Arwon's position on the cross claim
129 Arwon submitted that there should be no adjournment of the petition because the strength of the cross claim is so lacking that no adjournment is justified. It submitted that the history of years of litigation by Mr Wilson to avoid payment of the debt (now a judgment debt) indicates that Mr Wilson continues to seek to delay payment; that no payment has been made at all towards satisfaction of the debt; and that it is entitled to payment. All such matters, Arwon submitted, are relevant to the exercise of the Court's discretion, and weigh heavily against an adjournment.
130 Arwon points to the fact that the conduct referred to by Mr Wilson in the Conspiracy proceeding is not the conduct of Arwon. For example, the assertion pleaded at para 11(a) of the statement of claim that the Quintis Group allegedly told relevant parties (falsely and with intent to injure) that Mr Wilson had mortgaged the shares of his family company is not an act attributable to Arwon, whether in the particulars or otherwise.
131 Arwon also correctly observes that Mr Wilson's claim (para 11(b) of the statement of claim) that Arwon informed third parties that he was 'not a suitable person to be working with' is not supported by any of the matters referred to in the particulars of that claim.
132 However, Arwon principally relies upon the overlap between the allegations against Arwon in the Conspiracy proceeding and the allegations by Mr Wilson that were rejected in the Debt proceeding. Arwon submitted that the primary judge in the Debt proceeding (affirmed by the Court of Appeal) held that Arwon was entitled to enforce the debt owed by Mr Wilson under the Loan Agreement against him without first having recourse to the collateral provided: Arwon v Wilson WASC at [172]-[174], [217(d)]. Arwon submitted that the relevant findings in the Debt proceeding are not susceptible to challenge in this application, or in the Conspiracy proceeding: Blair v Curran (1939) 62 CLR 464 at 510, 531-533; and Jackson v Goldsmith (1950) 81 CLR 446 at 466-467.
133 Arwon further submitted that the primary judge in the Debt proceeding rejected Mr Wilson's characterisations of Arwon's actions relating to the enforcement of the Loan Agreement. For example, Mr Wilson's pleaded claim that Arwon falsely (and with intent to cause harm) notified parties that it would be taking enforcement action against Mr Wilson under the Loan Agreement was not correct and was based on premises relating to the Loan Agreement and the characterisation of the Group recovery policy, premises expressly rejected by the primary judge: Arwon v Wilson WASC at [25], [60]-[64], [126]-[129], [157]-[158], [172]-[174], [217(d)]. No particulars are provided as to Mr Wilson's allegations in this regard (para 11(b) statement of claim in Conspiracy proceeding).
134 In particular, the following paragraphs from the primary judge's reasons are important in this context:
[126] By my assessment, there has been a strong attempt by Mr Wilson to elevate the stature of this document to advance his cause. The document was simply, I find, an internal procedure document of Arwon. Mr Wilson seeks to make of it something set in stone. But such an approach is illogical. It goes beyond what a rational commercial lender would shackle itself to, in effect, in perpetuity and no matter what might be the prevailing circumstances surrounding a borrower's repayment default were. That is far too extreme a position to reach by reference to the bland commercial content of this document.
[127] To the extent Mr Wilson contends the arrangements as identified by cl 7 reflect an enforcement procedure approach taken by Arwon, which was incapable of ever being departed from across the time span of years of any loan, then I would reject the contention as commercially untenable. That position is not supported by the text of the Arwon Loan Policy document, read sensibly.
[128] Furthermore, to the extent Mr Wilson's evidence would also suggest the Arwon Loan Policy document was more than an internal Arwon day to day working procedural guide but, rather, the manifestation of Arwon's so-called inflexible and universally applied 'trees first' recovery policy, then I am left not at all persuaded this was ever the case. Mr Wilson might, of course, over the course of his 20 years of prior work experience as an Arwon and Quintis insider and senior decision maker, have internally convinced himself of Arwon's likely universal application of a 'trees first' loan recovery approach - without potential for any future recovery deviations across the course of a borrower's loan arrangements spanning potentially many years into the future. If Mr Wilson did lead himself into holding such a view, then that was, I would find, an unreasonable state of mind for Mr Wilson to have reached. He did not hold a lifetime appointment as a member of the board of Arwon (as subsequent events confirm).
