T260.38. There is no evidence to suggest that Katrina or Margaret was aware of the facts of the Lipovac case.

113 Fourth, the writer of the letters was familiar with medical terminology and treatment – see especially the letters of 12 July 2005 and 21 August 2007 – and was also familiar with the firm of Maurice Blackman Cashman as specialists in medical negligence litigation. Richard had both these familiarities. There is no evidence that Katrina had either of these familiarities. Margaret had been a nurse many years previously but there is no evidence that she knew of Maurice Blackman Cashman as medical negligence specialists. Further, the forensic examiner retained by Richard reported that she could detect no similarity between Margaret’s handwriting and the handwriting on the Kevin Reeves letters.

114 Fifth, the writer of the letters gave as the return mailing address an address with which Richard had a direct and immediate connection, through Mr Taransky, with whom Richard was in frequent contact at the time that the letters were sent. There is no evidence to suggest that Katrina or Margaret knew of the location of SARPA’s office or of Richard’s connection with it.

115 It would be important for the fabricator of the Kevin Reeves’ claim to have a return mailing address for Mr Thornton’s letters because if those letters had been sent to an address randomly selected, the return of the letters marked “not known at this address” would have immediately suggested that the claim was bogus. The writer of the letters, therefore, had to have a return mailing address remote enough to discourage anyone in Sydney or Melbourne from going there to enquire about Kevin Reeves. The writer also had to have someone at the mailing address to collect Mr Thornton’s letters so that suspicion would not be aroused by the return of the letters. The SARPA office and Mr Taransky’s availability to collect mail sent there fulfilled both requirements.

116 Sixth, Richard’s advisers were aware in good time that the Plaintiffs would be alleging that Richard’s connection with SARPA’s office through Mr Taransky was a central piece of circumstantial evidence pointing to Richard as the author of the letters, but they did not call Mr Taransky or Mr Javor to corroborate Richard’s evidence. I refused an application by Mr Hallen to tender affidavits sworn by Mr Taransky and Mr Javor in 2006 procured in the s 93 application as he wished to read those affidavits without making the deponents available for cross examination. I gave Mr Hallen the opportunity of taking evidence from Messrs Taransky and Javor by videolink. The opportunity was declined. I infer that the evidence of Messrs Taransky and Javor would not have assisted Richard.

117 Seventh, Richard’s assertion that the choice of SARPA’s office as the return mailing address was pure coincidence was obvious nonsense. Yet he persisted in that assertion. He could hardly do otherwise: the only other explanation was that it was he who had chosen the address.

118 Eighth, the writer of the Kevin Reeves’ letters betrays stylistic quirks which appear in Richard’s own writings:

– the writer of the letters, while employing a highly literate style, careful punctuation and accurate spelling, consistently uses two words for what is in English usage a single composite word, namely:
“mean time” instead of “meantime” (letter 12 July 2005)
“any one” instead of “anyone”, “any body” instead of “anybody” (letters 20 August 2007, 21 August 2007)

– in his many writings which are in evidence, Richard demonstrates a highly literate style, careful punctuation and accurate spelling, but also consistently uses two words for a single composite word:
“mean time” (e-mail 8 February 2002; written eulogy 4 February 2004; e-mail 24 February 2004; e-mail 24 March 2004; letter to his siblings 18 January 2005 para 31)
“any body” (file note 9 April 2004)
“no one” (letter 27 February 2002)
“every one” (written eulogy 4 February 2004);

– the writer of the letters carefully uses quotation marks to indicate either a direct quote or that something is claimed which is not accepted:
letter 12 July 2005 (direct quote)
letter 20 August 2007 (“Rod Johnson”, “compensation money”)
letter 21 August 2007 (“Rod Johnson”, “Sharon Reeves”)
letter 24 December 2008 (“to Katrina”)

– Richard’s writings consistently and very frequently use quotation marks for the same purposes:
letter 5 February 2002 (two instances)
letter 27 February 2002 (twenty instances)
file note 9 April 2004 (four instances)
file note 22 December 2001 (thirteen instances)

“in other words, George wasn’t out of the, inverted comma, woods yet”

119 I do not rely upon these observations of similar usage to found my conclusion that it was Richard himself who wrote at least some, if not all, of the Kevin Reeves letters. However, I note that these similar usages are consistent with my conclusion founded on the other evidence.

