1. When this matter came before me, Mr Cappellin was seeking an order that Miss Brondolino account to him with respect to the transactions affecting the Bank Building since its acquisition. He also sought various orders following on from a taking of the account.
2. During the cross-examination of Miss Brondolino, the claim for an order for the taking of an account was abandoned by Mr Cappellin. By Amended Points of Claim filed pursuant to leave during the hearing, Mr Cappellin's claims were amended. Thereafter there were a number of changes to the pleadings of both sides as the case moved with the evidence as it unfolded.

1. In the prayer for relief in his most recent Amended Points of Claim, Mr Cappellin seeks orders that:
   • (a) Miss Brondolino pay compensation to him with respect to, or alternatively, reimburse, monies said to have been wrongly received or applied by her;
   • (b) Miss Brondolino pay to him his five twelfths of the rental and GST received from the tenant of the Bank Building from September 2007 to December 2008 inclusive;
   • (c) the net proceeds of sale from the sale of the Bank Building be adjusted to take account of the said payments and reimbursements and that the net proceeds be disbursed in accordance with the parties' found entitlements;
   • (d) Miss Brondolino indemnify him with respect to certain penalties and interest payments that he will have to make to the Australian Taxation Office because he failed to accurately disclose his share of the income and GST received with respect to the Bank Building.
2. The money claimed to have been wrongly received or applied by Miss Brondolino falls into fourteen categories which are detailed in the Amended Points of Claim. They are set out and dealt with later in these reasons.

1. Miss Brondolino claims that, following the final refinance of their borrowings to Westpac Bank ("Westpac"), it was agreed that their responsibility for the amount then outstanding and secured by the Westpac mortgage was owed by them equally and not in the proportions in which they owned the Bank Building. However, their respective entitlements to the rental received from the tenant were five twelfths to Mr Cappellin and seven twelfths to Miss Brondolino.
2. A total of $827,007 was paid to Westpac, being the whole of the rental received over the relevant period, in order to discharge the sum secured by the mortgage and interest on it. The entitlement to that rental was $482,420 to Miss Brondolino and $344,587 to Mr Cappellin. Since the money secured by the mortgage was thereafter discharged solely from the rental, there should, she argues, be an adjustment in her favour for half of the difference, namely, $68,916 and she claims that sum.

1. The matter came before me for hearing on 26 May 2011 with ten days allocated. Mr D. Clarke of Counsel appeared for Mr Cappellin and Mr L. Watts of Counsel appeared for Miss Brondolino. The time allocated proved insufficient and the hearing was adjourned to 8 August with five further days allocated. The hearing was concluded on 12 August.
2. Mr Cappellin gave evidence on his own behalf and an affidavit sworn by his solicitor, Miss Luzaic, was relied upon without her being cross-examined. Expert evidence was given by an accountant and taxation consultant, Mr de Balquiere. This related to penalties and interest payable to the Taxation Office by Mr Cappellin which he claims he will have to pay because Miss Brondolino failed to provide him with information.
3. Miss Brondolino gave evidence and called an accountant, Mr Dedda and her brother, Mr Charles Brondolino, who were former part owners of the Bank Building and involved in some of the other enterprises. A retired Bank Manager, Mr Moy, was also called on her behalf in relation to the refinance to the Bank of Melbourne, which became Westpac.

1. The witnesses had very little recollection of events. That is unsurprising because they occurred between fifteen and twenty two years ago. Mr Dedda was able to confirm the correctness of various accounts and other documents that he had prepared and give some clarification of those and some other matters. Mr Charles Brondolino said that he recalled the general circumstances surrounding the acquisition of the Bank Building.
2. In regard to the evidence of both Mr Cappellin and Miss Brondolino I think most of it was a reconstruction from the documents that they had available to refresh what little memory they still had.
3. Since none of the witnesses had much recollection of events the case turned largely on the documents. Mr Cappellin's solicitor, Miss Luzaic has done a prodigious amount of work obtaining copies of documents from the titles office, from a former solicitor for the Commonwealth Bank, from the estate agent, some documents relating to the Westpac refinance and two files from the Supreme Court of Victoria concerning litigation involving Miss Brondolino. A file relating to a re-finance with Sandhurst Trustees Limited ("Sandhurst") was discovered by accident in Miss Brondolino's office shortly after the hearing started. This file also contained a few later documents. Mr Cappellin produced some bank records relating to a payment that he made at the time of the Westpac refinance but produced no other records. Miss Brondolino produced some financial records of recent receipts and payments.
4. Of the two files obtained from the Supreme Court, one was a claim Miss Brondolino brought against Mr Charles Brondolino in relation to the Bank Building and the other related to a claim brought against her by the Commonwealth Bank.
5. All other relevant documents appear to be missing. I draw no adverse inference about that. Documents many years old are commonly not retained.

1. The key issue relates to the position of Miss Brondolino and the nature of the role that she played vis a vis Mr Cappellin, principally in regard to the Bank Building but also in regard to their other financial dealings, and what duties she owed him, if any.
2. Mr Cappellin claims that Miss Brondolino acted as his solicitor throughout, that he signed whatever she put in front of him and that he was not aware, or had little understanding, of what he was signing or what he was agreeing to. There were a number of refinancing transactions and he alleges that he was unaware why the various amounts were borrowed or what happened to the money.
3. Miss Brondolino says that Mr Cappellin knew all along what was happening, that apart from the legal work that she did, which was done for herself and the other co-venturers from time to time, all without charge, she did not act as his solicitor. She was not retained by him as his solicitor and she did what she did because it had to be done. She said that everything was done with his knowledge and agreement.
4. Mr Cappellin also claimed that Miss Brondolino "assumed the management" of the Bank Building. Miss Brondolino denies that and says that the tenancies were managed by a real estate agent who was introduced by Mr Cappellin. Mr Dedda did the accounts and she paid the net rental received from the Real Estate Agent to the mortgagee at the time. She said that all this occurred with the knowledge and consent of Mr Cappellin.
5. To make any findings of fact it has been necessary to reconstruct what occurred over a very long period, largely by recourse to the documents. This can only be done by looking at the whole picture.
6. I turn first to the individuals and then to their financial dealings.

1. Miss Brondolino is a solicitor who has been in sole practice for the whole of the relevant period. From the fact that she was able to purchase substantial real estate, pay it off quite quickly and service large borrowings, I infer that she was successful in a financial sense.
2. It would seem from the title searches (referred to below) that, by mid 1985, Miss Brondolino owned a number of properties that she had acquired over several years. She had dealings with a number of lenders, including the Commonwealth Bank, which sued her in December 1994 to enforce a mortgage over her office. That litigation was settled in about June 1997 when Miss Brondolino paid the Commonwealth Bank an unknown sum, probably around $200,000.
3. As to Miss Brondolino's credit, reliance was placed upon her failure to comply with a number of orders of the Tribunal, particularly in regard to discovery and her lack of co-operation in settling the sale of her interest in the Bank Building to Mr Cappellin. This conduct resulted in orders for costs being made against her. Mr Watts has pointed out that, during the interlocutory stages of this proceeding she was seriously ill and receiving treatment for her condition, which was disabling. I accept that such was the case.
4. She was described by Mr Dedda as a generous person.
5. Miss Brondolino has been a solicitor for at least 35 years and although character was put in issue by her counsel, it was not established that she has engaged in any dishonest conduct over that period, save for the allegations that are now made against her by Mr Cappellin.

1. Mr Cappellin is a builder by trade and carried on business as such for many years. He is a director of a company that does or has done contract maintenance work. He has some building qualification and has done an accounting course, although he is not an accountant. He is said to be a wealthy man who owns racehorses, one of which is very valuable. Apart from that and his involvement in the various business ventures described below, I have no evidence about his finances or assets
2. Between 31 March 2006 and 2 April 2007 Mr Cappellin served a term of imprisonment for fraudulently obtaining money with respect to maintenance work falsely claimed to have been done for the Victoria University. He then served a further period of six months in home detention. He was ordered to make restitution to the Victoria University in the sum of $1.6 million. No further details of the fraudulent conduct of Mr Cappellin were given in evidence but from the fact that he was required to make restitution in the sum of $1.6 million I infer that the conduct of which he was guilty involved sums of at least that magnitude. The period over which the fraud was perpetrated was not stated in evidence. This criminal conduct is not only relevant to his credit but also to the extent of his business experience and his familiarity with financial matters.
3. As to his credit, the evidence of a witness who has been convicted of a serious crime of dishonesty should not be dismissed out of hand on that account alone but it is one of the matters to be taken into account in determining what reliance should be placed upon his evidence. As to his business and financial experience the perpetration of the fraud and the extent of it provide some indication of the magnitude of his business dealings and shows that he has had experience in handling large sums of money. It is also relevant when considering whether he would have been likely to have signed documents and entered into substantial transactions without realizing what he was doing.

1. The evidence in regard to the Bank Building and the division of the proceeds must be looked at in the context of the other enterprises in which the parties were involved. These involved not only the two of them but also Mr Charles Brondolino and Mr Dedda.
2. I deal with the various business ventures in date order. One striking fact about these is that they all appear to have been undertaken, at least partly, with borrowed money and that at least part of the security for those borrowings was Miss Brondolino's real estate. Apart from the co-owned properties themselves, there is nothing in the evidence to suggest that Mr Cappellin ever offered any security for any of the borrowings.

1. On 29 June 1988 Mr Cappellin and Miss Brondolino became directors and equal shareholders in a company called Total Hygiene and Technology Pty Ltd ("Total Hygiene"). The purpose of this company was to manufacture and sell an electronic tap invented by Mr Charles Brondolino. The other two directors of Total Hygiene were Mr Charles Brondolino and Mr Dedda, who was employed as its manager. All four of them were equal shareholders in Total Hygiene.
2. The registered office of this company appears to have changed according to where Mr Dedda was living. Each of the Directors made some contribution. Charles Brondolino invented the tap, Mr Dedda did the accounts, Mr Cappellin put in $115,000 as working capital and Miss Brondolino did some work in connection with the patents.
3. The company employed Mr Dedda as its manager and it sold some taps but ceased business after litigation with a major tap company. At the time that it ceased business it had substantial accumulated losses.
4. A memo from Mr Dedda suggests that there were some royalties received for the patent on the tap. An amount of $4,200 was received in June 1995 of which $3,000 was paid off the Commonwealth Bank Loan and the rest was used to renew the patents. The company was dissolved on 4 February 2001.

1. A company called C.B.D. Investments Pty Ltd ("CBD") was incorporated on 5 July 1988. The directors and shareholders were Miss Brondolino, Mr Cappellin, Mr Dedda and Mr Charles Brondolino. The shareholdings were equal. The purpose of CBD was to purchase and lease commercial premises in Johnston Street, Fitzroy. The premises were leased but the rent was insufficient to cover the mortgage instalments. Mr Dedda said that it was a bad investment.
2. By 7 October 1994 the Tenant had left the premises and the financial position became worse. The company incurred a substantial loss. The Johnson Street property was sold and CBD was de-registered on 23 December 1998. This enterprise resulted in further debts the joint venturers had to bear.

1. This was a bar in the City of Melbourne called "Dr Feelgood's". It was set up by Mr Cappellin in about 1993 and managed by a man whom he knew. It operated as a partnership between Mr Cappellin and Miss Brondolino and it proved unprofitable.
2. The manager left and Mr Cappellin wanted to close the bar down but the lease still had some time to run. Miss Brondolino continued to operate it for the balance of the term of the lease and then closed it down. Mr Cappellin criticized Miss Brondolino for that but it appears that if their commitments under the lease were to be honoured she had no choice. Substantial losses were incurred from the bar which, following Mr Cappellin's departure, Miss Brondolino bore herself. These losses do not appear to be part of any claim by her.

1. There were also disputes between the parties involving racehorses and litigation about horses but I have no evidence of the details of those disputes or the financial dealings they had concerning them. They are not relevant to the present dispute.