[129] Consequently, any assumption(s) that Mr Wilson held concerning a necessary future application to him as a defaulting borrower by Arwon of an inflexible future 'trees first' recourse against himself under the Loan Agreement, should he default in the future, would be unreasonable and self-induced. That state of assumption, if held, would be a case of an assumed position reached in the mind of Mr Wilson by his persuading himself of such a likely future recovery position to be followed by Arwon, more by way of a self-delusion, rather than by acting on a body of underlying rational facts to reasonably support that otherwise uncommunicated (by Arwon) state of mind and assumption concerning the extent of a his future risk exposure as a possible defaulting debtor, should he ever default on his repayments as a borrower years off in future.
…
[157] Quintis might, as a routine practice, have preferred for a time to first foreclose against a grower's asset, rather than to first pursue the defaulting grower for all their debt personally. But a preference for such an approach is hardly some act of generalised waiver by Arwon as regards limiting any of its recovery options for the future as against all its borrowers generally. Nor can I conclude that Arwon had ever indicated to its borrowers generally some truncation in the ambit of Arwon's potential lender recovery remedies available to Arwon from a future loan recovery perspective as against any particular grower under circumstances of a loan repayment default at some time in the future by the debtor.
[158] Assuming a standard course of commercial debt recovery approach taken by Arwon, by it usually acting to pursue foreclosure as the first favoured recovery strategy option, and then to obtain some perceived financial benefits for the Quintis Group by then directly owning more trees, is one thing. It is entirely another, and going much too far, to suggest, as Mr Wilson does, that a normative loan recovery approach favoured by Arwon in the period when he was on the board was inflexibly to be the only, invariable debt recovery strategy to be applied forever and with no room for a discretionary application of a different recovery approach should Arwon management see fit to follow a different recovery approach permitted under the terms of the debtor's Loan Agreement as regards a particular defaulting borrower in future.
…
[217] Hence, on my assessment, Mr Wilson's promissory estoppel case, even on the basis of all his other evidence being accepted, would still fail predicated upon his failure to establish:
(a) Any representation from Arwon to him communicating the 'trees first' recovery policy he contends for. Indeed, as I assess Mr Wilson's pleading, he has never run an estoppel by representation case.
(b) Accepting for argument's sake that Mr Wilson at some point had persuaded himself in his mind (based upon his 20 years or so of Quintis Group insider knowledge) the uncommunicated to anyone else assumption that Arwon would not pursue him personally until it had first foreclosed and only then if there was a SGARA value ascertained shortfall - then such an assumption was nevertheless an uncommercial and unreasonable assumption for him to hold in all the circumstances. It was commercially naive for Mr Wilson to make that assumption, absent some clearer express written commitment by Arwon confirming such a future position and issued by someone for Arwon other than himself (due to an obvious conflict of interest). But Mr Wilson never discussed obtaining such a written commitment with anyone else at Arwon/Quintis. He never got one. In truth, he simply ignored or took a gamble on the future, in circumstances where he had already obtained a significant tax benefit arising out of this investment by using the proceeds of the loan he received from Arwon. In such circumstances, a 'trees first' recovery assumption, if held, at 30 June 2014 (but which I would find is not proved) would in any event have been unreasonably reached. If anything, this expressed assumption position, I conclude, has emerged only very much later in the circumstances of Mr Wilson's repayment defaults and his cessation in holding board positions with Quintis and Arwon, after 27 March 2017.
(c) In any event, I find no reliance proved by Mr Wilson upon such an assumption in all the circumstances.