Richard’s credit

120 I find that:

– Richard fabricated Book 2 of his pilot’s log book, intending to mislead the Court into accepting that that document supported his evidence as to what happened on 26 March 1996;

– Richard’s evidence as to how he came to re-write that log book was deliberately false;

– Richard fabricated the bogus Kevin Reeves claim in order to prevent or delay distribution of the Trust Fund and of George’s estate to Katrina and Lindsay;

– Richard endeavoured to cast suspicion on Katrina and Margaret as the instigators of the bogus claim by writing the letters of 20 and 21 August 2007 and 24 December 2008 when he feared that his own part in the deception would be exposed;

– Richard has consistently lied in his evidence to the Court;

File note of 22 December 2001

121 In his will made in 1992, George appointed the State Trust Corporation of Victoria as executor and gave the whole of his estate equally to Katrina and Lindsay, subject to giving a right of residence in one of his properties to his mother.

122 In his will made 23 December 2001, which Richard himself drew up, George appointed Richard as executor and gave the whole of his estate to Katrina and Lindsay. It is a straightforward will with no qualifications or reservations about the bequests to his children.

123 However, Richard said that he had lengthy discussions with George on 20 and 22 December 2001 in which George expressed severe reservations about leaving his estate to his children without the benefit of Richard’s guiding hand to protect their use of their inheritance. Richard said that he made a detailed file note of these conversations which he typed on his laptop computer and carefully dated at the end “11.45pm 22 December 2001”. The file note is seven pages in length and records George’s intentions that, despite the clear and unconditional terms of the will which he was to sign the next day, what he really wished was that his children should have no more than ninety percent of his estate, the remaining ten percent to be distributed amongst his siblings in the complete discretion of Richard. Further, George expressed apprehension that Katrina and Lindsay would dissipate their inheritance and he desired that Richard establish a trust fund “outside his will” by which Richard, as trustee, could control wisely the use and enjoyment by Katrina and Lindsay of their inheritance.

124 Richard says that he carried out George’s intentions, as recorded in the file note, in advising Katrina and Lindsay to establish the Family Trust. Richard showed the file note to Katrina and Lindsay for the first time on the screen of his laptop computer at a meeting with them on 8 April 2004 in an endeavour to persuade them that, in resisting their requests for a distribution of the Family Trust Fund, he was only doing what their father had wished. Richard asked Katrina and Lindsay to accept the file note as genuine. They declined to do so. Whether the file note is, indeed, a genuine and contemporaneous record of discussions between George and Richard which occurred shortly before George made his 2001 will has been a large issue in these proceedings.

125 Both at the meetings with Katrina and George in April 2004 and in the course of these proceedings Richard has laid heavy emphasis upon the computer date stamp appearing on the file note which shows that it was saved to a diskette at 11.45pm on 22 December 2001. Richard says that that date stamp authenticates the document beyond question.

126 The Plaintiffs, through their expert witness, say that it is not difficult to create an incorrect computer date stamp on a document. I need not go into the technicalities: there was no challenge to the proposition that it was technically possible.

127 The only way in which the computer date stamp on the file note could have been verified with certainty was by examining the laptop computer on which Richard said that he had typed the document in December 2001. When these proceedings commenced, the Plaintiffs’ solicitors served a Notice to Produce the laptop computer. Richard’s solicitors responded by saying that Richard had traded the computer in on a new computer. Richard produced a tax invoice apparently showing that the trade-in occurred on 12 May 2004.