1. The losses arising from all of these enterprises resulted in debts. The debt relevant to this proceeding relates to Total Hygiene and CBD. By the time of the Sandhurst refinance, those outstanding debts were close to $400,000, just for Total Hygiene and CBD. At least some of that debt was secured at times by mortgage over Miss Brondolino's properties.
2. The accounts for the debts involving Total Hygiene, CBD and the Bank Building were prepared by Mr Dedda until he finally ceased to be involved on 25 August 1997 when he signed a transfer of his share in the Bank Building to Miss Brondolino and she assumed responsibility for his share of these debts. It is unclear why this transfer was not registered until 14 October 1998. What is quite clear from Mr Dedda's accounts is that the debts for Total Hygiene, CBD and the Bank Building were acknowledged by all four co-venturers as being owed by them in the proportions indicated in the accounts

1. Shortly before 30 May 1989 Miss Brondolino and Mr Cappellin attended an auction for the sale by the Commonwealth Bank of the Bank Building. Miss Brondolino was the successful bidder at the auction and paid the deposit of ten per cent of the purchase price with her own cheque.
2. The price paid for the Bank Building is in dispute. Mr Cappellin says that it is the figure on the Transfer of Land document, which is $815,000, and Miss Brondolino says that it was $850,000, the remaining $35,000 being that part of the purchase price that was allocated to chattels for Stamp Duty purposes. Any part of the purchase price that was allocated to chattels would not be included in the purchase price shown on the Transfer document.
3. Neither party has any definite recollection of the price that was paid but Mr Dedda also thought it was $850,000 as did Mr Charles Brondolino. In cross-examination, when shown the Transfer of Land document which shows $815,000 Mr Dedda said that to his recollection, the price was $850,000 but that it might have been $815,000. Mr Charles Brondolino said that it was $850,000.
4. In the Statement of Claim in the Supreme Court proceedings that Miss Brondolino issued against her brother, the price is said to be $815,000. When that passage was presented to Miss Brondolino in cross-examination she agreed at first that the price must have been $815,000 but then she resumed her former position which was that it was $850,000. It is possible that the figure in the Statement of Claim was taken from the transfer. The recollection of all witnesses other than Mr Cappellin was that it was $850,000 and Mr Cappellin appeared to have very little recollection of the money paid at the time of purchase.
5. The terms of the contract that Miss Brondolino signed entitled her to nominate other persons as purchasers and she nominated, as the purchasers and subsequent transferees, herself as to five twelfths, Mr Cappellin as to five twelfths, Mr Dedda as to one twelfth and Mr Charles Brondolino as to one twelfth. On 21 July 1989 those persons became registered in those proportions as proprietors of an estate in fee simple in the Bank Building as tenants in common.
6. Apart from the purchase price there was stamp duty of $44,825.00 paid on the transfer and a further $2,164 stamp duty on the mortgage. Mr Dedda said that he recalled paying something towards the stamp duty but did not believe that he paid anything towards the purchase price. He also said that he did not recall Mr Cappellin paying anything towards the price nor could he recall where the balance of the purchase money came from. He said that he thought that the parties contributed to the stamp duty in their due proportions but Mr Charles Brondolino said that he made no contribution at all to the purchase.
7. Some indication as to the date of the purchase is given by the fact that, on 30 May 1989, Miss Brondolino's office lodged a caveat over the title to protect their interests as purchasers.
8. The purchase of the Bank Building was largely financed with a loan of $550,00.00 from CBFC Limited ("CBFC") which was secured by a first mortgage over the Bank Building. The source of the balance of either $300,000 or $265,000 is disputed. The mortgage to CBFC was discharged on 30 May 1993 when the borrowings were refinanced to Sandhurst Trustees Limited ("Sandhurst").

1. On 21 May 1993 Miss Brondolino became registered as the proprietor of Mr Charles Brondolino's one twelfth share. All four parties signed the transfer and it was made pursuant to an Order of Acting Master Williams of the Supreme Court of Victoria. The ownership proportions were then one half by Miss Brondolino, five twelfths by Mr Cappellin and one twelfth by Mr Dedda. Evidence about this transfer was given by Miss Brondolino and also by Mr Charles Brondolino.
2. It appears that Mr Charles Brondolino had paid nothing towards the purchase of the Bank Building and his share had been paid for him by Miss Brondolino. He said that he considered that, until he had paid his sister what she had paid on his behalf, he held his share of the Bank Building upon trust for her. Whether or not that is correct as a matter of law, Miss Brondolino took legal proceedings against him and obtained an order in default of defence that he transfer his interest to her.
3. At the time of the legal proceedings Mr Charles Brondolino was involved in divorce proceedings in the Family Court and Miss Brondolino assisted him financially with paying for his solicitor and barrister. It was put to him in cross-examination that he had been concerned that his share in the Bank Building might be caught up in the divorce proceedings and he acknowledged that that was a concern. When a similar proposition was put to Miss Brondolino, she denied that that was the reason for the transfer and said that her brother had an interest with her in another property and that they did not transfer his interest in that property.

1. On 14 October 1998 Miss Brondolino became registered as the proprietor of Mr Dedda's one twelfth share. Again, all three of the then registered proprietors signed the transfer. The consideration expressed in the transfer was $61,028.00 but, according to the evidence of both Miss Brondolino and Mr Dedda, that was satisfied by Miss Brondolino assuming Mr Dedda's obligations for outstanding monies in regard to the joint venture debts and the mortgage to purchase the Bank Building. No money was actually paid to Mr Dedda by Miss Brondolino with respect to the transfer. The ownership proportion was then seven twelfths by Miss Brondolino and five twelfths by Mr Cappellin.

1. The initial lease of the Bank Building was to the Commonwealth Bank. The term was five years from the date of settlement with an option for a further five years. At the conclusion of the initial term the Bank did not renew its lease.
2. The Bank Building was next leased to a company called "Born Again Pty Ltd" which carries on business as "Dangerfield", a retailer of clothing ("Dangerfield") for a period of 5 years commencing on 1 July 1999 with options for two further terms of 5 years.
3. Dangerfield had submitted an application to lease the Bank Building to the estate agent and an acceptance of that application was signed by Mr Cappellin, Miss Brondolino and Mr Dedda. The document sets out the terms of the proposed lease. Miss Brondolino prepared the lease on behalf of the joint venturers but charged no fees for doing so. That lease has since been renewed and the tenant has continued in occupation of the Bank Building up until the present time.
4. A bond of $5,000 was paid by Dangerfield. This was not put into a special account or held anywhere in trust. There is no evidence as to what happened to it but Miss Brondolino said that it was probably paid off the mortgage debt. When her interest in the Bank Building was sold to Mr Cappellin the amount of the bond was credited to Dangerfield against the rent.
5. Mr Clarke pointed to the provisions in the Lease about the bond which set out what the Landlords could use it for. There is no express provision that it be held upon trust or in a special account. Whether the joint venture parties should have used it to pay off their mortgage is certainly questionable but it is not something I need to decide. It was suggested that Miss Brondolino has misappropriated the bond but there is no evidence to that effect nor is there any evidence to show who received it. All payments of rent went to the mortgagee and so it is plausible that the same happened with the bond.
6. There was a managing agent of the two tenancies throughout. It was a company called Crawfords Real Estate Pty Ltd, the Director of which was a Mr Lo Giuidice, who was a friend of Mr Cappellin. This company had a number of name changes. It was called "NAI Melbourne" when the mortgage over the Bank Building was finally paid off and Miss Brondolino sold her interest in it to Mr Cappellin. Rental was collected by the agent, expenses and outgoings were paid by the agent from the rental and the balance was forwarded to Miss Brondolino who then banked it in the mortgage account in the names of the parties.

1. In the early stages, the rental received from the tenant of the Bank Building was insufficient to pay all of the interest on the mortgage. This was despite the fact that the mortgage debt had only been for $550,000 for a property that probably cost $850,000.
2. Mr Dedda said that when he was a part owner of the Bank Building, the practice in regard to the collection of the rent and the payment of the mortgages was that rental collected by the estate agent was paid into a bank account operated by the parties and then the mortgage payment was made from that account. Which account it was paid into does not appear from the evidence but it was either the Total Hygiene account or an account kept in relation to CBD.
3. The statements for the repayment of the CBFC loan have been tendered. It is apparent that the contributions to pay out this mortgage were substantially more than the rental received from the Bank. Since the amount paid to the mortgagee was more than the net rental received there was a shortfall that must have been made up from the account. Where the funds came from in order to replenish that account is not established but in the light of the financial documents prepared by Mr Dedda that are in evidence it seems likely that they were contributed by the parties. By the time the CBFC loan came to be refinanced, the principal sum had been reduced considerably.
4. After Mr Dedda transferred his interest to Miss Brondolino, the rental continued to be collected by the agent and sent to Miss Brondolino and she paid it to the mortgagee. By that time the rental exceeded the interest and the principal sum of the mortgage was being reduced.
5. The mortgage debt over the Bank Building, which was then held by Westpac, was finally paid out in about September 2007. Miss Brondolino wished to discharge the mortgage but Mr Cappellin would not sign the requisite documents. She sent one of her brothers to visit him with the documents and persuade him to sign them. The visit was unsuccessful. By that time the relationship between the parties had completely broken down.
6. After the Mortgage was finally paid out the net rental was received from the agent by Miss Brondolino and paid into her trust account. She drew out what she claimed was her share and the rest accumulated in the account. There is now a balance in her trust account of $67,783.97 which she acknowledges is Mr Cappellin's share but she seeks to offset against that sum, money that she claims he owes her which is the subject of her counterclaim.

1. There is no full set of accounting records. Mr Dedda prepared partnership accounts for the parties and those with respect to the years ended 30 June 1992. 1993, 1995, 1996, 1997 and 1998 are in evidence. The last of these is only for the very short period from 1 July 1997 to 25 August 1997, that being the date upon which, according to these accounts, Mr Dedda ceased to be a "partner" for tax purposes. Thereafter, only Mr Cappellin and Miss Brondolino were left and no accounts were prepared by either of them.
2. In the Sandhurst refinance file there is an accounting prepared by Mr Dedda of the parties' respective positions as at 1 January 1996. It is a document comprising two tables. From the evidence, particularly that of Mr Dedda, I make the following findings about these documents:
   • (a) The left hand column shows the overall indebtedness the parties had at the time, which was $760,500. Responsibility for that sum is apportioned as to $133,028 to Mr Dedda, $244,222 to Mr Cappellin and $380,250 to Miss Brondolino. The reason Miss Brondolino has a bigger share than Mr Cappellin is that she had taken over the indebtedness of her brother, Mr Charles Brondolino, following the transfer to her of his share in the Bank Building.
   • (b) The monthly payment column shows the respective shares of the parties of what had to be paid to the mortgagee of the Bank Building.
   • (c) The "RENT" column shows the division between the parties of the rental received from the tenant of the Bank Building. The rent was $5,100, of which Mr Dedda was entitled to one twelfth, Mr Cappellin five twelfths and Miss Brondolino one half. Her share comprised her initial five twelfths plus the one twelfth share transferred to her by her brother.
   • (d) The "CBA" repayment figures show the division of responsibility between the parties with respect to the Total Hygiene debt borrowed from the Commonwealth Bank, for which the four directors had been equally responsible. However by the time this accounting was prepared, Miss Brondolino had taken over the quarter share of her brother, Mr Charles Brondolino of this debt. This was not a consequence of the transfer to her of his share in the Bank Building but an obligation that she seems to have assumed. This CBA mortgage appears to have been secured over Miss Brondolino's real estate.
   • (e) The "TOTAL REP" column shows the effect of deducting what each party was responsible to pay from his or her share of the rental. Because Mr Cappellin only had his original one quarter share of responsibility for the Total Hygiene and CBD debts and his five twelfths share of the rental exceeded his share of the interest, he was in credit in the sum of $179, whereas the other two parties had to pay the shortfall between the rental received and the interest payments under the mortgage.
3. The second table apportions responsibility between the parties for a shortfall of $1,387.61 with respect to the December payment to Sandhurst. It would seem that there was a surplus of $500 in a bank account which is apportioned in the column "SURPLUS IN BANK". Why it was apportioned like that is not explained in the document but after deducting the apportioned share of each party from his or her share of the shortfall, there is an amount set out in the final column that each party was to pay.
4. A similar format was adopted in the partnership accounts referred to above. In the account for the year ended 30 June 1992, the only income is the rent for the Bank Building, which was shared between the parties in the proportions in which they owned it. The interest liability was similarly apportioned and, since the interest was more than the rent, there was a substantial loss. To this was added the equal shares of Mr Cappellin, Miss Brondolino and Mr Dedda in the interest payment to the Bank of Melbourne for the joint venture debts. The end result was a loss for the year for both Mr Cappellin and Miss Brondolino of $14,695. Mr Charles Brondiolino's loss was $4,8899 and Mr Dedda's loss was $8,746. A similar calculation is made in the other years.
5. Although there is no direct evidence it would seem that each of the parties paid their share of these losses in order that the interest under the mortgages was paid. I think that is a reasonable inference to draw because:
   • (a) it does not appear that the interest was not paid;
   • (b) there are notes in Mr Dedda's handwriting to the effect that he will be providing a cheque for his share;
   • (c) there is a letter in the Sandhurst file sent in October 1994 complaining about Mr Cappellin being late with one of his contributions; and
   • (d) it was not suggested that there was any other source of funds to pay the mortgage instalments.
6. It should be noted that the foregoing accounts do not include any liability or potential liability for the deposit or the balance of the purchase price paid at settlement of the Bank Building, which Miss Bondolino says was $300,000 that she paid alone. Mr Cappellin denies any such liability.

