Colliers International (NSW) Pty Ltd v Ziani Corporation Pty Ltd and Anor

HEARING DATE(S): 17/07/2006-20/07/2006 EX TEMPORE JUDGMENT DATE : 07/20/2006

DECISION: Verdict and Judgment for the plaintiff against the first defendant; Verdict and Judgment for the second defendant against the plaintiff; Plaintiff to pay defendants' costs of these proceedings

CATCHWORDS: Real estate agent's commission - Whether earned - Whether plaintiff "introduced" tenant to landlord

Trade Practices Act 1974 (Cth) LEGISLATION CITED: Institute of Sport Act 1995 Civil Procedure Act 2005

Big Brother Movement Ltd v Richard Stanton & Sons Pty Ltd [1988] NSW Conveyancing Reports 55-434 CASES CITED: LJ Hooker Ltd v WJ Adams States Pty Ltd (1977) 138 CLR 52 Moneywood v Salamon Nominees Pty Ltd (2001) 202 CLR 351 Waltons Stores (Interstate) Ltd v Maher (1988) 164 CLR 387

Colliers International (NSW) Pty Ltd (Plaintiff) PARTIES: Ziani Corporation Pty Ltd (1st Defendant) Raymond John Jones (2nd Defendant)

COUNSEL: Mr J. Stoljar (Plaintiff) Mr N. Kidd (Defendant)

1 HIS HONOUR: The plaintiff, Colliers International NSW) Pty Limited was formerly known as Colliers Jardine (NSW) Pty Limited. However, at times stationery has been used indicating that its name, or its holding company's, may have been Colliers International Holdings (Australia) Limited. Nothing turns on the description of the plaintiff company. I shall refer to it merely as Colliers or the plaintiff.

2 The plaintiff is described in its stationery as "Land Economists, Property and Hotel Consultants, Valuers, Property Managers, Real Estate Agents, Auctioneers". Essentially, the plaintiff carries on a real estate agency business.

3 The first defendant is Ziani Corporation Pty Limited. The second defendant is Mr Raymond John Jones of Clontarf who is the managing director of the first defendant, Ziani Corporation Pty Limited. I infer that Mr Jones is the principal of the first defendant.

4 The first defendant was at all material times the holder of a long term lease of land known as 6 Figtree Drive at Sydney Olympic Park. The name of that property has sometimes been transcribed as 6 Victory Drive. I need merely refer to the land in question as the property. For present purposes, the first defendant can be described as the owner of the property.

5 The dispute before me concerns the payment of agent's commission on the letting by the first defendant of part of the property. The eventual lessee of the property was the Crown in right of the State of New South Wales "care of New South Wales Institute of Sport".

6 It is convenient at this time to say something of the New South Wales Institute of Sport, to which I shall refer as the Institute.

7 The Institute is constituted by the Institute of Sport Act 1995. Section 4 of that Act provides: "(1) There is constituted by this Act a body corporate with a corporate name of the New South Wales Institute of Sport. (2) The Institute is, for the purposes of any Act, a statutory body representing the Crown."

The Institute has a board. The board consists of eight people appointed by the Minister, and the Director General of the Department of Sport and Recreation. Under s 10 of the Act the board is required to prepare and deliver to the Minister at least three months before the beginning of each financial year, a draft corporate plan for the ensuing financial year. The corporate plan must specify, amongst other things, the budget of the Institute for the ensuing financial year. The board must consider any comments on its draft corporate plan that are made by the Minister within two months after the plan is delivered to the Minister and must deliver the completed corporate plan to the Minister before the beginning of each financial year. The Institute must exercise its functions in accordance with the relevant corporate plan.

8 It is clear from subs (5) of s 10 that in developing the corporate plan, the board of the Institute is subject to the directions of the Minister administering the Act. Section 14 of the Act refers to the powers of the Institute. Under subs (2) it has the ability to make and enter contracts and to acquire and develop any land. Significantly, it may occupy, use and control any land or building owned or held under lease by the State and made available for the purposes of the Institute.

9 Under s 14(4) the Institute cannot employ any staff, but it is clear from the note under that subsection and from s 18 that members of the New South Wales Public Service may be appointed to be in effect the members of the staff of the Institute.

10 Section 16 provides that the Institute is, in the exercise of its functions, subject to the control and direction of the Minister.

11 Section 17 provides for the appointment of a Chief Executive Officer who is responsible for the day-to-day management of the Institute, subject to and in accordance with the policies and other decisions of the board, and subject to any direction of the Minister.

12 Section 22 provides for the establishment of the New South Wales Institute of Sports Fund. Section 23 provides for payments to be made into the Fund and s 24 provides for payments to be made out of the Fund. Essentially, the payments to be made out of the Fund are the ordinary outgoings of the body corporate. Section 23(d) provides for the payment into the Fund of all money appropriated by Parliament for the purposes of the Institute.

13 Although the Institute is a body corporate which can clearly sue and be sued in its corporate name and title, the Institute is largely subject to the direction and control of the relevant Minister of State. The evidence discloses that the relevant Minister of State was either called the Minister for Tourism, Sports and Recreation or the Minister of Sport and Recreation. The evidence also establishes that there is a Department of the executive government of this State called either the Department of Sport and Recreation or the Department of Tourism, Sport and Recreation. I shall merely refer to it as the Department. The only relevant Minister of the Crown described in the evidence is the Minister of the Department, the Honourable Morris Iemma.

14 In 1997 the first defendant was granted the head lease of the property. The lease was granted following an appearance by Mr Jones before a government panel in order to establish that the first defendant was a fit and proper entity to become a head lessee within the Olympic precinct at Homebush Bay. The panel comprised three persons and the chairman was Mr Mick O'Brien, the Deputy Director General of the Olympic Coordination Authority, which was subsequently known as the Sydney Olympic Park Authority, or by its acronym SOPA.

15 At the time that the lease was granted to the first defendant there was a building on the property. That building is described as the existing building. The defendants proposed to build a second building adjacent to the existing building on the property. The proposed building can be described as the new building. A development approval for the new building was granted on 5 May 1998 by the local council.

16 Commencing on 27 January 1998, the existing building was let to a company described both as the Australian Council of Physical Education and ACPE Redlands Limited, which may be referred to merely as ACPE. The initial term of that lease was from 27 January 1998 until 26 July 1999. The term was varied before its ending so that the termination date became 29 February 2000. ACPE vacated the existing building in approximately March 2000 after the lease expired.

17 There were dealings between the first defendant and both the Department and the Institute prior to the involvement of the plaintiff. Paragraph 7 of Mr Jones' statement has not been challenged and is not controversial. It contains this matter: "I first became aware of the Department of Sport and Recreation (DSR) and New South Wales Institute of Sport (NSWIS), both government sporting bodies, in early 1998 following my appearance before the government panel as referred to in paragraph 2 of this Statement. At the time, DSR occupied premises at North Sydney, NSWIS occupied premises at the Athletics Field in Homebush Bay and Sports House, also a government sporting body, occupied premises at Wentworth Park, Glebe."

18 In early 1998 Mr Mick O'Brien, the chairman of the government panel before which Mr Jones had appeared, telephoned him and there was a conversation to the effect that a New South Wales government body was looking for space in the Homebush Bay area and as to whether Mr Jones was interested in having that government body take space in the existing building. To that inquiry Mr Jones gave a positive reply. A few days later there was a second telephone conversation in which Mr O'Brien advised Mr Jones that the body looking for space was the Department. Again, Mr Jones gave to Mr O'Brien a positive response.

19 Subsequent to those telephone conversations, there was a telephone call made to Mr Jones by Mr Michael Scott the Chief Executive Officer of the Institute. Mr Scott gave Mr Jones to understand that the Institute was interested in renting premises at Homebush Bay and asked for details of the existing building on the property. Mr Jones offered to Mr Scott a view of the existing building. That view took place on 16 March 1998. Mr Jones made a file note about the meeting at the property. It is this: "Met [Michael Scott] from [the Department] to view the building. Told him ACPE vacating in July 99 and that building available after that. He enquired rental and was told approx $550,000 net per annum. He'll get back to us. I told him of the potential development on the adjoining land. Expressed interest and asked for details as they come [sic] available."

It is not clear whether Mr Jones was at that time unaware that Mr Scott was the Chief Executive Officer of the Institute or whether he failed to appreciate the difference between the Department and the Institute.

20 After that, and before 24 April 1998, Mr Jones received a telephone call from Ms Marie Spencer, the Deputy Director General of the Department. Ms Spencer identified herself as being from the Department and said words to the effect that the Department was interested in leasing premises at Homebush Bay. She enquired as to whether Mr Jones was able to attend a meeting at the Department's offices at North Sydney on 24 April 1998 to discuss the Department's requirements. A positive response was made by Mr Jones.

21 On 24 April 1998 at 3pm Mr Jones met Ms Spencer and also a Mr Peter Freeman at the premises of the Department at North Sydney. Mr Jones made a file note of that meeting. That file note only merely advances my knowledge of what occurred by stating that the Department had need to rent 2,500 square metres of office space.

22 On 4 May 1998 Mr Jones attended a meeting with Mr Kymbal Dunne, a director of Pact Property Pty Limited, a real estate agency. Mr Jones had engaged Pact Property Pty Limited to find a tenant for the existing building and also a potential tenant for the proposed new building. Mr Dunne was charged with visiting the facilities of Sports House at Wentworth Park and the Institute at Homebush Bay for the purposes of ascertaining their space requirements. Both Mr Jones and Mr Dunne visited those two venues on 4 May 1998.

23 In approximately mid-May 1998 Mr Dunne telephoned Mr Jones and there was a conversation to the effect that the Institute might take space in the property. Mr Dunne advised that he would arrange a meeting with officers of the Institute.

24 On 27 May 1998 Mr Dunne wrote to Mr Jones as a director of the first defendant a letter, the first part of which is in the following terms: "I confirm that the NSW Institute of Sport has postponed today's meeting. Another meeting is expected in the ensuing two weeks. At that time and subject to Phil Coles' availability your Architect may be required to properly explain the new development. In the interim I will be attempting to meet with Michael Scott, the executive director, to better qualify [sic] the requirement [sic]. I would like you to return the executed agency agreement as soon as possible."

25 The letter merely goes on to explain why Mr Dunne required the agency agreement. He pointed out that it was to facilitate his involvement in trying to obtain the Institute as a tenant and very coyly does not point out that it would be necessary to enable Mr Dunne's company to earn a commission.

26 The evidence of Mr Jones indicates that a further meeting was scheduled between Mr Dunne and officers of the Institute during the first week of June 1998 but there is no evidence that that occurred or why it did not occur.

27 Mr Jones' first contact with the plaintiff was in early 1998. That contact was with a Mr Chris Snaith in relation to a proposed purchase of an adjoining property known as 8 Figtree Drive. That purchase did not proceed.

28 In or around September 1998 Mr Snaith telephoned Mr Jones enquiring as to whether he was looking for tenants for the existing building and the proposed new building. Mr Jones said that he was and Mr Snaith asked for Mr Jones to provide him with details. Mr Jones said that he would and he did. He did that in a letter dated 12 October 1998 which appears to have been sent by facsimile transmission to the plaintiff on 15 October 1998. The letter of 12 October 1998 addressed to Mr Snaith at the plaintiff referred to the prospective tenant as "Tech Pacific". Not only was there an initial letter bearing date 12 October 1998 but also an amended letter.

29 On 9 December 1998 there was a meeting at the property between Mr Jones, an officer of Tech Pacific and an officer of the plaintiff. Later on that day Mr Jones sent to the plaintiff a letter containing a proposal to be put on behalf of the defendant to Tech Pacific.

30 On 11 December 1998 the plaintiff, through Mr Snaith, provided to the defendant the plans that Tech Pacific had made for its building requirements. Early in the following year Tech Pacific decided not to proceed with the proposed lease of the new building.

31 In February 1999 it appears that the plaintiff introduced to the defendants a proposed new tenant, Metal Manufacturers. There is reference in the documents before me to a facsimile transmission from the plaintiff to the defendant of 16 February 1999 and to some telephone discussions thereafter culminating in a letter of 24 February 1999 from the first defendant to the plaintiff outlining the first defendant's proposal of the proposed lease to Metal Manufacturers.

32 On 26 February 1999 the plaintiff forwarded to the defendants a leasing agency agreement which had been dated 25 February 1999 by Mr Garry Pearce of the plaintiff. That document was executed by Mr Jones as a director of the first defendant. However that agreement is not the one relied upon in these proceedings.

33 It would appear that the proposed letting to Metal Manufacturers was dropped in either March or April of 2000 because the proposed lessee withdrew from the negotiations. That withdrawal motivated the defendants to extend the lease of ACPE until 29 February 2000. That extension was granted in April 1999.

34 In approximately mid-November 1999 Mr Jones received another telephone call from Ms Marie Spencer. Ms Spencer said words to the following effect: "I have been in touch with Wayne Prior, director commercial services, SOPA, on 9 September 1999 to ascertain the possibility of [the Department] and [the Institute] being able to take space in the existing building. Would you be able to attend a site inspection with [the Department and the Institute]?"

