British Marine PLC v Wollongong Coal Limited

Federal Court of Australia|2015-04-30|Before: Mr P, Ms J, Buchanan J

Counsel for the Plaintiff: Mr E G H Cox with Mr T E O'Brien

Counsel for the First Defendant: Mr C H Withers with Mr P A Meagher

Solicitor for the First Defendant: Holding Redlich

Solicitor for the Second Defendant: Barringer Leather Lawyers

4 May 2015 In paragraph 167, "north" has been changed to "south".

6 November 2015 The Counsel appearance for the Second Defendant has been corrected.

IN THE FEDERAL COURT OF AUSTRALIA IN ADMIRALTY NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2347 of 2013

JUDGE: BUCHANAN J DATE OF ORDER: 30 April 2015 WHERE MADE: SYDNEY

The further amended application be dismissed with costs.
The cross-claim by the second defendant against the first defendant be dismissed.
The cross-claim by the first defendant against the second defendant be dismissed.
There be no order as to costs of the cross-claims. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA IN ADMIRALTY NEW SOUTH WALES DISTRICT REGISTRY GENERAL DIVISION NSD 2347 of 2013

JUDGE: BUCHANAN J DATE: 30 April 2015 PLACE: SYDNEY

The pleadings in outline 1 In these proceedings the plaintiff ("British Marine") initially sued the first defendant (now "Wollongong Coal") upon an asserted guarantee dated 3 October 2013 whereby, British Marine asserted, Wollongong Coal contracted to assume specified obligations owed to British Marine by Gujarat NRE Coke Limited of Kolkata ("Gujarat India") under a contract of affreightment made between British Marine and Gujarat India on 16 September 2008 at London. The obligations which were asserted to have been assumed related to payment of freight for bulk coal shipped from Port Kembla, New South Wales to India on the vessels "Volumnia" and "Wadi Alkarm" in circumstances to which further attention will be given in due course. 2 In the alternative, British Marine sued Wollongong Coal for misleading and deceptive conduct within the meaning of s 18 of the Australian Consumer Law (Sch 2 to the Competition and Consumer Act 2010 (Cth)). 3 By the first of a number of amendments to the pleadings, British Marine also sued the second defendant (Mr Jagatramka) for breach of warranty of authority. Mr Jagatramka was, on 3 October 2013, Executive Chairman of Wollongong Coal (then called Gujarat NRE Coking Coal Limited). British Marine claimed that when Mr Jagatramka signed the asserted guarantee he warranted to British Marine that he had authority to bind Wollongong Coal. If, as Wollongong Coal pleaded by its initial defence, Mr Jagatramka had no authority to bind Wollongong Coal then British Marine asserted he was personally liable for breach of his warranty of authority. Later, by a further amendment to its pleaded case, British Marine also sued Mr Jagatramka on the basis that he was "involved" in the misleading and deceptive conduct pleaded against Wollongong Coal and also sued him directly for misleading and deceptive conduct. 4 Towards the end of the evidence, Mr Jagatramka filed a cross-claim against Wollongong Coal relying upon a policy of insurance which indemnified him for acts done in his capacity as director, except with a lack of good faith. Wollongong Coal's defence to the cross-claim asserted a lack of good faith. Wollongong Coal then filed a cross-claim against Mr Jagatramka, relying principally on the allegation of lack of good faith, claiming he had acted in breach of his duties as a director of Wollongong Coal and claiming compensation from him for any loss Wollongong Coal might suffer as a result. 5 Gujarat India had been the parent company of Wollongong Coal and Mr Jagatramka held a position of authority in each. However, on about 16 October 2013, control of Wollongong Coal effectively passed into other hands and Mr Jagatramka ceased to have authority in that company. Wollongong Coal says that when the document upon which British Marine relies came into the possession of British Marine Mr Jagatramka was, to the knowledge of British Marine, no longer in any position of authority. 6 Wollongong Coal in any event denies that there was any contract of guarantee as alleged and says that British Marine did not rely (or should not have relied) on any suggestion that Wollongong Coal would assume liability for debts owed to British Marine by Gujarat India. 7 Wollongong Coal has also identified the following alleged concurrent wrongdoers who, it asserts, bear effective responsibility for any loss or damage suffered by British Marine: Mr Jagatramka; Saigal SeaTrade (P) Ltd Mumbai ("Saigal SeaTrade"), an independent broker involved in the commercial transactions at the heart of the present dispute; Mr Ian Hawkes, a partner in the law firm of Moore Fisher Brown ("MFB Solicitors") of London who provided advice to British Marine on 4 November 2013 that the letter dated 3 October 2013 (on which British Marine now sues) appeared to be a valid guarantee; and MFB Solicitors. 8 Of the asserted concurrent wrongdoers, only Mr Jagatramka has been joined as a party to the proceedings. 9 Mr Jagatramka's defence seems to concede that Wollongong Coal is liable to British Marine for the particular debts of Gujarat India (it is in his interest to take that position) but he denies that the letter dated 3 October 2013 was a guarantee or that he gave any guarantee on behalf of Wollongong Coal. He also has suggested that his liability, if any, should be reduced because there were concurrent wrongdoers. There are a number suggested. I will refer to them again in due course. 10 Although I will discuss the various causes of action in more detail later in this judgment, it will be necessary to make some observations and findings about some factual matters as those facts are outlined and discussed. There are some matters of fact to which the evidence was directed, and which I will discuss, which will make little final contribution to any assessment of suggested legal liability arising from the pleadings. 11 The facts, as I discuss them hereunder, are those which, in my view, the evidence establishes. The legal principles to be applied to them to resolve the present case are not particularly complex and they are more confined in scope than the arguments of the parties would suggest. Despite some complexities arising from the fluid nature of the commercial interactions, I am satisfied that the basic factual position is not too difficult to discern.

Wollongong Coal and Gujarat India 12 Gujarat India produces metallurgical coke. It needs coal to do so. Mr Jagatramka is its Chairman and Managing Director. He is also its major shareholder. Mr Jagatramka's personal interests are directly connected with the interests of Gujarat India. 13 Until October 2013, Gujarat India was the majority shareholder in Wollongong Coal (which, as earlier indicated, bore the "Gujarat" name). From September 2011, until a date in October 2013, Mr Jagatramka was Executive Chairman of Wollongong Coal. He exercised a good deal of day-to-day control and discretion. He ceased, formally, to be Executive Chairman on 26 October 2013 but, as the evidence showed, he regarded himself as having been removed from any real authority on about 16 October 2013. That date, and the effective removal of Mr Jagatramka's powers of decision at Wollongong Coal, are important matters in an understanding of events as they unfolded. 14 It will be necessary to return in more detail to the change in management of Wollongong Coal in due course.

The contract between Gujarat India and Wollongong Coal 15 The events which generated the present proceedings arose from shipments of coal from Port Kembla on the Volumnia and Wadi Alkarm. It is the shipment on the Wadi Alkarm which requires detailed attention. The shipments were amongst a number which were subject to the terms of a contract between Gujarat India and British Marine for the shipment of coal which will be explained in due course. The shipments arose from a contract between Gujarat India and Wollongong Coal for the sale and supply of coal, as described hereunder. 16 On 11 May 2007, Gujarat India contracted with Wollongong Coal (under an even earlier name - India NRE Minerals Limited) to provide coal on specified terms. The price was to be the "Queensland hard coking coal price agreed with the Japanese Steel Mills on an annual basis". Price was to be FOB. Risk was to pass to Gujarat India as coal passed the rail of the loading vessel, but title was to pass upon payment "in accordance with this Agreement". 17 Clause 5 provided: 5. PAYMENT 5.1 Credit Facilities [Gujarat India] shall establish credit facilities for all shipments of Product under this Agreement. Payment shall be made to [Wollongong Coal] against credit facilities established by [Gujarat India] for 100% of the FOB value of the Product. 5.2 Drawdown [Wollongong Coal] may draw against such credit facilities to be payable for 100% of the invoice value of the Product supplied upon presentation of appropriate documentation. 18 The arrangements for Wollongong Coal to draw against credit facilities put in place by Gujarat India were subject to recovery from Wollongong Coal by Gujarat India's bankers if Gujarat India failed to comply with the credit arrangements. Those recovery arrangements were used in the case of the Wadi Alkarm shipment, as I will indicate. 19 It later suited Gujarat India and Wollongong Coal to convert the payment terms to "C&F" (or CFR). The shipments on both the Volumnia and the Wadi Alkarm were subject to this change, but it will suffice to indicate the particular arrangements for the Wadi Alkarm. 20 In a contract note dated 1 July 2013, the contract price for the shipping period 1 July 2013 to 30 September 2013 for 200,000 tonnes was fixed at US$67 per metric tonne FOB, with the option to convert to C&F. By an addendum dated 30 July 2013, the contract price for 70,000 tonnes (the Wadi Alkarm shipment) was converted to US$92 per metric tonne C&F. The freight component of this amount was US$25 per metric tonne, which was said by Mr Jagatramka in his evidence to include "a slight margin of profit" for Wollongong Coal (US$0.766 per metric tonne for that shipment). Mr Jagatramka explained that the change from FOB to "CFR" was made to avoid the need for separate regulatory approval of a foreign (rather than Indian) vessel which might be required for a FOB contract. 21 The contract note for the shipment to be carried by the Wadi Alkarm specified 70,000 MT (+/ 10%). The shipment loaded in September 2013 was 66,762 MT. 22 Although, so far as British Marine was aware, the whole of this shipment was destined for Gujarat India, in fact arrangements were made, first, for Wollongong Coal to directly sell 22,000 tonnes (+/ 10%) of the shipment to another Indian company, Concast Global Limited ("Concast") at the same price, US$92 MT C&F. However, the initial contract with Concast had specified a selling price of US$105 MT with Wollongong Coal entitled to draw 90% against an irrevocable letter of credit. Payments were received in the bank account of Wollongong Coal, under those arrangements on 31 May 2013 and 3 June 2013 of US$992,250 on each occasion, representing the great bulk of the finally agreed payment of $US92 MT. When the Concast coal was loaded on the Wadi Alkarm (total 21,600 MT) as part of the total shipment of 66,762 MT, two further invoices were raised for US$1350 each, representing the balance due from Concast. Payment was due, probably after 180 days. The evidence did not show actual receipt by Wollongong Coal, but the amount is trivial for present purposes. 23 The balance of the shipment loaded on the Wadi Alkarm (45,162 MT) was sold by Gujarat India on the high seas through an intermediary to yet another Indian company Sona Alloys Pvt Ltd ("Sona Alloys"). That was also unknown at that time to British Marine. That sale did not affect the liability of Gujarat India to Wollongong Coal for this part of the shipment and Wollongong Coal rendered an invoice on 9 September 2013 to Gujarat India for US$4,154,904, together with the necessary supporting documents. Mr Jagatramka's evidence was (from his recollection) that under the bill discounting facility which Gujarat India had with its banker, payment would have been available to Wollongong Coal shortly thereafter and was taken by Wollongong Coal around 1 October 2013. However, failure by Gujarat India to make payment to its bank within 180 days (by 7 March 2014) would result in the entries being reversed and Wollongong Coal being liable to repay. That is apparently what happened. 24 Bills were presented (8 x US$460,000 and 1 x US$474,904) totalling US$4,154,904. Wollongong Coal initially received into its bank accounts on 1 October 2013 six amounts of US$460,000, one of US$457,500 and one of US$390,000, a total of US$3,607,500. Mr Jagatramka volunteered that the bill discount limit may have cut in and reduced some of the payments due, but it is clear in any event that total payment was withheld or not made. The payments received were later retrieved when, it may be inferred, Gujarat India failed to honour its arrangements with its bank. 25 Although it does not bear on any question of liability, the arrangement which Gujarat India negotiated with Sona Alloys, according to Mr Jagatramka, was that Sona Alloys would pay by allowing a credit against an existing debt owed by Gujarat India as it took delivery of the coal. Mr Jagatramka estimated that 45 or 50% of the sale price was exchanged in this fashion, but the balance of the value of the sale had not been realised due to a lien British Marine had exercised over a portion of the coal shipped on the Wadi Alkarm, the circumstances of which I will explain in due course. 26 The end result, in practical terms, is that Wollongong Coal was paid by Concast for 21,600 MT. It was not paid by Gujarat India for the balance of the shipment. 27 One further matter might be mentioned here. As will be seen, the arrangements for the use of the Wadi Alkarm arose under a contract between British Marine and Gujarat India, which will be discussed next. On 25 November 2013, Gujarat India's broker, Saigal SeaTrade, forwarded a document to British Marine "for Owners counter-signature". The document purported to be a "Fixture Note Dated 26th July 2013". It bore the signature of Mr Jagatramka as Executive Chairman of Wollongong Coal. It purported to record a contractual agreement between British Marine and Wollongong Coal whereby Wollongong Coal would bear direct liability for the cost of carriage of a shipment of 70,000 MT. The proposal bears the appearance of an attempt to retrospectively adjust rights which, by then, were the subject of the present proceedings. 28 There are some curiosities which should be mentioned. One is that the covering email referred to the Wadi Alkarm, but the attached document referred to the Volumnia. The fixture referred to was to take place (as recorded by the proposed fixture note) between 14 and 23 August 2013. The Volumnia was in fact loaded in March 2013. The Wadi Alkarm, on the other hand, was nominated by Gujarat India on 30 July 2013 and her delayed loading occurred on 6 September 2013. 29 I am satisfied, therefore, that the proposal for countersignature of the "Fixture Note Dated 26th July 2013" was an invitation to British Marine to participate in an attribution of liability to Wollongong Coal concerning the Wadi Alkarm shipment which had been loaded and despatched more than two months before the proposal. Indeed, as I have said, these proceedings had been commenced before the proposal was offered to British Marine for its acceptance. 30 The document forwarded by Saigal SeaTrade was not countersigned by British Marine. Mr Jagatramka vacillated about whether he signed the proposal or did not sign it, whether it was signed around the date of the email and whether he had ever seen it before. It is one only of a number of documents transmitted by Saigal SeaTrade to one or other of the parties to the proceedings at various times which are open to the charge of being misleading or dishonest in their intent. Others will be referred to in due course. Mr Jagatramka's participation in this attempted duplicity, evidenced by his signature on the document, is manifest.

The contract of affreightment 31 British Marine owns and operates ships. British Marine is based in London and has offices in Singapore and Mumbai. In 2008 it owned 14 vessels and chartered in about 30 to 35 from other owners, according to the evidence of its founder and CEO, Mr Alan Bekhor. 32 In 2008 British Marine was introduced to Gujarat India by Saigal SeaTrade, which thereafter acted as broker in dealings between the two companies and was the usual medium of communication between them. It is important to indicate at once that I am satisfied that Saigal SeaTrade was not the agent of Wollongong Coal. Indeed, I am satisfied, for reasons which will require explanation, that Saigal SeaTrade commenced to act, from about mid-October 2013 against the interests of Wollongong Coal, probably to serve the personal interests of Mr Jagatramka and the commercial interests of Gujarat India. 33 There were, it will be seen, occasions on which Saigal SeaTrade expressly disclaimed any role as agent by endorsing its communications "as brokers only". 34 On 16 September 2008, when the international freight market was buoyant, British Marine and Gujarat India entered into a contract of affreightment (also referred to hereunder as the charter party) on the Americanized Welsh Coal Charter form. The charterer was Gujarat India or its "guarantee nominee". No nominee was ever appointed. The contract called for four cargoes per year of 70,000 MT of bulk coking coal to be shipped from any of five Australian ports (Hay Point, Gladstone, Abbot Point, Newcastle and Port Kembla) to any of a number of ports in India. The contract period was 1 April 2009 to 31 March 2014 (i.e. 5 years, 20 shipments). 35 Clause 25 provided: 25. Charterer shall have the privilege of transferring part or whole of the Charter Party to others, charterer guaranteeing to the Owner due fulfillment of this Charter Party. 36 Clause 29 provided that, on payment of freight, Saigal SeaTrade was to be paid by British Marine a commission of 2.5% on specified gross amounts - freight, dead freight, demurrage and BAF. It is not suggested that Saigal SeaTrade was thereby rendered the agent of British Marine. 37 There were adjustments made to the contract by a series of addenda. The 7th lifting was, by addendum 3-A, deemed to be "washed out" on payment by the charterers (Gujarat India) of lump sum compensation of US$275,000. This is worthy of mention for the reason that invoices (a first dated 21 March 2011 and then a second dated 4 April 2011) were sent out to Wollongong Coal for this amount. There were two other isolated instances where this occurred. On 12 October 2010, a revised invoice for the 5th lifting (MV "FD Isabella") was apparently issued in the name of Wollongong Coal, but it was forwarded by Saigal SeaTrade to Gujarat India for attention. On 13 November 2013, solicitors for Wollongong Coal made a claim on Gujarat India for satisfaction of an invoice dated 30 September 2013 (US$274,349.56) in the name of Wollongong Coal. However, this invoice (relating to the Volumnia) related to a debt invoiced to Gujarat India on 14 August 2013 (US$273,225.18) and invoiced again to Gujarat India (US$274,349.56) also on 30 September 2013. I think it likely, having regard to its timing and matters I shall discuss later, that this invoice in the name of Wollongong Coal was a fabrication, although it is not necessary to reach any final conclusion about that particular document. 38 So far as the evidence showed, these odd examples appear to be the only invoices rendered (or copied) to Wollongong Coal in its own name. All others, reflecting the obligations under the charter party, were rendered to, and in the name of, Gujarat India. 39 I shall separately identify some other invoices which appear to me to have been falsified by Saigal SeaTrade and then sent to Wollongong Coal. They were not issued by British Marine which, until it claimed the benefit of a separate guarantee, looked invariably to Gujarat India for payment. 40 However, as a matter of commercial practice, although invoices were rendered to Gujarat India payment was made to British Marine by Wollongong Coal when it was under the control of Gujarat India and Mr Jagatramka. That occurred for lifts which were washed out and for shipments made. 41 Apart from the 7th lift, referred to above, the 6th lift was agreed to be washed out also, on payment of US$400,000. Although there is no invoice in evidence, this payment was made by Wollongong Coal. 42 Aside from the first shipment, which was from Gladstone and Hay Point, the subsequent shipments appear to have been from Port Kembla (one took coal also from New Zealand). There is no record of payment of freight for the first shipment in evidence. The records before the Court are incomplete, and there may have been occasions of part payment only, but it appears that, thereafter, when coal was shipped from Port Kembla, it was Wollongong Coal which transferred payment to British Marine. 43 That general practice accords with the evidence given by Mr Jagatramka, and it is not contradicted by any other evidence. Mr Jagatramka said, at one point in his evidence: --- … I don't think anybody in the chain, including us or Saigal, were ever clear about the two companies as separate, because the business was, how - what I would call, like, a vertically integrated resource business. 44 The arrangements between Gujarat India and Wollongong Coal were of no legal significance to British Marine. Even if Wollongong Coal had been appointed Gujarat India's "guarantee nominee", or if the charter party had been transferred in whole or in part, Gujarat India would remain liable under the contract made on 16 September 2008. British Marine conducted itself at all times in accordance with this view of its legal position. During the commercial conflict which developed in late 2013, which has led to the present litigation, it rendered its invoices to, and only to, Gujarat India. 45 I am satisfied that, as between the various parties, the internal arrangements between Gujarat India and Wollongong Coal, whereby coal was shipped on a CFR, rather than FOB, basis and funds were then transferred to British Marine by Wollongong Coal on behalf of Gujarat India, had no effect on the legal rights and obligations under the charter party and did not commit Wollongong Coal legally to British Marine.