1. Title searches have been tendered of the titles to four properties. The information to be obtained from these searches is relevant to the movement of funds from time to time, as indicated by the dates of purchase and the raising and discharging of mortgages secured over them. They are set out in the following paragraphs.

1. On 30 May 1989 Miss Brondolino's office lodged a caveat over the title to the Bank Building in the name of the four purchasers, claiming an interest as purchasers of the estate in fee simple. The caveat itself has not been produced but it was not suggested that it would have provided any useful information.
2. On 21 July 1989, Mr Dedda, Miss Brondolino, Mr Cappellin and Mr Charles Brondolino became registered as proprietors of an estate in fee simple in the Bank Building as Tenants in Common in the ratio 1,5,5,1 (Certificate of Title Volume 9430 Folio 356) and CBFC became registered as Mortgagee. Subsequent transactions were:
   • (a) On 21 May 1993 the mortgage to CBFC was discharged and Sandhurst became registered as mortgagee.
   • (b) On that same day, Miss Brondolino became registered as the proprietor of the one sixth share of Mr Charles Brondolino. She therefore became the registered proprietor of a one half share in the Bank Building.
   • (c) On 18 September 1997, the mortgage to Sandhurst was discharged and Clients Investments Pty Ltd ("Clients Investments") became registered as mortgagee.
   • (d) On 14 October 1998, Miss Brondolino became registered as the proprietor of the one sixth share of Mr Dedda. She therefore became the registered proprietor of a seven twelfths share in the Bank Building
   • (e) On that same day, the mortgage to Clients Investments was discharged and Westpac became registered as mortgagee.

1. The building in which Miss Brondolino conducted her practise is at 261 Brunswick Street, Fitzroy, being Certificate of Title Volume 3175 Folio 903 ("Brondolino's office"). She purchased it in April 1976 and the building remained unmortgaged until late December 1979. She said that she took out a mortgage loan to buy it but it was secured upon other property. Subsequent transactions were:
   • (a) On 28 December 1979 CBFC became registered as mortgagee.
   • (b) On 21 April 1982, the Commonwealth Trading Bank became registered as second mortgagee.
   • (c) On 8 February 1984, the mortgage to CBFC was discharged.
   • (d) On 18 September 1997 the Commonwealth Trading Bank Mortgage was discharged and Clients Investments became registered as mortgagee.
   • (e) On 25 September 1998 the mortgage to Client Investments was discharged. Thereafter the title appears to be unmortgaged.

1. Miss Brondolino's home in Thorseby Grove, Eaglemont ("Thorseby Grove") was purchased by her in August 1981 with a mortgage loan from the State Bank. The original title particulars are Certificate of Title Volume 3568 Folio 576 but this was replaced with Certificate of Title Volume 10164 Folio 216. Following the purchase, subsequent transactions were:
   • (a) The mortgage to the State Bank was discharged on 14 February 1985.
   • (b) On 26 February, when the Banksia Road property was purchased, it was simultaneously re-mortgaged to Commonwealth Savings Bank that had apparently financed the purchase of Banksia Street.
   • (c) On 6 April 1986, the Commonwealth Savings Bank Mortgage was discharged.
   • (d) On 31 December 1991 Miss Brondolino signed an "all advances" type mortgage over Thorseby Grove to the Bank of Melbourne. The mortgage was to secure monies due under a loan agreement set out in a letter of offer dated 10 December 1991. The mortgage was not registered on title until 10 January 1992.
   • (e) On 12 May 1993 the Bank of Melbourne Mortgage was discharged.
   • (f) On 9 September 1994 Lotas Pty Ltd became registered as mortgagee to secure an amount of $150,000.
   • (g) On 7 December 1994 Beryl Stubbs Fashion Agencies Pty Ltd became registered as second mortgagee to secure an amount of $60,000.
   • (h) On 28 April 1995, both these mortgages were discharged and Westpac became registered as mortgagee.
   • (i) On 12 October 1995 Westpac became registered as proprietor of a further mortgage.
   • (j) On 18 September 1997 both mortgages to Westpac were discharged and Clients Investments became registered as mortgagee.
   • (k) On 14 October 1998 the mortgage to Clients Investments Pty Ltd was discharged and Westpac was registered as mortgagee.

1. Miss Brondolino became registered as the proprietor of a house and land in Banksia Street, Ivanhoe ("Banksia Street"), being Certificate of Title Volume 4873 Folio 433, on 26 June 1985 there was a mortgage to Commonwealth Savings Bank that had apparently financed the purchase. Subsequent transactions were:
   • (a) On 28 October 1987 the Mortgage to Commonwealth Savings Bank was discharged.
   • (b) On 21 May 1993 Sandhurst became mortgagee.
   • (c) On 18 September 1997 the Sandhurst Mortgage was discharged and Clients Investments became registered as mortgagee.
   • (d) On 14 October 1998 the mortgage to Clients Investments was discharged and Westpac was registered as mortgagee.
   • (e) On 23 October 2009 the mortgage to Westpac was discharged. The property now appears to be unmortgaged.

1. Having ascertained the foregoing facts as best I can on the evidence available, I now turn to the issues in the case.

1. The transfer document shows a purchase price of $815,000. Miss Brondolino said that the purchase price was $850,000 and that the balance of $35,000 was allocated to chattels in order to reduce the stamp duty. Mr Dedda said that he thought that the price was $850,000 but was uncertain. Mr Charles Brondolino said that it was $850,000. Mr Cappellin said that the price was $815,000.
2. On balance I think it more likely that it was $850,000. That was the evidence of Miss Brondolino. She wavered somewhat in cross-examination and is not certain but that was her recollection. Similarly, although he was not certain, Mr Dedda thought that it was that figure and so did Mr Charles Brondolino. Further, there was extensive partitioning in the building at the time of the purchase, raising the possibility that the purchasers would have taken advantage of that fact in order to reduce the stamp duty payable by allocating part of the purchase price to chattels. That was a device that is no longer available but the evidence is that it was available at the time of the purchase.
3. I was unimpressed by Mr Cappellin's evidence generally and it does not appear that he has any recollection as to what the price was.

1. There is a dispute as to the source of the $300,000, being the difference between the purchase price and the mortgage loan. According to Miss Brondolino's original Statutory Declaration, this was made up by "contributions from the parties". In the witness box she changed her evidence and said that it was paid by her, save for stamp duty and registration fees which were paid by the parties. I think her evidence about all this was reconstruction.
2. Much was made by both sides about the shortfall but there is no documentary evidence either way. The accounts prepared by Mr Dedda ignored this $300,000.00 altogether. It was not taken into account in any of the reconciliations to do with the interest and the rent, nor is there any evidence that either Miss Brondolino or Mr Cappellin claimed a tax deduction with respect to any monies borrowed in order to finance the $300,000.00.
3. In his affidavit of 22 December 2009, Mr Cappellin said that the balance of the purchase price was funded by "... contribution of the partners made in proportion to each partner's share in the property". That was not his evidence in the witness box. He was unclear how much he paid although he thought that it was $100,000 or $102,000.
4. Miss Brondolino said that she paid it all and has maintained that position throughout. However, there is no dispute that she paid the deposit and it does not appear that she received that back from the other joint venturers.
5. When Mr Dedda was asked by Mr Watts in re-examination whether it or a part of the shortfall was paid from the Total Hygiene account he said that, to his recollection, it was not.
6. In the absence of written evidence I have to choose who to believe and in regard to the payment of the difference of $300,000.00 between the purchase price and the amount raised on the first mortgage.
7. There are a number of reasons for preferring the evidence of Miss Brondolino over that of Mr Cappellin.
   • (a) It is not disputed that Miss Brondolino paid the deposit, which I think was $85,000, and apart from Mr Cappellin's assertion that he paid around $100,000, there is no evidence at all that anyone paid her back that amount of money.
   • (b) Miss Brondolino says categorically that she paid the $300,000.00 herself whereas Mr Cappellin is uncertain about what he paid.
   • (c) Mr Cappellin was able to produce a document from his bank to show that he had paid the amount of $75,135.29 at the time of the Westpac refinance and it appears that he also paid a further $20,400 at that time. That was in 1997, which is considerably later, but he has produced no evidence at all to support any contribution towards the $300,000.00 gap.
   • (d) There is the general issue of credit. Although a man that has served a term of imprisonment for a course of dishonest conduct over an unknown period depriving a publicly funded institution of a very large sum of money should not be rejected out of hand on that account, that factor must be taken into account in assessing his credit as a witness. In contract, it appears that Miss Brondolino has carried on practice as a solicitor for over thirty five years and there is no evidence that she has been guilty of any wrongdoing in that period.
   • (e) Both Mr Charles Brondolino and Mr Dedda say that they contributed no money at all to the purchase. Between them they owned one sixth of the building and one sixth of $300,000.00 is $50,000.00. Mr Cappellin's share would have been $125,000. Those are substantial sums and if Mr Cappellin had contributed his proportion one would expect that he would have remembered it and that Mr Charles Brondolino and Mr Dedda would have contributed as well.
8. On the other hand, why would one party pay, for the benefit of three other persons as well as herself, such a large sum of and not seek to recoup their due proportions of that sum from those other persons? Even today it is a large sum. Twenty two years ago it must have been a very large sum indeed.
9. Mr Charles Brondolino's evidence was that Miss Brondolino had been contemplating providing substantial funds to Total Hygiene to allow it to continue. He said that it was decided instead that a property would be purchased using the money that she would otherwise have lent the Company and that this could be used as security for borrowings. No other witness gave this account. Even on this view, why should Miss Brondolino provide such a large amount of money?
10. As to that question, it should be remembered that:
    • (a) Mr Charles Brondolino was her brother to whom she had been providing substantial financial support in other respects;
    • (b) Mr Dedda had limited money but handled the accounts;
    • (c) Mr Cappellin was her childhood friend and she regarded him as a close friend. He was sufficiently close that she paid for him to go to Rome with her to celebrate her birthday; and
    • (d) the later borrowings from Sandhurst and Clients Investments were secured not only over the Bank Building but over Miss Brondolino's own separate real estate. No one else appears to have provided any security. That is apparent from the documents yet one might also ask why she should have done that?
11. Since no claim is made with respect to this sum I do not need to finally determine where it came from and I am reluctant to do so on the limited evidence before me. However the existence of this claim by Miss Brondolino is relevant in considering why it was that Mr Cappellin agreed to the final split up of the borrowings. I think it likely that Miss Brondolino provided at least the deposit and I am not satisfied that it was ever repaid to her.

The re-finances. Why were these amounts borrowed and what happened to the money?

1. The available documents in regard to each loan must be looked at carefully

1. As stated above, the purchase of the Bank Building was financed by a First Mortgage loan from CBFC. The principal sum advanced was $550,000. It is acknowledged that Miss Brondolino paid the deposit of $85,000 and it would appear from the evidence of Mr Dedda that they all contributed to payment of the Stamp Duty and Titles Office fees.
2. The CBFC loan was said to be interest only but the statements provided by CBFC, which are in evidence, show that payments of monthly instalments of $9,350.00 were paid. This was well in excess of the rental paid by the Bank. Mr Dedda said that the payments came from the parties' bank account and it appears from the accounts that were prepared for a later period that the parties were making regular contributions to make up any shortfall.
3. In any case, by the time the mortgage was paid out on 30 March 1993 the balance needed to discharge it was $398,108.48, so the principal sum had been reduced by a little more than $150,000. That indicates substantial contributions by the parties and there is no clear evidence as to the source of such large payments.