35 On 24 November 1999 Mr Jones attended a meeting with Mr Michael Scott and Mr Bill Gillooly. The evidence discloses that Mr Gillooly was the Director-General of the Department and also a member of the Board of the Institute and that Mr Michael Scott was the Chief Executive Officer of the Institute. It should be clear from what I have said about the Institute of Sport Act 1995 that the Director-General of the Department of Sport and Recreation is ex-officio a member of the Board of the Institute.

36 Mr Jones made a file note of his meeting on 24 November 1999. The file note is to the following effect: "Met with [Mr Gillooly and Mr Scott] to show them the site and give the overview of the project. [Mr Scott] is the Chief Executive Officer NSWIS and [Mr Gillooly] is Director-General, Sport and Rec. He is looking for a site to house all major State sports bodies including NSWIS, Sports House and [the Department] viewed plans and discussed timing, [Mr Gillooly] asked for a set of plans to be sent to him for further analysis. [Mr Scott] invited me to view his existing facilities, [Mr Gillooly] left us and [Mr Scott and Mr Jones] inspected NSWIS. [Mr Scott] introduced me to Bob Cantley [who is] the finance person at NSWIS. [Mr Cantley] asked for Ziani to provide outgoings, costs and rental for existing building with a view to taking a lease over it until new building completed."

37 On 30 November 1999 Mr Jones, on behalf of the first defendant, forwarded to Mr Gillooly the development application approved plans for the new building. In a letter of 30 November 1999 Mr Jones pointed out that construction could commence as early as November 2000 should a pre-commitment be entered into by the Department and that completion of the construction would be due approximately twelve months after the commencement of construction.

38 On the same day a letter was sent by the defendants to Mr Michael Scott at the Institute giving certain information about the existing building and pointing out that as requested Mr Jones had sent copies of the new building to Mr Gillooly. Mr Jones, in that letter, pointed out that there was no objection to there being a short term lease of the existing building if that would facilitate the Institute taking space in the new building, together with the Department.

39 On 30 November 1999 there were two telephone conversations, at least. Mr Jones phoned Mr Cantley about the existing building, pointing out that most of the current financial data were available but that it may be necessary to estimate some for the short term. Mr Cantley said words to the effect that the information available was sufficient at the current time to see "if there is momentum within the Board to seek Government approval and funding". That quotation is from Mr Jones' file note. One can see from that that the Institute was subject to Government approval and funding.

40 On the same day Mr Jones received a telephone call from Ms Marie Spencer. She advised Mr Jones that she had spoken to some other senior public servant about the idea of relocating all sports groups to the property. That senior public servant, Mr Davis Gwyn, supported the concept according to Ms Spencer. Mr Gwyn had also been aware of the concept from another person whose name is identified in a memo in a file note of 30 November 1999 but whose position has not been explained to me. Ms Spencer had spoken to that gentleman on 9 September 1999 to seek a direction. According to Ms Spencer that person supported the project.

41 Ms Spencer went on to give information to Mr Jones about the space requirements of the sporting bodies. The Department had 150 people working for it at its premises at Miller Street, North Sydney. There was also Sports House and also the Institute. There were four regional offices at Burwood, Liverpool, Hurstville and Parramatta. The Department occupied 1,921 square metres, Sports House occupied 2,338 square metres and the Institute occupied 2,500 square metres. The total, according to the memorandum (I have not checked the mathematics) was 6,759 square metres, plus, according to the memo, one or more of the regional offices. The memo goes on to add a note that the Department had a lease until October 2001.

42 On the same day, that is 30 November 1999, the defendants forwarded to Mr Michael Scott of the Institute a letter giving the current approximate annual outgoings of the existing building and providing other information which might be pertinent to a lease of the existing building. Again an offer was made by the defendants that there was no objection to the entering of a short term lease on the existing building if that would facilitate the occupation of the new building by the Institute and the Department. The letter of 30 November 1999 was sent by facsimile transmission on 3 December 1999.

43 In early May 2000 Mr Jones received a telephone call from Mr Joseph Ali, an employee or officer of the plaintiff. Mr Ali advised Mr Jones of a potential tenant for the new building. According to Mr Jones' witness statement the following conversation occurred: "Mr Ali: We have a blue chip tenant to whom I have shown the existing building from the outside. They are interested in having an internal inspection. Is the building available? Me: Yes, who are they?

Mr Ali: I need to have an agency agreement signed and then I will tell you. Me: What is it with Colliers, they already have two executed agreements. Does every individual agent need a separate agreement? Mr Ali: No, but I've looked in the files and I can't find one."

44 In his second witness statement Mr Ali denied that the conversation described by Mr Jones occurred. According to Mr Ali the conversation went thus: "Ali: I have a tenant relocating from the south-western Sydney market he's after around 2000 square metres of office space with 70-80 car spaces. I would like to take them through but want you to sign an agency agreement before I do so. Jones: Okay."

45 Mr Ali goes on in his second witness statement to explain why he asked for the agency agreement and that was because the Real Estate Institute required that there be an agency agreement prior to a prospective tenant being shown premises owned by a landlord. Mr Ali's witness statement goes on to say this: "At no stage did Mr Jones ever say to me words to the effect of those set out in the paragraph beginning 'What is it with Colliers...' and did not ever tell me that he had already executed two agency agreements with Colliers. Further, I did not say [and would not have used] words to the effect of those set out in the paragraph beginning 'I need to have an agency agreement...' as I do not show such disrespect to clients or potential clients."

46 This is not the only disputed conversation in the current matter. Essentially the protagonist in the current matter is Mr Joseph Ali, the only witness called in the plaintiff's case. The antagonist is Mr Jones, the only witness called in the defendants' case. I am required to resolve factual disputes concerning conversations which took place between Mr Ali and Mr Jones.

47 Mr Ali spent very little time in the witness box. He was called and sworn at 11.15am on 16 February 2006. His evidence-in-chief was merely to aver that the statements that he had made, exhibits A and B, were true and correct. Cross-examination then commenced. That cross-examination commences at the foot of p 16 of the transcript. At the foot of p 20 of the transcript the morning tea adjournment was taken. I assume that it was the usual hour of 11.30am. After leaving the witness box Mr Ali became extremely unwell and I caused the Court file to be noted that the witness had collapsed. The matter was then adjourned.

48 On 1 January 2005 Mr Ali had fallen ill. That illness was due to a malignant tumour on the left side of his brain. Mr Ali came under the care of a neurosurgeon, Professor Michael Besser, who resected the tumour from Mr Ali's brain on 27 January 2005. Pathological examination identified the tumour as being a Grade III anaplastic astrocytoma. After that surgery Mr Ali came under the care of Professor Martin Stockler, a consultant medical oncologist. For ten months following the surgery, that is throughout 2005, basically, Mr Ali underwent radiotherapy and chemotherapy. Mr Ali remains under Prof. Stockler's care. According to Professor Stockler, Mr Ali's presenting symptoms were a complex seizure due to the underlying tumour. Since the surgery Mr Ali has had further seizures despite being prescribed an anti-convulsant. According to Professor Stockler there has been improvement with the passage of time and serial scanning of Mr Ali's brain does not show any evidence of recurrence of the tumour or any adverse progression of the tumour.

49 Mr Ali was taken from this courthouse to the Royal Prince Alfred Hospital on 16 February where he was observed and underwent scanning of his brain. He made a steady recovery over the ensuing few hours. The repeated CT scan of Mr Ali's brain showed no evidence of any new problem. According to Professor Stockler what happened to Mr Ali at court was entirely consistent with a generalised complex brain seizure. According to Professor Stockler psychological stress is a well described precipitant of such seizures in those prone to them.

50 In a report of 6 March 2006 Professor Stockler advised that he had no doubt that the stress of Mr Ali's appearing in court had contributed to the seizure occurring. The substance of Professor Stockler's report of 6 March 2006 ends with this: "Joe has done well following treatment for his brain tumour, however he remains at substantial risk of a recurrence and progression. He will remain prone to seizures indefinitely. The risk of a seizure would be increased by psychological stress. I recommended that he avoid such stressors if possible."

51 When the matter came before me on 17 March for directions I, in effect, excused Mr Ali from further cross-examination because it would have been inimical to his health. Certainly that was what the plaintiff requested. My excusing Mr Ali from further cross-examination was opposed by the defendant. I granted the defendant leave to administer interrogatories to Mr Ali, if the defendant wished to do so, and made other orders concerning interrogatories. I then fixed the further hearing of this matter to commence on 17 July, which it did.

52 The defendant did administer some interrogatories to Mr Ali and they have been admitted into evidence as exhibit 2. Mr Jones was required for cross-examination and was essentially in the witness box for the best part of two days. It ought be apparent from what I have just said that I saw very little of Mr Ali and I saw very much of Mr Jones. Mr Jones' evidence has been the subject of prolonged and sustained testing in cross-examination. The evidence of Mr Ali has not.

53 When the matter recommenced before me last Monday an application was made by the defendant that I, in some way, strike out or ignore the evidence of Mr Ali. For reasons which I gave at the time, I dismissed that application. However the fact remains that the extent of the weight that I can give to the evidence of Mr Ali in the circumstances is circumscribed. It is a question of what weight I might give to the evidence of Mr Ali.

54 This matter has been considered by the Court of Appeal in Amalgamated Television Services Pty Limited v Marsden [2002] NSWCA 419 between paragraphs 144 and 208. The circumstances in which the witness Lilburn, in Amalgamated Television Services, ceased being cross-examined are very different to the circumstances that have unfortunately befallen Mr Ali. However, clearly there are issues which must be determined between the evidence of Mr Ali, such as it is, and the evidence of Mr Jones.

55 The first thing that I can say is that I have heard Mr Jones over an extended period and thought him to be a careful witness, and I formed no adverse impression of him at all. Indeed, I formed the view that he was probably quite an astute businessman, and he certainly was prepared to make admissions which might be thought to be contrary to, not only his own interests, but those of his company. The only defect that I could detect in the evidence of Mr Jones was a reluctance to admit the involvement of Mr Ali in furthering relationships between the defendant and the Institute and the Department. Although clearly Mr Jones admits that Mr Ali is entitled to some remuneration for his work, that reluctance may be due to the naturally occurring resentment which cases of this nature often arouse. On disputed issues I am therefore quite happy to repose confidence in the evidence of Mr Jones.

56 I must give lesser weight, therefore, to the evidence of Mr Ali whom I have not had the benefit of seeing for any length of time, and whose evidence has not been tested by way of a prolonged cross-examination. Perhaps prolonged is the wrong word, the appropriate adjective is thorough. However there are other indications in the evidence before me that cause me to have reservations about the evidence of Mr Ali. For example the evidence now establishes that undoubtedly the first contact between Mr Ali and Mr Jones was certainly in or after March 2000 and more probably than not in May 2000.

57 There was no dispute on the evidence that ACPE vacated the existing building after the expiry of its lease on 29 February 2000, in or about March 2000. The existing building was then available for rental. Paragraph 2 of the first statement of Mr Ali contains the following matter: "I first met Ray Jones in mid to late 1999, when Colliers was asked to find a tenant on his behalf for the space now occupied by the Department of Sport and Recreation ("DSR") at the only then-existing building at 6 Fig Tree Drive, Homebush Bay. Mr Jones, another two officers of Colliers (Gary Pearce and Sean Lennon) and I were present on that occasion and undertook an inspection of the existing premises. At the time, the premises was [sic] vacant and for lease due to the previous lessee, Australian College of Physical Education ("ACPE") having vacated the premises."

58 Paragraph 4 of the same statement then goes on to say that Mr Ali next met Mr Jones in about mid-May 2000. After the service of Mr Jones' statement dated 6 December 2005, a second statement of Mr Ali was made dated 11 January 2006. In paragraph 2 of that statement Mr Ali said this: "In regard to paragraph 26, I accept that what Mr Jones says about the occupancy of the premises by ACPE in mid to late 1999 may be correct and it may be that I first met with Mr Jones at the premises around May 2000. However, I do recall that the meeting referred to in paragraph 2 in my earlier statement took place at a time when the premises were vacant and after ACPE had vacated the premises."

59 There now seems no doubt that the first meeting between Mr Ali and Mr Jones could not have occurred in 1999, but more likely than not occurred in May 2000. The next thing to note is that unfortunately Mr Ali has had major brain surgery following a life threatening illness. One would expect some cognitive deficit to result from such major surgery. In exhibit 2, the interrogatories verified by Mr Ali, Mr Ali conceded that it was true that the treatment afforded to him had adversely affected his memory. The way in which it was adversely affected is not spelt out in the interrogatory. According to Mr Ali's second statement, he said that he told Mr Jones words to the following effect; "Part of my memory has gone, being essentially the part to do with music, so I can't remember, for example, the names of the songs of U2, one of my favour bands, but 99 per cent of my work memory is okay."

Mr Ali accepts that there has been some cognitive impairment but often the problem with cognitive impairment is that those who suffer from it are unaware of it.

60 If one's memory has failed one, one does not know about what the failure has been. That is commonly seen in elderly people who suffer from senile dementia or Alzheimer's disease or the like, commonly when people tell the same story repeatedly, forgetting that they have told a person that story before. How does one know what one has forgotten if one has forgotten it? I must therefore be cautious in approaching Mr Ali's recollection of events, especially that is so when, for example, one comes to the essence of the issue before me, whether there was an agreement between Mr Ali and Mr Jones to accept half the usual commission for rendering assistance rather than full commission for introducing a lessee because of disputed conversations which Mr Ali says did not occur. In that regard I bear in mind what occurred when an account was sent by the plaintiff to the defendant and the defendant failed to pay the account.