The Volumnia debt 46 The global financial crisis at the end of 2008 placed strain on the international freight market. Mr Bekhor explained: --- … As many people in this room will be aware, there was a crash at the end of 2008 and that led to a certain amount of strain in the freight market. Many companies defaulted, some went out of business altogether. Some of the stronger ones, some of the more reputable ones honoured their contracts in full. There were a number of - there were a number of contractors who came and asked for renegotiations, asked for lower prices. … 47 Both Mr Jagatramka and Mr Bekhor referred to delays in complying with obligations under the contract during 2010 and 2011. First, according to Mr Bekhor, there were delays in nominations. Addenda to the charter party reflect adjustments which were agreed on 5 October 2011. Three remaining shipments for 2011 were to be postponed. Two were to be performed in 2012 (therefore six lifts in 2012) and one in 2013 (therefore five lifts in 2013). 48 There were also delays in payments. The charter party called for 95% of freight to be paid within five banking days of "signing/releasing Bill(s) of Lading and completions [sic] loading and sailing of the vessel", and invoices were rendered to Gujarat India on that basis. The balance was due 30 days after discharge. Those payments were being postponed. 49 Mr Jagatramka said that, going into 2013, payments by Wollongong Coal to various creditors were being prioritised, and delayed where possible. 50 Matters came to a head, between British Marine and Gujarat India (and Mr Jagatramka) in early 2013. 51 On 20 February 2013, the Volumnia was nominated to load 70,000 MT of bulk coking coal at Port Kembla, to be discharged at Bedi, India. The Volumnia loaded on 25 March 2013. An invoice for 95% freight issued on 28 March 2013. Payment was not immediately made. In addition, payment was outstanding from a previous shipment carried by the MV "Dragon". On 29 April 2013, a payment was made by Wollongong Coal which addressed the freight payment due for the Volumnia and part only of the payment due for the Dragon. In addition, demurrage charges incurred by the Volumnia remained unpaid. 52 On 21 June 2013, a meeting was held at the British Marine office in London. Minutes were taken, and circulated on 24 June 2013. Mr Bekhor and Mr Peter Johnson attended for British Marine, Mr Jagatramka and Mr Nitin Daga attended for Gujarat India and Saigal SeaTrade was represented by Mr Deepak Saigal. The minutes record the following: Gujarat Nre expressed their gratitude to British Marine for their support and advised them of the tough time they are going through and the reasons for same. British Marine also expressed that they need to have the old outstanding paid at the earliest and also need new nominations which are long overdue. It was then agreed as follows. 1. Gujarat Nre to arrange to settle the old outstanding latest by 31st July together with interest on the delayed payment to be calculated from overdue dates. 2. Gujarat Nre to give next nomination in Aug. 13. There after to give at least 2 more nominations between Sept to Dec. Further Gujarat Nre requested if British Marine could consider investment in the Australian company with favorable terms to be discussed. 53 In his evidence in chief, Mr Bekhor accepted that he regarded Mr Jagatramka to be present as the representative of Gujarat India, as the minutes record, and not as the representative of Wollongong Coal. In cross-examination he asserted to the contrary. I do not accept that the evidence given in cross-examination represented Mr Bekhor's true belief. British Marine's consistent position, and his, was that its legal relationship was with Gujarat India and that it was Gujarat India which was in default. British Marine did not regard itself, at that time at least, as having any legal relationship with Wollongong Coal. 54 Mr Jagatramka asserted that he was representing both Gujarat India and Wollongong Coal. Perhaps there was an element of practical truth in this assertion because, at a practical level at least, any failure to pay was being implemented through Wollongong Coal. However, I am satisfied that Mr Jagatramka had no misunderstanding about the legal position, and that he understood that it was Gujarat India which was in contractual default and on whose behalf he was negotiating in the meeting. 55 There is no legal consequence, in any event, from beliefs (much less assertions) about representation at this meeting. Its practical significance is that it opened the way to the nomination of the Wadi Alkarm for the next shipment, based on promises to pay the outstanding amounts. 56 It appears likely that the balance of the debt arising from use of the Dragon was paid on 1 August 2013, but the remaining debt from the Volumnia was still outstanding when the Wadi Alkarm sailed with its cargo. That debt was reinvoiced to Gujarat India on 14 August 2013, at US$273,225.18.

The Wadi Alkarm 57 The Wadi Alkarm was nominated on 30 July 2013 to carry 70,000 MT to New Mangalore. She was loaded with 66,762 MT of coking coal on 6 September 2013. She sailed on 18 September 2013, in circumstances where British Marine claimed a right to payment of "dead freight" for freight not loaded. On 11 September 2013, British Marine invoiced Gujarat India for 95% of freight (including dead freight) payable: US$1,715,161.35. 58 As a matter of practice, Mr Bekhor pressed for payment in accordance with the terms of the charter party, but he was philosophical about the commercial realities. Both his commercial interests, and his commercial leverage, came together most substantially when a vessel arrived off a port for discharge. He said in his evidence in chief: ---The contract called for the payment of freight, I think within three days after loading of the vessel in Australia and invariably we would never get paid three days after. We would get paid sometime in the course of the voyage. And it wouldn't necessarily represent a problem for us as long as we were paid before the ship got to the discharge destination. Right?---Because it was at that point where we would start to have to incur additional hire. 59 The position was complicated in India due to the possibility that a lien over cargo might be defeated if a ship came within port limits and was arrested at the behest of the possessor of bills of lading. Accordingly, Mr Bekhor was reluctant to allow a ship to enter an Indian port before initial payment (i.e. usually 95%) had been made. Mr Bekhor had received advice that under Indian law a receiver with a bill of lading had priority over the holder of a cargo lien. His evidence was: ---We would lose control of the cargo in the event that we allowed the ship to discharge. Now, in most jurisdictions, the lien could be exercised. In this case, because we were not the actual head owners, we were told that there might be a question mark over whether the lien would get accepted. And that's specific to India because there is a danger that the receiver could put pressure on the port to arrest the vessel and to arrest the cargo and we didn't want to be faced with that situation. So that was one of the considerations we had. 60 This belief explained some steps Mr Bekhor took in due course to obtain the co-operation of the ultimate owners of the Wadi Alkarm cargo, Concast and Sona Alloys, to which I will refer later. Subject to those considerations, however, Mr Bekhor's position was that he could cause the ship to sit outside the port and refuse to discharge indefinitely, until British Marine was paid. He did not believe, as a practical matter, that the ship could be sent elsewhere. He also needed sometimes to take into account the fact that British Marine might become liable to additional payments of hire to the owner of any ship it had chartered in, which was delayed in this fashion. That is what was in prospect for the Wadi Alkarm if it was delayed. 61 On 30 September 2013, an updated invoice was issued to Gujarat India for the Volumnia debt: US$274,349.56. 62 In an exchange of emails through Saigal SeaTrade in early October 2013, Gujarat India was warned that the Wadi Alkarm would not be discharged until all outstanding invoices had been paid. There were some unproductive attempts by Gujarat India to suggest that British Marine or the head owners of the Wadi Alkarm had been responsible for a delay in sailing. They are relevant only to indicate that each side was negotiating as a direct party to the contract between them, and without any suggestion of recourse against Wollongong Coal on either side. 63 On 8 October 2013, Gujarat India advised that it proposed to discharge about 25,000 MT at New Mangalore, and the balance at Mundra. A revised invoice was issued to Gujarat India on 8 October 2013 to accommodate this proposal: US$1,888,560.10. 64 On 9 October 2013, Gujarat India was advised that no discharge would occur until total freight for Wadi Alkarm and outstanding debt for Volumnia had been paid: total US$2,524,074.56. 65 On 11 October 2013, Gujarat India offered to make an initial payment of US$1,000,000 before first discharge, with the balance paid before second discharge. British Marine counter offered that it would accept US$1,685,973.16 (the Volumnia outstandings, 100% freight for first discharge and dead freight) with the balance outstanding. On 12 October 2013, Gujarat India replied that it could not send any funds from Australia "on account of impending Board/shareholders meeting", but offered to pay a deposit equivalent to US$1,000,000 in Indian Rupees. 66 The offer was rejected. British Marine offered to accept payment excluding the Volumnia debt: US$1,411,583.60. 67 The Wadi Alkarm arrived on 13 October 2013 and tendered a Notice of Readiness. British Marine reverted to its demand for US$1,685,973.16. On 17 October 2013, Saigal SeaTrade was asked to convey the following message to Gujarat India: Kindly convey the following to charterers We are yet to received swift details for remittance of USD 1,685,973.16 as per our email of 11/10/13. Meanwhile, vessel continues to wait and all waiting time to count as laytime. 68 Before the description of events concerning the Wadi Alkarm continues, it is necessary to provide details about the change of control and management which occurred at Wollongong Coal at about this time. On 16 October 2013, important events occurred which led to a significant change in Mr Jagatramka's perception of his authority and, I infer, in his motivation. From that time also, and I infer not coincidentally, the advice being given in various ways by Saigal SeaTrade also altered. I am satisfied that, commencing on 17 October 2013, Saigal SeaTrade falsified documents and probably did so to assist Mr Jagatramka and Gujarat India, to the potential prejudice of Wollongong Coal. More of that in due course.

Management change at Wollongong Coal 69 It will be apparent from what has already been said that Wollongong Coal was struggling financially in 2013. Those difficulties were, under the business arrangements employed by Mr Jagatramka, the immediate explanation for the failure to pay British Marine's outstanding invoices relating to the Dragon and the Volumnia, as well as the failure to pay freight for the Wadi Alkarm. The advice to British Marine on 12 October 2013 of inability to make any payment from Australia pending a Board/shareholders meeting should have made it apparent, and no doubt did, that a cross-roads had been reached at Wollongong Coal. 70 By early October 2013, Wollongong Coal was in a very strained financial position. Amongst other failures to pay its debts, it had defaulted on its obligations to both the Australian Tax Office ("ATO") and its utility supplier and outstanding moneys were not being paid to it by Gujarat India (a little under AUD$28 million in trade receivables according to an audit report dated 15 August 2013). The ATO had garnisheed related companies and two banks in a search for funds, effectively blocking its accounts. Its electricity supplier had threatened to disconnect power to its offices and the mine. In an email to all staff of Wollongong Coal on 4 October 2013, Mr Jagatramka referred to the provision of temporary funding by the "Jindal Group" over the previous three months (two Jindal companies were the subject of ATO garnishee orders), but advised: My "hands are tied" and all possible avenues of obtaining temporary assistance between now and the general meeting have closed. This is indeed a most regrettable outcome and I extend my sincere apologies to you all for any problems you might be experiencing. … 71 On 16 October 2013, at a meeting of the Board of Directors of Wollongong Coal, at which Mr Jagatramka was not present, the Board recorded its acceptance of Mr Jagatramka's resignation as Executive Chairman and from all other roles except nominee director of the Gujarat Group. Other resolutions concerning a proposed restructure of Wollongong Coal were passed. 72 The resolutions taken at this meeting were, on 18 October 2013, suspended until a further Board meeting on 26 October 2013. Mr Jagatramka, however (who had not submitted his resignation by 16 October 2013), regarded himself as having been dismissed, and he informed Mr Saigal of that on the same day (i.e. 16 October 2013). As I have said, in my view that is explanatory of a turn of events commencing at that point, to which I will return. 73 Mr Jagatramka's mother died in India on 22 October 2013. In accordance with Hindu religious conventions, Mr Jagatramka decided to confine himself to his house in India for 13 days. Although he limited his business activities, he received regular visits from members of his staff and, as will be seen, made important contributions to the affairs of Wollongong Coal. He was able to communicate by telephone or email at his discretion. Although he was inclined to suggest, at points in his evidence, that he withdrew from the world of commerce, or was incommunicado, I am satisfied that he did not, and was not, even though he may have accepted physical limitations on his activities and conducted himself outwardly to indicate his respect for, and observance of, Hindu beliefs and customs. 74 On 26 October 2013, the Board of Wollongong Coal met again. Mr Jagatramka participated by telephone. He proposed a motion that Wollongong Coal be placed in voluntary administration. Over Mr Jagatramka's objection, the Board instead resolved to raise fresh capital in two tranches of $200 million and $100 million by the issue of further shares. Certain of the earlier resolutions were rescinded. The Board noted a proposal by the "Jindal Group" (apparently principally Jindal Steel and Power (Mauritius) Pty Ltd) to fund Wollongong Coal up to $100 million, with up to $50 million available urgently, if required. 75 A further Board meeting was held on 27 October 2013. Mr Jagatramka participated by telephone. In substance the Board, over the objection of Mr Jagatramka, confirmed the capital raising decisions taken the previous day. 76 On 28 October 2013, Wollongong Coal advised the Australian Stock Exchange of Mr Jagatramka's departure from the position of Executive Chairman. A copy of the announcement was sent by Saigal SeaTrade to British Marine on the same day. Mr Bekhor accepted that he would have been made aware of it. 77 The operational arrangements and control of Wollongong Coal thus altered fundamentally, and to the knowledge of British Marine and Mr Bekhor, by 28 October 2013, but it was obvious that arrangements at Wollongong Coal were under alteration for some time before then. 78 Furthermore, so far as Mr Jagatramka was concerned his position changed decisively on 16 October 2013 when, as he saw it, the Board dismissed him. With that additional perspective I may return to the circumstances of the Wadi Alkarm and its cargo.