1. Mr Dedda sought to obtain a loan to refinance the borrowings from Sandhurst. He received an offer from Sandhurst on 14 December 1992 and forwarded it on to Miss Brondolino. According to Mr Dedda, the purpose of the loan was so that he, Miss Brondolino and Mr Cappellin could consolidate their debt position.
2. According to the original documents, the borrowers from Sandhurst were to be Mr Dedda, Miss Brondolino and Mr Cappellin and the mortgagee was to be Miss Brondolino. The advance offered was for $960,000.00 on the security of a first mortgage over Banksia Street. It was to be an interest only loan at an initial rate of 9.9% with provision for the rate to be varied.
3. By February 1993 the loan amount sought had reduced to $760,500.00 and was to be further secured by the Bank Building as well as Banksia Street.
4. There were two mortgage documents prepared. The first was over the Bank Building with Mr Dedda, Miss Brondolino and Mr Cappellin as Mortgagees. This secured a loan of $760,500. Interest to be charged was 9.9% and the loan was interest only. The second mortgage document was over Banksia Street and secured the same amount.
5. The payout figure of CBFC at the time was $398,108.48. After discharging that sum, the balance of the net proceeds of the Sandhurst loan, after deducting expenses and some rates, was an amount of $352,520.71 which was paid to Miss Brondolino by bank cheque. Of that amount, according to the file, $7,322.31 was owed to Miss Brondolino for disbursements. The balance was held in trust. These figures were calculated by Mr Dedda. They are set out in a letter dated 2 April 1993 addressed to all three joint venturers, care of Miss Brondolino's office.
6. On the following day, Mr Dedda sent a memo to Miss Brondolino directing her to:
   • (a) take the $7,322.31 in payment of her disbursements;
   • (b) bank $170,198.40 into the CBD bank Account; and
   • (c) keep the balance of $175,000 in order to discharge the Bank of Melbourne loan when it should fall due.
7. This memo by Mr Dedda is instructive in that it sets out the debts relating to the various ventures in some detail. Included is a list of joint venture creditors that were to be opaid out from the $170,198.40. The mortgage debt to the bank of Melbourne of $175,000 appears to have been secured over Thorseby Grove. This mortgage was paid out at a further settlement on 26 April 1993 and discharged over the title on 12 May 1993. The list suggests that there would still be a shortfall of about $7,500 that the parties would still owe.
8. At settlement of the Bank of Melbourne Mortgage, the balance outstanding was not $175,000 but $170,100. According to a letter dated 3 May 1993 prepared by Miss Brondolino's office and addressed to the three of them care of her office, there was, after disbursements, a credit balance of $5,123.41 held in Miss Brondolino's trust account for the joint venturers. By a further letter dated 6 May 1993, that amount was sent to Mr Dedda. There is no record as to what then happened to it but, since he was handling the finances at that time, there is no reason to suppose that the money was thereafter misapplied.
9. The fact that this mortgage over Thorseby Grove was discharged, at the direction of Mr Dedda, out of monies borrowed by the joint venturers is some indication that it secured a joint venture borrowing. That accords not only with Miss Brondolino's evidence but also with the way the joint venture debts seem to have been secured on several occasions, that is, by mortgage over Miss Brondolino's real estate. It is clear that there were other debts that the three of them owed, apart from the balance owed to CBFC.
10. Mr Dedda is an accountant. He did the accounting of the finances of the three joint venture enterprises and he was directing what should be done and how the various sums should be allocated. There is no evidence that any of the other parties questioned his calculations and assessments. Miss Brondolino says that she cannot recall them ever being questioned. Contributions appear to have been made according to his calculations. For taxation purposes, their relationship was treated as a partnership and partnership returns had to be prepared and submitted to the Tax office. That was done by Mr Dedda and the parties submitted their tax returns on the faith of the partnership returns that he prepared.
11. Mr Dedda said in the witness box that the purpose of the Sandhurst refinance was to consolidate the debts they all had at that point in time. It was not put to him in cross-examination that he was wrong in what he said in his evidence or in the letter setting out the figures. Since it is clear from both his evidence and this letter that he considered that this refinance and the allocation of the funds borrowed was for joint venture debts I think that I should find on the balance of probabilities that it was. I am satisfied that the money raised by this refinance has been fully accounted for and that no misappropriation of the principal sum borrowed has occurred.
12. Instalments of interest payable under this mortgage were paid out of the rental with the shortfall being made up by the joint venturers each paying their respective shares. In October 1994 Miss Brondolino wrote to Mr Cappellin regarding late payment of his share of the shortfalls.
13. In December 1994 Sandhurst raised the rate of interest to 10.9%. At the time the rent on the Bank Building was $5,000 per month. According to Mr Dedda's notes on the Sandhurst file, the effect of the higher interest was to increase the shortfall the parties had to pay to $1,157 per month for Miss Brondolino, $262.50 for Mr Cappellin and $644.50 for Mr Dedda. The rate was then further increased in March 1995, raising the shortfall the parties had to pay from $1,319 per month for Miss Brondolino, $352 for Mr Cappellin and $717 for Mr Dedda. According to Mr Dedda's memo of 20 March 1995 there was an additional amount of $250 per month that he was paying into the Commonwealth Bank of Australia. The purpose of that is unclear but would suggest that perhaps there were joint venture debts owed to that bank as well.
14. There is a handwritten note at the end of the Sandhurst file suggesting that Mr Dedda wanted to sell the Bank Building. There is a letter dated 16 January from Miss Brondolino to Mr Cappellin, the penultimate paragraph of which is as follows:

"We now refer to our facsimile transmission of several months ago wherein we requested that you make alternate arrangements for over which you may register your share of the mortgage presently held with Sandhurst and note that we have not had the courtesy of your reply."(sic.)

"Rosemary I have no assets available to put up for mortgage so I am prepared to sell the Bank."

1. An auction of the Bank Building took place on an unknown date but there were no bids. On 23 July 1996 the mortgages to Sandhurst were varied by extending the due date to 1 March 2001 and fixing the interest rate at 9.25%.
2. In August 1997 Mr Dedda was again anxious to sell the Bank Building. By a letter dated 22 August Miss Brondolino confirmed an agreement they had apparently reached that she assume his share of the Sandhurst debt, totalling $61,028 in exchange for him transferring his share in the Bank Building to her.
3. At about this time it was decided to refinance the borrowing but there is no documentary evidence as to why that decision was made.

1. On 18 September 1997 the Sandhurst mortgage was discharged and the mortgage debt owed with respect to the Bank Building was refinanced by a new lender, Clients Investments, at a lower interest rate. How this came about is a matter of dispute. Miss Brondolino said that it was Mr Cappellin who introduced Clients Investments. Mr Dedda had already agreed to transfer his share to Miss Brondolino and had signed the Transfer of Land but since that had not been registered he signed the mortgage documents for the refinance.
2. The total amount advanced by Client Investments was $1,600,000 divided into $475,000 which was secured by way of mortgage over the Bank Building and $1,125,000 secured over Miss Brondolino's office, Thorseby Grove and Banksia Street.
3. Mr Cappellin does not say in his witness statement why this refinance occurred or attempt to explain any of the figures. Nor does he say that he was unaware of what occurred. He simply refers to the amount secured over the Bank Building following the refinance, which was $475,000.00.
4. Why the $1,600,000 was split in this way does not appear from the evidence. It is apparent from Mr Dedda's accounts that the actual joint venture debts at that time stood at a little over $760,000. That is for the Bank Building, CBD and Total Hygiene. That figure does not include anything with respect to the shortfall on the purchase or Dr Feelgood's. I accept Miss Brondolino's evidence that part of the $1,125,000 secured over her properties was with respect to joint venture debt. I think that is quite likely.
5. In the first place, there is no doubt that the joint venture debts were well above $475,000. In her letter on 26 January referred to above, Miss Brondolino asked Mr Cappellin to secure his share of the debts independently. He replied saying that he had no security. He said he would be willing to sell the bank Building but the auction failed and there were no bids. A plausible explanation for the split is that they secured as much as they could over the Bank Building and the rest had to be secured over Miss Brondolino's real estate since Mr Cappellin was offering no security.
6. On 14 October 1998 the Client Investments mortgage was discharged and Westpac Banking Corporation became the mortgagee when it refinanced the mortgage over the Bank Building.

1. According to Miss Brondolino's evidence she was introduced to the Bank of Melbourne Bank Manager, Mr Moy, by Mr Cappellin although she agreed in cross-examination that she had met him some years earlier. According to Mr Moy's evidence, Mr Cappellin had been a customer of his at the bank for a number of years.
2. Mr Cappellin said in his witness statement that he agreed to the refinance in order to release Mr Dedda from his continuing obligation under the Clients Investments mortgage. Mr Dedda had signed the mortgage but had made no payments under it. His share was borne by Miss Brondolino.
3. They had several meetings with Mr Moy culminating in an offer of finance. Miss Brondolino says that Mr Moy worked out the figures. Mr Moy said that he would not have done that. It is likely that, over the several meetings that they had, the money then owing would have been discussed and some calculations would have been made of the amounts required and how the finance was to be divided.
4. According to Miss Brondolino the purpose of the exercise was to separate out their responsibility for the money that was owed with respect to their joint obligations from their separate indebtedness. Her earlier letter would suggest that she was concerned to do that. She said that the arrangement reached was that they would borrow $630,000 secured upon the Bank Building, that Mr Cappellin would pay off some of the money and she would assume responsibility for the rest.
5. That evidence is consistent with the objective facts.
   • (a) They were refinancing at a higher rate of interest. One would not do that unless there were some advantage to be obtained from doing so.
   • (b) It appears that it was contemplated that the parties were to make some contributions. In the last accounting that Mr Dedda did up until the time that he left the joint venture on 25 August 1997, his share of the loss for a little less than two months was $1,122.00. That arose from the business debts and the interest accruing on the money borrowed to pay them. Over the same period Miss Brondolino's share of the loss was $533.00 whereas Mr Cappellin made a profit of $588.00.
   • (c) Mr Dedda had withdrawn from the joint venture because he could not put in any money on account of their joint indebtedness. He transferred his share to Miss Brondolino in exchange for her assuming responsibility for his share of whatever the debts were.
   • (d) Mr Cappellin put in an additional $75,135.29 and a further $20,400, which were used to discharge part of the debt to Client Investments. Since he was not offering and did not offer any security, the loan secured over the Bank Building would have to be an amount that its value would support. The rest was discharged from the proceeds of the two mortgages.
   • (e) The larger mortgage debt was the sole responsibility of Miss Brondolino and was secured solely over her real estate. Unlike an earlier arrangement there was no guarantee given by Mr Cappellin of Miss Brondolino's liability under this mortgage.
   • (f) The two amounts totalling $95,535.29 are the only documented contributions made by Mr Cappellin towards the purchase of the Bank Building, apart from the regular contributions the parties had made towards the shortfall between the rent and their joint interest commitments.
6. In terms of an accounting, the Bank's letter of 15 September 1998 shows that, apart from the costs and disbursements of the mortgages, the whole of the monies advanced was paid to Client Investments. Mr Cappellin's complaint about that relates to the amounts of the respective mortgages.
7. The mortgage secured over the Bank Building secured a principal sum of $475,000 whereas the loan secured over Miss Brondolino's properties secured an amount of $1,125,000. However what is significant is not whose properties the indebtedness was secured over but rather, in what proportions they really owed this money. It is clear from the tax returns and accounts prepared by Mr Dedda that there were debts owed with respect to the other ventures. There was also the question of the losses from the bar and the balance of the purchase price, or at least the deposit. The details of all these matters were known by both Miss Brondolino and Mr Cappellin at the time of this refinance when they had their discussions involving Mr Moy.
8. Mr Cappellin neither admitted nor specifically denied that the purpose of the refinance was to divide their joint debt from their several debts. He simply denied any knowledge of how the figures were calculated and suggested that, since only $475,000 of the $630,000 was required to pay out the mortgage secured over the Bank Building, Miss Brondolino must have misappropriated the rest. That is a very serious allegation to make against anyone and it is a particularly serious allegation to make about a solicitor.
9. Miss Brondolino denies any misappropriation and said that, at the time, Mr Cappellin was well aware what was happening. She had no recollection of the calculations but thought they were done by Mr Moy. Whoever performed the arithmetic, I am satisfied that this arrangement was agreed upon by Miss Brondolino and Mr Cappellin after a number of discussions involving Mr Cappellin's bank manager, Mr Moy. Mr Cappellin not only signed the mortgage documents in these amounts acknowledging that he was a joint borrower of $630,000 but also transferred additional sums to be used at the settlement. I do not believe that he would have done so unless there had been an agreement reached in these terms.
10. Finally, on the evidence presented I am quite unable to say why that amount was borrowed or how the figures were arrived at. If Mr Cappellin alleges that Miss Brondolino has defrauded him he must prove that and he has not done so.

1. Miss Brondolino asserts in her counterclaim that at the time of the Westpac refinance it was agreed between herself and Mr Cappellin that thenceforth the money owed to Westpac would be owed by them equally. However I do not find the counterclaim proven for the following reasons:
   • (a) Her recollection of events is not good and I thought that her evidence was largely reconstructed;
   • (b) There is nothing in the documents or other evidence to support her claim;
   • (c) Her own conduct in paying all of the rent to Westpac without claiming an adjustment from Mr Cappellin is inconsistent with her claim. That occurred over a long period and involved a large sum of money;
   • (d) Mr Cappellin disputes the claim.