128 By 12 May 2004, Richard was well aware that Katrina and Lindsay disputed the authenticity of the file note and were pursuing enquiries as to its authenticity. On 14 April 2004, the Plaintiffs’ solicitors had written to Richard’s solicitors requesting a transcript of the file note which had been shown to Katrina and Lindsay on Richard’s laptop screen. Richard’s solicitors declined the request. The Plaintiffs’ solicitors had pursued the request on 27 April 2004. On 5 May 2004, they had written challenging the establishment of the Family Trust. On 7 May 2004, Richard’s solicitors had responded, asserting that the Family Trust had been established in accordance with George’s extra-testamentary wishes. Clearly, at that point, Richard must have realised that if the authenticity of the file note was challenged, an expert examination of the laptop computer on which he said he had created the document would be critical. Yet, apparently, five days later he disposed of the laptop computer.

129 I do not accept the file note of 22 December 2001 as a genuine contemporaneous record of George’s wishes expressed in December 2001 to Richard. My reasons may be shortly stated:

– the document is replete with detailed instructions from George as to how his estate should be administered. Those instructions are completely contrary to the clear and simple provisions of George’s will, which Richard drew up for him and which George executed on 23 December 2001;

– it would have been an easy matter for Richard to incorporate at least some of George’s instructions or qualifications in the will which Richard was then preparing for George to execute;

– I do not accept Richard’s explanation that there is no testamentary trust in George’s will because Richard, although he had qualified as a non-practising lawyer, did not know enough about will drafting to draft the terms himself and George did not want to engage a lawyer. Richard must have had a competent enough knowledge of will drafting, or access to good precedents, because the will which he drew is not copied from George’s previous will but is nevertheless drawn in exemplary and formal fashion, just as an experienced solicitor would draft it;

– I regard it as inherently improbable that, if George had had the qualifications to the disposition of his estate which Richard records in the file note, George would not have insisted that at least some of those qualifications appear in his will;

– on 8 and 9 April 2004, when the document was first produced by Richard, Richard made a point of emphasising that the document must be authentic because of the computer date stamp. This pre-emptive attempt to forestall a probe into authenticity is typical of his conduct generally: for example, drawing attention in his very first affidavit to the similarity between the facts of the Kevin Reeves claim and the facts in Black v Lipovac and describing the coincidence as “uncanny” : see [92]; see also [59];

– fabrication of the document with an incorrect computer date stamp is technically quite possible and a fabrication of that kind would be consistent with Richard’s conduct in fabricating his pilot log book and his conduct in fabricating the Kevin Reeves claim;

130 While George may have asked Richard to advise and guide Katrina and Lindsay after his death, I am satisfied that he did not express the wish that Richard control their inheritance in the manner recorded in the file note. I conclude that the file note dated 22 December 2001 was fabricated by Richard long after the date that it bears.

False representations

131 Both Katrina and Lindsay are firm in their evidence that at a meeting in the morning of 11 December 2003 between themselves, Richard and Kathryn, Richard represented to them that when George died his estate would have to pay a huge tax bill based on the size of the estate, which could be avoided if assets in George’s estate were transferred into a trust while George was still alive. It is not in dispute that if such a representation had been made, it would have been false and that Richard could have had no reasonable basis for making it.

132 Richard and Kathryn deny that Richard made such a representation. I do not give any credit to Richard’s denial. I prefer the evidence of Katrina and Lindsay to the evidence of Kathryn. Their credit was not shaken at all in cross examination on any issue. Katrina frankly conceded a number of errors in her evidence when they were pointed out to her. She never attempted prevarication. Lindsay was direct and frank in his evidence. He appeared to me to have a clear recollection of what Richard said to him at the meeting on 11 December about the tax consequences to George’s estate if a trust were not established.

133 The whole of the evidence in this case suggests that by December 2003 Richard had formed the firm intention of taking control of George’s estate and administering it between Katrina and Lindsay on the one hand and George’s other siblings on the other as Richard thought best in his own discretion. Richard seems to have an unshakeable belief that by reason of superior intellect, superior professional qualifications and superior business experience, he is best suited to control and direct the fortunes in life of his entire extended family to their own best advantage, whether or not they agree. This appears to have been Richard’s overpowering motive to do whatever was necessary to ensure that he retained control over the disposition of George’s estate.