The cargo and its discharge 79 On 17 October 2013, a broker at Saigal SeaTrade (Tushar Dandawate - hereafter Tushar) sent an email to Wollongong Coal asking for payment to British Marine of US$2,524,074.56. This was the amount previously advised to Gujarat India as the whole debt for both Wadi Alkarm and Volumnia. The email attached an invoice dated 8 October 2013 purporting to have been issued to Wollongong Coal by British Marine. 80 This purported invoice reflected details in the invoice issued to Gujarat India by British Marine after adjustment for a second delivery port. Although the new "invoice" appeared to be on the letterhead of British Marine it was not issued by British Marine. Mr Bekhor appeared to accept that it must be a forgery. 81 Apart from that central defect, the demand purportedly conveyed by the email and the attached invoice did not faithfully or correctly state British Marine's then current position about its own demand for payment as a condition for discharge. On 17 October 2013, as I earlier described, British Marine had reverted to the position it had taken on 11 October 2013, that it would accept US$1,685,973.16. 82 Apart from the unexplained occasions in October 2010 concerning the 5th lift and in April and May 2011 connected with the 7th lift, to which I referred earlier, the purported invoice to Wollongong Coal dated 8 October 2013 was a departure from normal practice. The invoice was not issued by British Marine. It arrived the day after Mr Jagatramka's perception that he had been displaced from his position as Executive Chairman of Wollongong Coal. It appears to represent an effort to assert a contractual liability in Wollongong Coal which did not exist. Transfer of legal obligations to Wollongong Coal from Gujarat India was in the interests of both Gujarat India and Mr Jagatramka, if it could be successfully asserted. Saigal SeaTrade was not disinterested in the outcome financially because payment of its commission by British Marine was consequent upon payment of freight to British Marine under cl 29 of the contract of affreightment. 83 In my view, the inference is irresistible that this forged invoice was falsely issued by Saigal SeaTrade to assist the position of Gujarat India and Mr Jagatramka. The circumstances will not safely sustain a conclusion that he directed or requested the precise means employed, but the attempt certainly reflected Mr Jagatramka's view that actual payment should be made by Wollongong Coal. 84 There are other matters to be referred to which assist me to reach this and other similar inferences about the conduct of Saigal SeaTrade, for the benefit of Gujarat India and Mr Jagatramka, with reasonable comfort. 85 After the email, and this false invoice, were sent to Wollongong Coal by Tushar on 17 October 2013, on 21 October 2013 Tushar sent another email to Wollongong Coal pressing for payment, and advising: We are discussing with Owners and trying to get them to accept a Corporate Gtee from Gnccl Australia [Wollongong Coal] to see if can allow discharge and thus we request you to kindly furnish us with the Corporate Gtee on Gnccl - Australia letter head and then we can put more pressure on owners to discharge. 86 Mr Jagatramka sent a note on 22 October 2013 to Mr Sanjay Sharma, the company secretary of Wollongong Coal, to whom the email had been addressed, saying: Sanjay, Pl discuss this with board members and try to send the executed copy on letter head so that we may try and save the ongoing demurrage costs 87 Mr Sharma sent this request to the members of the Board of Wollongong Coal but, also on 22 October 2013, the request for a corporate guarantee by Wollongong Coal was rejected. Mr Jagatramka was sent a copy of the rejection. 88 On 22 October 2013, British Marine sent the following email to Saigal SeaTrade, to be passed on to Gujarat India: Kindly convey the following to charterers Reference our various reminders regarding swift confirmation of freight overdue to us; we are appaled[sic] by the complete silence from COA partners of GNRE stature who are not even acknowledging our emails or reverting with the likely date when they expect to make this payment. A charterer who we have supported for years giving huge discounts does not even have the courtesy to reply about the likely payment date and we are very disappointed. (COA = contract of affreightment. GNRE is Gujarat India). 89 About 90 minutes later, Saigal SeaTrade replied to British Marine: Charterers advise asf Charterers [Gujarat India] thank owners for their continuous support and co-operation in this critical situation, and apologise for the delayed in remittance of the initial freight due to owners. Kindly note that the acquisitions process of JSPL [Jindal Steel and Power] having bean[sic] completed and charterers awaiting release of fund transfers by end of this week. Chtrs do sincerely regret for the continued delay and endeavouring their best to arrange the remittance of initial freight payable at the earliest. Once again Charterers appreciate Owners kind co-operation and understanding. 90 On 23 October 2013, Tushar sent the following email (again enclosing the false invoice dated 8 October 2013) to Mr Sharma, copied to Mr Jagatramka: Recvd flwing fm Owners. Q Reference Owners various reminders regarding swift confirmation of freight of US$2,524,074.56 overdue to us; we are appalled by the complete silence from GNCCL who are not even acknowledging Owners emails or reverting with the likely date when they expect to make this payment. A charterer who we have supported for this fixture and does not even have the courtesy to reply about the likely payment date and we are very disappointed. UN Q (GNCCL is Wollongong Coal). 91 This email is a fabrication. The statements in it, and its attribution to British Marine, are false. The figure given (US$2,524,074.56) was not mentioned by British Marine in its own email, and was not the claim it was then pressing for immediate payment. This email is obviously based on the advice from British Marine the day before, but it has been "doctored" to make it appear as though British Marine held Wollongong Coal contractually liable to it for the outstanding charges. It did not. Mr Jagatramka, I am satisfied, knew that. 92 The following day, on 24 October 2013, Saigal SeaTrade communicated again with British Marine. The email commenced: // As Brokers only - Without prejudice // We have once again taken-up with the Charterers regarding the outstanding initial freight, Charterers advise that they have once again apologise for the delayed in remittance of the initial freight due to owners. The main reason for delay is due to process of change of management to JSPL and this is now likely to cause some further delays duration of which is at present uncertain. 93 Saigal SeaTrade suggested allowing discharge into custody of port agents and then said: In Meantime We are trying and pushing to obtain an suitable guarantee from Charterers in Owners favour. 94 British Marine replied on 25 October 2013: Charteres are clearly in breach of the coa as per clause no 63 of the British Marine / Gujrat Nre coke limited Kolkatta coa cp dated 16/09/08 for timely payment of Freight. As mentioned in the below email on the Gurantee, Pls advise what kind of guarantee are chrts Gujrat NRE are willing to provide enable take it up with our senior management. 95 The reference to Gujarat India (Gujarat NRE) should be noted. British Marine understood, correctly, that it was dealing contractually with that company. 96 On the same day, Saigal SeaTrade replied: Thanks for your below email - and Yes we have been actively persuing[sic] with Charterers to get them to remit the Freight and solve the situation but same seems to be taking very long - the position as follows: - The Freight and Demurrage is to be remitted by Gujarat Nre Coking Coal Ltd Australia - the company is undergoing a change in the management and share holding pattern with a share holder's meeting on 16th Oct agreed for Jspl to increase their share holding and to become a major share holder - at the moment Jspl is going thru the process and same is taking longer then what was expected and as it looks will take another 2 weeks at least. - Unfortunately Mr.A.K.Jagatramka's mother has passed away earlier this week and thus Mr.Jagatramka is not attending office for sometime. - We as brokers can suggest as follows a. Ask for a corporate Gurantee from Gujarat Nre Coking Coal Ltd, Australia undertaking for paying the Freight/Demurrage ( We can look up our files elsewhere to see if any such wording we can provide - however if owners can provide same might be more affective ) b. Discharge the cargo and take undertaking from the Receiver's Gujarat Nre Coke Ltd on their letterhead that they will not take delivery of the cargo and same will stay inside the port until the full frt and demurrage is paid by Gnccl - Australia. End Unfortunately the timing for the take over or increase in the Jspl share holding in Gnccl - Australia is taking longer then what was anticipated and this has upset all the movements etc. Would appreciate any thoughts from your end - as owise we continue to chase them for payments on a continuous basis. 97 By this time, Wollongong Coal had decided that it would not give a corporate guarantee and Mr Jagatramka knew that to be the case. Nevertheless, on 30 October 2013 Saigal SeaTrade suggested to British Marine that it would attempt to obtain a corporate guarantee from Wollongong Coal in terms it suggested to British Marine for its agreement. I shall refer again later to an email sent on 30 October 2013 dealing with that issue. By this time, Saigal SeaTrade and British Marine knew Mr Jagatramka had no authority at Wollongong Coal. 98 On 31 October 2013, Mr Saigal sent the following email (with two attachments) to British Marine: We refer to telcon yday we have taken up discussions with Charterer's and they have discussed internally and in order to give complete comfort to British Marine that the full intention is to honour the payments and the delays are due to the cash flow and the changes taking place - but to show the flow of documents. 1. Letter from Gnccl - Australia [Wollongong Coal] stating very clearly that they are liable to pay the Freight / Demurrage and the old outstanding to British Marine. 2. Letter from Gncl - India [Gujarat India] further undertaking if Gnccl Australia fails to pay the Freight / Demurrage and old outstanding then liability will be met by Gnre india. This is important as the cargo is purchased Cnf from Gnccl australia to Gncl india - so the flow of documents is important to give the comfort to owners. Trust owners can consider same and basis which allow discharge of the cargo. appreciate owners assistance in this position. 99 The first-mentioned letter is the foundation for all the claims by British Marine in the present proceedings and so it will require special attention, but the context, means of transmission and accompanying material are all significant. 100 Some observations are here in order about the email from Saigal SeaTrade. First, the summary of the order in which the attachments should be read, and their effect, is misleading. I will deal separately with those documents. Secondly, there is a reference to a telephone conversation but its contents and effect are unknown. Thirdly, there is a reference to discussions "internally" within the "Charterer's [sic]". Those discussions may have involved Mr Jagatramka but there is no reason to think that they involved anybody at Wollongong Coal. Fourthly, there is considerable contention about the provenance of the critical document (the first-mentioned attachment) with which it will be necessary to deal separately. 101 The two attachments should be read in the order set out hereunder, as the second was forwarded as an enclosure to the first. Each was addressed to British Marine. The first (on Gujarat India letterhead) was as follows: [Gujarat India letterhead] Date: 31st October 2013 To British Marine PLC 11·Manchester Square London W1U 3PW Dear Sirs M.V. Wadi Alkarm Port Kembla, Australia - New Mangalore + Kandla, lndia. FREIGHT & DEMURRAGE PAYMENT With reference to above vessel, we irrevocably and unconditionally guarantee you, your successors and assigns, the due observance and performance by Gujarat NRE Coking Coal Limited [Wollongong Coal] of its any and all obligations as per the irrevocable letter issued by Gujarat NRE Coking Coal Limited [Wollongong Coal] dated 3rd October 2013 ( copy enclosed ) Kindly release the delivery order and instruct vessel to commence discharge at New Mangalore and 2nd Disport Kandla as a special case and we will indemnify you, your servants and agents and to hold all of you harmless in respect of any liability, loss, damage or expenses of whatsoever nature which you may sustain by reason of delivering the cargo in accordance with our request. In the event of any proceedings being commenced against you or any of your servants or agents in connection with the delivery of the cargo as aforesaid, to provide you or them on demand with sufficient funds to defend the same. Further we irrevocable agree that in case Gujarat NRE Coking Coal Limited [Wollongong Coal] as the party liable to make the payment defaults and in order not to let the Mv Wadi Alkaram incur unnecessary Demurrage and discharge and release the vessel we undertake that latest by 31st December2013 we will remit US$ 2,469,307.56 the outstanding freight and demurrage is fully settled in any case not later than 28th February 14 whichever occurs earlier. The liability of each and every person under this indemnity shall be joint and several and shall not be conditional upon your proceeding first against any person, whether or not such person is party to or liable under this indemnity. This indemnity shall be governed by and construed in accordance with English law and each and every person liable under this indemnity shall at your request submit to the jurisdiction of the High Court of Justice of England. Thanking you. Yours faithfully, Gujarat NRE Coke Limited [Gujarat India] P R Kannan (Chief Financial Officer) (Emphasis added.) 102 The second (an enclosure to the first on Wollongong Coal letterhead) was as follows: [Wollongong Coal letterhead] 03rd October 2013 To, British Marine PLC 11 Manchester Square London W1U 3PW Dear Sirs Re : Mv Wadi Alkarm - Port Kembla, Australia - New Mangalore, India. Freight, Load port demurrage and old outstanding payment Mv Volumnia We, Gujarat NRE Coking Coal Limited, Australia [Wollongong Coal], irrevocably agree to pay 100% Freight US$ 1,805 ,433.00 along with 100% Load port Demurrage of about US$ 207,000 and old outstanding in respect of Mv Volumnia US$ 274,349.56 (Invoices enclosed) to be paid prior vessel's arrival at 1st discharge port (New Mangalore). In case we nominate a second discharge port, then the additional freight payable for such option too shall be paid by us prior commencement of discharge at 1st discharge port. If not paid, We will be obliged to pay demurrage at US$ 9,000 per day at discharge port for the duration vessel is waiting until 100% freight, load port demurrage and old outstanding in respect of Mv Volumnia is received by Owners in their bank account. For Gujarat NRE Coking Coal Limited [Wollongong Coal] Arun Kumar Jagatramka Executive Chairman (Emphasis added.) 103 Again, some observations are in order. The first paragraph of the Gujarat India letter refers to an enclosure (the letter of 3 October 2013). Gujarat India purports to guarantee performance of "any and all obligations" there referred to. There is a further guarantee expressed later in the letter. 104 Each of these two statements of purported guarantee by Gujarat India, in my view, added nothing to British Marine's existing rights. That appears to be the view to which British Marine also came. The assurance of 31 October 2013 in the fourth paragraph rested on a false legal premise: Wollongong Coal was not contractually bound to make the payments; Gujarat India was. The paragraph in question also defies the assignment of an intelligible meaning, but I shall not parse it further. 105 The enclosed document dated 3 October 2013 referred to enclosed invoices. None were attached but, at that date, the invoices which had been issued were to Gujarat India. The precise figures given for 100% freight and the Volumnia outstandings were the subject of invoices to Gujarat India on 11 and 30 September 2013 respectively. No invoice in evidence shows a load port demurrage figure of about US$207,000, although emails from 9 October 2013 show such a figure as US$261,767. 106 It is convenient to make some observations at once about the email of 31 October 2013 and the two letters which it transmitted to British Marine, which will be relevant to various aspects of the causes of action. 107 The two letters (taking them at face value) proposed quite different things separated by almost a month in which there had been quite intense, but inconclusive, negotiations. 108 The letter of 3 October 2013, on its face, proposed a regime of payment by Wollongong Coal which might be delayed by it at its option, with delayed discharge also assumed in that event. 109 There were three elements to the apparent proposal. The first element (which concerned the bulk of the proposed payment) had been effectively withdrawn or dishonoured weeks before, when the Wadi Alkarm arrived at New Mangalore without any payment first being made. A second unload port had been identified, but since no payment of any amount had been made, the second element had been thrown into doubt also. The third element of the proposal was all that really remained but it (and the other elements) merely repeated the existing liability which fell legally on Gujarat India. As Mr Bekhor knew that Wollongong Coal's funds to pay British Marine normally came from Gujarat India, the third element should probably have held no attraction. Mr Bekhor thought that a change of control at Wollongong Coal might free extra funds but he had been told that the management changes were in fact delaying payment, rather than the reverse. 110 As at 31 October 2013, seen in proper context and by reference to its terms, the letter of 3 October 2013 really only amounted to a suggestion that British Marine continue to wait for its money without discharging for as long as Wollongong Coal might choose. 111 The letter of 31 October 2013 from Gujarat India, on the other hand, proposed delayed payment but immediate discharge. The email from Saigal SeaTrade which despatched the two letters also suggested that they provided a foundation for early discharge. 112 In those circumstances, it is hard to give any significance at all to the letter of 3 October 2013 in its own right because, apart from its lack of commercial utility, it was directed to a proposal which was simply not being made on 31 October 2013. It was also not a proposal which British Marine accepted, or even purported to accept, as I shall explain. 113 Nevertheless, Mr Bekhor asserted that it was this letter which was the foundation for his subsequent decisions. I do not accept that it could have been, or was. The meaning which Mr Bekhor attempted to attribute to the letter (that Wollongong Coal had unconditionally promised immediate payment even before discharge) was one which did not reflect the terms of the letter, or any meaning which could reasonably be assigned to it. Nor did it reflect the reality since the apparent date of the letter. 114 Moreover, in view of the passage of time, the discrepancy between the dates of the two letters, the fact that no payment had in fact been made since 3 October 2013, the fact that the letter of 3 October 2013 was provided by Gujarat India rather than Wollongong Coal, the fact that Mr Bekhor knew that there had been a recent change of control at Wollongong Coal, the fact that Mr Bekhor knew that Mr Jagatramka no longer held his office at Wollongong Coal as at 31 October 2013 and that he knew that Mr Jagatramka's personal interests were aligned with those of Gujarat India, prudence required that Mr Bekhor make some enquiry of Wollongong Coal if he wished to place any weight on the letter of 3 October 2013. Mr Bekhor made no such enquiry. That was not just imprudent but unreasonable, as I shall further discuss. 115 British Marine's case was that this letter formed the basis of a contract which was made, at the latest, on 8 November 2013 when a demand was made for immediate payment of all the amounts referred to. But, to repeat, what does the letter of 3 October 2013 actually propose? First, payment of outstandings before arrival at New Mangalore. By the time British Marine saw the letter that assurance had been dishonoured. Secondly, payment of any additional freight referable to a second port before discharge at New Mangalore. On 31 October 2013 that was still possible. Thirdly, and most importantly, if payment had not been made as promised (and it had not been) then payment of demurrage, while the ship continued to wait, until payment was actually received in British Marine's bank account. This aspect of the proposal accepted that British Marine would not discharge before, or without, payment and forego its only real commercial leverage. 116 An offer in the terms of the letter dated 3 October 2013 was thus still capable of acceptance in accordance with its terms. The bargain being offered consisted of the following elements: if British Marine agreed to release Gujarat India from its immediate obligation to pay then Wollongong Coal would make the payments, if possible by the times stated but if not then when it could, accompanied by demurrage. Wollongong Coal was requesting time to pay. British Marine was not expected to discharge until payment was made. 117 In my view, therefore, at 31 October 2013 there would be adequate consideration for a contract, the offer was capable of acceptance and it would create legal relations if the offer was, in fact, made by Wollongong Coal (as to which see later). But an offer in those terms was not accepted. There was no acceptance on 31 October 2013 or on any other date. Instead, on 8 November 2013, British Marine pressed for immediate payment, not just from Gujarat India but also from Wollongong Coal. The demand for immediate payment from Wollongong Coal involved rejection of the offer and rejection of the request for time to pay. Consideration was not exchanged. There could be no contract. 118 Moreover, as I shall discuss further, it remains important to see whether any offer was made by Wollongong Coal itself. 119 I need to explain and examine this, and other issues, in a further context but it may be apparent that, in my view, any case in contract against Wollongong Coal based on the terms of the letter dated 3 October 2013 encounters immediate, and fatal, obstacles. The same may be said for any case of misleading and deceptive conduct based on the same document. 120 When he received the email and its attachments, Mr Bekhor sought legal advice. The advice was that the letter from Gujarat India was worthless. I agree. The advice was that the letter signed by Mr Jagatramka was enforceable against Wollongong Coal. I do not agree. 121 On Mr Bekhor's evidence he noticed the date on Mr Jagatramka's document (3 October 2013) and asked Mr Saigal when it had been received. He was told it was received shortly before it was sent on to British Marine. I will deal separately with a suggestion that Saigal SeaTrade sent it to British Marine on 5 October 2013. If that had happened, Mr Bekhor did not see it, was unaware of it and could not have relied on it before 31 October 2013, by which time he knew Mr Jagatramka had no authority to bind Wollongong Coal. However, in my view it was not sent on 5 October 2013. A document purporting to forward it on that date is most likely another fabrication within Saigal SeaTrade. 122 It will be necessary to deal separately with Mr Jagatramka's evidence about how this letter dated 3 October 2013 came into the possession of Saigal SeaTrade and I will deal then with these other, ultimately peripheral, issues.

