"In terms of preparing cashflow budgets, you undertook that process we know, commencing on 12 May, correct? --- For Blackers, yes.
"Setting Blackers to one side for a moment, in terms of other farm lending, the usual practice was it, was to insist upon the production of budgets of that type, that is to say the type that you have prepared up [sic] on and after the 12 May, but from the client or customer's own accountants? --- Not necessarily, some of the clients prepared their own budgets.
"In the case of the Blackers, they didn't personally prepare their own budgets, did they? --- No.
"And we know that Mr Munro didn't prepare the sort of cashflow budget of the type that would ordinarily be expected from a client or from a client's accountant, don't we? --- Yes."
73 It thus appears that, in the preparation of budgets in the case of the Blackers, Mr Neagle, contrary to the defendant's usual practice, performed, not only his own usual function, but also simultaneously a function which would usually have been performed by the accountant of a prospective borrower (assuming that that prospective borrower had an accountant). Furthermore, Mr Neagle did so, knowing full well when he did so that the Blackers did have an accountant. Why he did so is a matter about which he was not specifically asked, nor did he volunteer an explanation.
74 To return now to the chronology of events, shortly after being advised by Mr Munro to see "John", the Blackers first (in about early May 1993) saw Mr Neagle about Springbrook. Naturally, the Blackers gave in evidence their accounts of what had been said at that meeting and Mr Neagle was cross-examined about (most of) the assertions contained in those accounts. By and large, Mr Neagle agreed in cross-examination with the Blackers' accounts of what had been said at that meeting, although, as to one or two of the matters put to him as having been said, he either answered that he did not recall or that he denied it. Further, as to some of his answers, it is not easy to tell precisely what Mr Neagle was intending to convey. In what follows, I propose to deal only with Mr Neagle's evidence as to what was said at the meeting, rather than dealing with the Blackers' evidence as well. I do so because I find it unnecessary to resolve such conflicts as exist between their respective accounts as to what was said. As will be seen below, looked at from the Blackers' point of view, it is sufficient for their purposes that I proceed on the basis of acceptance of Mr Neagle's evidence about what was said between them, not only at this meeting, but on subsequent occasions as well.
75 I first set out a number of matters put to Mr Neagle about the Blackers' accounts of things said by the Blackers at that meeting with which, as I understand his evidence, Mr Neagle agreed: the Blackers had said that they were looking at Dick Bateman's dairy; the Blackers had told him something of the set up of the property, including that there was a "travelling" irrigation system; the Blackers had said that Mr Bateman's price was $1.68m; Mr Blacker had said that his brother was going to buy South Kanoona for $700,000 and that that sum would be used as a deposit; the Blackers had told him what the milk quota attached to the property was; Mr Blacker had said that if he purchased the property, he would convert the existing irrigation system from the "travelling" type to the "[motor]bike shift" type; the Blackers had said that the existing milk vat was too small and would need to be upgraded (although Mr Neagle qualified his acceptance that that had been said by adding, "Over a period of time"); the Blackers had said that they had never run a dairy farm themselves; the Blackers had asked him to do a budget, which should be "conservative"; and the Blackers had said that they were there [that is, seeing Mr Neagle] "to give them an opinion about it [that is, entering into the dairying business on Springbrook] by reason of what the cashflows would show".
76 I next set out a number of matters put to Mr Neagle about the Blackers' accounts of things said by him at that meeting with which, as I understand his evidence, Mr Neagle agreed: he had told the Blackers immediately that he could run a budget on the bank's computer system; he had asked the Blackers about the number of cows being milked at Springbrook; he had told the Blackers that most of his dairy clients did monthly herd recording to show which cows were more profitable; he had told the Blackers that he had all the figures he needed; he had told the Blackers that, having produced a budget, he would "then let them know whether or not they could proceed"; he had asked the Blackers for some time to do the figures and had told them to come back; and he had told the Blackers that it would be necessary to get an answer from Canberra.