134 I conclude that it is inherently probable that Richard, as an encouragement to Katrina and Lindsay to agree to his proposal for the establishment of a family trust, represented that they would be financially better off if they agreed because they would thereby avoid a heavy imposition of tax on George’s estate. I find the alleged misrepresentation proved.

135 If this matter had not been compromised during the trial, I would have found that Katrina and Lindsay had relied upon misrepresentation by Richard as to tax consequences for George’s estate, and that their consent to the establishment of the Family Trust had been procured by Richard’s fraud. That finding would have been a sufficient basis for setting aside the Family Trust Deed or granting the other relief sought by the Plaintiffs, without the necessity of finding whether the other representations referred to in [11] had been proved.

136 I think that my finding as to Richard’s representation about tax consequences for George’s estate and my findings as to the file note of 22 December 2001 in [130] are sufficient to deal with the costs issues pertaining to the establishment of the Family Trust.

Conclusions

137 The major issues of credit in the trial have all been found adversely to Richard. There is no contest that in January 2005 Richard procured payment out of the Family Trust Fund of $134,945 to the “Oninama Charitable Foundation” in breach of trust.

138 The Plaintiffs are entitled to relief to the effect set out in paragraph 21 above, save as to costs, which were reserved for argument until these reasons for judgment were delivered.

139 I will stand the proceedings over to a date to be fixed for the Plaintiffs to bring in Short Minutes of Order reflecting these reasons for judgment and for argument as to costs.

140 I will send the papers in the proceedings to the Attorney General and to the Director of Public Prosecutions for consideration as to whether Richard should be prosecuted for perjury under Pt 7 Div 4 Crimes Act 1900 (NSW).

– oOo –

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Citations

Tjiong v Tjiong [2010] NSWSC 578

Most Recent Citation

Chang v Tjiong [2011] NSWSC 1614

Cases Citing This Decision

7

Tjiong v Tjiong [2012] NSWCA 201

Chang v Tjiong (No 2) [2024] NSWSC 74

Chang v Tjiong [2022] NSWSC 1092

Cases Cited

4

Statutory Material Cited

4

Briginshaw v Briginshaw [1938] HCA 34

Briginshaw v Briginshaw [1938] HCA 36

Beling v Sixty International S.A. (No 2) [2015] FCA 355

CITATION:	Tjiong & Anor v Tjiong [2010] NSWSC 578
HEARING DATE(S):	1 to 16 June and 14 to 18 December 2009
JUDGMENT DATE :	4 June 2010
JURISDICTION:	Equity Division
JUDGMENT OF:	Palmer J
DECISION:	Declaration that Plaintiffs’ consent to establishment of trust procured by fraudulent misrepresentation; finding that Defendant fabricated evidence; costs to be argued.
CATCHWORDS:	TRUSTS – FRAUD – PERJURY – Whether Plaintiffs’ consent to establishment of trust under control of Defendant procured by Defendant’s misrepresentation – whether Defendant fabricated evidence in support of his case.
LEGISLATION CITED:	- Civil Aviation Act 1988 (Cth) – s 8 - Crimes Act 1900 (NSW) – Pt 7 Div 4 - Trustee Act 1925 (NSW) – s 70, s 85 - Wills Probate and Administration Act 1898 (NSW) – s 93
CATEGORY:	Principal judgment
CASES CITED:	- Black v Lipovac (1998) 217 ALR 386 - Briginshaw v Briginshaw (1938) 60 CLR 336
PARTIES:	Katrina May Lan Tjiong (First Plaintiff, First Cross Defendant) Lindsay Kuang Djin Tjiong (Second Plaintiff, Second Cross Defendant) Richard Tat Tjhien Tjiong (Defendant, Cross Claimant)
FILE NUMBER(S):	SC 2005/257959
COUNSEL:	M.B. Evans, C. Lambert (Plaintiffs, Cross Defendants) P. Hallen SC, J. Millar (Defendant, Cross Claimant)
SOLICITORS:	O’Brien Lawyers (Plaintiffs, Cross Defendants) Diamond Conway (Defendant, Cross Claimant)