Wollongong Coal as guarantor 123 When suggestions began to be made by Saigal SeaTrade that some form of guarantee might be provided by Wollongong Coal, Mr Bekhor took some steps to investigate the financial standing of Wollongong Coal. Prior to that happening, Mr Sial had, between 13 and 22 October 2013, raised the possibility of Mr Jagatramka giving a personal guarantee but he declined to do so. Mr Bekhor asked for an audited copy of Wollongong Coal's accounts. Saigal SeaTrade referred him to documents publically available on the company's website. 124 On 25 October 2013, Mr Bekhor referred his Chief Financial Officer, Mr Peter Johnson, to the publically available accounts and asked for his opinion of the financial standing of Wollongong Coal. 125 Mr Johnson, on his evidence, studied the accounts for an hour or so and concluded that Wollongong Coal probably had assets of at least AUD$250 million, despite some difficulties with the picture shown by the accounts, to which I will refer. He gave his opinion to Mr Bekhor. 126 Mr Johnson's evidence about the formation of his opinion confirms Mr Bekhor's evidence about that matter. 127 The published accounts of Wollongong Coal (as at 31 March 2013) showed a marked deterioration in the state of Wollongong Coal's current liabilities. In large measure, that deterioration corresponded to substantial borrowings being shown as current liabilities, rather than non-current liabilities. In turn, Mr Johnson concluded, that was because Wollongong Coal was in breach of bank covenants, and what were otherwise long term borrowings had become, strictly speaking, immediately due and payable. Mr Johnson thought that the picture provided by the accounts was consistent with the information provided by Mr Jagatramka at the meeting in London on 21 June 2013; namely, that the Gujarat Group was experiencing financial difficulties, and was refinancing. 128 Mr Johnson also made enquiries about share price movements. He noted that the share price had almost halved, after a trading halt, in the period September/October 2013, but again thought that to be consistent with the overall picture of a group working its way through financial difficulties. He was reassured the banks had not foreclosed. He knew that part of the restructuring involved a change of control at Wollongong Coal. 129 All of those matters are disclosed in the published accounts. Of some concern, however, and Mr Johnson was cross-examined about this in a little detail, was the fact that Wollongong Coal's auditors, Grant Thornton Audit Pty Ltd ("Grant Thornton") had declined to provide an audit opinion due to insufficiency of the supporting information. 130 Grant Thornton's audit report dated 15 August 2013, stated the following: Basis for Disclaimer of Opinion We have been unable to obtain sufficient appropriate audit evidence on the books and records and the basis of accounting of the consolidated entity. Specifically, we have been unable to satisfy ourselves on the following areas: i. Valuation and impairment of assets - the consolidated entity obtained an independent valuation of its mining assets and mining licences. The independent valuation was based on certain assumptions which may no longer be valid. The directors have not obtained an updated independent valuation to determine the extent of the impairment to the carrying value of the mining assets and mining leases. We have been unable to obtain supporting evidence, based on updated assumptions, which would provide sufficient appropriate audit evidence as to the carrying value of the mining assets and leases. ii. Going concern - the financial report has been prepared on a going concern basis, however the directors have not provided an update of their assessment of the consolidated entity's ability to pay their debts as and when they fall due. The consolidated entity has reported a loss before income tax of $112,182,825 (including an impairment charge of $83,792,190) for the year ended 31 March 2013 and a working capital deficiency of $407,998,443. At the year end, the consolidated entity is in breach of loan covenants, has significant creditors in arrears and has been unable to provide evidence to support the full amount of the replacement loan facility which is required to pay existing facilities. As discussed in Note 1(c), the consolidated entity is in the process of re-negotiating financing and has announced a share placement to the market, subject to shareholder approval, for additional equity funding. We have been unable to obtain alternative evidence which would provide sufficient appropriate audit evidence as to whether the consolidated entity may be able to obtain such financing, and hence remove significant doubt of its ability to continue as a going concern for a period of 12 months from the date of this auditor's report. iii. Deferred Tax Assets - included in non-current assets are Deferred Tax Assets of $87,302,944. In accordance with AASB112 "Income Taxes", the recognition of deferred tax assets when an entity has incurred tax losses requires convincing other evidence that sufficient taxable profit will be available against which the unutilised tax losses can be utilised by the Group. The directors have not provided sufficient appropriate audit evidence of the Group's ability to recover these losses. iv. Recoverability of Trade Receivable - included in Trade Receivables is an amount of $27,795,628 due from the consolidated entity's ultimate parent company. We were unable to obtain sufficient appropriate audit evidence to determine the recoverability of this receivable. Consequently, we were unable to determine whether any adjustment to this receivable was necessary. v. Completeness of Contingent Liabilities and Subsequent Events disclosures - we were unable to obtain sufficient appropriate audit evidence to determine the completeness of the contingent liabilities and subsequent events disclosures. Consequently, we were unable to determine whether any additional disclosures are required to the relevant notes. vi. To the date of the directors approving the financial statements, we were not provided with sufficient appropriate audit evidence, or time, to finalise our procedures pertaining to various disclosures and transactions contained within the financial report. This constitutes a limitation of scope. As a result of these matters, we were unable to determine whether any adjustments might have been found necessary in respect of the elements making up the consolidated statement of financial position, consolidated statement of profit and loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows, and related notes and disclosures thereto. Disclaimer of Opinion Because of the significance of the matters described in the Basis for Disclaimer of Opinion paragraphs, we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion. Accordingly, we do not express an opinion on the financial report. 131 Note 1(c) to the financial statements, which is referred to in subparagraph (ii) of this extract, contained a statement by the directors of Wollongong Coal summarising proposals for the introduction of new capital to be supplied by the Jindal Steel and Power Group, for increases in production and for further borrowings. Note 1(c) contained the following cautionary statements: Based on the above the Directors consider the entity to be a going concern and able to meet its debts and obligations as they fall due. Notwithstanding the above, if one or more of the planned measures do not eventuate or are not resolved in the Entity's favour, then in the opinion of the Directors, there will be significant uncertainty regarding the ability of the Entity to continue as a going concern and pay its debts and obligations as and when they become due and payable. If the Entity is unable to continue as a going concern, it may be required to realize its assets and extinguish its liabilities other than in the normal course of business at amounts different from those states [sic] in the financial report. No adjustments have been made to the financial report relating to the recoverability and classification of the recorded asset amounts or the amounts and classification of liabilities that might be necessary should the Entity not continue as a going concern. 132 However, emails seen by Mr Johnson shortly before he provided his opinion to Mr Bekhor indicated that the proposal involving the Jindal Steel and Power Group was going ahead. 133 Obviously, questions of commercial judgment are involved in the opinion formed by Mr Johnson, which appears to have been accepted by Mr Bekhor. So far as it goes, I can see no basis for an accusation that either of them acted carelessly, negligently or otherwise wrongfully in concluding that Wollongong Coal had the capacity to stand behind a guarantee. Whether a guarantee was given is a different question.

The legal advice 134 When British Marine received the email from Saigal SeaTrade on 30 October 2013, proposing a form of words for a proposed guarantee from Wollongong Coal at that time, Mr Bekhor (and British Marine) was taking advice from Mr Ian Hawkes, a partner in the London firm of MFB Solicitors. Mr Hawkes had been advising British Marine since 26 September 2013. He had not previously acted for British Marine, nor previously met Mr Bekhor. Mr Hawkes specialises in contracts and tort aspects of shipping law. He joined MFB in January 1994 and became a partner in 1999. He gave evidence in the present proceeding which was candid and direct. 135 The proposal from Saigal SeaTrade on 30 October 2013 was rapidly overtaken and replaced by the communications on 31 October 2013. However, one remaining significance of the proposal on 30 October 2013, and the (unsatisfactory) form of words which it proposed (which Mr Hawkes said in his evidence would never have been accepted) is that it contradicts any assumption that Saigal SeaTrade had, on 30 October 2013, the letter from Mr Jagatramka dated 3 October 2013, which it forwarded the next day. 136 The email of 30 October 2013 said: Re : M/V Wadi Alkarm - Outstanding Initial Freight // As Brokers only - Without prejudice // Ref telcon as brokers shall endeavor to obtain wording as below, in case same is agreeable with Owners Q [please print letter head] Date: (insert date) To British Marine PLC 11 Manchester Square London W1U 3PW Dear Sirs M.V. Wadi Alkarm / Gujarat Nre Coking Coal Limited - Australia Port Kembla, Australia - New Mangalore + Kandla, India. FREIGHT & DEMURRAGE PAYMENT With reference to above vessel, we irrevocably and unconditionally guarantee you, your successors and assigns, the due observance and performance by Gujarat Nre Coking Coal Limited, Australia [Wollongong Coal] of its any and all obligations under the relevant Voyage Charter. [There were no such obligations] Kindly release the delivery order and instruct vessel to commence discharge as a special case and we will indemnify you, your servants and agents and to hold all of you harmless in respect of any liability, loss, damage or expenses of whatsoever nature which you may sustain by reason of delivering the cargo in accordance with our request. In the event of any proceedings being commenced against you or any of your servants or agents in connection with the delivery of the cargo as aforesaid, to provide you or them on demand with sufficient funds to defend the same. Further, we guarantee that latest by 31st December2013 we will remit US$ 2,469,307.56 the outstanding freight and demurrage is fully settled in any case not later than 28th February 14 whichever occurs earlier. The liability of each and every person under this indemnity shall be joint and several and shall not be conditional upon your proceeding first against any person, whether or not such person is party to or liable under this indemnity. This indemnity shall be governed by and construed in accordance with English law and each and every person liable under this indemnity shall at your request submit to the jurisdiction of the High Court of Justice of England. Thanking you. Yours faithfully, Gujarat Nre Coking Coal Limited [Wollongong Coal] ¿¿¿¿¿¿. UnQ (Emphasis added.) (My note.) 137 Some aspects of this draft were repeated in the 31 October 2013 letter from Gujarat India, sent the following day, but there were some important changes. 138 One important change was that the letter from Gujarat India, dated 31 October 2013, enclosed the 3 October 2013 letter signed by Mr Jagatramka as Executive Chairman of Wollongong Coal. It (the letter of 31 October 2013) purported to guarantee observance and performance of "any and all" obligations under the 3 October 2013 letter, which promised to discharge obligations which, under the contract of affreightment, fell on (and only on) Gujarat India. The combined proposal was confusing, and imprecise. 139 Mr Bekhor sought legal advice about the two letters of 31 October 2013 and 3 October 2013. At the same time he sought advice about whether British Marine could exercise a lien over the cargo. 140 He received three written advices (transmitted by email) from Mr Hawkes. Mr Hawkes was cross-examined by reference to a folder of documents which were discovered by the plaintiff. The documents appeared to represent his working file over which privilege had been waived for the period 30 October 2013 to 8 November 2013. The folder was marked for identification (MFI #10) for Mr Hawkes' cross-examination and the intention was that it be tendered by counsel for Wollongong Coal. No objection was foreshadowed except, possibly, as to relevance. Due to an apparent oversight, neither the folder nor any documents in it upon which Mr Hawkes was cross-examined were ultimately tendered. But I am satisfied that at least these particular documents are relevant and they are important ones to which to refer. Accordingly, I propose to treat at least those documents as admitted in evidence in the proceedings through Mr Hawkes' cross-examination, rather than to allow the record to be left incomplete due to an oversight. Much of what appears hereunder appears, in any event, from the record of Mr Hawkes' cross-examination. 141 Mr Hawkes' first advice was that British Marine had no valid lien over the cargo either as carrier under the bills of lading or under the charter party (as Gujarat India was not then the owner of the cargo). It is clear from the email exchanges with Mr Hawkes that British Marine was under pressure from the owners of the Wadi Alkarm (from whom the vessel had been hired by British Marine) about a reliable forecast date for redelivery. 142 By this time, Mr Bekhor was considering his options for achieving a satisfactory form of security for payment of outstanding freight. Mr Hawkes advised him that British Marine had no valid lien over the cargo. No lien arose under the bills of lading, to which British Marine was not a party. No lien arose under the charter party because Gujarat India was not (or was no longer) the owner of the cargo. As against the receivers of the bills of lading, therefore, British Marine's position was tenuous unless it could negotiate a better one. That is what Mr Bekhor set out to do with Mr Hawkes' assistance and advice. Notices of lien were drafted and served on Gujarat India, and on the receivers, which effectively asserted a lien. Negotiations then took place to achieve agreements which would permit discharge on the basis that British Marine's position was protected. Its position was not protected because it had a valid lien. Its position was ultimately protected because Gujarat India and the receivers agreed not to dispute its asserted lien, and agreed that it should have rights. Discharge of cargo did not occur until those protections were put in place. 143 Mr Hawkes' second advice concerned only the letter dated 31 October 2013. At first, he assumed that the letter of 3 October 2013 had been received by British Marine some time earlier, probably soon after 3 October 2013. Mr Hawkes' initial advice about these documents, therefore, dealt only with the possible legal effect and commercial value of the letter of 31 October 2013 from Gujarat India. He advised Mr Bekhor that that guarantee was "entirely worthless" and that "the position appears entirely unsatisfactory". 144 Shortly thereafter, Mr Bekhor and Mr Hawkes spoke by telephone and Mr Bekhor informed Mr Hawkes that the 3 October 2013 letter had only been received with the Saigal SeaTrade email of 31 October 2013, and in company with the letter from Gujarat India bearing the same date. Mr Bekhor informed Mr Hawkes that enquiries of Saigal SeaTrade (Mr Saigal personally) confirmed that Mr Saigal had not seen the 3 October 2013 letter earlier, nor sent it to British Marine. That was of some comfort to Mr Bekhor for another reason. 145 Initially, Mr Bekhor became apprehensive that if the 3 October 2013 letter had been delivered to British Marine earlier, Gujarat India might rely on the promises it contained to insist that discharge of cargo should not have been delayed, and that it (Gujarat India) was not responsible for any consequent demurrage. Mr Bekhor was, Mr Hawkes was told, reassured that there had been no earlier delivery of the 3 October 2013 letter. 146 However, Mr Hawkes' advice was now sought about the legal effect of that letter. Mr Hawkes was insistent that his advice had been sought in a limited context. Specifically, Mr Bekhor wanted to know if it appeared to be a valid guarantee "on the face of it" and if it provided a sufficient basis for a demand directly on Wollongong Coal. To this point neither Mr Hawkes nor Mr Bekhor had regarded Wollongong Coal as liable to British Marine. The issue now was - is there a foundation to demand payment directly from Wollongong Coal, as well as seeking security over the cargo itself? 147 Mr Hawkes made some assumptions and expressed some qualifications, but he was content to advise that the letter of 3 October 2013 did give a valid guarantee. His written advice said, in opening: Dear Alan Thank you for your call today. We spoke about the guarantee from the Australian company, Gujurat NRE Coking Coal Limited. I am grateful for your clarification that, for reasons that we do not understand, the guarantee was not provided to British Marine PLC until last week. The guarantee is dated 3 October and from the text it appears that it may have been signed on that date. It was only actually provided to us as an attachment to the 31 October 2013 guarantee from the Indian company. You ask whether there is any reason why the guarantee should not be valid. There is nothing on the face of the document which creates an obvious problem. We have no idea whether there may be any specific Australian law rules which apply particular formalities to the issue of a guarantee by an Australian incorporated company. On the face of it, though, the document appears to create a valid guarantee and we are entitled to make an immediate demand if we choose to do so. We assume that at the date that the guarantee was signed Mr Jagatramka was indeed executive chairman of the company and did have authority to bind it. … (Emphasis added.) 148 He then suggested the terms of a demand that might be made. 149 The significance of the passage I have emphasised must be seen in a broader context. Mr Hawkes appreciated that any contract of guarantee would need (under British law) to be written, signed, offered and accepted and supported by consideration. I am satisfied from his evidence that he gave no particular thought at the time to whether the last two conditions had been satisfied, although he did make suggestions in his evidence how such conditions might, with his present knowledge, be regarded as satisfied. The question of whether I should find that a contract exists is not a matter to which Mr Hawkes' opinion can be applied and so I will put those aspects of his evidence aside. 150 With respect, in my view the analysis offered at this point by Mr Hawkes was deficient, although I accept that it is easier to say that with hindsight than under the commercial pressure of the time. It was a matter of significance that the letter was only provided as an attachment with the (worthless) letter from Gujarat India, that its initial assurances had already been dishonoured and that it was not provided by Wollongong Coal to British Marine. The advice gave insufficient weight to the critical third paragraph the significance of which was emphasised by the failure to pay outstandings before arrival, or since. The assumption about the date of signing (and therefore Mr Jagatramka's authority) was just that - an assumption. It must be borne in mind that Mr Hawkes was not attempting to forecast what might happen in a court case on the other side of the world. Overall, the advice is best regarded as qualified and tentative. 151 The passage which I emphasised above in Mr Hawkes' third written advice makes it apparent that he was fully aware that the letter of 3 October 2013 was, on the face of matters, presented by Gujarat India. It was also, in a sense, presented by Saigal SeaTrade but Saigal SeaTrade did not say they were acting for Wollongong Coal. They referred to discussions with "Charterers", whom Mr Hawkes accepted to be (and in my view could only be) Gujarat India. 152 There was thus no evidence of any offer by Wollongong Coal to British Marine represented by the terms of the 3 October 2013 letter. Furthermore, by the time Mr Bekhor received it, and satisfied himself it was not sent earlier, he knew Mr Jagatramka had no actual or apparent authority to bind Wollongong Coal. 153 Mr Bekhor's evidence is that he relied completely on this advice to give up substantial commercial advantages. If he did so that was foolish but, as I will explain, I am not satisfied that was the case. 154 On 5 November 2013, British Marine sent Saigal SeaTrade an email attaching a number of notices to be given to Gujarat India. I shall refer to it hereunder. A demand was not made, so far as I can see, on Wollongong Coal itself until 8 November 2013. I shall set out its terms in due course. The demand made did not exactly correspond to the terms of the 3 October 2013 letter although in argument it was explained that the different money amounts were due to a recalculation of freight costs as suggested in the second paragraph. The demand departed from the terms suggested by Mr Hawkes. On 11 November 2013 the demand was renewed, supported by invoices addressed to Gujarat India. A solicitor's demand was made on 11 November 2013 and again on 12 November 2013. There was no apparent response; certainly no compliance. The proceedings were commenced on 15 November 2013.