61 In para. 115 of his statement Mr Jones stated that on 2 March 2005 Mr Robert Gishen of the defendant, came to his home. Mr Gishen is the State Director of Metropolitan Commercial Leasing for the plaintiff. The only inference which I can draw is that Mr Gishen is in fact much superior to Mr Ali in the plaintiff company. At the meeting on 2 March 2005 Mr Jones showed Mr Gishen his file concerning, I assume, the property going back to 1998, including correspondence between Mr Ali and Mr Jones regarding what Mr Jones described as the "agreement to pay 50 per cent of the fee". Mr Gishen said that after seeing Mr Jones' file that he would "need to speak with Joe and seek more information". Joe is clearly a reference to Mr Ali.

62 In para. 116 of his statement Mr Jones said that on 7 March 2005 Mr Gishen telephoned him and there was a conversation to the following effect; "MR GISHEN: I have spoken with Joe and he has no recollection of the 50 per cent agreement. ME: I know he told me he has lost part of his memory, but this is ridiculous."

The conversation continued about other matters not currently relevant. The important point to know is that Mr Ali had admitted to Mr Gishen of having no recollection of the 50 per cent agreement and Mr Ali now denies that it happened. There are of course a number of possibilities. One is that his memory was then affected by the surgery and adjuvant chemotherapy and radiotherapy and that it has somehow returned. However, equally the possibility is open that there has been a reconstruction by Mr Ali of what must have occurred and the next point to note is that it is clear from a number of places in Mr Ali's statements that what he speaks of is based not on what his actual memory was but what his usual practice was and what would have been said. That is clear from what I have already quoted from Mr Ali about the initial conversation between Mr Jones and Mr Ali. In other words there is reconstruction based on normal or suspected usual practice.

63 Finally on this issue, there are on most of the occasions to which I need make reference, file notes made by Mr Jones which are in effect contemporary records and on crucial matters no file notes at all made by Mr Ali when he has at times made file notes which have made their way into evidence. Mr Ali's personal circumstances excite the Court's sympathy and would excite anyone's sympathy. However I have to decide the issues raised before me. I have already made comment about how I perceived the evidence of Mr Jones and I have also pointed out matters concerning the evidence of Mr Ali. I am led to the inevitable conclusion that where there is any dispute based solely on disagreement between Mr Jones and Mr Ali, that I should prefer the evidence of Mr Jones, tested as it has been to the evidence of Mr Ali which, in essence, has not been tested.

64 I return to the matter I was discussing before I needed to discuss the general effect of the evidence of Mr Jones and Mr Ali. I return therefore to the conversation between Mr Jones and Mr Ali that occurred in early May 2000 according to Mr Jones. I accept Mr Jones' version of what occurred. There is some corroboration in any event for that because material before me does disclose an earlier agency agreement between the defendant, meaning the first defendant, and the plaintiff, that leasing agency agreement dated 25 February 1999 that lends credence in my view to Mr Jones' evidence that he already had to execute agreements with Colliers and also credence to his statement that Mr Ali said he had looked in the files and could not find one. If he had looked through the files and found one there would be no need to obtain another. That also in my view has bearing on another issue which will arise in due course as to missing documents.

65 The plaintiff, through Mr Ali, sent to the defendants on 25 May 2000 a facsimile transmission enclosing a letter of that date and also a leasing agency agreement which has upon it the typed date of 25 May 2000. Mr Jones executed that agreement on 26 May 2000 and transmitted it by facsimile transmission to the plaintiff on that date, 26 May 2000. The covering transmission sheet also asks for confirmation of a time for a proposed internal inspection of the existing building with the prospective tenant so as to enable Mr Jones to plan his week. The proposed tenant was Phillips Projects Australasia. An inspection was held on 31 May 2000. After that inspection the plaintiff forwarded to Mr Jones a letter bearing that date confirming that the inspection had taken place and as to what might happen in the future. A proposal was then prepared by a Mr Jones on behalf of the first defendant to be presented to Phillips Projects Australia or Phillips Projects Australasia. The evidence discloses both names. On 17 July 2000 the plaintiff advised the defendants that that proposed tenant did not wish to proceed with a lease. Nothing further of any significance occurred in the year 2000.

66 On or about 9 March 2001 the Department executed a lease of the existing building. The plaintiff was not involved in any guise in the negotiations between the Department concerning the letting of the existing building. The lease commenced on 1 April 2001. According to Mr Ali's statement the lease was negotiated between the Department and Mr Jones directly, without the involvement of Colliers. That is common ground but the only addition made to the current enquiry by Mr Ali's statement is that there would not appear to have been the intervention of any agent.

67 On 19 March 2001 Mr Jones received a telephone call from Ms Marie Spencer who has earlier been described as the deputy director of the Department. According to Mr Jones' statement the telephone call concerned the letting of the proposed new building. That is confirmed by a letter of 21 March 2001 from the defendants to Ms Spencer concerning the proposed new building at the property. On 8 April 2001 Mr Jones had a telephone conversation with Ms Spencer. She advised Mr Jones that she had had discussions with the Director General of the Department and that the Department were very interested in renting the new building but needed to know the cost of that in dollar terms. The file note of Mr Jones continues thus; "I said it would depend on the amount of space in square metres and if there are any unusual requirements, eg if NSWIS has special floor, special air et cetera. She said disregard requirements allow as normal tenancy, also to include Sports House plus a library currently located at Narrabeen. Sports House is 3,300 square metres including 1,800 square metres of office areas plus the additional library which would be enlarged and upgraded if relocated to Homebush, so allow 700 square metres total for DSR around 4,000 square metres plus NSWIS 3,500-4,000 square metres. I suggested that I would take out all the new building and suggested a meeting with her, the [Director General] Mr Jones and Steve Camillo to discuss plans and layouts. She agreed it would be best way forward and said Easter would be best. I reminded her of the tight time constraints and she acknowledged the urgency. I brought up the idea of a coffee shop/café on the ground floor and she thought it an excellent idea."

68 It has been noted that Mr Steve Camillo is an architect engaged by the defendants, no doubt in the planning of the new building. On 24 April 2001 there was another meeting with Ms Spencer, a Ms Stephanie Cross of the Department and Mr Camillo. The meeting was held at the premises of the Department, presumably in the existing building. At the meeting Mr Camillo laid out the plans for the new building and explained the concept, finishes and the timing of construction. He asked for input from the Department and from the Institute as to their requirements. The members of the Department were asked to keep a copy of the plans to circulate "to all involved parties" for input. Ms Spencer advised that she was still awaiting on the Director General "to progress the matter". She told Mr Jones that the Director General was meeting with the Minister "shortly" and would bring it up with him for an indication of his views on the matter.

69 There was a further telephone conversation between Mr Jones and Ms Spencer on 17 May 2001. Ms Spencer advised that she had spoken to the Director General and he supported the proposal. She advised him that the Director General was keen to bring "all aspects of sport under one roof". She told Mr Jones that the Director General was on the board of the Institute and that they came under the same Minister, so that made things look favourable. She advised that the Director General was still waiting to have a meeting with the Minister and she would let Mr Jones know if the proposal had the support of the Minister. The proposal clearly was that the proposed new building be let essentially to the Crown to enable the proposed new building to hold the Institute, the entity known as Sports House and perhaps the balance to be let to other elements of the Department.

70 On 21 June 2001 Mr Jones made a telephone call to Mr Bruce Hawker who is a lobbyist. On the evidence before me, Mr Hawker was a former Chief of Staff of a former Premier of this State, the Honourable Robert Carr. Mr Jones asked Mr Hawker about his potential to assist with the concept of housing all the government sports bodies on the property. Mr Hawker advised that he would make enquiries with the Minister's Chief of Staff to "test the waters". He said he hoped to obtain an indication of the priority of the concept, presumably with the Minister and establish if there was government funding available.

71 On 25 June 2001 the defendants sent to the plaintiff at the request of Mr Mark Zouroudis of the plaintiff, a letter giving details of the proposed tenancy of the existing building. It may well be that Mr Zouroudis had obtained an expression of interest from a prospective lessee for accommodation in the Olympic Park area.

72 On 27 June 2001 Mr Jones received a telephone call from the lobbyist Mr Bruce Hawker. Mr Hawker advised him that he had spoken to the "right people" and that the proposal to house all the sports bodies in the one building had approval in principle but that no government funding had been allocated and the matter was not seen as having a high priority. Mr Hawker promised to continue to "monitor the situation".

73 On 7 August 2001 Mr Jones met Mr Zouroudis and Mr Ali at the property to discuss the prospective tenancy of the Spotless group. Mr Zouroudis said he would speak further with the Spotless group and asked for a proposal from Ziani to put to that proposed tenant.

74 There was a further telephone discussion with Mr Zouroudis on 9 August 2001 concerning the proposed tenancy for Spotless. On 9 August that day Mr Zouroudis sent to the defendants a letter which contains the following: "Thank you for taking the time to meet Joe and myself during the week. It was great to finally catch up to discuss your site at Homebush in general. As discussed, I can now nominate Spotless Services Limited as the potential tenant regarding the brief I sent you.

I have passed on your comments regarding the possibility of creating some warehouse area. I am planning to meet them next week to discuss further.

I would appreciate your acknowledgement of our introduction of Spotless Services."

75 On 14 August 2001 Mr Jones sent, on behalf of the first defendant, a facsimile transmission to the plaintiff acknowledging its "introduction" of Spotless Services Limited as a prospective tenant for the new building. There were further transactions between the plaintiff and the defendants in August 2001 concerning the proposal of Spotless Services Limited but that company did not enter into a lease for the new building and it appears that their interest expired in perhaps September 2001.

76 In approximately early November 2001 Mr Ali received a telephone call from Mr Ralph Doubell, the new CEO of the Institute. According to Mr Ali, Mr Doubell said words to the following effect: "The Institute is looking for some office accommodation and I have seen your signboard in regard to QUAD II."

According to Mr Ali, during the conversation he had with Mr Doubell he said to him words to the effect that he was able to advise him of other leasing opportunities in or around Homebush Bay. Mr Ali said that he arranged to meet Mr Doubell at his office. QUAD II was a development at 8 Parkview Drive at Homebush Bay. On 14 November 2002 Mr Doubell and Mr Ali met at the premises of the Institute at Homebush Bay at the athletics field. Following upon that meeting Mr Ali sent a letter to Mr Doubell of November 2001. In that letter he enclosed floor plans and property particulars in regard to the QUAD II building at 8 Parkview Drive Homebush Bay and also regarding the property. He also provided information on industrial buildings in Carter Street that could be refurbished or altered to suit the Institute's requirements. Attached to that letter were essentially brochures or fliers concerning QUAD II, the proposed new building at the property and properties known as the Orix Building, the Institute Broadcast Centre, both at Carter Street Homebush, an unidentified building known as 7 Carter Street at Homebush Bay, a Uniting Church site on the same street and a property at 1 Hill Road at Homebush. It is to be noted that Mr Doubell's enquiry to Mr Ali was instigated by a sign that Mr Doubell saw on the QUAD II building and then Mr Ali offered to Mr Doubell information concerning a number of properties, the inference to be drawn being that the plaintiff was the agent for all of the properties referred to in the annexures to the letter of 19 November 2001.

77 According to Mr Ali some time between 19 November 2001 and 23 November 2001 he advised Mr Jones by telephone that he had met with Mr Doubell and arranged an inspection of the site of the new building. According to Mr Ali Mr Jones did not say anything to him at that time about any previous discussions that he may have had with personnel from the Institute or with any person from the Department regarding a possible tenancy of the new building by the Institute.

78 According to Mr Jones the following was the conversation in which Mr Ali first mentioned the Institute: "MR ALI: I have had a call from Ralph Doubell at NSWIS, who are looking for space in Homebush Bay and they asked about what options there are in that area. I told them about the new building along with the QUAD.

ME: Joe, you know I've been dealing with DSR and NSWIS for years about this.

MR ALI: But Ralph Doubell contacted me for advice. I think I can push him towards your side.

ME: The deal is this is not an introduction of NSWIS for the leasing commission. However, if Colliers assist in negotiations with NSWIS and NSWIS takes a lease of the new building, Ziani will pay Colliers 50 per cent of the leasing commission, so by all means nominate them. If Colliers introduces a tenant for the new building who is not currently in negotiations with Ziani for a potential lease, like Spotless for example, Ziani will pay Colliers 100 per cent of the leasing commission.

Further in his statement Mr Jones says that Mr Ali did not communicate to him at any time prior to the inspection of the property by the Institute that he had arranged such an inspection. He said that he did not attend any inspection on 19 November 2001 and that the inspection was carried out without his prior knowledge. In other words the evidence of Mr Ali is his first contact with Mr Jones about the Institute was prior to the inspection on 19 November 2001 to advise him that he had arranged an inspection at the site. Mr Jones denies any knowledge of the inspection before or at the time of its occurrence. However Mr Jones' evidence is that antecedent to that inspection, perhaps there was a conversation between him and Mr Ali about the Institute and its interest in the new building.

79 In my view the probabilities favour Mr Jones not having been advised of the inspection by the Institute. In my view it is likely that if the Institute wished to inspect either the existing building or the site of the proposed new building, Mr Jones would have done his best to attend it or if he were unavailable, to have rescheduled the inspection so that he could be available. The probabilities also favour that Mr Ali might now believe that he had advised Mr Jones about the inspection prior to its occurrence because that would be the normal procedure.