77 I next set out a number of matters put to Mr Neagle about the Blackers' accounts of things said by the Blackers at that meeting as to which I am not certain what Mr Neagle's response was intended to mean. He was asked whether the Blackers had told him that the costs of changing the type of irrigation and upgrading the milk vat should be included in the budget; he answered, "All the improvements [sic] costs that we discussed were put in the budget". He was asked whether the Blackers had told him that they would need to buy replacement heifers, because Mr Bateman was not rearing any at that time; he answered, "I allowed for heifer purchase in the budget". He was asked whether the Blackers had told him that they were intending to take their machinery with them; he answered, "Not all their machinery. They discussed the little four wheel bike or what -- I can't remember the sort of bike it was, to do the ---". He was then asked whether the Blackers had said that they would take their motor bike for moving the irrigation system and their post driver, because extra fencing would be needed; he answered, "I can't remember the post driver. I remember the bike." I take Mr Neagle's first two answers as probably intended to convey assent to the questions asked. I take his last two answers as probably intended to convey that the only machinery which he remembered the Blackers' telling him about was their motor bike.
78 I next set out a number of matters put to Mr Neagle about the Blackers' accounts of things said by him at that meeting as to which I am not certain what Mr Neagle's response was intended to mean. He was asked whether he had told the Blackers that the budget he would do would be "based on the bank's own computer records". His answer was, "Banks - I could punch up a budget, yes, out of the computer". He was asked whether he had told the Blackers that milk production would be significantly higher in the spring. He answered, "Normally it is, yes". He was asked whether he had told the Blackers that they should be able to produce some specified number of litres of milk. His answer was, "I can't remember saying that - I can't remember what exactly what litres I said". Whether the first of those answers was intended to convey assent to the question, I am unable to say. The second and third answers appear to have been intended to convey assent to the question.
79 Mr Neagle was asked whether he had said to the Blackers that the bank had all of the milk prices and freights and levies on the computer. His answer, which (like so many of his answers to questions put to him, some of which I have already set out above) was not directly responsive, was, "I had them available to me, yes". He was next asked whether he had said to the Blackers that there were other input figures which he could use for the purpose of working out the cashflow for them, which question he answered in the affirmative.
80 Mr Neagle was asked some questions specifically relating to discussion at the meeting about Mr Munro, with which it appears to me to be appropriate to deal separately. He was asked whether the Blackers had told him that they had been advised by Mr Munro and that he had done a budget for them. Mr Neagle's answer was, "Yes, they said they'd seen Ewan Munro, yes". (He also acknowledged that, at the time of the first meeting with the Blackers, he had a copy of Mr Munro's budget). Mr Neagle was asked whether the Blackers had said to him that Mr Munro had advised them that the figures were "pretty tight". He answered that he could not recall that. Mr Neagle was also asked whether he had told the Blackers that he would not use Mr Munro's figures in preparing his own budget. Mr Neagle said he could not remember saying that.
81 Mr Neagle was also asked a number of questions, not about what had been said at the meeting, but about what he had known at the time. He agreed that he knew at that time that the Blackers were not dairy farmers, had never run a dairy farm themselves, had no capacity to do any budgets for themselves and had "no familiarity with prices of feed and freight and running costs".
82 About two weeks later, the Blackers again saw Mr Neagle, by which time he had prepared a budget dated 12 May 1993. It covered the same three year period as Mr Munro's budget had. It will obviously be necessary for me to deal in some detail with the content of that budget (as well as dealing with certain aspects of two subsequent budgets relating to Springbrook prepared by Mr Neagle, so far as they differed from those of his first). Before I do so, however, I will mention certain evidence by Mr Neagle about what he said to the Blackers at the meeting at which he gave them the 12 May 1993 budget.
83 First, according to Mr Neagle, at that meeting, "I said they [that is, the figures in the budget] were good". Secondly, Mr Neagle was asked some questions in cross-examination about whether (as they asserted) he had told the Blackers at that meeting that the budget showed that they would have "a $70,000 profit in the second year". The relevant evidence was as follows:
"So is it possible that you said to them that at the end of the second year ... [they] would have a [$]70,000 profit?---No.
…
You've got no recollection, one way or the other, as to what you said to them about the profit at the end of the second year?---I thought I told them there was going to be a profit of about [$]30,000. I can't remember.
You've got a recollection that you told them that there was a profit of about [$]30,000 in the second year?---I can't remember.
...
You now say, do you, that you think instead of saying that there would [be] a [$]70,000 profit in the second year ... in fact you said to them there will be a [$]30,000 [profit] - - -?---No, I can't remember what I said to them. I wouldn't have said there would [be] a [$]70,000 [profit] because it [that is, the budget, did not] show a [$]70,000 profit.