3 October 2013 letter - provenance 155 As I have said, the letter signed by Mr Jagatramka bearing the date 3 October 2013 was sent to British Marine by Saigal SeaTrade as an attachment to the letter from Gujarat India dated 31 October 2013. Mr Bekhor, when he received the two documents, and the email from Saigal SeaTrade, asked about the discrepancy. He requested Mr Parikshit Sial, then the British Marine manager of chartering in Singapore, to contact Mr Saigal and ask about the discrepancy. Mr Saigal's response, Mr Bekhor understood, and this was confirmed by Mr Sial in his own evidence, was that the letter of 3 October 2013 was sent as soon as it was received. That suggests that it was received by Saigal SeaTrade with Mr Kannan's letter (i.e. as an attachment as Mr Kannan's letter suggests) and sent on in that form, as the letter of 31 October 2013 itself suggests. I do not accept that the letter of 3 October 2013 was sent independently by Saigal SeaTrade (who had no authority to do so, or to act for Wollongong Coal on 31 October 2013) or that Saigal SeaTrade had received it earlier with instructions to use it on behalf of Wollongong Coal. 156 During Mr Sial's evidence he was shown a document which was, in late July 2014, provided by Saigal SeaTrade to Wollongong Coal and Mr Jagatramka in response to enquiries for the purpose of providing discovery. It was thereupon discovered by Wollongong Coal. 157 The document provided by Saigal SeaTrade purports to be a copy of a letter dated 5 October 2013 forwarding Mr Jagatramka's letter of 3 October 2013 to British Marine. It says simply: 5th October 2013. British Marine PLC., 903 'c' wing, 215, atrium (next to marriot courtyard), Andheri kurla road, Andheri east, Mumbai - 400069 K/a: Ms. Prabha + Mr. Varun Dear Sir, Re : Mv Wadi Alkarm - British Marine/Gnre Coa Dated 16/09/08 Please find attached herewithletter received from Charterers In respect of the outstanding due to Owners. Kindly confirm safe receipt. Thanking you, Yours faithfully, For Saigal SeaTrade (P) Ltd (As Brokers Only) Encl. : A/a. 158 There are some curiosities involved. This was not the usual means of communication. Wollongong Coal was not the "Charterers" and Saigal SeaTrade was not their broker. Saigal SeaTrade was the broker between the Owners (British Marine) and the charterer (Gujarat India) as all the communications revealed. The attached copy of the 3 October 2013 letter is obviously another (poor) copy of the attachment to Mr Kannan's own letter of 31 October 2013, which appears as an attachment to Saigal SeaTrade's email of that date. 159 The purported letter dated 5 October 2013 did not appear in the records of any party to the proceedings. Indeed, Mr Sial (who is now at the Mumbai office) had the posting records of the British Marine Mumbai office checked, because that is where the document was purportedly addressed. There is no record of receipt in the mail log and a search and further enquiries in that office revealed no trace or knowledge of the letter. 160 I see no real alternative but to conclude that this document is a further fabrication by somebody within Saigal SeaTrade. Mr Jagatramka tried, in his oral evidence, to make out a case that there were two different letters signed by him on 3 October 2013 and that one was sent immediately to Saigal SeaTrade. I do not believe him. They are obviously the same document. The version attached to the purported letter of 5 October 2013 is a poor copy. 161 Mr Sial's evidence also made it clear that British Marine had not invoiced Wollongong Coal on 8 October 2013; the invoice sent by Saigal SeaTrade was a fabrication. British Marine had not sent messages to Saigal SeaTrade in the form alleged by Saigal SeaTrade in its emails to Wollongong Coal on 23 October 2013 suggesting that British Marine was "appalled" or otherwise displeased with Wollongong Coal. British Marine said it was "appalled" by the conduct of Gujarat India. Mr Sial confirmed, like Mr Bekhor, that British Marine had looked only to Gujarat India to pay the outstanding charges. Suggestions to the contrary by Saigal SeaTrade, I am satisfied, were false. 162 Mr Jagatramka's evidence about the 3 October 2013 letter was not satisfactory in many respects. His evidence in chief was that he prepared and signed the letter of 3 October 2013 in Ahmedabad, on the afternoon or evening of that day, and shortly thereafter asked the Gujarat India office in Ahmedabad to send it to Saigal (not British Marine to whom it was addressed) in Mumbai. His evidence at that point was that the letter was to be sent by courier. Mr Jagatramka produced a courier receipt showing a 50 gram delivery of one item to Saigal SeaTrade - consigned on 3 October 2013 and received on 4 October 2013. He said it could not have been any other document. 163 Mr Jagatramka's underlying thesis was that Wollongong Coal was responsible for paying the freight and other charges for the Volumnia and the Wadi Alkarm. That suited his personal interests, and those of Gujarat India, but it appears to give little, if any, weight to the fact that the arrangements between Wollongong Coal and Gujarat India have nothing to do with the contractual arrangements between Gujarat India and British Marine, nor to the fact that receipts by Wollongong Coal according to the bill discounting arrangements put in place by Gujarat India depended upon ultimate payment by Gujarat India. 164 Mr Jagatramka said initially that he also gave a copy of the 3 October 2013 letter to Mr Sharma, the Wollongong Coal company secretary in about the second week of October. There is no objective support for that assertion. A little later he said he assumed he had given him a copy. There is a large difference. 165 It is necessary, at this point, to deal with a submission made by British Marine that Wollongong Coal should have called Mr Sharma to deal directly with this issue and that, as he had not been called, I might infer that he did receive a copy. Such a conclusion would be purely speculative. Mr Jagatramka's evidence was inconclusive and fell well short of establishing that he had given Mr Sharma a copy of this document. Moreover, such a conclusion would be unfair. 166 Wollongong Coal did not discover any copy of the document. It was argued that it was not open to rely upon any affidavit which might have verified discovery but I am quite satisfied that there is no serious suggestion of any failure to give proper discovery. Rather, the argument is a technical one. If it was necessary to do so, I would not hesitate to dispense with any formality under s 190(3)(a) of the Evidence Act 1995 (Cth) but it is not necessary to take even that step. I am not persuaded by Mr Jagatramka's own evidence that he gave any copy of the document to Mr Sharma. 167 Mr Jagatramka confirmed, in his cross-examination, his instruction that the 3 October 2013 letter be delivered to Saigal SeaTrade as soon as possible. Mumbai is about 500 kms south of Ahmedabad. When asked why he did not email it he said: ---I think the Ahmedabad office scanner was not working, so the scanning and emailing was not physically possible that day. … 168 He was asked: … Do you remember that this happened, or is this just an explanation that you thought might be - - -?---No, I think I had asked him that, "Can you scan it and email," and he told that the scanning - "I may be able to get it done tomorrow, because today there is some problem." Then I told, "Never mind. You send the courier." 169 Those responses rapidly produced additional complications for Mr Jagatramka. First, he was not able to say whether in Ahmedabad, the scanner and photocopier were the same machine. Then: I'm going to suggest that you're not answering my question because you know the problem it presents for you, which is that if your scanner is not working then your photocopier is not working; do you agree with me about that?---Could be. And if your photocopier is not working, then how do you have a copy of that letter dated 3 October when it was sent out by courier?---They would have taken a copy from the shop downstairs, the photocopy - there's a photocopy shop in the office building downstairs. 170 Retention of a copy by Mr Jagatramka was important for his assertion that he had given such a copy to Mr Sharma. It was also important if he claimed to have given a copy at some stage to Mr Kannan. This difficulty was addressed by Mr Jagatramka in a different way. But first, he sought to overcome the immediate problem in this way: HIS HONOUR: … I had forgotten that Mr Jagatramka had retained a copy of this letter; is that the position? MR WITHERS: Well, he must have, because he said he gave it by hand to Mr Sharma. And - - - THE WITNESS: No, that was not a photocopy. He has taken two printouts from the computer. One is kept with me, and one is given to ..... courier. 171 Reliance on the photocopy shop downstairs was thereby abandoned immediately. Then this exchange occurred: HIS HONOUR: Can I ask, Mr Jagatramka, where Mr Kannan got his copy?---Kannan would have got in maybe mail from Saigal, or he would have got a copy from Sharma himself. He didn't get it from you?---I don't recall that. and MR WITHERS: When do you think Mr Sharma might have given that letter to Mr Kannan?--- I don't know. It could have been any time in October itself. Well, you say that, but I think your evidence was that Mr Kannan exited the business, the management committee in the middle of October?---Yes. Right. So it's going to be some time between the - - -?---Before 15 October. Yes. So - but in the window between 3 October and 15 October, you think it's possible, do you, that Mr Sharma gave that letter to Mr Kannan? Is that right?---…, and I believe it would be more from Saigal himself. … HIS HONOUR: Got it from Saigal rather than gave it to Saigal; is that what you're saying?---Yes. He would have got the copy from Saigal himself. He would have? Yes. 172 The following day the following exchange occurred: Again, I'm asking you, number 1, did you direct Mr Soy [sic: Roy] to send this by courier, the 3 October letter?---I think I have already described the circumstances, that there's no reason for me to say that to you send it by courier. But he might have asked, "That is okay if I send by courier?" I might have said yes. … HIS HONOUR: The question is a much more simple one, Mr Jagatramka. Did you or did you not direct that it be sent by courier?---Sir, I have described the exact thing. Now, if that is considered direction or not, I'm not sure. … Did you or did you not direct that it be sent by courier?---In my understanding, when I say "direction" - means I'm giving a direction that you do it like this, which is not something that I did. But if he had asked, "That is okay if I send by courier," and I might have said yes. So that is different from directing somebody that you do it. … I will take it that you mean you did not direct that it be sent by courier?---Yes. And you have no present memory of being asked whether it should go by courier?---Yes. 173 This is a very different account from the day before. Mr Jagatramka's evidence about the inoperable scanner changed also: MR WITHERS: Do you have any recollection, sitting here today, of the scanner being inoperable on 3 October?---No. So when you told me - his Honour that, yesterday, that the scanner was inoperable -you had no recollection of that, at the time?---No. 174 Mr Jagatramka was asked about the fact that the document sent by email on 31 October 2013 (as an attachment to Mr Kannan's letter of 31 October 2013) and the document purportedly sent by Saigal SeaTrade to British Marine on 5 October 2013 (of which there is no other record) are apparently identical. He asserted they were different. In my view they are the same document. Each is signed identically. One is a copy of the other. The only rational possibility is that the version most recently produced (from Saigal SeaTrade with the document dated 5 October 2013) is a poor copy of the one sent with Mr Kannan's letter, which was obviously supplied by Mr Jagatramka. 175 In evidence called in his case after a lengthy adjournment, Mr Jagatramka sought to bolster his version of events. 176 Ms Sabina Fernandes, a receptionist employed by Saigal SeaTrade, gave evidence that her initials appeared upon the delivery receipt alleged to have accompanied the delivery by courier of the 3 October 2013 letter to Saigal SeaTrade. However, she could give no evidence about what accompanied the delivery receipt. 177 Mr Sutirtha Roy gave more direct evidence that he had produced the 3 October 2013 letter, following Mr Jagatramka's instructions as to its content. He said he printed two copies, sent them by car to Mr Jagatramka for his signature, received a signed copy by car and sent it on to Saigal SeaTrade by courier. This evidence, if accepted, gives some support for Mr Jagatramka's assertions, although it is not completely consistent with Mr Jagatramka's evidence. 178 However, I am not prepared to place any weight at all on Mr Roy's evidence. At one point, he volunteered, unnecessarily, that the scanner in the Ahmedabad office was broken on the day in question. I got the impression that Mr Roy's evidence was rehearsed and contrived. Far from supporting Mr Jagatramka's position, my conclusion about Mr Roy's lack of reliability is adverse to Mr Jagatramka and confirms me in my view that his evidence that the letter dated 3 October 2013 was produced, signed and sent to Saigal SeaTrade on that day should not be accepted. 179 A few things are clear, however. No copy of the letter of 3 October 2013 ever emerged into view until 31 October 2013. It came from Mr Jagatramka at some stage, obviously enough, but there is no objective support for the proposition that it came into existence on, or around, 3 October 2013. If it did, it remained private and unpublished beyond Mr Jagatramka and possibly Gujarat India until 31 October 2013. When it was sent to British Marine it was not sent by Wollongong Coal. It was sent by Gujarat India, with the assistance of Saigal SeaTrade. 180 At one point in his evidence Mr Jagatramka volunteered that Mr Saigal was a "family friend". The following day he said: ---… Other than as a freight broker, we don't have any other relationship or business connection. 181 When pressed he said there was no family relationship, but conceded he is a "long term friend". 182 It is quite clear that, from the time Mr Jagatramka felt he was "sacked" by the Board of Wollongong Coal on 16 October 2013, Saigal SeaTrade in various ways, including fabrication of documents and falsification of communications, assisted in promoting the contention that Wollongong Coal was directly liable to British Marine for the outstanding charges from the Volumnia and the Wadi Alkarm. That contention, if accepted, was in the interests of Mr Jagatramka and Gujarat India. 183 I infer that those machinations were ones to assist Mr Jagatramka. He certainly knew about them and I infer that he approved and probably encouraged them. When they commenced that at least involved Mr Jagatramka in a large conflict of interest, so far as concerned his obligations as a director and Executive Chairman (as he still was) of Wollongong Coal. In fact, as will appear shortly, in my view Mr Jagatramka was burdened with a conflict of interest before this time, but events from 16 October 2013 removed any possibility that it might be denied. 184 However, it is important to note that despite all those matters there is no direct evidence that it was Mr Jagatramka who, on 31 October 2013, directed or caused the transmission of the 3 October 2013 letter to British Marine or, for that matter, the letter of 31 October 2013 from Gujarat India to which it was attached. A proper basis would need to exist to support an inference to that effect. Otherwise, that would represent a bare assumption which substituted speculation and guesswork for a proper process of inference. That is not permissible (see Luxton v Vines (1952) 85 CLR 352 at 358, quoting Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1; Bell IXL Investments Ltd v Life Therapeutics Ltd (2008) 68 ACSR 154 at [14]; Tisdall v Webber (2011) 193 FCR 260 at [127]-[130]). 185 Late in the proceedings, after his evidence had concluded and without returning to Australia to re-enter the witness box, Mr Jagatramka discovered two emails addressed to him by Mr Saigal on 31 October 2013 before the email sending the two letters. The first is at 2.03 pm, the second at 3.11 pm. The first is addressed only to Mr Jagatramka (at least it is on the copy provided); the second was addressed to Mr Jagatramka and copied to Mr Kannan. There is no reply to either of them in evidence. 186 The first email again proposed a guarantee by Wollongong Coal and a personal guarantee by Mr Jagatramka. The second email referred to a telephone conference (without elaboration) and proposed a letter in the terms of the 31 October 2013 letter signed by Mr Kannan. 187 Those two emails were relied upon by Wollongong Coal as sufficient to support an inference that Mr Jagatramka personally, despite his denials in his oral evidence, had directed Mr Saigal to offer the 3 October 2013 letter to British Marine on 31 October 2013. 188 The contents of those two emails provide support for the contention that the letter dated 3 October 2013 was not brought into existence on the date it bears, but on 31 October 2013 when Mr Jagatramka had no authority as Executive Chairman of Wollongong Coal. 189 The first email proposed a guarantee from Wollongong Coal in the following terms: To: Mr.Arun Jagatramka Wadi Alkarm - Discharge We have been discussing with British Marine - and they can consider favourably to look at discharge the vessel and hold the cargo inside the Port - but they would need the following 1. On Gujarat Nre Coking Coal Ltd - Australia [Wollongong Coal] letter head - the wordings as attached. 2. Personal Gtee from Mr Jagatramka for the payment of Freight and the outstanding Demurrage. Can we provide the below letter - agains the earlier letter which was issued. Qte [please print letter head] Date: (insert date) To British Marine PLC 11 Manchester Square London W1U 3PW Dear Sirs M.V. Wadi Alkarm / Gujarat Nre Coking Coal Limited - Australia Port Kembla, Australia - New Mangalore + Kandla, India. FREIGHT & DEMURRAGE PAYMENT With reference to above vessel, we irrevocably and unconditionally guarantee you, your successors and assigns, the due observance and performance by Gujarat Nre Coking Coal Limited, Australia [Wollongong Coal] of its any and all obligations under the relevant Voyage Charter. Kindly release the delivery order and instruct vessel to commence discharge as a special case and we will indemnify you, your servants and agents and to hold all of you harmless in respect of any liability, loss, damage or expenses of whatsoever nature which you may sustain by reason of delivering the cargo in accordance with our request. In the event of any proceedings being commenced against you or any of your servants or agents in connection with the delivery of the cargo as aforesaid, to provide you or them on demand with sufficient funds to defend the same. Further we guarantee that latest by 15th December2013 we will remit US$ 2,469,307.56 the outstanding freight and demurrage is fully settled in any case not later than 31st Decemeber 2013 whichever occurs earlier. The liability of each and every person under this indemnity shall be joint and several and shall not be conditional upon your proceeding first against any person, whether or not such person is party to or liable under this indemnity. This indemnity shall be governed by and construed in accordance with English law and each and every person liable under this indemnity shall at your request submit to the jurisdiction of the High Court of Justice of England. Thanking you. Yours faithfully, Gujarat Nre Coking Limited [Wollongong Coal] ………… Un Q Thanks + Brgds 190 It was submitted for Mr Jagatramka that "the earlier letter which was issued" must be the 3 October 2013 letter but I find the contention insufficiently persuasive. There is no reference to it in the suggested draft, the first paragraph of which refers to suggested obligations upon Wollongong Coal under the "Voyage Charter", not some collateral assurance. It is not necessary to resolve what "the earlier letter" might be. 191 The suggested form of words in the draft attached to this first email is almost identical to the form of words suggested to British Marine for its consideration the previous day (i.e. apart from the dates in the fourth paragraph which were in fact earlier in this version) to which no positive response had been made by British Marine. 192 However, when this proposal was made to Mr Jagatramka, in the email addressed only to him so far as the evidence shows, it was also suggested that he give a personal guarantee. Although there is no recorded response to the suggestion, the second email does refer to a resulting telephone conversation (although not the participants). It is clear that no personal guarantee was given by Mr Jagatramka and, of course, he knew without any doubt that he could not sign any letter on behalf of Wollongong Coal on 31 October 2013, as was suggested. 193 It is in those circumstances (which are actual rather than presumed) that the significance of the second email must be assessed. The suggestion in the first email was replaced by the suggestion in the second that a letter be sent instead from Gujarat India, referring to the letter dated 3 October 2013. 194 Other changes were made also. I will not set out the proposal in the second email because the draft is in the same terms as the letter signed by Mr Kannan which was sent later that day. However, the following important changes from the draft proposed by the first email should be noted. The first email to Mr Jagatramka proposed a letter by Wollongong Coal. The second email to Mr Jagatramka (copied to Mr Kannan) proposed a letter by Gujarat India. The draft in the second email referred to an enclosure of 3 October 2013. The draft in the second email changed the dates in the fourth paragraph (delaying suggested payment further) and incorporated a suggestion that Wollongong Coal was directly liable "as the party liable to make the payment". The second email drew the attention of its addressee (Mr Jagatramka) to a preceding telephone conversation. 195 In view of the critical stage which the dispute had reached, the commercial importance of the letter of 31 October 2013 in attempting to get discharge and the changes and reformulations to which I have referred, including the attribution of legal liability to Wollongong Coal, I think an inference is fairly available that Mr Jagatramka was, despite his denials, closely involved in settling and approving the terms of the letter signed by Mr Kannan, and that it would not have been sent without his authorisation or direction. 196 Apart from the version of events concerning 3, 4 and 5 October 2013 which was given in evidence in the proceedings, which I have rejected, the second email on 31 October 2015 is the only objective indication of the existence of the letter dated 3 October 2013 before it was, later on the same day, sent to British Marine with Mr Kannan's letter dated 31 October 2013. 197 I earlier rejected the propositions that the letter dated 3 October 2013 came into existence as claimed by Mr Jagatramka on that day, that it was sent to Saigal SeaTrade on that day, and that it was sent by Saigal SeaTrade to British Marine with a covering letter on 5 October 2013. 198 With those findings in mind, and in the absence of any evidence or other objective indication that the letter dated 3 October 2013 existed before 31 October 2013, the two emails on 31 October 2013 which precede the transmission of the two documents to British Marine later that day are sufficient to support an inference that the letter dated 3 October 2013 came into existence on or around 31 October 2013 and not before. However, that finding is not vital to my conclusion that no cause of action can be supported by reference to this letter. That would be my conclusion whenever it was signed. 199 Whether or not the letter dated 3 October 2013 was actually brought into existence on or around 31 October 2013, in view of the earlier findings I have made there is no evidence of the existence of the letter before that date, except the representation on the face of the letter itself. In the present case, having regard to the various examples of falsification to which I have referred (the fixture note, the falsified emails and forged invoices) and to which I will refer (the Cooperation Agreements), I am not prepared to place any weight on the fact that the letter is endorsed with the date of 3 October 2013. 200 The significance of those matters for British Marine's case is that it cannot show (against Wollongong Coal) that Mr Jagatramka made the statements in that letter when he had any authority to do so, whether actual or apparent. 201 In any event, I shall indicate shortly why Mr Jagatramka had no authority (actual or apparent) whenever the letter was signed. 202 Whenever that was, Mr Jagatramka, in my view, directed, authorised or approved Mr Kannan's letter. He acted in his own interests and in the interests of Gujarat India and against the interests of Wollongong Coal.