1. There was considerable debate as to whether I have jurisdiction to entertain the claims that Mr Cappellin makes in this proceeding. This Tribunal is a creature of statute and only has the powers conferred by the Victorian Civil and Administrative Tribunal Act 1998 or by an enabling Act. The relevant enabling Act here is the Property law Act 1958 ("the Act").
2. Section 225 of Act provides as follows:

"(1) A co-owner of land or goods may apply to VCAT for an order or orders under this Division to be made in respect of that land or those goods.

(2) An application under this section may request -

(a) the sale of the land or goods and the division of the proceeds among the co-owners; or

(b) the physical division of the land or goods among the co-owners; or

(c) a combination of the matters specified in paragraphs (a) and (b).

In the present case, the order for the sale of the Bank Building was made under sub-section (1).

1. Mr Cappellin's current claims are made in regard to s.233, which is as follows:

"(1) In any proceeding under this Division, VCAT may order -

(a) that compensation or reimbursement be paid or made by a co-owner to another co-owner or other co-owners;

(b) that one or more co-owners account to the other co-owners in accordance with section 28A;

(c) that an adjustment be made to a co-owner's interest in the land or goods to take account of amounts payable by co-owners to each other during the period of the co-ownership.

(2) In determining whether to make an order under subsection (1), VCAT must take into account the following -

(a) any amount that a co-owner has reasonably spent in improving the land or goods;

(b) any costs reasonably incurred by a co-owner in the maintenance or insurance of the land or goods;

(c) the payment by a co-owner of more than that co-owner's proportionate share of rates (in the case of land), mortgage repayments, purchase money, instalments or other outgoings in respect of that land or goods for which all the co-owners are liable;

(d) damage caused by the unreasonable use of the land or goods by a co-owner;

(e) in the case of land, whether or not a co-owner who has occupied the land should pay an amount equivalent to rent to a co-owner who did not occupy the land;

(f) in the case of goods, whether or not a co-owner who has used the goods should pay an amount equivalent to rent to a co-owner who did not use the goods.

(3) VCAT must not make an order requiring a co-owner who has occupied the land to pay an amount equivalent to rent to a co-owner who did not occupy the land unless -

(a) the co-owner who has occupied the land is seeking compensation, reimbursement or an accounting for money expended by the co-owner who has occupied the land in relation to the land; or

(b) the co-owner claiming an amount equivalent to rent has been excluded from occupation of the land; or

(c) the co-owner claiming an amount equivalent to rent has suffered a detriment because it was not practicable for that co-owner to occupy the land with the other co-owner.

(4) VCAT must not make an order requiring a co-owner who has used goods to pay an amount equivalent to rent to a co-owner who did not use the goods unless -

(a) the co-owner who has used the goods is seeking compensation, reimbursement or an accounting for money expended by the co-owner who has used the goods in relation to the goods; or

(b) the co-owner claiming an amount equivalent to rent has been excluded from using the goods; or

(c) the co-owner claiming an amount equivalent to rent has suffered a detriment because it was not practicable for that co-owner to use the goods with the other co-owner.

(5) This section applies despite any law or rule to the contrary.

1. In deciding how to apply sub-section (1) consideration must be given to the matters referred to in sub-section (2). What matters can be taken into account?
2. In Grigoriou v. Petran [2009] VCAT 2272 I said (at para 12):

"It should be noted that the words: "amounts payable by co-owners to each other during the period of the co-ownership" are not expressly restricted by the words of the section to amounts payable with respect to the co-owned property. Further, the circumstances in which orders for compensation and accounting can be made appear to be very wide and include amounts payable by the parties to one another during the period of co-ownership as well as damages caused by the unreasonable use of the land. It was not suggested that any of the amounts sought by either side did not fall within the section and so I do not need to consider the breadth of its operation. "

1. I did need to consider that matter in the case of Sutherland & anor v. Corkhill [2011] VCAT 709. In that case, I said as to the application of the s.233 (at para 21):

"The amounts to be taken into account in determining compensation or reimbursement or an adjustment of the interest of one co-owner must be of a nature whereby it is appropriate to make an adjustment to the interest of one party or the other. A mere debt unrelated to the Property would not be in that category. To take an unrelated debt into account would have the effect of elevating the person to whom that debt was owed to the position of a secured creditor, the security being over the interest of the debtor in the co-owned land. This might have significance for other unsecured creditors of the debtor.

Section 228(1) provides that the tribunal may make any order that it thinks fit to ensure that a just and fair sale or division of land or goods occurs. Before making an order under s.233 the Tribunal should be satisfied that the making of the order will ensure a just and fair division of the proceeds of sale. The purpose of the legislation is to effect a just and fair division of jointly owned Property and so the exercise of the powers should be confined to achieving that purpose. This is a statutory tribunal and only has the powers that Parliament has given it. It was not the intention of Parliament to confer upon the tribunal by this legislation a power to secure over co-owned property debts that are not directly related to that property**".**

1. Mr Watts referred me to the case of Whitehead v. Whitehead & anor [2002] NSWSC 486, a decision of a single judge of the New South Wales Supreme Court where Austin J reached a similar conclusion as to what should be taken into account in adjusting the rights of co-owners upon the sale of co-owned property. He said (at para. 28):

"28 It is not a proper function of the court, in making orders for adjustments to the proceeds of sale in order to work out the respective rights of the parties as co-owners, to bring into account any additional right to damages that they may have under a contract they have made, just as it would not be a proper function of the court to make an adjustment to reflect damage suffered by one co-owner by some tort of the other, whether or not relating to the land. To allow such extraneous claims to be brought into account would be to elevate them to a kind of security interest chargeable against the fund of proceeds of sale. To do so would delay the final distribution of the fund, and in cases where the extraneous claim is for an unliquidated and unquantified amount even a partial distribution might be prevented. By making such a claim, one co-owner might be able to keep the other co-owner out of his share of the proceeds of sale for a substantial time. Those consequences would be unsatisfactory, and frequently unjust".

1. Mr Clarke said that Victoria was the only state that had passed this jurisdiction on to a statutory tribunal and there are no guidelines as to how the jurisdiction should be exercised. He said that, although subsection (2) sets out what must be taken into account, it does not mean that other things cannot also be taken into account. He said that the purpose is to achieve a just and fair division of the land. He also said, although not in these terms, that Miss Brondolino could not have undertaken any of the impugned conduct except as a co-owner of the Bank Building and that accordingly redress for any breach by her of a fiduciary duty to Mr Cappellin was something that could be awarded in the adjustment of rights under the section in order to ensure a fair division.
2. Mr Clarke is right that subsection (2) does not say that nothing else can be taken into account in adjusting rights but what does appear in sub-section (2) is a clear statement of what parliament thought relevant in this regard. These are amounts spent improving the land, maintenance costs and insurance, payment of more than the party's share of mortgage instalments or outgoings and damage caused by unreasonable use of the land. These are matters to do with the maintenance of the co-owned property and also its value and what a co-owner has done to augment or diminish that value.
3. As to the suggestion that the Victorian position is exceptional, it is true that the New South Wales legislation does not contain an equivalent to s.233. Under the regime in that state, adjustments of rights are made according to general equitable principles. Those principles are referred to the judgment of McLelland J in Re Fettell (1952) 52 SR(NSW) 221, where his Honour said (at p.225):

"But in all cases where relief was granted in addition to partition, it was directly concerned with the position of the parties as co-owners".

"In order to deal with the facts of particular cases, it will at times be necessary to make special provisions, to work out the respective rights of the parties as co-owners, or to give the trustees particular powers or duties not covered by the general words of the definition, or to deal with other like circumstances. It is such matters with which s 66G (6) is concerned, and the court cannot, in my opinion, import into the statutory trusts conditions to give effect to rights arising quite outside the position of the parties as co-owners."

1. From this it would seem that the general principles to be applied in New South Wales are somewhat similar to those set out in s.233. Any basis for adjustment must relate to the position of the parties as co-owners, not their relationship in any other capacity. His Honour's comments therefore appear to support what I said in Sutherland and I still believe that is the correct approach.

1. By s.6 of the Limitation of Actions Act 1958 ("the Limitations Act"), actions for an account and actions founded in contract and tort cannot be brought after the expiration of six years from the date on which the cause of action accrued. By s. 3 of the Limitations Act, the term "action" is defined includes any proceeding in a court of law. Times can be extended in the case of fraud or mistake (s.27).
2. Notwithstanding the age of many of the claims made, Mr Clarke submitted that the Limitations Act has no application because, he submitted, this Tribunal is not a court of law. The claims made are also, he said, equitable in nature and not claims for the recovery of money or damages in contract or tort.
3. As to the argument that this Tribunal is not a court for the purposes of the Limitations Act, I repeat what I said in Sutherland (at para 37):

"It would be strange if a litigant could bring a claim in this Tribunal that could not be brought in a court because it was statute barred. I would not consider that Parliament intended such a result unless the language of the Act clearly required it and it does not. The fact that the word "Action" includes a proceeding taken in a court of law does not mean that it does not also include other things, such as a proceeding in this Tribunal. It is not an exclusive definition."

1. What is sought here is an adjustment of proprietary rights pursuant to a statutory provision. There are two stages to the process. First, establishing the claim itself. The party seeking the adjustment must prove it on the balance of probabilities. Secondly, determining whether it is appropriate to adjust the rights of the parties with respect to it. That is a task for the Tribunal and it does not involve any onus of proof. If the claim is of the nature referred to in subsection (2), the Tribunal must take it into account. However, the decision as to whether any adjustment is then made is discretionary.
2. The basis of the claim in each case is something outside the Act. The claims with respect to breach of a fiduciary duty are equitable in nature. The claims of fraud are tortious. So the establishment of the claim requires the determination of a claim in tort or equity and Mr Cappellin bears the onus of proof. However the power to order adjustment is not tortious and in Victoria, where the claim is made under the Act, it is not the granting of an equitable remedy either. It is the exercise of a statutory power. The consequence of making the order is to establish the claim and then in effect, attach the value of the claim to the co-owned property by making an adjustment with respect to it. An application for an adjustment under the Act is not properly an action to recover money or damages in tort or contract. It is an application under the section, although the power to give this sort of relief is similar to equitable relief in other jurisdictions.
3. Mr Watts submitted that, although this is not a claim for recovery of a sum of money or damages, I should apply the Limitations Act by analogy. He relied upon the following passage from the judgment of Dixon J as he then was, in the case of Cohen v. Cohen [1929] HCA 15; (1929) 42 CLR 91 (at p. 99-100):

"The Statute of Limitations, by its terms, does not operate directly upon equitable remedies. (See also, for Victoria, sec. 79 (2) of the Supreme Court Act 1915.) But such remedies are barred in Courts of equity by analogy to the statute. The analogy is found in the case of constructive trusts, where the equity is fastened upon the trustee not because he intended to become the fiduciary of property but because of the character of his dealings and in spite of his intention to take the property for himself. But Courts of equity have refused to see any analogy when a person, intending to act in a capacity which is fiduciary, has received, as and for the beneficial property of another, something which he is to hold, apply or account for specifically for his benefit. Such a person is either an express trustee, or, if that name does not in strictness belong to him, he stands in the same position as a direct or express trustee (see Soar v. Ashwel [1893] 2 QB 390l)".

1. Mr Watts submitted that it would be unjust to allow Mr Cappellin to raise equitable claims against Miss Brondolino in circumstances where, because of the effluxion of time, she would be statute barred in pursuing him for the money that she had paid or assumed responsibility for on his behalf at the time.
2. I do not think that I should read, by analogy or otherwise, a limitation into the section that is not there. Further, I do not believe that a claim for adjustment of rights under s.233 is an action founded in contract or tort within the meaning of s.6. Hence, I do not think that the power to make an adjustment to rights is affected by the Limitations Act.
3. However the power to order an adjustment of rights is discretionary. The discretion must be exercised with a view to achieving a just and fair division of the co-owned property or of the proceeds of sale of it. Where it is clear that the underlying claim would be statute barred if enforced by action or suit, it would not generally be just and fair to allow the claimant to circumvent the Limitations Act by obtaining an adjustment under s. 233 with respect to it. Moreover, the passage of time will usually make it difficult to prove or disprove the allegations made, as memories will have faded and supporting material will have been lost or discarded. Further, the opposing party might have other claims of a similar age that he or she is prevented from enforcing by the Limitations Act. To reopen transactions between parties after so many years in those circumstances might be unjust unless they could all be fully reopened and properly examined and the rights of all parties equally enforced. This case is a very good example of both of those sets of circumstances. There may also be many other situations where an adjustment of rights would not achieve a just and fair division of the co-owned property. Each case must be determined on its own facts.
4. In Sutherland, I declined to take into account, for the purposes of s.233, any claim that might be statute barred if recovery were sought in a court. I said (at para 38-40):

"It is important to bear in mind the nature of this proceeding. This application is not an action by Mr Corkill to recover the money that he has lent to Mr Sutherland and so there is no opportunity for Mr Sutherland to plead the statute. What I have before me is an application for the sale of co-owned land and for consequential orders. As to those consequential orders, Mr Corkill is not asking me to make an order for the money that he says Mr Sutherland owes him. The only basis for considering the financial relationship between these two men is for the purpose of s. 233.