But you've offered up today a reference to a [$]30,000 profit?---No, I didn't offer that all, sorry, that's what - - -
That's what what?---That's what the budget shows there but I'm not saying that's what I told them then.
...
You gave them the document to take away, you didn't say anything at all about profit even though you say today that you think that there was a $30,000 profit --- No, I can't remember saying there was a [$]30,000 profit then."
84 About the evidence which I have just quoted, I make the following observations. It was obviously Mr Neagle's belief, at the time when he gave his evidence before me, that his 12 May 1993 budget had shown that the Blackers would have about a $30,000 profit in the second year from the operation of a dairying business on Springbrook. If Mr Neagle had the belief at the time when he gave his evidence before me that his first budget had shown a profit of about $30,000 in the second year, I infer that he also had that belief at the time of his meeting with the Blackers at which he gave them that budget. In those circumstances, I am prepared to accept, in spite of his later refusals to be positive about it, that he "told them there was going to be a profit of about [$]30,000" in the second year, as he at first said in oral evidence he thought he had.
85 I should, perhaps, add here that according to other evidence which he gave, Mr Neagle reached his conclusion that his 12 May 1993 budget had shown that the Blackers would have about a $30,000 profit in the second year from the operation of a dairying business on Springbrook by subtracting the amount of the closing balance in the Blackers' working account #1 at the end of July 1994 ($27,240) from the amount of the closing balance in their working account #1 at the end of June 1995 ($55,310), both of those figures being shown in his budget. Why that difference, which was actually $28,070, was thought by him to represent the profit predicted to be earned from the operation of a dairying business on Springbrook between the dates of those two closing balances, Mr Neagle did not explain in his evidence. Furthermore, I note that, on the assumption that the process of comparing two closing balances in the Blackers' working account #1 would yield the profit to be earned by a dairying business between the dates of those two closing balances, then Mr Neagle's calculation did not compare the correct closing balances in order to determine the profit for the second year. That is because he compared the closing balance at the end of June 1995 with the one at the end of July 1994, rather than with the one at the end of June 1994. If one compares the closing balance at the end of June 1995 ($55,310) with the closing balance at the end of June 1994 ($38,270), one discovers that the difference (and, therefore, according to Mr Neagle, the profit predicted for the second year) is not about $30,000, but only $17,040.
86 The inference should be drawn from the evidence that, very shortly before preparing his own budget, Mr Neagle had been made aware by Mr Munro, when the two of them had gone through Mr Munro's budget together, that Mr Munro's prediction as to the number of cows being milked at the start of the three year period, namely, 175, already represented an increase of 25 from the number then actually being milked. Such awareness by Mr Neagle militates against a conclusion that Mr Neagle's starting prediction of 190 milking cows had been based on reasonable grounds.
87 As well as the evidence to which I have just referred, the defendant tendered as part of its case in the Federal Court certain answers by the Blackers to interrogatories, in which they had asserted that they had informed Mr Neagle for the purpose of his preparing the budget that Mr Bateman was milking 180 cows. Again, such awareness by Mr Neagle, very shortly before preparing his own budget (though not as destructive as his awareness of what Mr Munro had apparently told him), militates against a conclusion that Mr Neagle's starting prediction of 190 milking cows had been based on reasonable grounds.
88 Having now discussed the question of whether there existed reasonable grounds for Mr Neagle's predictions as to the number of cows being milked during each month of the 36 month period, I mention briefly the question of whether he had reasonable grounds for his predictions as to the average number of litres of milk produced per cow per day in each of those 36 months. In the case of 35 of those 36 months, Mr Neagle simply adopted Mr Munro's (effectively, the Bega Co-operative's) figure and I treat those predictions just as I did Mr Neagle's adoption of Mr Munro's figures as to the number of cows being milked during each month of the 36 month period. However, as to the 36th prediction, namely, 16.5 litres of milk produced per cow per day for the 12th month of the 36, rather than 16, although the difference in terms of milk production is slight, still the fact is that Mr Neagle made no attempt to explain the grounds upon which he had made that particular prediction, nor did the defendant seek to prove otherwise what those grounds had been. In the absence of such proof, I conclude that there were no reasonable grounds for that particular prediction.
89 Katz J dealt with Mr Neagle's predictions in his budget concerning the income and expenditure of the proposed dairying business. I do not find it necessary to consider these in detail. For the reasons given by Katz J, it is clear that the budgets were poorly and carelessly prepared.