Authority 203 Wollongong Coal denied Mr Jagatramka's authority to sign the letter dated 3 October 2013 (whenever it was signed). It submitted, as did British Marine, that he had directed that it be sent with the letter of 31 October 2013. As I have said, I am satisfied on the balance of probabilities that Mr Jagatramka did give that direction. 204 I have no difficulty in concluding that on 31 October 2013 none of Gujarat India, Mr Kannan or Mr Jagatramka had authority to give any undertaking or assurance on behalf of Wollongong Coal. However, I should in fairness to Mr Jagatramka consider what would be the position if the letter of 3 October 2013 was signed on that date and simply remained unpublished. On a fair reading of Mr Kannan's letter of 31 October 2013, in those circumstances, it merely attached an existing document. 205 What, then, of Mr Jagatramka's authority to sign the letter on 3 October 2013, or advance the proposals which it contained? Clearly, after 16 October 2013 he had no such actual authority. But neither did he, in my view, before that. 206 The fact that Mr Jagatramka signed the letter as Executive Chairman of Wollongong Coal does not advance the analysis very far. He could not cloak himself with authority, or even apparent authority (Pacific Carriers Ltd v BNP Paribas (2004) 218 CLR 451 ("BNP Paribas") at [36]). In my view, to answer this question, it is first necessary to focus on the matter which that letter of 3 October 2013 purported to address. 207 The commercial and legal issue at hand (whether on 3 October 2013 or 31 October 2013) concerned the failure of Gujarat India to make (or effect) payment for outstanding debts to British Marine. In terms of legal liability that obligation concerned only Gujarat India, whatever commercial practice may have developed between Gujarat India and Wollongong Coal. Wollongong Coal owed no legal obligation to British Marine. 208 In my view, the letter dated 3 October 2013, whenever it was written, was brought into existence on behalf of Gujarat India. Mr Jagatramka was not acting in the interests of Wollongong Coal, either legally or commercially. Indeed, his actions were not only contrary to the interests of Wollongong Coal vis-à-vis British Marine, but also vis-à-vis Gujarat India, having regard to the commercial dispute by then alive between those two companies. 209 In his analysis in Freeman & Lockyer v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480, which was cited and adopted by the High Court in BNP Paribas, Diplock LJ said (at 502-503): An "actual" authority is a legal relationship between principal and agent created by a consensual agreement to which they alone are parties. Its scope is to be ascertained by applying ordinary principles of construction of contracts, including any proper implications from the express words used, the usages of the trade, or the course of business between the parties. To this agreement the contractor is a stranger; he may be totally ignorant of the existence of any authority on the part of the agent. Nevertheless, if the agent does enter into a contract pursuant to the "actual" authority, it does create contractual rights and liabilities between the principal and the contractor. It may be that this rule relating to "undisclosed principals," which is peculiar to English law, can be rationalised as avoiding circuity of action, for the principal could in equity compel the agent to lend his name in an action to enforce the contract against the contractor, and would at common law be liable to indemnify the agent in respect of the performance of the obligations assumed by the agent under the contract. An "apparent" or "ostensible" authority, on the other hand, is a legal relationship between the principal and the contractor created by a representation, made by the principal to the contractor, intended to be and in fact acted upon by the contractor, that the agent has authority to enter on behalf of the principal into a contract of a kind within the scope of the "apparent" authority, so as to render the principal liable to perform any obligations imposed upon him by such contract. To the relationship so created the agent is a stranger. He need not be (although he generally is) aware of the existence of the representation but he must not purport to make the agreement as principal himself. The representation, when acted upon by the contractor by entering into a contract with the agent, operates as an estoppel, preventing the principal from asserting that he is not bound by the contract. It is irrelevant whether the agent had actual authority to enter into the contract. 210 I am satisfied that Mr Jagatramka had no actual authority to sign the letter dated 3 October 2013 as Executive Chairman of Wollongong Coal whenever he may have done so. If for no other reason, he was debarred from doing so by his conflict of interest. The general principle was referred to by Dixon J in Richard Brady Franks Ltd v Price (1937) 58 CLR 112 at 142: Under the general law of agency it is a breach of duty for an agent to exercise his authority for the purpose of conferring a benefit on himself or upon some other person to the detriment of his principal… The position may be otherwise if the agent has apparent authority relied on by third parties who deal with him bona fide and without notice. 211 Did Mr Jagatramka have apparent or ostensible authority? The course of dealings over the previous few years had established a consistent pattern whereby invoices rendered by British Marine to Gujarat India were discharged, sooner or later, by payment from Wollongong Coal. Even in the case of the Wadi Alkarm, British Marine understood that payment was delayed because of circumstances concerning the proposed change of management at Wollongong Coal. Although British Marine looked correctly to Gujarat India for payment as a legal obligation, it would be entitled to believe, based on the commercial conduct of Wollongong Coal, that Mr Jagatramka had authority to propose arrangements for the payment of the outstanding debt. If he had signed the letter on 3 October 2013 it might, therefore, be open to British Marine to rely upon it, although only by reference to its actual terms. 212 However, that is only one obstacle which might be removed from the path. Although I accept that the commercial course of practice would ordinarily have entitled Mr Bekhor to accept and rely upon Mr Jagatramka's ostensible or apparent authority, if the letter had been signed on 3 October 2013, there are qualifications to the general principles about ostensible authority which must now be considered. 213 It has been held that reliance on ostensible authority must be "reasonable" (Pourzand v Telstra Corporation Ltd [2014] WASCA 14 at [84], [131]) and circumstances may be such as to put a person on inquiry. In the present case, there was a clear need for Mr Bekhor to make further enquiries if he was to rely on any ostensible or apparent authority in connection with the letter of 3 October 2013. Those circumstances included the possibility of backdating, his knowledge that Mr Jagatramka had no actual authority at 31 October 2013 and the fact that Mr Jagatramka was burdened by an obvious conflict of interest. 214 The last consideration falls comfortably within the observations of the Full Court of this Court in Combulk Pty Ltd v TNT Management Pty Ltd (1993) 41 FCR 59 at 66: It is well established that it is not within the scope of an agent's authority to bind his or her principals by a contract which, although made ostensibly on their behalf, is, to the knowledge of the other party, really made for his or her own benefit, even though the contract is of a kind which he or she had general authority to make; and that, therefore, when an agent purports to make such a contract, and the party with whom he or she is dealing is aware of the circumstances, the principal is not bound (see Lysaght Bros & Co Ltd v Falk (1905) 2 CLR 421). 215 The conjunction of Mr Jagatramka's personal interests with those of Gujarat India was well-known to Mr Bekhor. Any attempt by Gujarat India or Mr Jagatramka to deflect legal liability to Wollongong Coal should, in the circumstances of the dispute at that time, have excited Mr Bekhor's apprehension about Mr Jagatramka's motivation and authority. It was not reasonable for him to assign any weight or legal significance to the letter of 3 October 2013 without further enquiry, whenever it was signed. The enquiry as to Mr Hawkes' opinion did not suffice. 216 The result of this finding is that it ultimately does not matter when the 3 October 2013 letter came into existence. Even it if was on 3 October 2013, and even if it had been sent on that day to Saigal SeaTrade, who had sent it on 5 October 2013 (unsuccessfully) to British Marine, Mr Jagatramka had no actual or ostensible authority to sign it. 217 He had no actual authority because he was disabled by a conflict of interest. He had no ostensible authority because it was not reasonable of Mr Bekhor not to make enquiries about that matter. Those enquiries would have revealed his lack of authority. 218 This is another fundamental reason why the case in contract against Wollongong Coal cannot succeed.

Demand for immediate payment 219 British Marine's contract case first relied on the 31 October 2013 letter as a transmission of promises in the 3 October 2013 letter. But a mere transmission of promises would be clearly insufficient. 220 The second way in which the letter of 31 October 2013 (with its attached letter of 3 October 2013) is relied upon in contract is in combination with events on 5 and 8 November 2013. I shall turn to them now but it must be remembered that the letter of 31 October 2013 did not come from Wollongong Coal. It came through Saigal SeaTrade from Gujarat India, the party with which British Marine was at that time in dispute about unpaid charges. 221 The email from Mr Sial (from British Marine) to Saigal SeaTrade on 5 November 2013 which is relied upon in British Marine's pleaded case asked for a number of attached documents to be provided to Gujarat India. The bundle of attachments included an unsigned draft demand against Wollongong Coal. That communication provides no support for any case against Wollongong Coal. 222 The letter from British Marine to Wollongong Coal dated 8 November 2013 (a signed copy of the earlier draft) was in the following terms: Gujarat NRE Coking Coal Limited [Wollongong Coal] PO Box 281 Fairy Meadow NSW 2519 Australia (Postal address) 147 Princes Highway Corrimal NSW 2518 Australia (Corporate address) Dear Sirs "WADI ALKARM" - PORT KEMBLA, AUSTRALIA TO NEW MANGALORE, INDIA FREIGHT, LOADPORT DEMURRAGE AND OUTSTANDING PAYMENTS MV "VOLUMNIA" GUARANTEE DATED 3 OCTOBER 2013 We refer to your guarantee dated 3 October 2013, a copy of which is attached. That guarantee contains your irrevocable agreement to pay 100% freight and deadfreight along with loadport demurrage in respect of "WADI ALKARM" and outstandings in respect of "VOLUMNIA". All of these sums remain outstanding as on 5-Nov-13 and this is our formal written demand requiring immediate payment by you of the following:- 1. 100 % Freight including deadfreight for discharge at 2 Ports - New Mangalore and Kandla: US$ 1,987,958. 2. Loadport demurrage of US$ 169,837.47. 3. Outstandings in relation to the fixture of mv. "VOLUMNIA" of US$ 275,698.82. In addition, the vessel has been at the discharge port New Mangalore since 13 October 2013. In accordance with the final paragraph of the guarantee of the 3 October 2013 the demurrage payable which has accrued at the rate of US$ 9,000 per day and is immediately payable is US$ 178,299.99. Regards [signature] S. Malhatra Director (Emphasis added.) 223 In its written submissions British Marine attempted to argue that the letter of 8 November 2013 represented acceptance of an offer "constituted" by the 3 October 2013 letter "as provided" by the letter of 31 October 2013. I reject each element of this contention, which departs impermissibly in any event from the pleaded case. Importantly (accepting for this purpose that the letter of 3 October 2013 represents an offer capable of acceptance in contractual terms), this letter of demand indicates clearly that British Marine will wait no longer to be paid. 224 Immediate payment, with demurrage to that point, is demanded. That is not what was proposed by the terms of the 3 October 2013 letter. What was offered (if it be an offer) was delayed payment accompanied by demurrage until payment occurred, with discharge also delayed. Perhaps Mr Bekhor would wait no longer, but whatever the explanation for rejection of the position suggested in the 3 October 2013 letter, the letter of demand on 8 November 2013 represented rejection, not acceptance. British Marine was asked for forbearance, on terms, if full weight is given to the letter of 3 October 2013. On 8 November 2013, it declined forbearance and rejected the terms. When discharge occurred, rejection of any proposal constituted by the letter of 3 October 2013 was complete. 225 In oral submissions, British Marine appealed to the idea that the construction I have given to the letter of 3 October 2013 would not represent a sensible business arrangement, at least from the point of view of British Marine, and pointed to the statements of the majority in the High Court in Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640 at [35]: The construction issue 35 … The meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean. That approach is not unfamiliar. As reaffirmed, it will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract. Appreciation of the commercial purpose or objects is facilitated by an understanding "of the genesis of the transaction, the background, the context [and] the market in which the parties are operating". As Arden LJ observed in Re Golden Key Ltd, unless a contrary intention is indicated, a court is entitled to approach the task of giving a commercial contract a businesslike interpretation on the assumption "that the parties … intended to produce a commercial result". A commercial contract is to be construed so as to avoid it "making commercial nonsense or working commercial inconvenience". (Footnotes omitted.) 226 However, those statements do not assist in deciding whether a contract has been made. I accept that the proposal in the letter dated 3 October 2013 would have been of little, if any, practical or commercial utility to British Marine, but it was not accepted. There was no contract based upon its terms.

Notices of lien 227 Despite the advice that it had no right to a lien, British Marine served notices of lien on Gujarat India, Sona Alloys and Concast, although the Wadi Alkarm remained for the time being outside port limits. British Marine also set about to negotiate agreements with Sona Alloys and Concast, to which Gujarat India also became a party, effectively seeking a right of lien over the cargo. Discharge did not occur until the relevant "Cooperation Agreement" was signed. 228 The first Cooperation Agreement was signed with Sona Alloys and Gujarat India on 12 November 2013. It recorded that British Marine had exercised a lien over 20,162 MT. It recorded acceptance by Gujarat India of the validity of the lien. It purportedly recorded that Wollongong Coal was liable for freight, dead freight and demurrage charges -by reference to cl 26 of the contract of affreightment - although Wollongong Coal was not a party to the first Cooperation Agreement or the contract of affreightment. It also recorded that the lien was related to the earlier debt concerning the Volumnia, despite the lack of any apparent connection between that debt and Sona Alloys. The Cooperation Agreement was to remain confidential to the parties. It bound British Marine to discharge that part of the cargo as soon as possible. By the time the first Cooperation Agreement was signed it was plain that Wollongong Coal was not responding to any demands upon it. Having regard to the whole course of events, it is difficult to accept Mr Bekhor's statements that he was, nevertheless, relying on anything in the letter dated 3 October 2013, but it is not necessary to dwell further on that aspect here. 229 On 17 November 2013, the Wadi Alkarm discharged 45,162 MT in New Mangalore, 20,162 MT being subject to the agreed lien. It follows that 25,000 MT was not subject to the lien. Although no relationship was established by the evidence it will be remembered that Mr Jagatramka said that Sona Alloys had acquired the coal from Gujarat India by allowing a credit against existing debt. He thought 45-50% of the credit had been taken up. It seems possible, therefore that, in substance, the remaining coal, subject to the agreed lien, was effectively held by British Marine to the detriment of Gujarat India, which on the evidence had also not paid Wollongong Coal for its purchase or freight. 230 On 21 November 2013, a Cooperation Agreement was made by British Marine with Concast and Gujarat India. By this time the proceeding had been commenced. Mr Bekhor was certainly not acting on the faith of any representation at this point. The document shows Wollongong Coal as the first contracting party, but it was not. The document is misleading; I infer deliberately so. The document identifies Wollongong Coal as "the Charterer". This is also misleading. 231 The agreement records that Concast purchased 21,600 MT from Wollongong Coal and was "to sell the entire cargo on back to back terms" to Gujarat India. The evidence does not disclose if that was done but if it was it imposes the burden of the lien arrangement, again, on Gujarat India. On this occasion payment to Wollongong Coal has been made (by Concast). Otherwise, the agreement is in similar terms, with similar inaccuracies, to the Sona Alloys Cooperation Agreement. 232 On 25 November 2013, the Wadi Alkarm discharged 21,600 MT under the agreed lien in Kandla. 233 Mr Bekhor may have had little interest in resisting the misrepresentations in the Cooperation Agreements about the liability of Wollongong Coal but the inclusion of those statements nevertheless implicates British Marine in them. It is clear that the misrepresentations were made in the perceived interests of Gujarat India, and hence Mr Jagatramka. 234 I shall refer later to arrangements that were subsequently made for some sale of coal from the amounts held under the agreed liens. On the evidence, a little under 9,000 MT has been sold at US$45 per metric tonne and the proceeds (US$400,000) are held by British Marine under an agreed security regime.