80 On 23 November 2001 Mr Ali sent to Mr Jones a letter which does refer to an earlier telephone discussion and confirms that the New South Wales Institute of Sport has carried out an inspection via Colliers on 19 November 2001. He goes on to advise Mr Jones that the proposed tenant required approximately 3,500 square metres of accommodation comprising an office, a laboratory and a gymnasium. He points out that the Institute had requested funding from the Treasury of New South Wales and anticipated that it would be available in the first quarter of the year 2002. Mr Ali asked Mr Jones to provide him with full scale floor plans which he would send on to the Institute.

81 The evidence before me does not contain any reply to the plaintiff's letter of 23 November 2001. The evidence does not suggest that Mr Jones sent to the plaintiff floor plans for the new building which the plaintiff could pass on to the Institute. A query arises as to what the "recent telephone discussion" is that is referred to in the letter of 23 November 2001. It may represent a telephone conversation on that day or at some time either before or after 19 November 2001, accepting as I do, the evidence of Mr Jones that he was not advised before the inspection that it was to occur. It appears to me more likely that the telephone discussion referred to by Mr Ali in the letter of 23 November 2001 occurred some time after the inspection on 19 November 2001 and prior to his penning the letter of 23 November 2001. It may be that the conversation set out by Mr Jones in para. 58 of his statement occurred in that telephone conversation. If it did, it will only reinforce a finding to which I shall refer later.

82 On 29 November 2001 Mr Ali sent two letters to the defendants, one about the Quad II building, another about a building at C Homebush Bay Drive Road, advising of successful negotiations concerning those properties and advising the length of the lease and the amount of rental and the size of the letting. No doubt this information might be of utility to somebody trying to rent out property.

83 On 26 November 2001 Mr Jones received a call from Mr Charles Turner, the deputy Chief Executive Officer of the Institute. The file note generated by Mr Jones is this: "Had a call from [Charles Turner] to inquire how we are progressing with DSR re new buildings. They could be interested with or without DSR. They appear to be fed up waiting on DSR and are investigating going solo. The basic requirement is for 2500 square metres of office and 6-800 square metres for a gym. They has[sic] been in contact with Joe Ali from Colliers to ask what are their options in Homebush. Given a list of the usual suspects including us. I said I would be happy to come and meet with them to see how to progress the matter."

84 It is significant in my view that this is an approach directly by the Deputy Chief Executive Officer of the Institute to Mr Jones without the intervention of Mr Ali, and at a time when there is no evidence that Mr Ali had disclosed to the Institute Mr Jones' details. The inference to be drawn is the contact was made because of previous contact between Mr Jones and the officers of the Institute. Furthermore, the conversation recorded in the file note indicates to me that Mr Turner knew of previous dealings between the Department and the defendants concerning proposed accommodation for the Institute on the defendants' property. One can understand that the officers of the Institute might be "fed up" waiting for some response from the Department but it is clear from what I have earlier recited that both the Deputy Director of the Department and the Director General of the Department and some other senior public servant had all tried to obtain space for the Institute and the Department in the new building and that it appeared to have some "in principle" agreement from at least the Minister's staff and the funding was a perennial government problem, a lack of funding. One might be forgiven for thinking that if the Department could not obtain the funding directly from its Minister for the Institute that the Institute might have problems doing it without the Department's intervention. Furthermore, the file note confirms that that approach to Mr Ali was about options at Homebush and that a number of sites were mentioned by Mr Ali as is clear from Mr Ali's letter to the Department of 19 November 2001. Everything recorded in the file note indicates to me that the contact was made by Mr Turner on behalf of the Institute with Mr Jones because of prior dealings between the Department and the Institute and Mr Jones and not because of the mediation or intermediation of Mr Ali.

85 On 4 December 2001 Mr Ali sent an email to Mr Doubell seeking to arrange a meeting between the owner of the building at 6 Figtree Drive, Homebush and Mr Doubell at the site. Mr Ali asked for some times that might be convenient for Mr Doubell to attend such a meeting. Significantly, the email does not refer to Mr Jones, does not refer to Ziani, but refers to them anonymously. That meeting took place on Friday 2 December 2001. The meeting occurred at 2.30pm. Present were Mr Doubell, his deputy Mr Turner, Mr Ali and Mr Jones. The file note prepared by Mr Jones is this: "Met with the above at NSWIS premises to discuss the prospective tenancy - again!. [Ralph Doubell] seems to think he can move forward without DSR and that he is able to deal with parties without going to [an expression of interest]. He said that funding for the tenancy should be forthcoming in the New Year. They have had some space planning done and it appears their requirement is 3695 square metres. He will get back in touch in the New Year. Spoke after the meeting with [Joseph Ali] to say we will accept his involvement with NSWIS but not DSR. Agreed to 50 per cent of scale if he is of assistance with NSWIS. Should a different tenancy occur through Colliers, i.e. Spotless, then 100 per cent scale applies."

86 The conversation that Mr Jones had with Mr Ali after the departure of Messrs Doubell and Turner is denied by Mr Ali. That denial must be seen in the context of Mr Ali having communicated to Mr Gishen in March 2005 that he could not remember any such conversation. The file note made by Mr Jones is a contemporaneous document. There was no suggestion that it was a recent fabrication. I accept that he states accurately what occurred at the meeting in two parts, that is the meeting with the officers of the Institute and the meeting solely between Mr Jones and Mr Ali. I believe it likely that that conversation is that more fully set out by Mr Jones in paragraph 58. However, clearly Mr Jones is of the view that a similar conversation occurred on two occasions. I am therefore prepared to accept that it did occur on approximately two occasions and it seems likely to me that the conversation that occurred referred to in paragraph 58 of Mr Jones' statement occurred in the telephone call between 19 November 2001 and 23 November 2001. Mr Jones, in his witness statement, expands somewhat the conversation referred to in the file note of 7 December 2001. It sets out this in paragraph 61 of his statement: "Me: As I told you two weeks ago, we will accept your involvement with NSWIS for the new building but not DSR as they are already a tenant. We will pay Colliers 50 per cent of the scale if they are of assistance with NSWIS. If a different tenancy occurs through Colliers, we will pay you 100 per cent of the scale. As to NSWIS, you're going to have to help and add value to the deal, otherwise, why do I need you? Mr Ali: I can help because Doubell needs to be seen to be looking at all his options for probity reasons, so I am sure I can assist you." 87 The opening words used by Mr Jones in that conversation do suggest the earlier conversation as having occurred between 19 and 24 November 2001, which was approximately two weeks prior to 7 December 2001.

88 In each of the two conversations there was no dissent by Mr Ali from the proposal put to him by Mr Jones that if he provided assistance to the defendant in obtaining a lessee for the new building and that tenant being the Institute that he would pay fifty per cent of the commission that would otherwise be payable if Mr Ali had introduced a lessee.

89 Mr Ali has conceded that the prior dealings between the Institute and the defendants were mentioned at some time by Mr Jones but that was not until some time in May and probably late May 2002. In my view that is highly unlikely. If there had been earlier dealings and the Institute was known to Mr Jones one would expect in normal circumstances for him to have mentioned that at the beginning of or towards the beginning of any conversations that Mr Ali and Mr Jones had. It does not have the ring of truth to suggest that Mr Jones would delay for over six months in advising Mr Ali of his earlier dealings with the Institute. I therefore accept that in the two conversations to which I have referred Mr Jones did draw to Mr Ali's attention that he had had earlier dealings with the Institute and the Department on its behalf, if that be a proper way of dealing with the matter. It seems more probable than not to me that this would have occurred at the first time Mr Ali mentioned the Institute to Mr Jones and that is Mr Jones' evidence. I accept it.

90 After the inspection on Friday 7 December 2001 Mr Ali wrote to the defendants on Tuesday 11 December 2001 referring to the inspection on the previous Friday. The letter continues thus: "As indicated during the meeting the prospective tenant requires 3000 square metres - 3500 square metres of commercial accommodation and it is understood that the premises would be used for administration/ training and coaching of professional athletes with a gym which would not be open to the public. Funding has been requested from Treasury and we anticipate a favourable decision will be made prior to Christmas. Full size floor plans have been requested and once received I will forward the same to the tenant."

91 The first thing to note about that letter is that the information it conveyed is not as accurate as the information contained in Mr Jones' file note. Mr Jones's file note contains the exact amount of space required by the Institute, 3695 square metres, rather than providing the range suggested by Mr Ali. Furthermore, Mr Jones' file note says that the funding "should be forthcoming in the New Year" whereas Mr Ali's letter indicates the decision would be made "prior to Christmas" which appears to me to be unlikely. It should also be noted from that letter that again full size floor plans were requested by Mr Ali in order that he could forward them to the Institute, the same request having been made on 23 November 2001 and clearly not responded to. On this occasion it appears that the floor plans were provided to Mr Ali and he sent them to Mr Doubell under cover of letter 12 December 2001.

92 On 21 December 2001 Mr Ali sent an email transmission to Mr Jones. In the first paragraph of that transmission he advised that the Institute was having another meeting with the Treasury on 21 January 2002 regarding funding. Mr Ali advised that he would be in contact with the Institute on 22 January to find out what happened following the hand in cap approach to Treasury on 21 January. The email continues: "Would you care to confirm the nomination of NSW Institute of Sport by Colliers Jardine by responding to this email at your earliest convenience."

93 On that day the defendants sent an email transmission to the plaintiff the first sentence of which is the following: "We acknowledge your nomination of the NSW Institute of Sport as a prospective tenant for our proposed building in Figtree Drive."

I shall have more to say about that exchange of correspondence later.

94 According to Mr Ali, he had a meeting with Mr Turner and Mr Doubell at the Institute's then premises on 21 January 2002. The file note is undated. It may be that the meeting occurred on 22 January 2001 after the meeting with Treasury scheduled for 21 January 2002 and on 22 January 2002 as Mr Ali had proposed in his email of 21 December 2001. The first thing recorded in the file note is that funding for the relocation was "to be approved" in early February 2002. Obviously the approach to Treasury on the previous day had been unsuccessful. Amongst other things, he goes on to record the preference of the Institute to have all its requirements housed in one building with ground floor accommodation being available for disabled clientele. It appears that meeting was not merely to further the interests of the defendants, but also to seek to satisfy the requirements of the Institute.

95 On 25 January 2001 Mr Ali sent to Mr Doubell, at the Institute, an email headed 'Leasing Opportunities', including a spreadsheet of properties for his consideration. At the top of the spreadsheet is the property now in question, followed by the Quad at Parkview Drive, followed by premises at 15 Carter Street, premises at 31 Carter Street, and premises at 302 Hill Road at Homebush.

96 On 31 January 2002 Mr Jones met with his architects to discuss with them the interior design of the new building, with the requirements of the Institute in mind. The file note generated at that time confirms the Institute's needs of 3695 square metres space.

97 On 11 February 2002 a file note was generated by Mr Ali concerning a conversation he had with Mr Doubell. Mr Doubell advised Mr Ali that funding was to be approved "this week" and that a board meeting would be held on 21 February 2002 to consider the possibilities of leasing.

98 On 14 February 2002 Mr Zouroudis, of the plaintiff, wrote to Mr Jones asking for Mr Jones' advising of any developments that were occurring in discussions then underway between the defendants and the Sydney Olympic Park Authority and also an identity known as DUAP which counsel has suggested might represent Department of Urban Affairs and Planning. Whether it is or not, I do not know, nor is it important that I do.

99 On 19 February 2002 a meeting took place which was attended by Mr Jones, his architect and interior designer, and Mr Doubell and Mr Turner. The meeting was about "space utilisation". The party toured the Institute's current premises to assess its needs and in order to prepare a space plan reflecting the needs of the Institute within the physical constraints of the defendants' proposed building. The file note generated at the time indicates that "they" will report back within a couple of weeks. Whether that was the architect and interior designer or officers of the Institute I do not know, but the former seems the more likely.

100 On 22 February 2002 Mr Ali faxed to Mr Jones a proposal for a lease which Mr Jones might send to the Institute.

101 On 26 February 2002 a proposal addressed to Mr Doubell and signed by Mr Jones on the stationery of the first defendant was sent to the Institute. It appears to have been sent both by Mr Jones to the Institute directly with a copy sent to Mr Ali, who then sent a further copy on to Mr Doubell.

102 On 21 March 2002 there was a conversation between Mr Doubell and Mr Ali, the first word of which is "postponed". It appears that any decision had been postponed. It records that the Institute had the Department's approval in place and that there was a "75 per cent chance", whether that was a 75 per cent chance of the proposal coming into effect in total or a 75 per cent chance of it coming into place at the end of March is unclear from the file note. However, it does indicate that there should be some negotiations by mid April of 2002.

103 On 30 April 2002 Mr Ali sent to Mr Jones an email transmission. It referred to a conversation on the previous day between Mr Ali and Mr Doubell. Mr Doubell had advised that he had met with officers of the Department of Public Works and Services in the previous week and had subsequently toured all the short listed sites in the Homebush Bay area with a Mr McIntyre of that Department. The transmission goes on to record that it was expected the Department of Public Works and Services would have a strategy in place "by the end of this week" and it would either be calling for expressions of interest or simply replying to all owners of buildings to carry out a "traditional deal". The transmission records that Mr McIntyre of the Department of Public Works and Services did not feel that it was necessary that the matter should go out to expressions of interest. From the proposed lessee's side of things, things were moving very, very slowly.