90 It is necessary to deal quite briefly with two subsequent budgets of his, one a budget of 25 May 1993 and the other a budget of 7 June 1993. Each of those two budgets was intended to supersede its predecessor and there is no dispute that at least the budget of 25 May 1993 was given to the Blackers, although the defendant did dispute in its scheduled final submissions that the 7 June 1993 budget was given to them.
91 So far as operating income and expenditure is concerned, there is only one difference between the budgets of 12 May 1993 and 25 May 1993. That is in Mr Neagle's predictions of operating expenditure under the heading "Seed & Fertiliser". Whereas the three annual figures under that heading in the 12 May 1993 budget were $15,000, $17,000 and $20,000 respectively, the three annual figures under that heading in the 25 May 1993 budget were $20,000, $22,500 and $23,500 respectively.
92 There is a dispute between the Blackers, on the one hand, and Mr Neagle on the other, as to the circumstances under which those substitutions occurred. Mr Neagle's evidence was, in effect, that he had been directed by Mr Blacker to substitute those precise figures, whereas the Blackers' evidence was, in effect, that they had asked Mr Neagle to increase the predicted expenditure, but had not nominated any particular increase.
93 In my view, it is unnecessary for me to resolve that dispute (although I should mention that there appears to be some incongruity between Mr Neagle's position in the dispute and his evidence that, at the relevant time, the Blackers, to his knowledge, had "no familiarity with ...running costs"). If I accepted Mr Neagle's evidence on the matter in dispute, then that would lead me to be satisfied that Mr Neagle did have reasonable grounds for making those particular predictions in his 25 May 1993 budget (and again in his 7 June 1993 budget). However, his having had reasonable grounds for the making of those particular predictions would have no effect on the multitude of other predictions in his budgets as to which I have already said that I am not satisfied that he had reasonable grounds for making them. For that reason, resolving the dispute presently under discussion would seem to me to be a matter of little consequence in the resolution of the present case.
94 I turn now to Mr Neagle's 7 June 1993 budget. Before dealing with certain changes made to it, it is appropriate to mention yet again the fact that on 1 June 1993 Mr Neagle had submitted to his superiors an application for credit by the Blackers. That application contemplated that for the first two years after they began to operate their dairying business, the Blackers would not repay any of the principal owing on their $900,000 loan from the NAB, but that they would begin to repay principal on the loan in the third year, the principal sum then being amortised over a certain number of years. Mr Neagle's superiors were, however, troubled about the Blackers' capacity to begin repaying principal on the $900,000 loan from the start of the third year of operation of their dairying business, given the figures for the third year contained in Mr Neagle's 25 May 1993 budget. Mr Neagle's superiors also appear to have wanted a shorter amortisation period for the $900,000 loan than Mr Neagle had proposed.
95 It was in that setting that Mr Neagle produced his 7 June 1993 budget. It will be recalled that in his 12 May 1993 budget, Mr Neagle had predicted milking cow numbers reaching 250 in the 13th month of the 36 month period and remaining at that level throughout the rest of the period. (The 25 May 1993 budget was the same in that respect). In his 7 June 1993 budget, Mr Neagle instead predicted that, in the 25th month of the 36 month period, milking cow numbers would increase from 250 to 275 and then remain at that level throughout the rest of the period.
96 That predicted 10% increase in milking cow numbers during the third year of the period should obviously have led to a predicted milk production in the third year of the period which was 10% greater than that which had been predicted in the 12 May 1993 and 25 May 1993 budgets. In fact, due to an arithmetic error on Mr Neagle's part, it led to a prediction by him of milk production in the third year of the period which was over two thousand litres less than a 10% increase. Be that as it may, the extra litres now predicted to be produced were all predicted to be sold as non-quota milk and their sale apparently led to an increase in the predicted gross operating income in the third year of almost $35,000.
97 However, what is striking about Mr Neagle's changes in his 7 June 1993 budget to his predictions as to the number of cows being milked and as to the resulting receipts from the sale of milk is that he found it unnecessary to predict at the same time any increase in operating expenditure in the third year in order to accommodate the predicted increase in cow numbers involved. To take just one example, either the additional cows would require to be fed no bought fodder at all or else the original cows would each have to make do with less bought fodder than first planned, with the difference going to the additional cows. Neither of those alternatives was realistically possible, without a corresponding decline in milk production.