3 October 2013 letter - reliance and misrepresentation 235 I have already given some attention to the letter of 3 October 2013 in connection with the claims against Wollongong Coal in contract, and I will have more to say about that issue when I deal with the pleadings in greater detail. 236 Further attention is required to that letter now from a different perspective because it is also the foundation for the suit by British Marine against both Wollongong Coal and Mr Jagatramka under the Australian Consumer Law ("ACL"). 237 It is clear that British Marine received this letter in company with the letter from Gujarat India, signed by Mr Kannan, dated 31 October 2013, each being attachments to an email from Saigal SeaTrade bearing the same date. This was the usual means of communication. 238 During argument it was submitted that the letter of 3 October 2013 was (in addition to being an attachment to the letter of 31 October 2013) also proffered independently by Mr Saigal as agent for Wollongong Coal. I do not accept either element of this contention. In my view, it is clear that the letter of 3 October 2013 was only significant as a reference point for the letter of 31 October 2013. British Marine's case was that Mr Jagatramka instructed that the letter of 31 October 2013 be sent. As I have said earlier, I think the evidence sufficiently supports this contention. It is clear that Mr Jagatramka was not acting on behalf of Wollongong Coal on 31 October 2013, but against its interests. By this time Mr Saigal also had been acting contrary to the interests of Wollongong Coal. I do not accept that Saigal SeaTrade was its agent at this or any other time. 239 In any event, Saigal SeaTrade had made it abundantly apparent in its communications around this time that it was acting as "broker only". Although it did not expressly disclaim on 31 October 2013, to be acting for either Gujarat India or Wollongong Coal, it is quite clear, in my view, that it was certainly not acting as the agent for Wollongong Coal. Rather, it was acting to assist Gujarat India. 240 When Mr Bekhor gave evidence that these letters were drawn to his attention he said he noticed the discrepancy in dates. Mr Bekhor's evidence included the following: ---… My working hypothesis was that this is a document that could have been produced on 3 October. It was perfectly possible that it would have been produced on 3 October because this would be a normal thing in relation to the way the conduct of the business was being done between India and Australia. In other words, once the ship has sailed, once the nomination has been accepted, once the cargo is loaded, my understanding would be that, effectively, the liability - this is an internal arrangement between Gujarat India and Gujarat Australia - that the liability would pass on to Gujarat Australia. So it wouldn't have surprised me for this document to be in existence, although it was a question why it was proffered at this stage and not earlier. Right. Well, there's not much point, is there really, in preparing a document dated 3 October like this and putting it in a drawer and not sending it to you; you agree?---I would agree with that. Right. So when you read - when you consider that and you have regard to the two emails I have just directed you to, you would agree that it would have seemed reasonably possible to you that this document had been backdated?---It was a possibility. (Emphasis added.) 241 The passage I have emphasised throws up some difficulties for British Marine's case. The first question is - by whom was the letter of 3 October 2013 proffered on 31 October 2013. It was not proffered by Wollongong Coal. It was proffered by Gujarat India. That is clear for a number of reasons. First, it was proffered as an attachment to the letter from Gujarat India, and not independently of it. Secondly, it was provided through the broker who was the intermediary in the contractual relationship between British Marine and Gujarat India. The broker had no role in relation to, or on behalf of, Wollongong Coal. At another part in his evidence Mr Bekhor accepted: And just pausing there, I just want to be clear, your organisation apart from what you say is the contract formed through the 3 October letter has never entered into any kind of contractual relationship with my client [Wollongong Coal] has it?---No. 242 By 31 October 2013, Mr Bekhor knew that commercial control of Wollongong Coal by Gujarat India had ceased and that Mr Jagatramka had no authority to bind Wollongong Coal. At the date that the letter of 31 October 2013 was proffered, therefore, there was in my view no respectable basis upon which he could rely upon it, without more. 243 Mr Bekhor also knew that the pattern of trade had changed. His expectation was that Wollongong Coal would send the cost of freight if it had received payment for the shipment from Gujarat India. It must have been apparent to him, therefore, that it was likely that Wollongong Coal had not been paid by Gujarat India, either by 3 October 2013 or by 31 October 2013. That impression can only have been confirmed by the terms of the 31 October 2013 letter with its further panoply of assurances of payment by Gujarat India itself. 244 The possibility that the letter dated 3 October 2013 was backdated also reinforced the need for further enquiries. And further enquiries were, in fact, made. Mr Bekhor asked Mr Sial to make enquiries of Saigal SeaTrade. He was told that the letter of 3 October 2013 was sent when it was received. That had significance in three ways. First, it confirmed that it came with the letter from Gujarat India, and not independently. Secondly, it left open the possibility that the letter had been backdated. Thirdly, it left unexplained the basis upon which any safe conclusion was available that its terms were authorised, or still authorised. 245 Mr Bekhor was asked: … what you have got here is a document that suggests to you the possibility that it has been backdated; you agree with me about that. Yes?---There was a possibility that it might have been backdated. And it has got the name of Mr Jagatramka as the executive chairman on it?---Correct. And you knew, at that point, that he was no longer the executive chairman?---Yes. 246 Mr Bekhor took no steps to confirm that the letter was authoritative. Instead, he made a demand (on 8 November 2013) based on the supposed guarantee. When he received no response, British Marine commenced the present proceedings. 247 Nevertheless, Mr Bekhor claimed to have relied on the letter of 3 October 2013 in three important ways. First, he agreed to discharge. I have already pointed out that the terms of the letter of 3 October 2013 do not suggest discharge until full payment was made. Discharge was not a response to this letter. Mr Bekhor had his own commercial reasons to discharge. He was paying hire on the Wadi Alkarm and the head owners were pressing for its release. Discharge did not occur until after the present proceedings had commenced when Wollongong Coal failed to respond to the demand made on 8 November 2013. I reject the suggestion that British Marine relied on the letter of 3 October 2013 to discharge. 248 Mr Bekhor also said he would have, in negotiations with the receivers who held the bills of lading to which I referred earlier, otherwise insisted on a right of sale and he also refrained from pressing for a lien over the whole of the cargo. British Marine took the view that it was not legally entitled to either of those last two things. Its ability to achieve either as a commercial outcome depended solely upon Mr Bekhor's skills as a negotiator. 249 The substance of Mr Bekhor's evidence about those matters is captured in the following exchange: Okay. But what I'm getting at is that you say that you did two things in reliance on the 3 October letter. Number 1, you agreed to discharge then unload the coal?---Yes. And instead of coming - just sitting out there in the ocean, you came into port and you unloaded the coal. That's the first thing you say you did?---Yes. And the second thing you say that you did is that you declined to press for a right of sale?---Having been armed with a guarantee, I was prepared to compromise on the terms of a cooperation agreement. Yes. Which means that you did not press your demand for a right of sale?---Which - amongst other things, including not wanting to lien the entire cargo. I didn't press for a right of sale. … Now, it's the case, isn't it, that you can't say one way or another whether or not if you had insisted upon a right of sale you would have received it?---Absolutely. You can't say that and it's just a matter of speculation?---Absolutely. Can I - in any event as you said this right of sale is something that - the failure to press for a right of sale is something that you say you did in reliance on 3 October letter. Do you agree?---Yes. Okay. Is there anything else that you say that you did in reliance upon the 3 October letter?---Yes. Yes, what was that?---I failed to press for a lien over the entire cargo. Okay. Anything else?---No. 250 British Marine did not discharge until it had negotiated the Cooperation Agreements. Whether Mr Bekhor could have achieved, commercially, a right of sale to which he was not legally entitled was, he accepted, "just a matter of speculation". Mr Bekhor said: ---… You can negotiate with the - with - with your counter-party and with the receivers to have a right of sale. I am sorry this is the sort of thing that was subject for negotiation. It is something that we could have pushed for, and it is something that we might possibly have secured had we pushed for it. I reiterate the point that the easy win if you like, the most likely thing that we would have achieved would have been a lien over the entire cargo. But it is entirely possible that we would have also secured a right of sale. … 251 Recovery of the cost of freight has been hampered by limitations on the arrangements for sale. Mr Bekhor negotiated separate arrangements about that. On his evidence, the negotiations were with Mr Jagatramka, commencing in London on 2 May 2014. The result was an agreement dated 27 May 2014 between B&B Global Limited (a Hong Kong registered company) and Gujarat India on one side and British Marine on the other. The agreement valued the coal held under the Cooperation Agreements at US$45 per metric tonne. It provided for payments to be made to British Marine, in tranches, up to a total of US$1,879,290, such payments to be held by British Marine as security for the claims against Gujarat India (my emphasis), arising from the voyages of the Volumnia and the Wadi Alkarm. The cargo was to be released correspondingly. 252 The total cargo held was 20,162 MT at New Mangalore and 21,600 MT at Kandla (i.e. all but 25,000 MT of the original cargo). US$1,879,290 represents its value at US$45 per metric tonne. 253 On Mr Bekhor's evidence, about US$400,000 had so far been paid under this arrangement. If British Marine is successful in the present proceedings, against either Wollongong Coal or Mr Jagatramka, then to that extent a "net recovery" would be calculated. If, after sale under the agreement, and recovery in the proceedings (less costs and associated expenses) there was a surplus over the value of the outstanding claims against Gujarat India then the balance would be returned. The agreement provided for payment to B&B Global, but Mr Bekhor stated in his evidence: ---… We entered into an agreement the effect of which is that, to the extent that our debt has not been discharged fully by, in the first instance, your client [Wollongong Coal] and anything left over of our debt would be returned to Gujarat India. So if this honourable court determines that the guarantee is indeed valid as we have maintained throughout, then we would be entitled to compute how much is left over after debt has been discharged and to the extent that there was anything left over, that amount of money would be returned to Gujarat India. 254 Despite making those remarks, Mr Bekhor later disclaimed knowledge of where the surplus would go, except to B&B Global. As the whole arrangement was negotiated with Mr Jagatramka, I am satisfied that the commercial understanding volunteered by Mr Bekhor is likely to be correct. 255 On the day oral submissions were to commence, a further agreement, dated 17 December 2014, was tendered without objection. It was made between British Marine and NRE Resources Pty Limited. It was signed by Mr Jagatramka as Director of the latter company. It records that this company now has the ultimate benefit of the arrangement recorded in the earlier agreement of 27 May 2014. 256 None of those arrangements affect or alter the legal issues to be decided in the present case but one of those issues, according to the way the case has been argued, is whether Mr Bekhor relied on the letter dated 3 October 2013, received by him on 31 October 2013. In my view he did not, except as a possible foundation for the present proceedings, additionally to such other arrangements as he could negotiate. I am not satisfied that he refrained from attempting to achieve any commercial position of advantage which he thought he might reasonably be able to achieve. If he refrained from seeking a full lien (while in fact believing he had no legal right under Indian law to any lien at all) it was probably because he believed he had done as well as he could in the circumstances. If he failed to press harder for a right of sale, it was probably because, again, he thought he had done as well as he could in the circumstances. 257 Discharge did not occur until after the proceedings had been commenced and the Cooperation Agreements were in place. I am satisfied that Mr Bekhor did not rely on the letter of 3 October 2013 to authorise discharge and that, in any event, discharge was not responsive to anything in that letter. 258 In all those circumstances, I am not satisfied that Mr Bekhor relied on the letter of 3 October 2013. If he had done so it would have been unreasonable to do so. 259 In any event, no representation was made by Wollongong Coal to British Marine as a result of this letter being sent by Gujarat India to British Marine after Mr Jagatramka ceased to be Executive Chairman. On the face of matters, as known to Mr Bekhor, that is the only available conclusion. Any prudent and focussed enquiry would only have confirmed the position. 260 In any examination of whether there has been misleading or deceptive conduct two matters (at least in the present case) require attention: establishing when the alleged conduct occurred; and focussing on the conduct of Wollongong Coal. The alleged representations were made to British Marine on 31 October 2013. Wollongong Coal made no contribution to them, nor did any person with authority to speak for Wollongong Coal on that date. Those matters are obvious on the face of the documents. Examination of the terms of the documents only confirms that the letter dated 3 October 2013 was provided by Gujarat India, not Wollongong Coal. At 31 October 2013, Gujarat India had no conceivable authority to proffer it to British Marine, nor at that date was it proffered by Wollongong Coal. Both documents were supplied by Saigal SeaTrade, as documents only just received. It was not acting in any sense on behalf of Wollongong Coal. 261 There was no misrepresentation by Wollongong Coal. Moreover, Mr Jagatramka had no authority to sign the letter, whenever he did so. In any event, there was no reliance on the letter of 3 October 2013 for any commercial conduct by British Marine before proceedings began in this Court.

The final pleadings 262 The pleaded case, on all sides, developed from simple beginnings to a convoluted and dense set of allegations and counter-allegations. Most of the responsibility for the untidy and confusing state of the final pleadings must rest with the defendants who directed their pleaded cases, in most instances, to the proposition that if either had any liability to the plaintiff, the liability should be shifted to the other defendant or discounted upon the premise that third parties were "proportionally" liable also. 263 This forensic jockeying for position during the proceedings led to a number of iterations of each of the principal pleadings, and then to cross-claims between the defendants. Perhaps the Court could have done more to bring greater order to the situation, although it is hard to know when effective intervention, and ultimate restraint, might have begun or been enforced. 264 Finally, the proceedings go to judgment on a Further Amended Originating Application and a Further Amended Statement of Claim by British Marine (filed on 3 and 2 October 2014 respectively), a Third Further Amended Defence by Wollongong Coal (filed on 24 October 2014), a Further Amended Defence by Mr Jagatramka (filed on 9 December 2014), a Notice and Statement of Cross-Claim (the first cross-claim) filed by Mr Jagatramka against Wollongong Coal (filed on 24 October 2014), Defence to the first cross-claim by Wollongong Coal (filed on 7 November 2014), a Notice and Statement of Cross-Claim (the second cross-claim) by Wollongong Coal against Mr Jagatramka (filed on 7 November 2014), and a Defence to the second cross-claim by Mr Jagatramka (filed on 2 December 2014). 265 I shall refer to each of the applications (or notices), statements and defences as though they were the first iteration - i.e. originating application, statement of claim, defence, first and second cross-claim and defence to the first and second cross-claim. 266 I consider it to be appropriate in the present case, after all the iterations which were permitted, to confine the parties to the cases which were finally pleaded. 267 Much of what I will say at this point will reflect observations or findings which I have already made. There will, therefore, be a good deal of repetition but it is only at this point that the pleaded cases can be dealt with in the light of all the factual findings.