104 On 22 May 2002 at 5pm Mr Jones attended a meeting with, inter alia, the Chief of Staff of the Minister, Mr Iemma, at the Governor Phillip Building, in the Minister's office. Representations were made. Mr Jones' frustration was vented and the Chief of Staff said that he would speak to the Minister about the matter. The Chief of Staff advised Mr Jones that he could see the commonsense in bringing "all sport together", by which I infer was meant the housing at the property of both the Department, the Institute, and Sports House, a proposal first made in May 1998, four years earlier.

105 On 28 May 2002 there was a telephone call made by Mr Jones to Mr Ali. The telephone call was made whilst Mr Jones was at his architect's offices. The point of the call was to advise Mr Ali of recent developments as far as the lobbyist was concerned. The file note made by Mr Jones continues: "General discussion re tenancy and had to remind [Joseph Ali] of the agreement on fees after he spoke about his desire for a fee re DSR. I ruled this out and reiterated that no fee is payable on DSR and should he continue to be of assistance re NSWIS he'll get a fee [50 per cent]. Reminded him that if [Rural Fire Service] or Spotless leased [sic] through Mark Zouroudis and Colliers then full fees apply."

106 That remuneration was discussed in that telephone conversation there can be no doubt. Immediately after it Mr Ali sent a facsimile transmission to Mr Jones in the following terms: "I refer to our recent telephone conversation and confirm that Colliers International will agree to a 50 per cent leasing fee should the Department of Sport and Recreation execute a lease agreement on 6 Figtree Drive, Homebush Bay. The above agreement is separate to the 100 per cent fee Colliers International will be paid should NSW Institute of Sport execute a lease for 6 Figtree Drive, Homebush Bay. The following is the break up for both tenants: New South Wales Institute of Sport 100 per cent of the Colliers International scale of fees and charges. Department of Sport and Recreation 50 per cent of the Colliers International scale of fees and charges. Would you care to provide me with a letter confirming the above. In the meantime should you have any queries please feel free to contact me on [telephone number]."

107 The first thing to note about the developments of 28 May 2002 is that the contemporaneous file note of Mr Jones says that he rang Mr Ali rather than Mr Ali phoning Mr Jones. Mr Ali's statement contains the following matter commencing at paragraph 28: "Shortly after the above conversation [with Mr Doubell], I telephoned Mr Jones to raise the opportunity of leasing part of the premises to the DSR. I knew that the DSR were an existing tenant of Mr Jones in the then existing building at 6 Figtree Drive. We had a conversation to the following effect: ALI: I had a conversation with Ralph Doubell recently. He told me the DSR's current premises are inefficient and they are experiencing HR issues and they are keen to move out. There is a chance to acquire the DSR and the NSWIS as tenants of the premises at the same time. JONES: If you can do that, it would be great. You realise however that the DSR are an existing tenant of mine and you would only be eligible for 50 per cent of the ordinary leasing fee should they become tenants. ALI: Yes, I understand that. I agreed with what Mr Jones suggested because this is a commonly-negotiated arrangement in commercial leasing agency agreements - namely that an agent will only receive an agreed proportion of its usual commission if it arranges for an existing tenant of a landlord to sign a new lease with that landlord in different premises from the one it currently occupies."

108 According to Mr Ali's statement the conversation had with Mr Doubell was about the possibility of securing Sports House, an aspect of the Department of Sport and Recreation from the premises at Wentworth Park. One will recall that that was part of the proposal first mooted in 1998.

109 The first thing about what Mr Ali says is that he telephoned Mr Jones. The contemporaneous records says otherwise and the contemporaneous record is more likely to be accurate. Secondly, the contemporaneous record states that the purpose of the telephone call was to bring Mr Ali up to date with developments as far as the lobbyist was concerned. Mr Ali says it was to advise Mr Jones of the fact that he might be able to obtain a Sports House through the Department as another tenant for part of the new building. Why Mr Doubell, who was the CEO of the Institute and although probably an employee of the Department, should take up the interests of another aspect of the Department is not clear. In any event, this proposal had long been mooted and would have been well known to Mr Jones. The contemporaneous record clearly indicates that the conversation was about the lobbyist's activities. Of course, the facsimile transaction of 28 May 2002 from the plaintiff to the defendants is explicable if that conversation occurred. It is also explicable if the matter had to be raised with Mr Ali again about fees as Mr Jones' contemporaneous file note says.

110 In answer to paragraph 28 of Mr Ali's statement Mr Jones said this in his statement: "The conversation did not take place as set out in that paragraph. On 28 May 2002 I telephone Mr Ali from the office of Leffler Simes, architects, to bring him up to date with my discussions with the various parties. After updating Mr Ali, we had a conversation to the following effect: "MR ALI: I had a conversation with Ralph Doubell recently. He told me the DSR's current premises are inefficient and they are experiencing HR issues and they are keen to move out. There is a chance to acquire the DSR and the NSWIS as tenants of the premises at the same time. ME: You're not telling me anything I don't already know. I've told you already that we did not recognise Colliers involvement with DSR, that we do not recognise Colliers involvement with DSR, but if you can assist with NSWIS you get 50 per cent of the fee. If you or Mark Zouroudis can secure Rural Fire Service or Spotless, you can 100 per cent. MR ALI: It was worth a try."

111 I accept the version of Mr Jones of what occurred in the conversation supported as it is by the contemporaneous file note. Mr Ali made no file note at all. It is clear that Mr Jones received Mr Ali's facsimile transmission. Mr Jones's witness statement goes on to say this: "After the telephone conversation referred to above, I received a fax dated 28 May 2002 from Mr Ali. The facts did not record accurately my discussion with Mr Ali. I received the fax in the afternoon when I called into my home with my father. He advised me to respond immediately, but there was a power outage so being unable to type a fresh letter, I hand wrote my comments: "No Joe - I said 50 per cent for NSWIS, not DSR", on the fax. I was due to collect my son, and being unable to fax the letter from home due to the power outage, my father offered to fax it for me whilst I left to collect my son. I believe he later faxed it from his home although I cannot be certain. He gave me the fax transmission sheet next time we met. A copy of the fax together with the 'sending confirmation' is attached and marked WW."

112 The copy of the facsimile transmission from the plaintiff to the defendants is before me as well as a copy of that endorsed with Mr Jones' handwritten comments.

113 The first thing I should say about this is to decry the use of the words "power outage" for what is traditionally known as a blackout. Outage is as monstrous word which should be expunged if it has ever been included in the Queen's English. Unfortunately, Mr Jones' father has died and is not available to give evidence. Mr Jones, senior, died on 1 October 2003 so there was no possibility of his having prepared a statement or the like because no dispute arose until 2005. The facsimile sending confirmation does show a transmission to the plaintiff's fax machine on 28 May at 5.05pm. It would appear that the plaintiff sent its facsimile transmission to the defendant at 1.50pm. Mr Ali says that Mr Jones' facsimile was never received by him and there is a general denial by the plaintiff of its receipt.

114 In a letter from the general manager of Legal Services of the plaintiff of 17 March 2005 a statement is made that Colliers International had never received the document. Of course it is possible that the document was received and destroyed or that it was received and lost, or that it was received and misfiled, or that perhaps somebody thought it was merely a copy of some earlier transmission, and put it in the waste paper basket.

115 Significantly, the plaintiff has not introduced any sworn evidence on this issue other than the statements of Mr Ali which he averred on oath were true and correct, but whose evidence has not been tested, unfortunately, because he was unable to be cross-examined.

116 Equally, the evidence does establish that something was sent to the plaintiff on 28 May 2002 at 5.05pm, but the plaintiff has been unable to produce some other document, for example, that might have been sent to it by or on behalf of the defendants. Furthermore, there was no cross-examination of Mr Jones to the effect that some other document was transmitted than the one he said he asked his late father to transmit. I accept that it was transmitted by Mr Jones senior at the direction of Mr Raymond Jones and that it was sent to the plaintiff's fax machine.

117 A significant failing, in my view, in the plaintiff's case is this. The last line of Mr Ali's transmission to the defendant of 28 May 2002 seeks a confirmatory letter. The defendants were at no time pressed thereafter to provide a confirmatory letter. One would think that if money or remuneration was in dispute that one would be eager to tidy up any misunderstanding, hence the need for a confirmatory letter. The fact that Mr Ali did not press for a confirmatory letter suggests mightily to me that he had received Mr Jones' facsimile in reply and thought it would be futile to press the matter further.

118 Before continuing with narrative of events I should indicate at this stage that the evidence discloses that leasing arrangements for any State government body appear to have been arranged at this time through the Department then known as the Department of Public Works and Services, or the DPWS. Subsequently it appears that that role was undertaken by the Department of Commerce.

119 On 25 June 2002, Mr Jones received a telephone call from Mr McIntyre of the Department of Public Works and Services who advised him that it had been decided that there be an expression of interest for the requirements of the Institute and the Department. Mr McIntyre was unable to give Mr Jones a timetable as to when the expression of interest proposal would be published and Mr Jones found it necessary to make some arrangements for Mr Camillo, his architect, to deal with an expression of interest proposal if it occurred whilst he was away on a planned holiday to China. Mr Jones sent a facsimile transmission to Mr McIntyre on that day reiterating his interest and giving him contact numbers for Mr Camillo during his absence. It is of interest to note that that facsimile transmission confirms that the interest of the Department was in respect of Sports House as well as the Institute.

120 A file note made by Mr Ali on 9 August 2002 indicates that a new Director General for the Department was about to be appointed and hence there was delay in advertising for expressions of interest.

121 On 28 August 2002, Mr Jones and Mr Ali met for lunch at the Novotel Hotel to discuss leasing activity in the Homebush Bay and inner western areas. Mr Jones expressed his frustration with the lack of progress of the proposed tenancy of the Institute and Mr Ali told Mr Jones that Mr Doubell had no authority essentially to enter into a lease and had no approval as yet from Treasury, no doubt for the funding.

122 On 2 September 2002, Mr Ali sent a facsimile transmission to Mr Doubell at the Institute. It concerned short term leasing opportunities and the cover sheet indicates that there had been a "recent inspection" of the QUADII building. The facsimile transmission enclosed eleven flyers for properties in the Homebush Bay area.

123 On 5 September 2002, there was a conversation between Mr Ali and Mr Doubell. Mr Doubell advised Mr Ali that the DPWS had agreed to retain a firm of Cann Finch as project managers to advise the Department on the design, space analysis and the like. Apparently that had already been agreed by the Institute. The file note remarks that "co-location is still in plan", co-location of course, having been the proposal first mooted in 1998.

124 A file note made by Mr Ali on 11 September 2002 records that expressions of interest were now not to be invited but there would be invitations to tender and that might happen towards the end of October 2002.

125 On 15 October 2002 Mr Ali had a conversation with Mr Doubell. Mr Doubell advised that a meeting was to be held on 16 October at the Treasury office with officers of the Treasury, the DPWS, and the Department to discuss funding for the relocation.

126 The file note continues: "This funding is imminent and requires Morris Iemma (Minister) to have this approved and signed off prior to the election".

127 The file note also indicates that there had been no change to the proposed timetable and it was still expected that invitations to tender would be issued at the end of October 2002. A file note of 28 October 2002 indicates that there again had been delay because any decision by Treasury had been postponed to 9 December. It seems that at that time Mr Jones proposed to have a meeting with the Minister shortly thereafter. There is no evidence that any meeting between Mr Jones and the Minister occurred.

128 On 3 December 2002 there was a meeting at the then premises of the Institute between Mr Doubell, his deputy, Mr Turner and Mr Jones. The officers of the Institute expressed their frustration with a push to move them into the SOPA building. Mr Doubell suggested that Ziani should lodge a proposal directly with the Minister, the Director-General of the Department and with the Institute that would be too attractive for those authorities to ignore. It appears that Mr Doubell advised Mr Jones that that might be the only way to prevent the proposed move to the SOPA building taking place. Mr Jones agreed to do so.

129 On 4 December 2002 Mr Jones, on the first defendant's stationery, and on its behalf, wrote to Mr Doubell with a proposal and also to the Minister enclosing a copy of the proposal to the Acting Director General of the Department again enclosing a copy of the proposal and to the Manager of the Government Leasing Service with the DPWS again enclosing the proposal. Copies of those were not only forwarded by hand or by mail but were sent by fax and were copied to Mr Ali.

130 On 18 December 2002 Mr Ali made a file note about a conversation that he had with a person whose identity is not clear to me. However the intelligence gleaned in that conversation Mr Ali passed on to Mr Jones. Te substance of the file note is this: "Not dead but needs a bit more time. Outside chance it may go to open market, however SOPA has powerful friends."

131 On 14 January 2003 Mr Ali had another conversation with Mr Doubell. Mr Doubell advised that SOPA had a specific site in mind for both the Institute and I infer Games House and that it was unlikely that they would be able to look at anything else. Mr Ali also had a conversation with the other gentleman to whom I have recently referred who advised that any dealings would be at arm's length and that the Acting Director General of the Department was disappointed that Mr Jones had sent an offer out to the Department uninvited.