98 In my view, determining whether Mr Neagle had reasonable grounds for the changes which he made (and did not make) in his 7 June 1993 budget is a matter of little consequence in the resolution of the present case (even assuming that he gave that budget to the Blackers). However, his failing to provide for any increase in operating expenditure whatsoever in that budget in consequence of his increase in milking cow numbers appears to me to typify the approach which Mr Neagle took to the preparation of his Blacker budgets generally. In a memorandum dated 5 April 1994, Mr Robert St John, one of Mr Neagle's successors as Bega branch manager, said that Mr Neagle's Blacker budgets had been "inflated to reflect a viable situation", an assessment with which it is hard to disagree, especially in light of Mr Neagle's conduct in connection with his 7 June 1993 budget. It seems plain that in his 7 June 1993 budget, Mr Neagle simply used a device to improve the Blackers' predicted positive net cashflow in the third year for the purpose of allaying his superiors' concerns about the Blackers' ability to switch, in that year, from payments of interest only to payments of principal and interest both on the $900,000 loan and as well accommodating a shorter amortisation period for the $900,000 loan.
99 There is, perhaps, one other aspect of Mr Neagle's 7 June 1993 budget which I should mention briefly. It will be recalled that in his memorandum to his superiors dated 1 June 1993, Mr Neagle had told them that Mr Bateman was milking 185 cows as of that date. Accepting the accuracy of that statement, the fact that Mr Bateman was milking 185 cows on 1 June 1993 militates against the reasonableness of Mr Neagle's persisting, in a budget dated only six days later, with his earlier predictions of 12 and 25 May 1993 that the number of cows being milked at the start of the three year period would be 190.
100 I have already mentioned that there exists a dispute as to whether Mr Neagle gave the Blackers his 7 June 1993 budget. It will be apparent from what I have already said about that budget that it is a matter of little moment that I should resolve that dispute. However, I note that in cross-examination Mr Neagle did give evidence that he discussed with the Blackers at some stage a budget increasing milking cow numbers from 250 to 275 and that he might have had a meeting with them at which he told them that he had redone the budget for Canberra in light of the shorter amortisation period. In those circumstances, it would, to say the least of it, not be straining credulity to conclude that Mr Neagle did give the Blackers his 7 June 1993 budget.
101 Peter Blacker gave evidence that he saw a reference to 275 milking cows in the budget. He knew Mr Bateman had only been milking 180 cows and that Mr Munro's budget had worked on the property running 250 milking cows maximum. However, Mr Neagle said to him, ""Don't worry about that. The lending manager does not understand dairying like I do".
102 Mr Neagle prepared an application for line of credit ("ALOC") and submitted all the documents including cashflow projections to the Canberra regional office. The ALOC submitted by Mr Neagle misrepresented the true facts and the loan was ultimately approved based upon those misrepresented facts. The plaintiffs had signed the supporting documents in blank. In particular, the initial ALOC dated 1 June 1993 misrepresented the extent of the Blackers' knowledge and experience in dairying. Peter Blacker did not spend six weeks assisting Mr Bateman with milking and general dairying operations to gain knowledge of the dairy. The ALOC misrepresented the extent of Peter Blacker's formal qualifications. Peter Blacker attended Yanco Agricultural College but the course was not a four year course. Although the Risk Analysis purported to advance counter measures to the Blackers' inexperience (Tender Bundle Volume 1/93.8), it conveyed the impression that the various named persons had specifically offered to assist the Blackers which was untrue. At best there were names of persons who might, if called upon, be available to assist or advise (see for example reference to Phillip Armstrong at T.897-898, reference to the sharefarmer -"It was on the understanding that he was staying on" T.897).
103 Contrary to what appears at Tender Bundle Volume 1/95.5, the property had not been set up to handle 400 acres of irrigation. This was a representation likely to make the proposal much more attractive to Canberra and more likely to suggest a much more productive property (cf T.896) especially since Mr Neagle believed that the availability of irrigation on a block would add about $1,000 per acre to the value of any property.
104 The budgets compiled by Mr Munro were not based on actual figures employed by Mr Bateman. Mr Munro had never advised Mr Neagle, nor did he in fact have 32 dairy farmers on his books. These figures were utilised in compiling Mr Munro's budgets also.
105 Expenditure figures in Mr Neagle's budgets were not in fact loaded to combat the inexperience of the Blackers.
106 A revised ALOC increased the amount to be provided in the funding table by an extra $54,167 without further reference to the Blackers.