In determining whether to make an order under subsection (1), I must take into account, amongst other things, such things as mortgage payments and various other costs and expenses incurred by one or other of the parties. That does not mean that, having taken those things into account, I have to exercise my discretion in any particular way. Having looked at the mortgage payments that Mr Corkill has made and seen that a large proportion of them appear, at least on their face, to be statute barred, it seems to me that I ought not to exercise my discretion to allow that proportion in his favour in any order made under subsection (1).

However, since I am not asked by Mr Corkill for an order in regard to payment of any of these moneys it does not fall for me to determine which of them, if any, are statute barred and which are not. That is a task properly for the tribunal that has to determine Mr Corkill's claim for repayment, in this case, the Melbourne Magistrates' Court. Mr Sutherland will be able to raise his Limitation of Actions defence there."

Duties claimed to be owed to Mr Cappellin by Miss Brondolino

1. Mr Clarke submitted that I should find that, although Mr Cappellin is a wealthy man, he is reliant upon his solicitors and accountants.
2. The essence of Mr Cappellin's claim is his allegation that Miss Brondolino was his solicitor and he allowed her to do everything, trusting that she would look after his interests. He also asserted that she took charge of the leasing and financing of the Bank Building and would not allow him any involvement. He said that he signed whatever she put in front of him without understanding what it was all about, trusting that it was all in order. He said these circumstances gave rise to various duties that she had to him.
3. A further duty alleged was said to arise from their relationship, which was said to be a partnership.
4. Their relationship was multi-facetted. As well as being close friends for at least part of the relevant period they participated in the business enterprises referred to. Some years earlier (there is no evidence as to precisely when) Miss Brondolino had done a small amount of legal work for Mr Cappellin in exchange for some building work that he did for her. She did the legal work for the joint venture participants for which she did not charge. This was work that had to be done and it was done as much for herself as for Mr Cappellin. Her office was the address to which the Real Estate agent sent the statements and, after Mr Dedda left, the address to which the lenders sent statements.

1. Mr Cappellin claims that Miss Brondolino has been his solicitor over a number of years. When asked what work she did in this capacity he referred to the Will that she drew and the company she incorporated for him many years ago. He gave no evidence of any other work that she had done for him.
2. As to the period I have to deal with, from 1989 to date, there was no evidence or suggestion of any formal retainer of Miss Brondolino. Indeed, for much of that period, Mr Cappellin had other solicitors.
3. The documents tendered show that Miss Brondolino did the conveyancing work required to purchase the Bank Building. For the various mortgages, she acted for the joint venturers. The extent of the work done is unclear. There was some correspondence, obtaining of certificates and attending to the other matters and formalities required by the lenders. However the mortgage documents themselves appear to have been prepared, stamped and lodged at the Titles Office for registration by the solicitors for the lenders concerned and it seems to have been the lenders that paid out or received the money. In regard to the Sandhurst refinance, which is the only one that I have a file for, there was a reconciliation at the end prepared by Mr Dedda and a letter from Miss Brondolino's office addressed to the three of them, providing a full accounting.
4. In regard to the tenancy, she drew the lease and corresponded with the agent and Mr Cappellin and Mr Dedda.
5. I accept that this work was done voluntarily by Miss Brondolino for herself and the other joint venturers. She never sent any of them a bill or charged any fees. The fact that there was no retainer does not mean that she was not under a duty towards the other persons whom she was representing. However, in the absence of a retainer, any such duty was confined to the work that she undertook. She could not take advantage of the position that the doing of that particular work gave her to profit at the expense of the others whom she was representing and she had to act with reasonable professional care and skill in what she did but she had no wider duty to subordinate her own interests to theirs. There is no evidence that she took advantage of the position that the doing of this work gave her. Such documents as I have show that she behaved quite properly.
6. There is also no evidence that Miss Brondolino ever gave any advice to Mr Cappellin during the relevant period or that he sought her advice about anything. When he spoke to her about his pending criminal proceedings she made some suggestions which he rejected. At that time he was represented by other solicitors.
7. As to the Westpac refinance in particular, I am not satisfied that he entered into the arrangement on the advice of Miss Brondolino. He knew that her interests were in conflict with his. The mortgage documents to the bank were signed by the two of them in front of Mr Moy, all of the money, including the additional money supplied by Mr Cappellin, was handled by the bank, not by Miss Brondolino, and the mortgages to Clients Investments were discharged by the bank's solicitors. Miss Brondolino did not purport to act for Mr Cappellin or charge him any fees. He is not a simple or a naïve man. He is a mature and experienced business man who would have been astute to look after his own interests.
8. In his first witness statement Mr Cappellin said that he trusted Miss Brondolino "...to perform the role of managing partner..." because "...she was also, at the time of the purchase my solicitor and had the care and conduct on my behalf of various personal and professional matters." In cross-examination he was unable to identify any of these "various personal and professional matters" or any work that she had ever been retained to do for him apart from the will and the incorporation of the company years earlier.
9. Apart from the free conveyancing work that she did for the joint venture, I am not satisfied that she was his solicitor in the sense that she was acting on his behalf at any relevant time or that she had the care and conduct on his behalf of any "personal and professional matters".

1. I have referred throughout to the relationship as a joint venture so as to use a neutral term. Mr Cappellin claims that he and Miss Brondolino were in partnership. It is common ground that they were "partners" for certain tax purposes but it is disputed whether they were partners according to ordinary legal principles.
2. The mere co-ownership of property does not of itself create a partnership between the co-owners (Partnership Act 1958 s.6) even though the co-owners share profits and losses from the co-owned property.
3. Mr Watts referred me to the case of Commissioner of Taxation v. McDonald (1987) 15 FCR 172. That was a case where two dwelling units were owned by a husband and wife and were rented out. The issue was whether they were in partnership. After noting that they were partners for taxation purposes, Beaumont J. said:

"Partnership is the relationship which subsists "between persons carrying on a business in common with a view of profit." (Partnership Act, s.1). The reference to "business", defined in the statute as including every trade occupation or profession (Partnership Act, s.45), indicates "a commercial enterprise as a going concern" (see Hope v. Bathurst City Council [1980] HCA 16; (1980) 144 CLR 1 per Mason J. at p 8). Purely domestic transactions are thus excluded from the definition (see Fletcher, op. cit. at p.28). The "business" must be "carried on". This suggests some active occupation or profession (see The Commissioners of Inland Revenue v. The Marine Steam Turbine Co., Ltd. (1919) 12 TC 174 per Rowlatt J. at p 179). It also suggests an element of continuity although it has been recognised that it is possible that a single joint venture will suffice (see Canny Gabriel Castle Jackson Advertising Pty. Ltd. v. Volume Sales (Finance) Pty. Ltd. [1974] HCA 22; (1974) 131 CLR 321; United Dominions Corporation Ltd. v. Brian Pty. Ltd. [1985] HCA 49; (1985) 157 CLR 1 at p 15; Fletcher, op. cit. at pp 31-33). On the other hand, in the case of a private individual as distinct from a company, "it may well be that the mere receipt of rents from properties that he owns raises no presumption that he is carrying on a business" (see American Leaf Blending Co. Sdn. Bhd. v. Director-General of Inland Revenue (1979) AC 676 per Lord Diplock at p 684)."

1. His Honour referred to the case of French v. Styring [1857] EngR 509; (1857) 2 CB (NS) 357 where Willes J said, as to the relationship between co-owners in that case,: (at p 366):

"It in truth amounts to no more than a contract between two tenants in common, whereby the one agrees, in consideration of certain things to be done by the other, to abstain from exercising his rights in respect of the chattel held by them in common. It is no more a partnership than if two tenants in common of a house agreed that one of them should have the general management, and provide funds for necessary repairs, so as to render the house fit for the habitation of a tenant, and that the net rent should be divided between them equally."

1. Reference was also made in that case to Lindley on Partnership, 15th ed. Where the author says (at p.81):

"When, however, co-owners of property employ it with a view to profit, and divide the profit obtained by its employment, the difference, if any, between them and partners becomes very obscure. The point to be determined is whether, from all the circumstances of the case, an agreement for a partnership ought to be inferred; but this is often an extremely difficult question.

If each owner does nothing more than take his share of the gross returns obtained by the use of the common property, partnership is not the result. On the other hand, if the owners convert those returns into money, bring that money into a common stock, defray out of it the expenses of obtaining the returns, and then divide the net profits, partnership is created in the profits, if not also in the property which yields them."

1. When Mr Dedda was involved, there does not appear to have been any business activity between the parties after the other enterprises came to an end. All that occurred was that Mr Dedda prepared accounts as to how the accruing losses should be shared and they made their contributions and submitted their taxation returns on the faith of those accounts. After Mr Dedda ceased to be involved and the finances were amalgamated in the borrowings from Clients Investments and then Westpac, it does not seem to me that Mr Cappellin and Miss Brondolino did anything more than collect the net rental from the agent and pay off the mortgage over the Bank Building. They did not bring money into common stock or employ it in any enterprise. Mr Watts submitted that there was little in this case for either Miss Brondolino or Mr Cappellin to do. They had engaged an agent who collected the rent and paid the expenses. All that had to be done was bank the net rental. That was done by Miss Brondolino. Mr Cappellin did nothing at all. I agree that that was the situation.
2. There is insufficient evidence to determine whether the parties' activities before the purchase of the Bank Building would have amounted to a partnership but I am not satisfied that there was any partnership afterwards between Mr Cappellin and Miss Brondolino according to normal legal principles, even though they were "partners" for taxation purposes.

1. Mr Clarke submitted that Miss Brondolino assumed the role of fiduciary in regard to Mr Cappellin. He said that a duty is imposed by the very fact of co-ownership for the co-owners to act fairly between themselves. I do not accept that submission. No doubt Miss Brondolino owed a duty to pay into the bank account any money sent to her by the agent and not to use it for her own purposes but it does not appear on the authorities that, simply because she assumed that role, she became a fiduciary in any wider sense.
2. Both counsel referred me to the decision of Mason j in Hospital Products Ltd v. United States Surgical Corporation [1984] HCA 64; (1984) 156 CLR 41 where his Honour described a fiduciary relationship in the following terms:

"The accepted fiduciary relationships are sometimes referred to as relationships of trust and confidence or confidential relations (cf. Phipps v. Boardman [1966] UKHL 2; (1967) 2 AC 46, at p 127), viz., trustee and beneficiary, agent and principal, solicitor and client, employee and employer, director and company, and partners. The critical feature of these relationships is that the fiduciary undertakes or agrees to act for or on behalf of or in the interests of another person in the exercise of a power or discretion which will affect the interests of that other person in a legal or practical sense. The relationship between the parties is therefore one which gives the fiduciary a special opportunity to exercise the power or discretion to the detriment of that other person who is accordingly vulnerable to abuse by the fiduciary of his position. The expressions "for", "on behalf of" and "in the interests of" signify that the fiduciary acts in a "representative" character in the exercise of his responsibility, to adopt an expression used by the Court of Appeal."

1. Miss Brondolino undertook the role of solicitor for Mr Cappellin in regard to the conveyancing referred to above. However, apart from the mechanics of the conveyancing work which seems to have been largely done by her clerk, I am not satisfied that she exercised any powers or discretions on behalf of Mr Cappellin or that she did anything to his detriment The decisions were made by them both, not by her alone.
2. Mr Watts also referred me to the following passage from an article by Professor Mendes Da Costa in the Melbourne University Law Review Vol 3 1961, where the learned author said :

"It must however be borne in mind that co-ownership, as such, does not create an agency or partnership between co-owners, nor does it, by itself, give rise to a fiduciary relationship between them."

1. Reference was also made to an article by Dr Heather Conway in (1999) 7 Australian Property Law Journal at p. 1 and to the case of Rex Phillip Tory v. Sarjit Kuar Tory [2007] NSWSC 1078, both to a similar effect.
2. In the House of Lords decision in Kennedy v. Trafford [1987] AC 180, leased property was owned by two men. The arrangement between them was that one of them would collect the rent and pay it into a bank account upon which they could both draw. That arrangement could have been ended at any time. It was held that the mere collection of rental by one co-owner did not make him a fiduciary for the other. It was also said that the mere fact that one co-owner "kept aloof" and left everything to the other did not make that other his bailiff.
3. So what was Miss Brondolino's role here?