132 On 7 April 2003 there was a meeting between Mr Ali and Mr Jones. They met to discuss the progress of the proposed lease. Mr Jones' file note continues thus: "He told me SOPA had secured NSWIS and DSI in a building to be built near Indoor Sports Centre. Beyond his control, the decision has been taken. It will be a 10,000 square metre building 4.5 per cent rating. He will look for other tenants. I expressed my frustration and told him I was meeting with Brett Burridge at the office of a prospective purchaser. He suggested one last try to secure a tenant by doing a direct mail out with a brochure and new signboard. I said to come back with a costing and numbers. I said Colliers can pay for the sign - he agreed."

It would appear that by that stage the proposed letting of the new building by the Institute was at an end, certainly the suggestions and subsequent activity of Mr Ali suggest that he at least thought the matter was at a dead end.

133 On 13 June 2003 Mr Jones met with Mr Charles Turner again to discuss the chances of the Institute renting space in the new building. Apparently Mr Turner advised Mr Jones that his property was the choice of the Institute but that a direction was coming from the Government to commit to the new SOPA building. Mr Turner undertook to keep Mr Jones informed as to progress one way or the other. Para 83 of Mr Jones' witness statement contains the following matter which is relied upon not only by the defendant, but also by the plaintiff. The following passage occurs after Mr Jones referred to the meeting on 13 June 2003: "Whilst this was our only official meeting during 2003, we spoke by telephone every six to eight weeks regarding the progress of securing NSWIS as tenants. In August 2003, I met Mr Turner at a social function we both attended and we discussed the progress of NSWIS taking the lease."

134 On 10 November 2003 Mr Ali had a telephone conversation with Mr Turner. Apparently Mr Turner advised Mr Ali that SOPA had agreed to build a building to house inter alia the Institute. Mr Turner went on to tell Mr Ali that if that did not proceed ("falls over") then it would be necessary for the Institute to go back to the open market.

135 On 9 March 2004 there was another meeting between Mr Jones and Mr Ali. Mr Ali suggested selling the site might be the best option as both he and Mr Jones had tried all avenues to obtain a pre-commitment for the new building which was still then only proposed. There was then reference to Mr Ali's preparing a "marketing proposal". That marketing proposal was made and it was for the sale of 6 Figtree Drive, Homebush Bay. It is a document of twelve pages which is annexed to Mr Jones' statement. It is dated merely April 2004, the exact date is not known to me.

136 On 14 April 2004 one year and seven days after the meeting between Mr Jones and Mr Ali occurred which suggested to Mr Ali, I infer, that the prospect of obtaining the Institute as a tenant was at an end. Mr Turner telephoned Mr Jones. Mr Jones was then in Port Douglas. Mr Turner advised Mr Jones that a SOPA building was no longer an option and that the defendant's building was now "favourite". Mr Turner requested a meeting with Mr Jones in order to advance the matter. Arrangements were made for that meeting to take place on 30 April at 3pm. Prior to the meeting Mr Turner and Mr Ali had some conversations. On 23 April 2004 Mr Turner advised Mr Ali that funding had been approved by Treasury but the "Sports House" project had been cancelled as a result of a Government mini-budget. Apparently the amount of money required for Sports House to be moved into the building to be occupied by the Institute was too much.

137 There is a file note made by Mr Ali which bears the dates "29/4/04 to 11/5/04", it is very difficult to be certain when the file note was made or when the matter referred to in it was communicated to Mr Ali. However there is reference to a meeting with a Mr Turner of the Institute, Mr Lester Stump of the Department of Sport and Recreation and reference to Mr Mark Vickers of the Department of Commerce. There is reference to 4,000 square metres of space required by the Institute and 4,000 square metres of space required by the Department. There is then mention of "a right of first refusal" for the remainder of the building. A notation was made that Mr Vickers was to call Mr Jones.

138 The meeting 30 April 2004 took place at the Institute's then premises at Homebush Bay at 3pm. The file note made by Mr Jones is this: "Met with [Charles Turner], he told me his Board had met yesterday (Thursday) and voted to enter negotiations with us exclusively re tenancy for approximately 4,000 square metres. He confirmed advice from Government that due to construction on our site, that no need for [expression of interest] as deemed an existing structure. He will be briefing Department of Commerce re authority to negotiate on behalf of NSWIS. He said he wants to fast track the negotiation and hopefully be in new building September '05, end '05. Alan Jones, Phil Coles and Bill Healey, Director General, want me to meet on site - he will arrange timing. I informed him of my absence from Sydney 17 to 23 May."

Mr Coles, a well-known sporting identity, is Chairman of the Institute and Mr Alan Jones is the Deputy Chairman, he is the well-known broadcaster. Things appeared to have moved relatively swiftly thereafter. On 6 May 2004 there was a meeting between Mr Jones, Mr Turner, Mr Camillo, Mr Jones' architect, and officers of Cann and Finch about the laying out and other aspects of the construction of the new building.

139 On 7 May 2004 there is a telephone call from Mr Charles Turner to Mr Jones. Mr Turner confirmed that he had had a meeting with Mr Mark Vickers of the Department of Commerce and as a result of that meeting Mr Turner had some concerns and wanted to meet Mr Jones to discuss the matter. Mr Jones said he would got to Mr Vicker's office. The file note of that conversation indicates that a meeting with members of the Board of the Institute was schedule for 1 June 2004. On 1 June 2004 members of the Board of the Institute did meet to inspect the site. Present at inspection were Mr Alan Jones, Mr Phil Coles, Mr Charles Turner, Mr Lester Stump of the Department and Mr Bill Healey, Director General of the Department. The meeting with Mr Vickers occurred on 11 May 2004 at the McKell Building in the City. Mr Vickers asked for a written proposal.

140 In an e-mail transmission of 11 May 2004 to Mr Jones, Mr Ali advised that Mr Vickers had advised him that the Department of Commerce would be dealing with the owners of three buildings, one of which was that of the defendants. Mr Ali suggested ways of trying to make his proposal more acceptable to the Department of Commerce. A formal proposal was eventually put by the defendants to Mr Vickers on 9 June 2004. That followed on the meeting of 1 June 2004 at the site. Either that or a subsequent document was a "second proposal". The second proposal was discussed at a meeting on 16 June 2004 with Mr Vickers of the Department of Commerce and also Mr Lester Stump of the Department. Mr Vickers raised a memo from the then Premier, the Honourable Robert Carr, concerning building ratings. Mr Vickers advised that the building only need be three star rated. A bank guarantee amount was agreed and the rental rate was agreed at that meeting. That generated a further proposal which was formally sent to Mr Vickers on 18 June 2004. It is clear that there was input into that proposal by Mr Ali.

141 There was then some further correspondence between the defendants and the Department of Commerce ending with a formal proposal by the Department of Commerce of 24 June 2004. The defendants accepted that proposal by facsimile transmission on that date. The proposal was of course not binding and subject to the execution of a development deed, an agreement to lease, and leasing documentation. Eventually that all occurred.

142 An exclusivity deed was executed between the first defendant and the Crown on 2 July 2004. The agreement to lease the new building was executed on or about 23 November 2004. There was obviously much shuffling of paper between June and the final execution of the documentation. It is clear that Mr Ali played a significant role in helping to progress the paper shuffling exercise. Of course, the main paper shufflers were lawyers.

143 It is clear that not all of the new building was the subject of the initial lease but that the Crown was granted a right of first refusal of the remainder of the area of the new building. The evidence from Mr Jones is that that right of first refusal was exercised by the Crown and that the new building as well as the existing building now contain the offices of the Department, the premises of the Institute and another Crown tenant who may or may not be Sports House.

144 On 22 December 2004 Mr Ali sent an E-mail to Mr Jones. It commences with again expressing congratulations on the successful letting to the Institute. The E-mail continues: "I actually went through my file today and realised that we had our first meeting with the CEO (Ralph Doubell) and Charles Turner, late 2001, so essentially this deal took three years in the making. Scary, but most large transactions take between one-two years and there is always an eleventh hour crisis and we had plenty of those due to you-know-who. Anyway, know [scil. now] that this deal is done and I will be sending the invoice out later this week,..."

The e-mail goes on to making proposals about letting the remaining space in the new building. On 27 December 2004 a letter was addressed by Mr Ali to Mr Jones enclosing an invoice. The invoice was for $314,150 98 including GST. That was calculated on the basis of "a successful leasing fee". It is based on a hundred per cent of the leasing fee for the area occupied by the Institute 4,800 square metres.

145 Mr Jones was overseas between 26 December 2004 and late January 2005. He did not receive the letter of 27 December 2004 and the attached invoice until his return from overseas. On his return from overseas Mr Jones also received an e-mail transmission from Mr Ali. The first part of the e-mail contains pleasantries relating to Mr Jones' recent holiday. The next part of the e-mail outlines the unfortunate health problem of which Mr Ali developed symptoms on New Year's Day. The rest of it is discussion about business matters, essentially Mr Ali was asking for a meeting to discuss business. Mr Jones stated that in mid-February 2005 he received a telephone call from Mr Ali. The conversation was to this effect: "Mr Ali: I am out of hospital now. I have lost about ten per cent of my memory and I am undergoing ongoing treatment following my surgery. Have you paid the invoice? Me: No. We agreed to fifty per cent commission for NSWIS if you provided assistance. Mr Ali: Why don't we meet at Rhodes Business Park to discuss this invoice?"

There was then a meeting at Rhodes. What was discussed at the meeting is highly contentious. According to Mr Ali the meeting occurred on 21 February 2005. Mr Ali said this occurred: "Ali: Have you managed to organise payment of the fee for the NSWIS transaction? Jones: I will get it to you soon. Although, how about I pay Colliers fifty per cent of the fee, and pay you 60-65,000 on the side? If you can convince Colliers to accept fifty per cent of their fee, I will give you $60-65,000. Ali: No, I am sorry, that's not the way I operate. Jones: At least raise with Colliers that they will get 50 per cent of their fee".

Mr Ali says that there was another telephone conversation on the following day to this effect: "Jones: Have you had a chance to consider the fifty per cent offer we discussed yesterday? When you get the $65,000 you can put it in your own company. Ali: I don't have a company, this sort of thing is unethical and illegal. Did I not do the right thing on the NSWIS project? Jones: No, I am very happy with your work. Have a think about it and ring me tomorrow".

Mr Ali also says that there was a telephone call on the second day after the Rhodes meeting where this occurred: "Ali: Ray, could you please pay the fee for the NSWIS project. I haven't raised the 50 per cent offer we discussed. The full leasing fee has been due for a few weeks now. Jones: I don't know what you are talking about. We always agreed to 50 per cent of the fees".

146 In essence Mr Ali attests to highly unethical behaviour by Mr Jones and when that highly unethical proposed conduct was rejected by Mr Ali, Mr Jones then protested that the agreement had always been fifty per cent of fees. The problem with that is that it completely ignores the contemporaneous file notes made by Mr Jones on 7 December 2001 and 28 May 2002. It is clear from contemporaneous file notes as well as from what Mr Jones has told me on his oath that his position has always been that if the tenancy with the Institute was successfully obtained that the plaintiff would be paid 50 per cent of the usual commission. The version put forward by Mr Ali seems to suggest that the fifty per cent agreement was a recent invention on the part of Mr Jones. It was not.

147 Mr Jones' version of events is this: "The purpose of meeting Mr Ali at Rhodes was not to talk about leasing opportunities or view Rhodes, it was to discuss the invoice. I believe that the invoice had been raised in error while Mr Ali was in intensive care. The conversation as outlined in paragraph 6 of Mr Ali's statement did not take place. Upon my arrival at Rhodes Business Park, I saw Mr Ali standing by the roadside so I stopped and he got into my car. By Mr Ali's appearance and demeanour I could tell he was not well. He commented on my car and I told him I was selling it because my new car was arriving shortly. After general discussion as to his health and prospects for recovery, we had a conversation to the following effect: Mr Ali: When are you going to pay the leasing fee? Me: Firstly, why did you send the invoice out two days after I left the country, knowing I would not be back until the end of January? Secondly, you know the figure is wrong. The correct fee is to be fifty per cent of the scale fee for NSWIS if you provided assistance. Mr Ali: But the company's expecting the full amount. They budgeted it into the forecast. Me: That's not my problem. You know full well that you are only to receive 50 per cent for NSWIS, or have you forgotten? Mr Ali: My memory is not what it was. Anyway, I am worried about providing for my family in case something happens to me. I only get 40 per cent of the fee; Colliers keeps the rest. Me: I am very sorry to hear about your illness, but the agreed fee is the fee. Mr Ali: Well, can you pay me some of the commission in cash? Me: You must be kidding. Besides I don't have cash just lying around. Mr Ali: Could you give me your car and I could sell it to raise cash rather than you trading it in. Me: No. Just fix up your mistake. I then drove Mr Ali to his home, as he has no alternative mode of transport. His wife had earlier dropped him off and due to his brain illness he was unable to drive himself".

Mr Jones then goes on to say this of the next telephone conversation, he said he telephoned Mr Ali. The conversation was not as stated by Mr Ali. The conversation was to this effect: "Me: Joe, have you fixed up the mistake? Mr Ali: I have been thinking, you're in the building game, maybe you could pay some money to my brother's, or cousin's - [I cannot now recall whether Mr Ali mentioned brother or cousin] company supposedly for work done and he could pay it to me. Me: Joe, this is not right, I thought about it last night. You disappoint me and I won't be part of it. Just tell Colliers you made a mistake with the commission amount".