(d) I find that Arwon, the corporate entity (absent what would be irrational assumptions made by Mr Wilson as its CEO), made no relevant contributions by reason of its prior recovery conduct actions taken against other defaulting borrowers over time towards the encouraging, acquiescing in, ratifying or providing to Mr Wilson any reasonable basis for him to support a holding by him of the assumption he contends (assuming, contrary to my primary finding such an assumption was ever held by him). Loan recovery actions by Arwon over time against defaulting borrowers as regards favouring asset foreclosure first, relating to other individual defaulting lenders, may be accepted. But such past recovery conduct of itself by Arwon set no precedent. It did nothing to detract against an applicability to Mr Wilson of the Arwon's express full recovery under his Loan Agreement terms. The plenary recovery options thereunder were a matter of discretion for Arwon to pursue as it assessed to be appropriate under the circumstances of Mr Wilson's potential future repayment default as a borrower, should that ever happen.
135 As is apparent from those extracts, the primary judge clearly and categorically considered and dismissed Mr Wilson's claims as to the nature and enforceability of the so-called Group recovery policy. Arwon submitted that accordingly the central premise of the First conspiracy is not tenable. This, it submitted, is significant because the acts specifically alleged against Arwon that are said to constitute the tort of conspiracy relate to the enforcement of the Loan Agreement as part of the First conspiracy. This part of the claim is highly likely to fail, and so the conspiracy cause of action against Arwon is similarly likely to fail.
136 Further, Arwon's decision to sue Mr Wilson for the debt in the Debt proceeding was one of its 'plenary recovery options' (Arwon v Wilson WASC at [217(d)]) - and was a commercial choice that Arwon was entitled to make and which was made for commercial reasons. Arwon submitted that in circumstances where the underlying security over the trees was illiquid and might takes some time to realise (matters apparently said by Mr Wilson himself in evidence in the Debt proceeding - Arwon v Wilson WASC at [218]), the decision to pursue him rather than to take possession of the plantations, and so assume the costs of maintaining, managing and seeking to realise those plantations, was commercially justifiable.
137 Arwon also relies on particular evidence directed to the fifth matter, being the prospective transaction with Steynton to recapitalise the Quintis Group. Mr Louden gave evidence that Steynton submitted a non-binding and indicative offer on 28 August 2017. Steynton was granted access to a data-room containing 823 documents. The Quintis Group granted access to 17 people associated with the Steynton due diligence process, and 13 people accessed documents in the data room. Steynton submitted 38 questions through the data room, 37 of which were answered by representatives of the Quintis Group. Steynton's representatives performed site visits to various Quintis Group sites in November 2017.
138 Between November 2017 and 18 January 2018, representatives of the Quintis Group and representatives of one of its secured noteholders (Blackrock) made multiple requests of Steynton to provide evidence that it had sufficient funding to complete the proposed transaction. Despite these requests, Steynton did not provide any evidence satisfactory to the noteholders that it had secured finding to complete the transaction. Correspondence from Sarah Thompson of Blackrock to the Quintis Group, McGrath Nicoll and Allens, recording that Mr Wilson had continued to email her 'with no evidence of a commitment', was in evidence. Also in evidence was a letter from Sternship Advisers (advisers to the Quintis Group) to Mr Scott and Mr Wilson seeking evidence of equity support and financial commitment by 17 January 2018, and indicating that absent such evidence, Quintis Group would assume that it does not exist.
139 Arwon also relies on the absence of any conduct on its part with respect to the alleged Second conspiracy, observing that the acts pleaded were alleged to have been undertaken by SPL and Quintis. Arwon's role in the Quintis Group was confined to providing financing to investors and it did not perform plantation management services, nor was it involved in decision making in that regard. I have already referred to the email evidence adduced by Mr Wilson and Mr Prestwich relevant to the water supply and infrastructure issues, and the role of the receivers ([93]-[119] above).
140 As to the quantum the subject of the Conspiracy proceeding, Arwon submitted that it was not necessary for this Court to deal with it, as the other elements of the alleged conspiracy have no prospect of being established, but submitted that Mr Wilson's evidence on quantum should be treated with a degree of scepticism, submitting that the primary judge in Arwon v Wilson WASC had noted the potential range of different valuations referred to by Mr Wilson.