107 In the "Customer Statement of Position" submitted to Canberra, Mr Neagle inflated the value of the bush block to $174,000 notwithstanding Mr Neagle knew that block was of similar quality and size to two other blocks which had previously been sold by the plaintiffs for less than $70,000. The value of Kanoona was similarly inflated from $700,000 to $750,000 and the value of the Blackers' assets was misrepresented in the Schedule of Securities. As to South Kanoona, Mr Neagle knew from as far back as 12 May 1993 that Bill Blacker was to pay $700,000 for that property. Putting a figure of $174,000 into the "Customer Statement of Position" for the bush block was likely to be more impressive to Canberra (T.852.21). The "Customer Statement of Position" was submitted to Canberra knowing the detail was incorrect in relation to South Kanoona.
108 The value of the bush block could not be justified by reference to the existence of a water licence attached to it. At best that would have improved the value of the property by $1,000 an acre. The existence of a water licence stood in marked contrast to the suggestion that it was of similar quality and size to the other two blocks.
109 The above has mainly been taken from the judgment of Katz J who, of course, concentrated on the facts germane to the causes of action before him. Before dealing with the facts particularly germane to the claim under the CRA, I need to note the essence of the result in the Federal Court.
110 Apart from the claim under the CRA, the Federal Court considered claims made under five heads. However, only two were still active at the time for judgment. The plaintiffs' claims under the Trade Practices Act failed because they were out of time. The plaintiffs' claim for damages for negligent misstatement causing economic loss succeeded. However, Katz J did not consider that the evidence presented on the question of quantum of damages at all satisfactory and awarded $92,500 damages plus interest from 1 February 1994. This sum was assessed as about $10,000 per month between the time the plaintiffs acquired the Batemans' assets until the end of June 1994. The defendant succeeded on its cross claim.
111 On 8 June 2000, Katz J indicated the orders that he would formally make after the present proceedings in this Court had terminated. In summary, these are:
1. The plaintiffs give the defendant possession of Springbrook.
2. The defendant have leave to issue a writ of possession.
3. The plaintiffs deliver up to the defendant the cattle on Springbrook and Kangarooby.
4. Judgment for the defendant for $1,551,475.68.
5. Order to account for sale of milk quota.
6. Judgment for the plaintiffs for negligent misrepresentation for $153,968.15.
7. Orders for costs.
112 I return to the facts relevant to the present case. Contracts for the purchase of Springbrook were exchanged on 31 August 1993.
113 On 7 September 1993, the defendant, under Mr Neagle's signature as Manager of the Bega branch, advised that the plaintiffs' application for lending facilities had been approved. Three loans were covered by this advice. First a loan for $50,000 by way of overdraft. This was to provide working capital. Secondly, a fixed loan of $900,000 to purchase the property. Thirdly, a fully drawn loan for $100,000 for capital improvements. The whole set of loans was to be repaid in no more than ten years.
114 The plaintiffs were a bit disturbed by the form of the offer. They called at the Bega branch of the defendant bank. By this time, the defendant had dismissed Mr Neagle from its employ. He in fact left the bank on 17 September 1993.
115 On 22 September 1993, the plaintiffs saw Mr Nibbs, the relieving manager, and explained their problem. Mr Nibbs accommodated the plaintiffs by adjusting the letter of offer. The plaintiffs then accepted that offer.
116 When Mr Nibbs saw the file, he considered that the deal had already been done. However, he was concerned about certain aspects of the matter and telephoned his superiors in Canberra about those concerns. However, he did not say anything to the plaintiffs, except that which is noted in his memorandum.
117 Mr Nibbs wrote a memorandum dated 22 September 1994 to Canberra which is in evidence as Tender Bundle 1/249-250. This memorandum said that in order to keep good customer relations, Mr Nibbs had reduced the figure to that sought by the customer, however, he informed Canberra:
"I have discussed all costings with them (the plaintiffs) and it appears that adequate funds are available to them for the project. HOWEVER, THERE IS VERY LITTLE MARGIN FOR ERROR AND CERTAINLY NO ALLOWANCE FOR EXCESS EXPENDITURE. THEIR MANAGEMENT WILL HAVE TO BE SPOT ON. MR & MRS BLACKER ARE ABSOLUTELY CLEAR ON THIS POINT...". (The use of upper case letters should be noted).