Mr Jones' version of the telephone conversation on the following day is this: "Mr Ali: I haven't raised the matter of the commission with Colliers as we discussed. It's too late. They think that is what they are entitled to and that is what they have been expecting. Me: Like I said yesterday, that's not my problem. They are due what was agreed to and you know it".

Mr Jones' versions of events is that Mr Ali had been painted into a corner by his employer and was concerned that his own income would be affected and that he made unethical approaches to Mr Jones for financial assistance.

148 The first thing to say is that in any matter of this nature a court must be very circumspect in making adverse findings, that is the Court must be concerned with the standard of proof, see for example Briginshaw v Briginshaw.

149 Mr Jones has been extensively cross-examined as I have said and I said that I formed a favourable impression of him. Mr Jones denied what Mr Ali stated in his statement, in his, Mr Jones' statement. Mr Jones was formally challenged in cross-examination on Mr Ali's versions of events but maintained his denial of Mr Ali's version and nothing in his demeanour or the like, or anything that he said, would persuade me that the imputations made against Mr Jones by Mr Ali were correct.

150 Equally Mr Ali has not been cross-examined about the allegations made against him by Mr Jones except that he denied them in his second statement which is exhibit B.

151 Suffice it to say that all I need to find and all I do find is that the subject of the invoices was raised and that Mr Jones raised the earlier agreement alleged by him of the 50 per cent commission and that Mr Ali was unable to do anything to correct the position because it would affect him financially. I do not clearly accept the suggestion of recent invention which is the inference to be drawn from Mr Ali's version of events. Furthermore this conversation, according to Mr Ali, took place on 21 February 2005, about four weeks after he underwent brain surgery on 27 January 2005 and when he would have been the recipient of both chemotherapy and radiotherapy. One would think it unlikely by that stage Mr Ali had returned to work, let alone be soliciting work from Mr Jones. It appears to me more probable than not the reason for the meeting was in fact to discuss invoices. Mr Ali denies being unwell at the time, but he does admit, for example, that his appearance was unusual since he had a shaved head and a substantial surgical scar on his scalp.

152 The plaintiff's first claim is in contract. The contract relied upon is the leasing agency agreement, executed by the plaintiff on 25 May 2000 and by the defendant on 26 May 2000.

153 Clause 2.1 of the agreement is in the following terms: "The agent is not authorised to lease the Principal's interest in the property but to find and introduce to the Principal such one or more persons as they consider might be acceptable as a Lessee to the Principal".

154 Clause 8.1 of the agreement is in the following terms: "The Principal or their duly authorised representative acknowledge that where the agent prior to the termination of this agreement introduce to the Principal a person ("the Lessee") who: (a) executes either any Agreement to Lease, or Lease of the Property, or procures another person to execute either any Agreement to Lease or Lease of the Property, irrespective of by whom such documents are prepared; or (b) enters into possession of the Property or procures another person to enter into possession of the Property; or (c) pays rent for the Property or procures another person to pay rent for the Property, including, without limitation, any assignee from a Lessee of the Property (or any part thereof); the Agent shall upon the happening of any one of the events stipulated in (a), (b) or (c) above be forthwith entitled to be paid the full leasing fee being calculated as a percentage of the average annual rent (as defined in the schedule overleaf) reserved under the lease hereunder:"

The leasing agency agreement is a copyright printed form produced by the Real Institute of New South Wales.

155 The essential requirement for the plaintiff to obtain commission is that the agent introduces to the principal a person who effectively becomes the lessee. Here the lessee is the Institute. The essential question for my determination is, did the plaintiff introduce the Institute to the defendants?

156 The meaning of the word "introduce" is not without authority. Importantly it was considered by the Court of Appeal in Big Brother Movement Limited v Richard Stanton & Sons Pty Limited [1988] NSW Conveyancing Reports 55-434. The appellant was a charitable body. One of its directors was Mr Stanton, the managing director, of the respondent real estate agents. One of the appellant's properties was ripe for sale. The appellant asked Mr Stanton to explore the possibility of selling that land. Consequently Mr Stanton and the respondent advised the appellant as to what should be sold and the basis for it and suggest the method of sale. In the meantime the Land Commission of New South Wales, known as Landcom, communicated directly with the appellant offering to purchase the land. The appellant informed Landcom that the respondent would be handling the sale and thereafter negotiations were carried out between the respondent real estate agents and Landcom.

157 Subsequently the appellant and the respondent entered into a selling agency agreement in the standard printed form under which the appellant appointed the respondent agent for the sale and promised commission "in the event of the agent introducing a party and proceeded to complete the sale". Landcom completed the purchase and paid for the land. The agent claimed commission and the appellant refused to pay.

158 Newton DCJ found for the real estate agent but on appeal the decision was reversed.

159 At page 57, 928 Mahoney JA (as he then was) applied certain principles of statutory interpretation about the agreement there in question. His Honour went on to say: "What, then, is the interpretation 'introducing' and what did it require the plaintiff to do? 'Introduce' may, according to its context mean any of several different things: cf for example McNamara v Martin (1908) 7 CLR 699; Ryan v Horton 12 CLR 197; Doyle v Mt Kidston Mining and Exploration Pty Limited (1984) 2 Qd.R 386. Two at least of them are relevant for present purposes. It may mean 'making known'; it may involve that X makes known to Y a person previously Y did not know. And, I think, in that sense it may include making him known to Y in a capacity which previously he did not know him to have. But, as the dictionary evidences, the term may mean the 'presenting' of one person to another or the bringing of him to a particular situation. In this sense, the person may be introduced to Y although Y may know of him previously. And, in particular, he may be introduced to Y in a particular character or capacity eg 'I introduce to you the winner' or 'I introduce X as a candidate of the club'. In the present case the term introducing is 'in it's context, not free from ambiguity'."

His Honour went on to consider the particular facts of the case. His Honour was in the minority.

160 Kirby P as he then was said this: "The first issue concerned the meaning of 'introduce' in the respondents' printed form of agency agreement. By clause 2 of that form, the respondents' entitlement to commission was conditional upon its 'introducing a party who proceeds to complete a purchase'. I accept all of the principals for the construction of commercial arrangements which Mahoney JA has collected. But to them I would add to additional considerations. One is of general application, the other is special to the circumstances of this case."

161 The first principal to which his Honour referred was essentially the contra proferentem rule and to the ability of a person such as the real estate agent in that case to have placed a special condition on the printed form.

162 His Honour went on to say this: "The 'introduction' had occurred before the agency agreement was signed. It is difficult to see how, in the circumstances, the agreement, which plainly anticipates an introduction as 'event' taking place after its execution will apply to facts which have preceded that execution. However, even if it did apply to past events, it is necessary to construe the agreement bearing in mind this commercial object. This is to reward with commission the agent who brings together, for the first time in a relevant way, the parties who thereafter proceeded to a settlement. The commercial object is to ensure equity both to the vendor and to the agent. The vendor who completes a purchase with a party who has been introduced by the agent should be not entitled to evade the payment of commission simply by purporting to terminate the agency agreement. But equally, the agent who has not initiated the original contact which eventually proceeds to the completion of a purchase should not secure the commission which is conditional upon that vital first contact. This is not a theoretical problem. Agents typically advertise real estate on behalf of vendors. Often they incur considerable costs in doing so. They incur such costs against the chance that they will bring into contact the vendor and the purchaser who proceeds to complete the purchase. The entitlement to commission depends upon the facts proved in each case. Those facts can vary enormously as many earlier cases demonstrate, but achieving the first contact that leads onto settlement is usually the essence of the agent's role."

163 The other judge in majority in that case was Rogers AJA. At 57, 933 his Honour said: "Counsel for the respondent drew attention to a line of authority, recently re-affirmed by the full court of the Supreme Court of Queensland, to the effect that it is possible to "introduce" a person to the property on more than one occasion, (cf. Max Christmas Real Estate v Schumann Marine Pty Limited B (1987) 1 Qd.R 325, especially McPherson J at page 335 and the cases there cited). So much may be accepted. It is only sensible to recognise that the effect of the first introduction to a property may be completely spent, whether by lapse of time, or any other reason, by the time the second introduction is effected and a successful sale made."

164 Further, his Honour said this: "In contrast to the circumstance of the authorities referred to by McPherson J, the interests of the Land Commission never slackened and the effect of the initial "introduction" was neither heightened nor lowered by the so called competition introduced."

165 It ought to be clear from the facts which I have recited that the Department and the Institute are intimately connected. The Director General of the Department is ex officio a member of the board of the Institute. The board and the Institute are under the same Minister of State. The Institute is subject to the direction and control of the Minister just as is any government department. It would appear that the funding of the Institute is largely provided by Parliament. The proposal that the Department, the Institute and Sports House be housed in the one facility or at the same site was first proposed in or about May 1998. That clearly was the policy or perhaps one ought say the advice of the appropriate officers of the Department at an early stage. It appears, if one can rely on the members of the staff of the Minister, to have been within the Minister's purview as well at a relatively early stage. It was also initially the desire of the Institute that it be housed with the Department and the other sports body, Sports House, but it clearly became frustrated with the inevitable delays experienced in trying to obtain relevant funding and priorities from the executive government.

166 The defendants had drawn to their attention the proposal to house all New South Wales sports bodies in the one place in May 1998. Eventually the defendants, without the intervention of the plaintiff, obtained the Department as a lessee of the existing building with effect from 1 April 2001.

167 The first meeting between Mr Jones on behalf of the first defendant and an officer of the Institute was on 24 November 1999 when he met with Mr Michael Scott, then Chief Executive Officer of the Institute and Mr Bill Gillooly, the Director General of the Department of Sport and Recreation who was, ex officio, a member of the board of the Institute. Clearly Mr Gillooly was looking for a site to house the major state sports bodies which included the Institute, Sports House and the Department itself.

168 Thereafter the interest of the Department was re-agitated by the deputy director of the Department on or about 19 March 2001. That clearly was after the lease had been entered into for the existing building where the tenancy actually commenced on 1 April 2001. Then was the time where the Deputy Director General of the Department Ms Maree Spencer clearly met in 24 April 2001, the Department was looking at potential space, both for it and the Institute in the new building. Such was the interest being shown that Mr Jones engaged a political lobbyist. By 27 June 2001 that lobbyist was able to advise Mr Jones that the idea had approval, "in principle". Thereafter there was a lull until Mr Doubell, the new Chief Executive Officer of the Institute contacted Mr Ali sometime in early November 2001 after Mr Doubell saw an advertising sign on the Quad II building. That led to Mr Ali meeting with Mr Doubell at the existing premises of the Institute and inspecting them and then Mr Ali's providing Mr Doubell with information about a number of properties which Mr Ali was in a position to market.

169 On 19 November 2001 officers of the Institute carried out an inspection at the property in the company of Mr Ali. That was unknown to Mr Jones. It is to be noted that at that time the Department of Sport and Recreation, the tenants of the existing building, but the new building, which was only a building site had the same address. It was in the same parcel of land or an adjoining parcel of land. The Institute's then premises were at the athletics field at Homebush Bay, not far distant from the Department of Sport and Recreation Offices at the property and that, if anything, to be inspected could only be the department's own office space or vacant land adjacent.

170 On 26 November 2001 Mr Jones had an approach made to him by Mr Charles Turner, that approach was by telephone and I have discussed that earlier. Suffice it to say on my view and on the findings that I have made on that, contact was made, not because of the intervention of Mr Ali, but because of pre-existing dealings between both the Department and the Institute and the defendants.

171 Thereafter an interest was maintained by the Institute up until at least early 2003 when the Institute was faced with the SOPA proposal. It is clear from the evidence of Mr Jones that even though it was confronted with the SOPA proposal, that officers of the Institute maintained the desire to take accommodation in the new building and after the SOPA proposal "fell over" in April of 2004, contact was reinitiated between Mr Turner and Mr Jones and that led to the eventual agreement to rent the new premises.

172 I am not persuaded on the balance of probabilities that the plaintiff company introduced the Institute to the defendants. To use the formulations referred to by Mahoney JA in Big Brother Movement, the plaintiff did not make known the Institute to the defendant. Furthermore, the plaintiff did not make known the Institute to the defendant in some capacity other than had been originally put to Mr Jones and the first defendant, that is, as a proposed tenant. However, it is clear from the judgment of Rogers AJA that an introduction might be spent or lapsed. Here, the plaintiff submits that the introduction that had occurred antecedent to the involvement of Mr Ali in November 2001 lapsed in early or mid June 2001. The last meeting with an appropriate person, namely Ms Spencer, the deputy director of the Department was on 24 April 2001 and in a telephone conversation with her on 17 May 2001.

173 Mr Jones retained the political lobbyist who provided him with some encouraging news on 27 June 2001 that the concept to house both elements of the Department of Sport and Recreation and the Institute in the new building had received approval in principle from those relevantly concerned, but there was the perennial problem of obtaining money from the government in order that it might be advanced.

174 The plaintiff points out that there is a gap of some five months and that contact was reinitiated by Mr Ali. I am unable to accede to that submission. Firstly, when one looks at the whole scheme of the conduct between the government bodies here in question and the defendant, one sees an extraordinary lengthy period of inaction explicable in many ways by bureaucratic inertia and the perennial cry of government of a lack of money to advance matters.