The Statement of Claim 268 In its originating application the plaintiff claimed damages on the grounds appearing in the statement of claim. Those damages (excluding interest) are made up as follows: 1. Damages in the sums of: a. "Volumnia" Charges of US$274,349.56; b. "Wadi Alkarm" Freight of US$1,987,958.00; c. "Wadi Alkarm" Loadport Demurrage of US$169,837.47; and d. "Wadi Alkarm" Discharge Port Demurrage of US$9,000.00 per day from 17 October 2013 and continuing. 269 There was an alternative, unquantified claim based on the ACL. 270 The statement of claim asserted a "contract of guarantee" made "on or about 31 October 2013, and between 5 and 8 November 2013". Particulars of the claim referred to the letter of 3 October 2013, to an email from Mr Sial (at British Marine) to Saigal SeaTrade on 5 November 2013 and a letter from British Marine to Wollongong Coal on 8 November 2013. 271 The terms of the contract were asserted to be that Wollongong Coal had guaranteed performance of the contract of affreightment by Gujarat India, would pay most outstanding charges ("Volumnia" Charges, "Wadi Alkarm" Freight and "Wadi Alkarm" Loadport Demurrage) before the arrival of the Wadi Alkarm and/or before commencement of discharge and would otherwise pay any Discharge Port Demurrage. 272 The alternative claim was that Wollongong Coal had misleadingly represented that it would pay all the charges. This pleading was based on the same foundation as the contract case - namely, the 3 October 2013 letter (taking contractual effect on 31 October 2013) and/or the suggested exchange in November 2013. 273 It was then pleaded that Mr Jagatramka was "involved" in the alleged misleading and deceptive conduct (within the meaning of s 2 of the ACL). 274 Next, British Marine sued Mr Jagatramka for breach of warranty of authority. This pleading depends upon it being found that an otherwise valid contract of guarantee was unenforceable against Wollongong Coal because Mr Jagatramka acted outside his actual or apparent authority. 275 Finally, British Marine sued Mr Jagatramka personally for misleading and deceptive conduct (if he did not have authority to bind Wollongong Coal) by making representations on or around 31 October 2013 - i.e. the representations contained in the asserted guarantee of 3 October 2013. 276 The first foundation upon which British Marine claims damages from Wollongong Coal is that between 31 October 2013 and about 8 November 2013 Wollongong Coal made a contract with British Marine whereby Wollongong Coal guaranteed performance of the contract of affreightment by Gujarat India. This claim does not depend on any assertion that Wollongong Coal was directly liable to British Marine under the contract of affreightment. Despite arguments to the contrary by Mr Jagatramka, I am satisfied that no such particular liability existed. 277 In written submissions British Marine contended that (factually) Wollongong Coal was "responsible" for payment of freight to British Marine. I am satisfied that there was such a practice which reflected the commercial arrangements between Gujarat India and Wollongong Coal, but British Marine although an uncomplaining recipient of the payments was not an active party to the arrangement and had no legal right to enforce it. 278 The contention that Wollongong Coal made a contract with British Marine which incorporated the suggested promises in Mr Jagatramka's letter dated 3 October 2013, depends upon a number of propositions which I do not accept. 279 First, Wollongong Coal did not take any step on or about 31 October 2013 which British Marine can identify, much less rely upon. The letter dated 31 October 2013 upon which the argument relies was signed by Mr Kannan, of Gujarat India. Mr Kannan had no apparent authority to bind Wollongong Coal, and nor did Gujarat India. British Marine argued in its written submissions that "Mr Jagatramka gave instructions to Saigal and Mr Kannan to issue the Gujarat India letter and for that to include the 3 October letter". The evidence does support that contention but that does not assist British Marine's case against Wollongong Coal because at 31 October 2013 Mr Jagatramka had no authority to bind Wollongong Coal, as British Marine well knew. 280 I do not accept, as I earlier indicated, that Mr Saigal sent the 3 October 2013 letter independently of the 31 October 2013 letter (i.e. not only as an attachment to it) or that he had any authority as an agent for Wollongong Coal on 31 October 2013. 281 British Marine did not, by its pleaded case, assert that the letter of 3 October 2013 had independent contractual force. Had it done so I would not have accepted the argument. There is no evidence of any receipt of that letter by British Marine, otherwise than as an attachment to Mr Kannan's letter. 282 Whatever view is taken of the assessment offered by Mr Hawkes to Mr Bekhor, that the 3 October 2013 letter was a guarantee enforceable in its own right, that is not the case which I have to decide. But, for the reasons which follow, I would not accept such a case in any event. 283 I would not, whatever view I took of the provenance of that letter, have imbued it with contractual force in the circumstances of the present case. There was no acceptance (at any time after 31 October 2013) of anything that might be considered to be an offer in contractual terms. Nor was there ultimately sufficient evidence of a mutual intention to create contractual relations based on the true terms of the letter. All those basic elements are missing. 284 Even if attention was given independently to the letter of 3 October 2013 as a possible offer to make a contract capable of acceptance as such, it would be necessary to identify what promises were being made. The first paragraph would be construed as a promise to pay outstanding debts of Gujarat India before arrival at New Mangalore. The second paragraph would be construed as a promise to pay any additional freight referable to a second discharge port, before any discharge at New Mangalore. In view of the failure of the first (most financially significant) promise, the third paragraph, in my view, would be construed as the operative promise to pay demurrage at New Mangalore until discharge occurred following payment of outstanding debts evidenced by actual receipt in British Marine's bank account. There was no suggestion of discharge before payment. The letter represented a request for time to pay, on terms. A demand for immediate payment represented rejection of the offer. 285 In summary, the 3 October 2013 letter did not constitute an offer or promise by Wollongong Coal, acceptance of which might constitute a contract obliging immediate payment, or even payment before discharge. The letter of 3 October 2013 was not proffered by Wollongong Coal. It was provided by British Marine's contract partner who (as British Marine knew) had no authority to act on behalf of Wollongong Coal or deflect liability to it. In any event, the letter of 8 November 2013 could not (and did not in terms) constitute acceptance of such an offer. 286 In the written submissions British Marine also argued that from 8 November 2013 Wollongong Coal was estopped from denying its liability under the 3 October 2013 letter (purportedly signed by Mr Jagatramka on that date but only provided on 31 October 2013 by a party interested in deflecting liability and attention from itself) because Wollongong Coal knew from 8 November 2013 that British Marine was relying upon it. If only litigation was so easy. 287 No authority was quoted for the proposition that an estoppel could be hoisted on a letter of demand which was left fluttering in the breeze of anticipated litigation until that litigation commenced one week later. 288 Such a case was not pleaded. It could not have survived a moment's scrutiny if it had been. 289 When the demands were made and when litigation was commenced Wollongong Coal was entitled to remain silent if it wished. Neither its silence nor the unilateral terms of any demand will provide evidence to fill the gaps in the case against it. 290 The claim against Wollongong Coal for misleading and deceptive conduct was only pressed against Wollongong Coal in the written submissions "in the event that Jagatramka is found to have had authority in respect of the 3 October letter, but for some reason that letter is not found to have resulted in a binding agreement between [Wollongong Coal] and British Marine". 291 Similarly, the claim that Mr Jagatramka was "involved" in Wollongong Coal's asserted misleading or deceptive conduct also depended on the same foundation. 292 These claims can fare no better than the contract case, as they are based upon the same factual elements. 293 Wollongong Coal did not make representations to British Marine through the 3 October 2013 letter, which was not placed in British Marine's hands by Wollongong Coal, nor by Mr Jagatramka at any time while he had authority to do so. It was given to British Marine by Gujarat India. It was not then given on behalf of Wollongong Coal, but to support a written promise by Gujarat India upon which British Marine did not rely. Nor did it rely, I am satisfied, upon the letter of 3 October 2013 except to make a demand for payment. 294 Mr Bekhor did not rely upon the 3 October 2013 letter, except as a foundation to assert a claim against Wollongong Coal. I am satisfied that he did not give up any commercial advantage he may have had, that he did the best he could commercially with the arrangements he negotiated for discharge of the Wadi Alkarm and that he did not refrain from attempting to negotiate the best possible outcome, as he judged it. Mr Bekhor was not deflected by the advice given to him that he had no right to a lien over the cargo once it arrived within port limits. Nor was he deflected, I am satisfied, by any suggestion that he might have some sort of alternate claim based on the 3 October 2013 letter. Mr Bekhor was concerned with negotiations for a commercial outcome and appears to have done much better than any strict view of British Marine's legal rights might suggest. 295 This part of the foundation for any claim can fare no better than the speculative possibilities referred to by a Full Court in Castel Electronics Pty Ltd v Toshiba Singapore Pte Ltd (2011) 192 FCR 445, in these terms at [166]-[167]: 166 It was incumbent on Castel to establish on the balance of probabilities that it had lost a valuable opportunity. If Castel satisfied the burden of proof it bore on this issue, the Court could proceed to value that opportunity in accordance with the degree of likelihood that the opportunity would have ensued to Castel's pecuniary gain. In Sellars v Adelaide Petroleum NL at 346-353, Mason CJ, Dawson, Toohey and Gaudron JJ analysed the authorities at length, emphasising the distinction between causation of loss (which must be determined in accordance with the general civil standard of proof) and the assessment of the plaintiff's loss "taking into account any reductions arising from the uncertainty of future events". Their Honours concluded their discussion with the observation: "When the issue of causation turns on what the plaintiff would have done, there is no particular reason for departing from proof on the balance of probabilities notwithstanding that the question is hypothetical." That authoritative statement applies with no less force where the issue is not only what the plaintiff would have done, but also involves questions as to what others would have been disposed to do in relation to reaching an agreement with the plaintiff. 167 The primary judge was simply not satisfied that Castel would or could have concluded an agreement with Harman or Convoy, nor that the misconduct alleged by Castel against TSP had any bearing on that state of affairs. Even if Mr Kwong genuinely believed that he would be able to conclude an agreement with Harman or Convoy, the primary judge was entitled to regard that belief as no more than wishful thinking after the event. Damages are not awarded for wishful thinking. 296 It follows that I reject each, and all, of the claims against Wollongong Coal. No claim remains against Mr Jagatramka which derives from any claim against Wollongong Coal. 297 Had I found that Wollongong Coal was liable to British Marine for misleading and deceptive conduct I would have found, based on Mr Jagatramka's own evidence, that he was knowingly involved in such conduct, subject to some matters discussed below. 298 If I was wrong about the liability of Wollongong Coal for misleading and deceptive conduct then Mr Jagatramka must share that responsibility. First, he was the author of the letter. Secondly, he claimed to have authorised its transmission to Saigal SeaTrade on behalf of Wollongong Coal as early as 3 October 2013. 299 I would only be at this point in the analysis if I had already accepted that the representations in the letter were misleading and deceptive, or were representations about future events made without reasonable grounds, that they were authorised and that British Marine relied upon them to its detriment, none of which conclusions reflect my views. But if they did, Mr Jagatramka could not avoid them any more than could Wollongong Coal. 300 For the purpose of the independent claim against Mr Jagatramka of misleading and deceptive conduct, however, it is not appropriate to proceed upon the same assumptions. 301 This claim assumes that Wollongong Coal cannot be fixed with liability for Mr Jagatramka's conduct because he did not have "actual or ostensible authority in respect of the 3 October letter". 302 If I concluded that Mr Jagatramka signed and sent the letter on 3 October 2013, and intended that it be received and considered by British Marine at about that time, I would not conclude that a case of misleading or deceptive conduct had been made out unless I concluded that British Marine received the letter and acted upon its contents. On no view of the evidence would any such conclusion be available before 31 October 2013. 303 It would not matter, therefore, for the purpose of this analysis, whether Mr Jagatramka acted unilaterally and without authority on 3 October 2013 or on 31 October 2013. 304 By 31 October 2013, British Marine knew that Mr Jagatramka's assurances could not be relied upon as he had no authority. Furthermore, for the reasons I have already given, I am satisfied that British Marine did not rely upon them. Instead Mr Bekhor set out to negotiate something more tangible than Mr Jagatramka's empty platitudes which, by then, had proved to be without any value at all. The independent claim of misleading and deceptive conduct cannot succeed. 305 Counsel for Mr Jagatramka advanced two further matters as defences available to Mr Jagatramka against any claim under the ACL. They are based on s 5(1)(i) and s 5(3) of the Competition and Consumer Act 2010 (Cth), which provide: 5 Extended application of this Act to conduct outside Australia (1) Each of the following provisions: … (c) the Australian Consumer Law (other than Part 5-3); … extends to the engaging in conduct outside Australia by: … (i) persons ordinarily resident within Australia. … (3) Where a claim under section 82, or under section 236 of the Australian Consumer Law, is made in a proceeding, a person is not entitled to rely at a hearing in respect of that proceeding on conduct to which a provision of this Act extends by virtue of subsection (1) or (2) of this section except with the consent in writing of the Minister. 306 It was argued that Mr Jagatramka was not "ordinarily resident within Australia" on 3 or 31 October 2013 and that the Minister's consent had not been provided to claims against him before any hearing. It is convenient to deal with the second issue first. 307 The construction of s 5(3), upon which the argument depends, receives some support from a judgment of Drummond J in Yamaji v Westpac Banking Corporation (No 2) (1993) 42 FCR 436 at 440. Drummond J referred to s 5(4) (which required Ministerial consent before an application is made) and reasoned that s 5(3) should be construed conformably. With respect, I cannot accept this reasoning. The terms of the two provisions are quite different. 308 Drummond J's construction of s 5(3) has not been applied in subsequent cases in this Court (see Natureland Parks Pty Ltd v My-Life Corporation Pty Ltd (1996) 67 FCR 237 at 240-241; Stern v National Australia Bank [1999] FCA 1421 at [152]; Auskay International Manufacturing & Trade Pty Ltd v Qantas Airways Ltd (2008) 251 ALR 166 at [57]). 309 In the present case, Ministerial consent was given before the conclusion of the hearing. That is sufficient. 310 The question of whether Mr Jagatramka was ordinarily resident within Australia at the relevant time is more finely balanced. In his evidence in chief, Mr Jagatramka gave the following evidence: Now, Mr Jagatramka, where did you work from? Physically where were you in the work that you did for the company in the period September 2011 through to October 2012 - sorry, October 2013?---I used to work from everywhere, but - like, I used to travel a lot. And generally it was two weeks in India, two weeks in Australia, or it could be one week in Australia, one week in India. And when in Australia, I had - I had the office at the mine site in Wollongong in Russell Vale. While in India, I had the office in Camac Street. And even while travelling with the laptop, you can have your office everywhere. And, Mr Jagatramka, did you have a home in Wollongong?---Yes. 311 In his cross-examination, Mr Jagatramka referred to being, on 26 October 2013, "in Kolkata in my home". 312 Mr Jagatramka's "Executive Services Agreement" made with Wollongong Coal effective from 11 September 2011, contemplated that he would hold a 457 - Business Long Stay visa (permitting him to live and work in Australia), be provided with a residential property for himself and his family, up to two domestic helpers and that he and his "resident family members" would be provided with "internet and telecommunication" devices. 313 A person may be ordinarily resident in more than one country (see Re Taylor; Ex parte Natwest Australia Bank Ltd (1992) 37 FCR 194 at 198; Logue v Hansen Technologies Ltd (2003) 125 FCR 590 at [24]; Battenberg v Restom [2007] FCAFC 195 at [11], [33]-[36]). 314 I would be inclined to think that, at least with respect to any conduct as an officer of Wollongong Coal during this period, Mr Jagatramka should be regarded as "ordinarily resident" in Australia. 315 In view of my other findings, it is not necessary to explore this question in greater depth, but I would not, had it been necessary to rule upon them, have upheld either of Mr Jagatramka's defences based on s 5 of the Competition and Consumer Act 2010 (Cth). 316 The claim against Mr Jagatramka for breach of warranty of authority, as argued in the written submissions, depends upon it being accepted that Mr Jagatramka instructed Saigal SeaTrade to provide the 3 October 2013 letter to British Marine on 31 October 2013, that British Marine relied upon it in making a contract and that British Marine relied upon it in discharging the cargo. I do not accept any but the first element in the argument, for reasons which by now should be apparent.

Defence of Wollongong Coal 317 I accept, for the reasons I have given, that Wollongong Coal is not liable under the claims in contract or for misleading and deceptive conduct. The case against it must therefore be dismissed. 318 It is not necessary, therefore, to deal with the assertions by Wollongong Coal that the whole of any claim against it should be dismissed because the claims are "apportionable claims" for which various alleged concurrent wrongdoers should be found responsible (even if not all could be declared liable in the present proceedings). 319 The alleged concurrent wrongdoers were: Mr Jagatramka, Saigal SeaTrade, Mr Hawkes and MFB Solicitors. 320 The allegation against Saigal SeaTrade was first that, if it warranted and represented to British Marine that Mr Jagatramka was an agent of Wollongong Coal or that Wollongong Coal was prepared to pay debts owed by Gujarat India or that Saigal SeaTrade was the agent of Wollongong Coal, it did so without authority. Alternatively, it was suggested that Saigal SeaTrade could be liable because it had passed on the 3 October 2013 letter without reasonable enquiries and without authority by Wollongong Coal. 321 None of those contentions would have provided any comfort to Wollongong Coal. They were not established by the evidence and none of them, in my view, identify any cause of action which might be relevant. The attempted attribution of responsibility to Saigal SeaTrade was a diversion. The kindest thing to say about it is that it consumed no time in the proceedings. 322 I have been critical of the contribution of Saigal SeaTrade, but those criticisms relate to the performance of its role as a conduit for communications and to its manipulative attempts to further the interests of Gujarat India and Mr Jagatramka. Those matters do not sustain any suggestion that Wollongong Coal would be released from liability to British Marine, if a case had been made out against it. 323 Mr Hawkes' and MFB Solicitors' liability is said to arise from a failure of reasonable skill and care. Presumably, it was intended to suggest that Mr Hawkes was negligent. I do not accept that allegation. In any event, it will be apparent from the findings which I have made that I do not accept that Mr Bekhor or British Marine suffered loss as a result of Mr Hawkes' advice any more than as a result of alleged reliance upon the letter of 3 October 2013 itself. 324 It is not necessary to deal with any allegation that Wollongong Coal's liability might be reduced because Mr Jagatramka was a concurrent wrongdoer, in light of the cross-claims. 325 Wollongong Coal also sought to mitigate any liability by pleading that British Marine had failed to exercise reasonable care and had contributed to its own loss. It is not possible to satisfactorily evaluate this contention in light of the findings I have made and it is not necessary to address it further. However, I very much doubt that the argument could survive a finding of misleading and deceptive conduct based upon misrepresentations upon which it was reasonable to rely.

Defence of Mr Jagatramka 326 I have found Mr Jagatramka not to be liable to British Marine under any of the causes of action finally pleaded against him. 327 It is not necessary to do more than briefly mention those parts of his defence which seek to avoid liability because of the alleged conduct of concurrent wrongdoers. 328 Those concurrent wrongdoers were said to be: two of Wollongong Coal's independent directors; Mr Hawkes; and the company secretary of Wollongong Coal. I would not, on the evidence before me, have found any reduction in Mr Jagatramka's liability having regard to any of the matters thus pleaded. Again, the allegations were a distraction. They did not properly identify any relevant causes of action and the evidence about each was trifling. 329 The allegations of concurrent wrongdoing advanced in written submissions by Mr Jagatramka were no more than that - allegations. They fell well short of establishing even a prima facie case of liability, even though it was accepted that it is necessary to establish such liability in the sense that the actions of the suggested wrongdoer caused the loss and damage complained of (see Shrimp v Landmark Operations Ltd (2007) 163 FCR 510 at [62]; Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613 at [47], [91]-[92]). 330 Mr Jagatramka also suggested that British Marine was responsible for its own losses for failing to take reasonable care but, again, it is not necessary to here deal with this contention.

The first cross-claim 331 In the event that he was liable to British Marine, Mr Jagatramka claimed an indemnity under an Executive Services Agreement ("the Agreement") and a Deed of Indemnity, Insurance and Access ("the Deed"). 332 Wollongong Coal admitted the Agreement and the Deed but relied upon provisions of the Deed (acknowledged by Mr Jagatramka) which restrict the operation of the Deed to an indemnity in respect of conduct which does not involve a lack of good faith. 333 Wollongong Coal pleaded various bases for its assertion that Mr Jagatramka had not acted in good faith. 334 Wollongong Coal also pleaded that Mr Jagatramka had acted in a personal capacity, and not as an officer of Wollongong Coal, and that he was estopped from relying on the Deed because he gave no notice he would do so (until the cross-claim was filed) after Wollongong Coal asserted a lack of entitlement on 29 April 2014 denying Mr Jagatramka's assertion on 18 April 2014 that he was entitled. 335 The parties accepted that it was not necessary to make findings about the allegations in either cross-claim if the claims against Wollongong Coal and Mr Jagatramka were all dismissed. 336 I accept that Mr Jagatramka had a conflict of interest, but that does not mean that a lack of good faith attached to all that he did. It would depend what particular conduct was impeached and precisely what the evidence showed. 337 On the findings I have made, no liability attaches to Mr Jagatramka in the proceedings commenced by British Marine, and no occasion arises for him to invoke the indemnity. It would be unwise to speculate, contrary to the findings I have made, what might have been the position if the findings had been otherwise. The nature of any different findings might be very important to any conclusions about a lack of good faith. 338 The first cross-claim will be dismissed.

The second cross-claim 339 The cross-claim against Mr Jagatramka by Wollongong Coal pleads that Mr Jagatramka caused the 3 October 2013 letter to be provided to British Marine on or around 31 October 2013, that the 3 October 2013 letter purported to agree to pay certain sums to British Marine, that he had no authority (i.e. at 31 October 2013) to cause the 3 October 2013 letter to be provided, that he was in a position of conflict of interest at that time (i.e. 31 October 2013) and that he breached his statutory and fiduciary duties. 340 The above is a bare skeleton but it will suffice for present purposes. 341 In my view, the second cross-claim is moot, like the first cross-claim. 342 Like the first cross-claim also, it is not desirable to speculate unnecessarily about what conclusions might be appropriate if the findings of fact had been otherwise. 343 The second cross-claim will be dismissed.

Summary 344 The plaintiff's case against Wollongong Coal fails at a number of levels, whatever the particular findings of fact that I make. 345 It fails in contract because Mr Jagatramka had no actual or ostensible authority to commit Wollongong Coal to legally assume a debt owed by Gujarat India to British Marine, if that was the proper construction of the letter of 3 October 2013, whether that letter was written on or around 3 October 2013, or not. 346 It fails because, properly considered, the letter of 3 October 2013 proposed an assumption of debt on terms which were not accepted by British Marine. 347 It fails because, on the findings I have made, the letter was not written on or around 3 October 2013 but more likely on 31 October 2013 when Mr Jagatramka clearly had no actual authority (implied or otherwise) to commit Wollongong Coal and it was unreasonable for Mr Bekhor to rely on any assumption or appearance of authority based on the earlier course of dealings. Even if the letter had been written on 3 October 2013 Mr Jagatramka would have no authority, actual (whether implied or not) or ostensible. He had an obvious and intractable conflict of interest if he attempted to shift legal liability from Gujarat India to Wollongong Coal while he was Executive Chairman of the latter. He clearly had no actual authority to legally burden Wollongong Coal in order to further the interests of Gujarat India in achieving discharge of the cargo, whatever the prior course of commercial dealings with British Marine. He had no ostensible authority, even at that point, because Mr Bekhor knew of the conflict of interest and it was not reasonable of him to refrain from making enquiries about Mr Jagatramka's authority when he received the 3 October 2013 letter on 31 October 2013. 348 As at 31 October 2013, Mr Jagatramka had lost his office with Wollongong Coal, to Mr Bekhor's knowledge. The letter dated 3 October 2013 did not come to him from Wollongong Coal, or anybody acting for Wollongong Coal. The previous course of commercial dealings had been ruptured and British Marine was pressing its legal claims against Gujarat India with all means at its disposal. There is no foundation for an estoppel based on ostensible authority. 349 The case against Wollongong Coal for misleading and deceptive conduct based on the 3 October 2013 letter fails for the same reasons and because I have found that Mr Bekhor did not rely upon it. 350 The case against Mr Jagatramka that he was involved in misleading and deceptive conduct also fails, as a result. 351 The case against Mr Jagatramka, personally, based on misleading and deceptive conduct fails because Mr Bekhor did not rely on the letter of 3 October 2013, and because the statements and representations in the letter do not mean what the plaintiff asserted. 352 The case against Mr Jagatramka for breach of warranty of authority fails at least because Mr Bekhor did not rely on the 3 October 2013 letter. 353 The cross-claims are moot.

Conclusion 354 The further amended originating application will be dismissed. The first and second defendants should have their costs. 355 The first and second cross-claims will be dismissed. In view of their exchange, and the failure of each, there should be no order for costs of either. I certify that the preceding three hundred and fifty-five (355) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Buchanan.

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