1. Mr Cappellin says that Miss Brondolino "assumed the management of" the Bank Building on behalf of "the partnership". That is not borne out by the evidence.
2. Mr Cappellin said that he was never privy to or kept informed of Miss Brondolino's dealings with third parties in relation to the Bank Building that she undertook on behalf of the joint venturers. In his first witness statement he said that he never received any correspondence about the management of the Bank Building. The Sandhurst file contains copies of a number of letters and emails to him and others have been produced from Miss Brondolino's computer. I do not accept that he never received any such correspondence.
3. When it was suggested to Mr Dedda in cross-examination that Mr Cappellin had no part of the administrative side of the ventures he said that Mr Cappellin was always involved as a silent partner who just became involved in discussions. He said that he did not think that Mr Cappellin was ever excluded from any of the dealings.
4. Mr Cappellin said that Miss Brondolino deposited all of the rental income into the mortgage account without his consent. I do not believe that evidence. He knew what the rental was and he knew or ought to have known what the mortgage instalments were. He knew in the early stages that he had to make contributions to make up shortfalls and later, when the rental covered the mortgage instalments, he knew that he was not receiving any distribution of funds over and above the mortgage repayments. He must have been aware that the balance was either kept by Miss Brondolino or paid to the mortgagee. If he had believed that she was keeping it for herself he would have raised some objection at the time so I do not accept that he thought that was occurring. I am satisfied that he knew that it was being paid off the mortgage, and such evidence as I have shows that it was. There is certainly no evidence at all that Miss Brondolino misappropriated any of it.
5. In his first witness statement, Mr Cappellin said that Miss Brondolino "assumed the Management" of the Bank Building. When one looks closely at the evidence, that bald statement is quite misleading. He said that this assumption of management included, but was not limited to, the following matters:
   • (a) "Negotiating the terms of the lease and liaising with the tenant". There were only two tenants. The first was the Commonwealth Bank. The Bank Building was purchased subject to that tenancy. The second was Dangerfield and the terms of that lease were agreed to by Mr Cappellin as well as Miss Brondolino and Mr Dedda. They all signed the written offer from the tenant. It was not something independently negotiated by Miss Brondolino.
   • (b) "Engaging and liaising with the real estate agent". The agent was introduced by Mr Cappellin. The agent sent the net rental to Miss Brondolino who banked it. There is evidence that he also wrote to her about some repairs and the construction of a fence but the file shows that she referred these on to Mr Cappellin for his input. There is no evidence of any unilateral decision making on her part.
   • (c) "Sourcing finance and liaising with the mortgagee". There is no evidence who sourced the loan from CBFC. Mr Dedda sourced the Sandhurst loan. The Client's Investments loan was through someone Mr Cappellin knew and the Westpac finance was arranged by Mr Foy, who was one of Mr Cappellin's bank managers and someone also known to Miss Brondolino. Miss Brondolino did the legal; work in regard to the various refinances. Apart from that, the only evidence of liaising was in regard to the Sandhurst loan and that was by Mr Dedda.
   • (d) "Receiving all and any moneys due to the partnership pursuant to the lease". The rental was received by the agent who paid rates and outgoings and any expenses. The net rental was sent by the agent to Miss Brondolino who paid it into a bank account in the name of the parties.
   • (e) "Paying all and any moneys due pursuant to the mortgage". There is no clear evidence as to who paid the mortgage instalments while Mr Dedda was still involved. At that time Mr Dedda was managing the finances but the physical payment might have been done by Miss Brondolino or by someone in her office. Because of the initial shortfall, additional contributions had to be calculated and collected to enable the instalments to be paid. These calculations were done by Mr Dedda and Mr Cappellin appears to have made his contributions according to those calculations, as did Mr Dedda and Miss Brondolino. When Mr Dedda left there was no shortfall between the rental and the mortgage payments and the rental was received from the agent by Miss Brondolino who paid it all to the Mortgagee, Westpac, until the mortgage was discharged. She then received it into her trust account in the names of herself and Mr Cappellin and details of that are in evidence.
   • (f) "Paying or ensuring payment by tenant of all rates, taxes and other expenses payable in respect of the property". That was done by the agent. The tenants appear to have been model tenants and apart from some disputes over plumbing and roofing works and complaints about the absence of a written renewal of lease (Mr Cappellin would not send it back to Miss Brondolino) there does not appear to have been any problem with the tenant.
6. Mr Cappellin also says in his first witness statement that at no time did Miss Brondolino permit him to be involved in the management of the Bank Building. That is not established. The actual management was by the estate agent. Until their falling out over Dr Feelgood's, Mr Cappellin and Miss Brondolino met regularly in Miss Brondolino's office. The only contemporaneous file that I have shows that he was written to, not just about contributions and finance but about matters to do with the tenancy. Indeed, there was difficulty with the Dangerfield tenancy because Mr Cappellin would not sign and return the renewal of lease. Although he appears to have had little active involvement that was his own choice.
7. He said in his first witness statement that he recalls that the rental returns were sufficient to cover the mortgage instalments to CBFC. They were not. There was a shortfall that Mr Dedda calculated that had to be made up by the parties, including Mr Cappellin.

Alleged failure or refusal to provide information

1. In his first witness statement, Mr Cappellin said that Miss Brondolino never provided him with copies of any documents that he signed. She did send him a copy of the then current lease on 30 January 1996 when the sale of the Bank Building was being discussed. That appears from a letter on the Sandhurst refinance file. Otherwise, I am not satisfied that he ever asked for copies. Miss Brondolino said that he did not.
2. Mr Cappellin also stated:

"Notwithstanding numerous requests, I was never provided with any information pertaining to the property such as details of the rental income from time to time generated by the property, GST on the rent, out of pocket expenses incurred in relation to the property, details of the mortgage debt and the required repayments. Without that information my accountant and I have been unable to accurately prepare my tax returns."

1. That allegation is not supported by the other evidence. While Mr Dedda was part of the joint venture, he prepared the accounts and forwarded copies to Mr Cappellin's accountant. Thereafter, no accounts at all were prepared by either Miss Brondolino or Mr Cappellin. That might have been because all that happened was that the agent sent the net rental to Miss Brondolino and she paid it to the bank to reduce the mortgage. The agent's statements and the bank statements would therefore seem to have amounted to a complete record.
2. According to the Sandhurst file, on 8 February 1996 Mr Cappellin's accountant, Mr Tan, sent a letter by fax to Miss Brondolino asking for information. Miss Brondolino wrote back by fax on the same day asking that Mr Cappellin's solicitors contact her for the information required and that she would require an authority executed by Mr Cappellin. There is nothing on the file from either the accountant or the solicitors nor any other evidence to suggest that further contact was made although there is correspondence at that time between Miss Brondolino and Mr Cappellin about the extension of the Sandhurst loan refinance and a proposed sale of the Bank Building.
3. The information that Mr Cappellin says he was denied could have been readily obtained by him from the Estate Agent, whom he knew personally, or from the bank, since he was one of the named account holders. Mr Cappellin does not say why he did not authorize Miss Brondolino to provide the requested information to his accountant or why he did not simply ask the agent or the bank for copies of statements.

The allegations of wrongful conduct by Miss Brondolino

1. In regard to many of these allegations Miss Brondolino is said to have acted "wrongly and possibly fraudulently". That is a very serious allegation. Although the burden of proof is the balance of probabilities, the standard of proof in any civil claim must vary according to the seriousness of the allegations made.
2. In Briginshaw v. Briginshaw [1938] HCA 34; (1938) 60 CLR 336 Dixon J (as he then was) said (at p. 362-3):

'But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters "reasonable satisfaction" should not be produced by inexact proofs, indefinite testimony, or indirect inferences. Everyone must feel that, when, for instance, the issue is on which of two dates an admitted occurrence took place, a satisfactory conclusion may be reached on materials of a kind that would not satisfy any sound and prudent judgment if the question was whether some act had been done involving grave moral delinquency. Thus, Mellish L.J. says: "No doubt the court is bound to see that a case of fraud is clearly proved, but on the question at what time the persons who have been guilty of that fraud commenced it, the court is to draw reasonable inferences from their conduct" (Panama and South Pacific Telegraph Co. v. India Rubber, Gutta Percha, and Telegraph Works Co.). In the same way, in dealing with the question in what county the publication of a criminal libel had taken place, Best J. said: "I admit, where presumption is attempted to be raised, as to the corpus delicti, that it ought to be strong and cogent; but in a part of the case relating merely to the question of venue, leaving the body of the offence untouched, I would act on as slight grounds of presumption as would satisfy me in the most trifling cause that can be tried in Westminster Hall" (R. v. Burdett (1820) 106 ER 873 at 884). It is often said that such an issue as fraud must be proved "clearly", "unequivocally", "strictly" or "with certainty" .............. This does not mean that some standard of persuasion is fixed intermediate between the satisfaction beyond reasonable doubt required upon a criminal inquest and the reasonable satisfaction which in a civil issue may, not must, be based on a preponderance of probability. It means that the nature of the issue necessarily affects the process by which reasonable satisfaction is attained. When, in a civil proceeding, a question arises whether a crime has been committed, the standard of persuasion is, according to the better opinion, the same as upon other civil issues ............ But, consistently with this opinion, weight is given to the presumption of innocence and exactness of proof is expected."

I will deal with each of the allegations of wrongful conduct on the part of Miss Brondolino after examining what evidence there is to support them.

1. As stated above, the money claimed to have been wrongly "and possibly fraudulently" received or applied by Miss Brondolino is said to fall into fourteen categories. They are as follows:
   • (a) The paying out from the proceeds of the Sandhurst refinance of amounts not arising from matters relating to the Bank Building

The amounts in question are those apart from the payout figure to CBFC. As stated above, I am satisfied that the proceeds of that loan were properly disbursed. The claim therefore fails on the merits.

Since this relates to the disbursement of moneys secured over the Bank Building it might have fallen within s.233 although it is unnecessary to decide that point. However, because of the age of the claim and the fact that it is tied up with possible claims by Miss Brondolino that would now be statute barred and because neither the claim nor any potential counterclaim could be fairly tried after so long, because of the absence of evidence due to of the passage of time, I would not, in my discretion, have made an order under the section with respect to it even if it did apply and the grounds of the claim had been proven.

(b) The acquisition from her brother, Charles Brondolino of his one twelfth share of the Bank Building "wrongfully and possibly fraudulently"

It is not clear how this is put. By this transfer, Miss Brondolino acquired a further one twelfth interest in the Bank Building. The evidence of Mr Charles Brondolino is that he considered that, since he had paid nothing towards the acquisition of the Bank Building or the mortgage repayments, he held his share in trust for his sister who had made all payments on his behalf.

Miss Brondolino claimed in the Supreme Court proceedings between them that he held his interest on trust for her. She was cross-examined about that, but whether or not that is so as a matter of law is not relevant. Her brother was ordered to transfer his interest to her and he did so.

It was also suggested that the Supreme Court proceeding and the ensuing transfer were a device to remove Mr Charles Brondolino's interest in the Bank Building from his divorce proceedings which were then underway. Even if that were so it would not be relevant to these proceedings. I have no jurisdiction to set aside a transfer of real estate for inadequate consideration or because it was an attempt to defeat property proceedings in the Family Court (I do not decide that it was), nor would Mr Cappellin appear to have standing to make an application to set the transfer aside on either ground.

Mr Clarke said that Miss Brondolino should have informed Mr Cappellin that Mr Charles Brondolino's interest in the property was available for acquisition and given him the opportunity to acquire it. There is no legal basis for that contention. The opportunity for Miss Brondolino to acquire it did not come to her in circumstances where she would have to account for it to Mr Cappellin. Mr Charles Brondolino was her brother. She had paid for his share, not Mr Cappellin. She had met his share of the expenses, not Mr Cappellin. Her acquisition of her brother's share was not wrongful or fraudulent.

Finally, this claim does not clearly fall within s.233, that is, it does not appear to be a claim with respect to which an adjustment under s.233 can be made. It is a claim that Miss Brondolino was in a fiduciary position and that she has used her position as fiduciary to obtain a profit for herself. It does not seek compensation or reimbursement with respect to any of the things mentioned in subsection (2). It does not seem to be an application for an account in accordance with s.28A and it does not relate to amounts payable by Miss Brondolino to Mr Cappellin during the period of co-ownership.

(c) The discharge, from the proceeds of a mortgage loan obtained from Sandhurst Trustees Limited, of a mortgage registered over a property that she owned in Thorseby Grove Eaglemont "wrongfully and possibly fraudulently"

This is discussed above. The documents tendered and Mr Dedda's evidence show that was a debt of the joint venture and so it was properly discharged from the proceeds of the Sandhurst loan. This was agreed to by all three parties. It is not something that Miss Brondolino did unilaterally. Far from there being no proof to the Briginshaw standard, there is no evidence at all of fraud or wrongdoing. Indeed, such evidence as there is shows nothing at all wrongful or fraudulent. Had the claim not failed on the facts it might have fallen within s.233 because of its nature but I would not have allowed an adjustment in my discretion because of the age of the claim for the reasons given above.

(d) The mortgage by her of another property that she owned in Banksia Street, Eaglemont "wrongfully and possibly fraudulently"

Quite obviously, it is not improper to mortgage ones own property. The complaint may have been intended to be as to the discharge of the mortgage but that is not pleaded. There is no evidence of fraud, the claim is too old to allow an adjustment for the reasons given and it does not, as pleaded, fall within s.233.

(e) Failed to account to Mr Cappellin for $145,567.67 from the proceeds of the Westpac refinance "wrongfully and possibly fraudulently"

This is dealt with above. Not only is the claim not proven, I am satisfied that the extra funds were required to discharge a joint venture debt and that Mr Cappellin was fully aware of the nature of the transaction and agreed to it. It is not something that Miss Brondolino did unilaterally. There is no evidence of fraud or even wrongful conduct and it is also not established that there was any "failing to account" on the part of Miss Brondolino. The claim fails on the merits. By its nature it might arguably have fallen within s.233 but even if it had been proven on the merits it is too old now to allow an adjustment for the reasons given.

(f) The acquisition from Mr Dedda of his one twelfth share of the Bank Building "wrongfully and possibly fraudulently"

It was open to Mr Dedda to agree to sell his share to Miss Brondolino in exchange for her assuming his share of the liabilities and it was equally open to Miss Brondolino to agree to purchase it on those terms. Whether or not the consideration was adequate was for those two parties to determine. I am not satisfied that Miss Brondolino was in a fiduciary relationship with Mr Cappellin at the time of this transaction and it was not demonstrated that the opportunity for Miss Brondolino to acquire Mr Dedda's share came to her in any other circumstances where she would have to account for it to Mr Cappellin. There is no evidence of any wrongful or fraudulent conduct in the part of Miss Brondolino. The claim fails on the merits and also does not appear to fall within s.233.

(g) Obtaining a discharge of the Mortgage registered in the name of Client Investments Pty Ltd over Thorseby Grove and Banksia Street "wrongfully and possibly fraudulently"

I have found that the discharges occurred in the circumstances described above and that both Mr Cappellin and Miss Brondolino understood and agreed with what occurred. It is not something that Miss Brondolino did unilaterally. The discharge of these mortgages was part of the refinancing. Again, not only is there no proof to the Briginshaw standard, there is no evidence at all of fraud or improper conduct. Mr Cappellin bears the onus of proof and he has not discharged it. The claim therefore fails on the merits. Had the claim not failed it might well have fallen within s.233 because of its nature but I would not have allowed an adjustment in my discretion because of the age of the claim for the reasons given above.

(h) Granted a mortgage over Thorseby Grove and Banksia Street to Westpac "wrongfully and possibly fraudulently"

The complaint may have been intended to be as to the discharge of the mortgages but that is not pleaded. There is no evidence of wrongful conduct or fraud. This claim clearly does not fall within s.233.

(i) Requiring Mr Cappellin to pay $75,135.29 or alternatively, $95,535.29 towards the discharge of the mortgage to Clients Investments "wrongfully and possibly fraudulently"

This seems to be a claim in fraud but it is not altogether clear how it is put. It is not proven that the payment by Mr Cappellin of these sums was a requirement imposed upon him by Miss Brondolino. All that the evidence establishes is that Mr Cappellin, following discussions with Miss Brondolino and his bank manager, Mr Moy, provided these funds towards the discharge of the Clients Investments mortgage. I find that the purpose of that refinance was to finally divide the liabilities between them so that the mortgage over the Bank Building reflected what remained of their joint debts. This is not something that Miss Brondolino did unilaterally. It is not established, either to the Briginshaw standard to or any other standard, that there was anything fraudulent or wrongful about Miss Brondolino's conduct in this regard. I am satisfied that Mr Cappellin knew what he was paying this money for and why. The claim therefore fails on the merits. Had it been established it is doubtful whether it would have fallen within s.233. In any case, I would not have made an adjustment because of the age of the claim for the reasons stated.

(j) Failing, between 15 September 1998 and 24 December 2008 to account to Mr Cappellin for five twelfths of the interest paid on the allegedly excess borrowings of $145,567.67 or for five twelfths of the sum itself when the Westpac Mortgage was paid out in September 2007 "wrongfully and possibly fraudulently".

It is not proven that there were any excess borrowings. I am satisfied that all of the moneys borrowed that were secured over the bank Building were with Mr Cappellin's agreement and for the purposes of the joint venture. None of it has been shown to have been used by Miss Brondolino for her own separate purposes. There is no evidence at all of fraud or wrongful conduct. The claim also appears to be of a personal nature that would not fall within s.233.

(k) Receiving the rental for the Bank Building after the Westpac mortgage was paid out and not accounting to Mr Cappellin for it

The rental for this period was received into Miss Brondolino's Trust Account and has been accounted for. He knew that the mortgage was paid out and he knew that she was receiving the rental and how much it was. She did not pay it and has still not paid it to Mr Cappellin because of the claim she makes in her counterclaim. It is not disputed that, subject to he counterclaim, that money belongs to Mr Cappellin.

(l) Failing to account to Mr Cappellin for money paid pursuant to the Westpac mortgage between 15 September 1998 and 24 December 2008 "wrongfully and possibly fraudulently"

No accounts were prepared by either party for this period. Statements from both the agent and the bank were sent to Miss Brondolino's office addressed to both parties and were available to Mr Cappellin if he wanted them. I am satisfied that the rental was sent by the agent to Miss Brondolino and that someone in her office paid it to Westpac. In that way, the mortgage was ultimately discharged. I do not believe that Mr Cappellin was unaware of that or that he was not content for that to occur. Upon receipt of the rental, the obligation assumed by Miss Brondolino was to pay it into their joint bank account. It was a mechanical exercise. She did not assume any obligation to prepare accounts for Mr Cappellin although she has accounted for the money in this proceeding. Again, there is no evidence of fraud or wrongful conduct on the part of Miss Brondolino.

(m) Failing to account to Mr Cappellin for any of the money received pursuant to the lease of the Bank Building between 25 August 1997 and 24 December 2008

This allegation is related to the last one and the answer is the same.

(n) Failing to account to Mr Cappellin for any rates taxes or other expenses paid with respect to the Bank Building between 25 August 1997 and 24 December 2008, including GST paid by the tenant from 1 July 2000 to 24 December 2008.

These expenses were paid and accounted for by the agent, not Miss Brondolino. Statements from the agent were available to Mr Cappellin if he had wanted them. She had an obligation to bank the money in their joint account but undertook no obligation to account to him. There is no evidence of any fraud or wrongful conduct by Miss Brondolino.

Mr Cappellin's claim with respect to Goods and Services Tax

1. Included in each rental payment was an amount of Goods and Services Tax. The whole of the amount received, including the tax component, was paid by Miss Brondolino to the mortgagee. She said that she included her share of the GST on her own BAS statements and so paid her share of the tax. Mr Cappellin did not do the same and now claims to have a substantial liability to the Tax Office for his share. He seeks to recover from Miss Brondolino the penalties that he says he now has to pay.
2. The problem with this claim by Mr Cappellin is that there is no evidence that Miss Brondolino agreed to manage the Bank Building on his behalf. They had an agent to do that. He was content for the agent to send the net rental receipts to Miss Brondolino and for her to pay it off the mortgage but he could not assume that she would do anything else. Indeed, he knew that she had not prepared any accounts so that, if he wanted any he would have to prepare them himself. He was able to ascertain the amounts of all of the payments from the agent.
3. Despite his denials, it is apparent that Mr Cappellin took part in the leasing of the Bank Building to the current tenant. He signed the offer to lease received from the tenant and also the Lease documents. I do not accept his assertion that he simply signed whatever was put in front of him and left it all to Miss Brondolino to manage on his behalf. He knew who the agent was. Indeed, he had introduced the agent. He had as much right to be supplied with information by the agent as Miss Brondolino and was no less able to access it than she was.
4. The only inference that I can draw from her receipt of the net rental and the payment of it to the mortgagee was that she undertook that role. That does not impose upon her any wider liability. He knew that he was not including these amounts of GST in his BAS statements or remitting his share of the GST to the tax office, if that was required to be done. It was for Mr Cappellin to attend to his own tax situation and, if he failed to do so, that is his own fault. He cannot blame it on her.

1. There are numerous general allegations about Miss Brondolino set out in paragraph 18 of the Amended Points of Claim. They are that she failed to:
   • (a) exercise due care and diligence. There is no evidence of that.
   • (b) regularly provide relevant information to Mr Cappellin. She had no obligation to do that.
   • (c) not conceal information from Mr Cappellin so as to prevent him from understanding the purpose and effect of any transaction. There is no evidence that Miss Brondolino concealed anything from Mr Cappellin and I am satisfied that he understood what he was doing.
   • (d) act honestly. There is no evidence of any dishonesty on her part.
   • (e) act in good faith and in the best interests of Mr Cappellin and the other co-owners. There is no evidence of any lack of good faith on Miss Brondolino's part. She had no duty to the others to act in their best interests except in regard to the legal work that she undertook on their behalf and the money that she collected and banked. There is no evidence of any failure on her part to act in their best interests in that regard or any abuse by her of her position. She was not a partner or fiduciary of Mr Cappellin.
   • (f) not act in her own interest or in the interest of any other person. I do not understand this allegation.
   • (g) not to allow her personal interest to conflict with those of her co-owners. The comments in (e) are repeated.
   • (h) not to improperly use her position. There is no evidence that she did.
   • (i) not to misappropriate property. There is no evidence that she did.
   • (j) not to misuse the Bank Building for her own benefit. The comments in (e) are repeated.
   • (k) not to misuse her powers as a solicitor, partner or fiduciary. The comments in (e) are repeated.
   • (l) do all things necessary to protect the interests of the Bank Building and any of the co-owners of it. She was under no such duty.
   • (m) Not to do anything that would be detrimental to Mr Cappellin or the other co-owners. The comments in (e) are repeated.

All of these allegations are very serious and none of them have any substance

1. The essence of Mr Cappellin's claim is that he signed documents put in front of him by Miss Brondolino, trusting that they were in order and without any understanding of what he was doing. I do not believe him.
2. Mr Cappellin is an astute businessman. I am satisfied that he knew what was doing and if he had not agreed to the transactions effected by these documents he would not have signed them. Having agreed upon the division of responsibility effected by the Westpac refinance, Mr Cappellin cannot now seek to reopen the arrangement on the basis that, with the passage of time and the unavailability of documents, Miss Brondolino is now unable to explain why or how the two of them arrived at the figures that they agreed upon almost thirteen years ago.
3. Quite apart from that, he alleges fraudulent conduct on the part of Miss Brondolino. Such a serious allegation requires strong and cogent evidence to support it but here there is none. Mr Cappellin simply points to figures in documents that he signed, many years after he signed them, and calls upon her to explain them. By reason of the discovery of the Sandhurst file the figures in regard to that refinance are explained and there is nothing untoward about them. None of the other documents that have come to light show any misappropriation of money or fraudulent conduct on the part of Miss Brondolino or anyone else.
4. The allegations of fraud, breach of duty and negligence fail on the evidence. The claims with respect to her acquisition of the shares of her brother and Mr Dedda fail because there was nothing improper about her obtaining those shares and there is no legal basis for the claims made.
5. Even if I am wrong about this, there is doubt as to whether many of these are allegations are of a nature that can be raised in a claim for the adjustment of rights between parties. Further, they relate to financial transactions that occurred many years ago. If Mr Cappellin had any remedy it should have been pursued then. They cannot be properly assessed at this late stage without injustice, due to the passage of time and the consequent lack of evidence. The only entitlement that Mr Cappllin has is to the money in Miss Brondolino's trust account that she is holding on his behalf and which she acknowledges is his.
6. As I indicated to counsel I will now direct the matter to be re-listed to receive submissions as to the orders to be made in the light of the above findings. Costs will also be reserved for further argument.