175 Furthermore, it is clear to me from Mr Turner's call to Mr Jones on 26 November 2001 that contact was initiated not because of some earlier dealing between Mr Ali and Mr Doubell and Mr Turner, but rather because of earlier contact that had been made essentially by deputy director Ms Spencer earlier in 2001 or even from contact before that time by earlier officers of the Institute.

176 There is some inconsistency in the position argued for the plaintiff. I pointed out that by the meeting of 7 April 2003 it might have been thought that the Institute as a tenant for the new building was a "dead issue" because of a direction from "on high" that it be housed in the SOPA building. Clearly, the inference to be drawn from Mr Ali's conduct is that he thought it at a dead end. Nevertheless, it is clear from the evidence of Mr Jones that not only did Mr Jones, but also Mr Turner of the Institute maintain the interest thereafter. That interest was eventually to bear fruit when the SOPA proposal "fell over" some one year later. If the five months period of inactivity between May or June 2001 and November 2001 ought be seen as breaking the earlier introduction or earlier interest of the Institute, then why, pray, would not one year between April 2003 and April 2004 also be seen as breaking the initial introduction that had been effected prior to the involvement of Mr Ali?

177 True it is that the plaintiff was an effective cause in clinching the deal, that is in bringing to perfection the lease of the new building by the Institute. However the plaintiff is only entitled to commission under the contract if it introduces the tenant to the landlord, not if it only helps bring about the end result and clearly the agent in the Big Brother Movement case helped clinch the deal with Landcom but it did not introduce that purchaser to the vendor. There are cases that have been cited to be by Mr Stoljar which discuss the involvement of the agent as being an effective cause. They are, for example, LJ Hooker Limited v WJ Adams States Pty Limited (1977) 138 CLR 52 and Moneywood v Salamon Nominees Pty Limited (2001) 202 CLR 351. In those cases there was no issue that the agent had introduced the relevant party to the vendor. The question was whether that introduction was the effective cause of the eventual sale. Here that question does not arise because the plaintiff has not established that it introduced the Institute to the defendant.

178 The plaintiff claims in the alternative the same amount as would have been due under the contract on the basis of a quantum meruit. A quantum meruit is only available where the work done or services performed were not done pursuant to any contractual arrangement. Since another contractual arrangement is alleged, I do not need to deal with a quantum meruit at this time.

179 The plaintiff's third claim is that an equitable estoppel arises which prevents the defendant essentially from denying the plaintiff's case. For there to be an equitable estoppel the defendant must establish the matters referred to in the judgment of Brennan J in Walton Stores (Interstate) Limited v Maher (1988) 164 CLR 387. The head note adequately sums up his Honour's judgment and I shall merely quote the head note: "To establish an equitable estoppel it is necessary for a plaintiff to prove that: (1) the plaintiff presumed that a particular legal relationship then existed between him and the defendant, or expected that a particular legal relationship would exist between them and, in the latter case, that the defendant would not be free to withdraw from the expected legal relationship; (2) the defendant induced the plaintiff to adopt that assumption or expectation; (3) the plaintiff acts or abstains from acting in reliance on the assumption or expectation; (4) the defendant knew, or intended him to do so; (5) the plaintiff's action or inaction will occasion detriment if the assumption or expectation is not fulfilled; and (6) the defendant has failed to act to avoid that detriment, whether by fulfilling the assumption or expectation or otherwise. For the purpose of the second element, a defendant who has not actively induced the plaintiff to adopt an assumption or expectation will be held to have done so if the assumption or expectation can be fulfilled only by a transfer of the defendant's property, a diminution of his rights, or an increase in his obligations and, knowing that the plaintiff's reliance on the assumption or expectation may cause detriment to the plaintiff if it is not fulfilled, he fails to deny to the plaintiff the correctness of the assumption or expectation on which the plaintiff is conducting his affairs."

180 The second particular delivered by the plaintiff on the claim of estoppel is this: "Represented to the plaintiff that the plaintiff had introduced the lessee to the first defendant (so as to entitle the plaintiff to payment in accordance with the Agreement, if the lessee entered into a lease of the property) by way of the first defendant's letter dated 21 December 2001 in response to the plaintiff's email to the second defendant dated 21 December 2001."

181 Here the defendant did not admit that the plaintiff had introduced the Institute to it. Mr Ali's email of 21 December 2001 asked the defendant to "confirm the nomination" of the Institute by the plaintiff. The defendant on the same day acknowledged "your nomination" of the Institute as a perspective tenant for the proposed building. The defendant was not asked to admit that the plaintiff had introduced the Institute to the defendant. That communication is to be contrasted with the plaintiff's letter to the defendant of 9 August 2001 regarding the "nomination" of Spotless Services in which letter the plaintiff asked the defendant to acknowledge its "introduction" of Spotless Services as a perspective tenant, which acknowledgement was duly given by the defendant on 14 August 2001.

182 Mr Jones would not admit that nomination and introduction were the same thing, nor would he admit that in acknowledging the plaintiff's nomination of the Institute, he was in fact acknowledging the introduction of the Institute to him and to his company. He said he nearly gave back the reply requested because he was asked to do so.

183 I formed the view that Mr Jones was an astute, canny businessman and I accept that he was aware of the technical use of the word "introduce" when used by real estate agents, especially when he would have on many occasions executed agreements with real estate agents for the sale or lease of property.

184 It was submitted by Mr Stoljar for the plaintiff that I should construe the email and letter in question so as to give them "business efficacy" and the only way of giving business efficacy is to read the word "nomination" as "introduction". In the circumstances of this case, I am unable to do so. Clearly Mr Jones saw a difference. Mr Ali has not been the subject of cross-examination in that regard.

185 Furthermore, the request that was made to the defendant by the plaintiff could be construed as merely seeking permission for the agent to continue to deal with this proposed tenant. After all a landlord might refuse to deal with certain persons as tenants, persons, for example, with whom he has previously had an unhappy experience, or where a tenant, for example, might carry on some noisome or unpopular business.

186 Furthermore, the time at which Mr Ali had typed his email must be considered. That was after I accept that there were conversations between Mr Jones and Mr Ali about fees and that it had been clearly communicated by Mr Jones to Mr Ali that he would not pay any commission if the eventual tenant, which was an existing tenant of his, obtained at his own instigation and would pay half of the usual commission to the plaintiff if Mr Ali could be of assistance in Mr Jones's dealings with the Institute.

187 According to the chronology proposed by Mr Ali, and there does not appear to be much dispute about it, Mr Ali would have been dealing with the Institute at this stage for six or seven weeks. It was rather late at that stage to be seeking an acknowledgment of an introduction, especially where fees had already been discussed by Mr Jones and Mr Ali.

188 It appears to be likely that the part of the email asking for confirmation of the nomination of the Institute was an attempt by Mr Ali to perhaps, to use the vernacular, "protect his back" in case there should be further disputation concerning fees. It may be that Mr Jones was aware of that and used the term used by Mr Ali knowing that it might not have the efficacy that Mr Ali thought it might have.

189 Furthermore, the work which Mr Ali continued to do for the defendant as far as the Institute is concerned is explicable by the offer by Mr Jones of half commission if Mr Ali was of assistance in obtaining the Institute as a tenant and is, of course, also consistent with Mr Ali remaining the agent for this proposed tenancy: after all it might have been that the proposed tenancy of the Institute would fail and Mr Ali might be able to find some other tenant, or indeed a better tenant, a tenant at a greater rent.

190 The next particular delivered by the plaintiff is this: "Did not respond to the facsimile transmission from the plaintiff to the first defendant dated 28 May 2002 in which the plaintiff indicated that it would charge at full commission to the first defendant in accordance with the agreement A if the lessee L executed a lease of the property capital P".

191 I have already found as a fact that the first defendant did respond to the facsimile transmission of 28 May 2002. I have already pointed out that that transmission was in response to, again, another discussion between Mr Jones and Mr Ali relating to fees or remuneration in which Mr Jones had reiterated the position he had adopted in November 2001. If the plaintiff has lost or mislaid or destroyed the reply by Mr Jones that cannot be visited on the defendant. Equally, since what the plaintiff was seeking at the time was confirmation, one wonders why the plaintiff did not seek confirmation by pressing for a response if none had been received.

192 The final particular delivered by the plaintiff is this: "At all material times directed and instructed the plaintiff to supply services and carry out work in accordance with the terms of the agreement".

193 Clearly Mr Ali supplied services and carried out work. However, the supply of those services and the carrying out of that work is explicable in the two ways I have already referred, that is by the promise made by Mr Jones to remunerate Mr Ali with half commission and also explicable by the fact that Mr Ali might want to keep this leasing agency agreement on foot and perhaps find another tenant or have the opportunity to do so.

194 I am not persuaded on the balance of probabilities that the plaintiff has made out a case that it is entitled to an equitable estoppel.

195 The fourth head of relief claimed by the plaintiff is for misleading or deceptive conduct in contravention of section 52 of the Trade Practices Act 1974 (Cth).

196 Essentially, the plaintiff relies on the first defendant's letter of 21 December 2001 in response to the email of Mr Ali of 21 December 2001 as a representation to the plaintiff that the plaintiff had introduced the lessee to the first defendant so as to entitle the plaintiff to payment in accordance with the leasing agency agreement. I am not persuaded that the letter was such a representation for reasons which I have already discussed in dealing with the claim based on an equitable estoppel.

197 It is further alleged that the first defendant did not, after making the representation, or after receipt of the facsimile transmission from the plaintiff to the first defendant of 28 May 2002 claim prior to the execution of the lease that the plaintiff did not find and introduce the lessee to the first defendant as a potential lessee of the property. That is summarised in the statement of claim as the "failure to advise". I am persuaded that Mr Jones did advise the plaintiff via Mr Ali that he had had an earlier introduction to the Institute in the conversation which I held occurred sometime between 19 November 2001 and 23 November 2001 and certainly again at the meeting on 7 December 2001.

198 Furthermore, it is clear from those conversations that Mr Jones specifically made the point or disclaimed that the Institute had been introduced to him by the plaintiff.

199 The statement of claim also alleges that in reliance upon the representation and by reason of the failure to advise the plaintiff carried out work for the defendant between in or about 2001 and in or about December 2004 in regard to assisting the first defendant to enter into the lease with the Institute.

200 For reasons I have already given that is not correct. The work done by Mr Ali is wholly explicable by the agreement reached between Mr Ali and the defendant that Mr Ali would be paid half the usual commission if he assisted the defendants in obtaining the Institute as a lessee, the offer made by Mr Jones which I accept was accepted orally by Mr Ali, and is also explicable by Mr Ali's wishing to keep on foot the leasing agency agreement with the prospect of finding some other tenant for the new building if the proposed lease by the Institute did not proceed.

201 In the circumstances there has not been, in my view, any misleading or deceptive conduct, or conduct which was likely to mislead or deceive in contravention of section 52 of the Trade Practices Act 1974 and that claim must fail.

202 The claim against Mr Jones personally as second defendant is that he was at all material times knowingly concerned in and a party to the contravention of the Trade Practices Act earlier pleaded by the plaintiff. Since I held that there was no contravention of the Trade Practices Act the claim against the second defendant personally must fail as he could not have been guilty of any conduct for which he can become personally liable under section 75B and section 82 of the Trade Practices Act.

203 The final allegation in the statement of claim is this: "Further, in the alternative, if (which is denied) the plaintiff did not effect an introduction of the lessee to the defendant within the meaning of the agreement, then the plaintiff pleads as follows: (a) In about late 2001 or early 2002 the plaintiff and the defendant entered into a contract pursuant to which the defendant would agreed that in the event that the plaintiff was of assistance to the defendant in acquiring the lessee as a tenant to the property, the defendant would pay to the plaintiff half the commission to which the plaintiff would have been entitled pursuant to the agreement had it introduced the lessee to the defendant within the meaning of the agreement, ("the half commission"); (b) Subsequent to, an in performance of the said contract the plaintiff was of assistance to the defendant in acquiring the lessee as a tenant of the property; (c) The defendant is thereby liable to pay to the plaintiff for half the commission".

204 The amended defence admits the matters contained in that pleading on the basis that they relate to the first defendant and not to the second defendant.

205 It is noteworthy that the pleading itself in the statement of claim refers merely to the defendant, not to the defendants. Clearly the agreement which is admitted by the defendant was made by Mr Jones, but I believe it to be common ground and find as a fact in case it be disputed that it was made on behalf of his company Ziani Corporation Pty Limited which was in effect the owner of the property and the person who was the proposed lessor of the property.

206 The plaintiff therefore is entitled under the final claim in the statement of claim to judgment in its favour for half of the commission. Since the work done by Mr Ali is remunerated under the contract referred to in the final paragraph of the statement of claim, the quantum meruit must fail because the work that was done by Mr Ali was done pursuant to that agreement and therefore cannot be remunerated in quasi contract.

207 The remaining issue is whether the plaintiff is entitled to interest on the half commission. That requires me to consider the terms of the Civil Procedure Act 2005. Subsection one provides this: "In proceedings for the recovery of money (including any debt or damages or the value of any goods), the Court may include interest in the amount for which judgment is given, the interest to be calculated at such rate as the Court thinks fit; (a) on the whole or any part of the money, and (b) for the whole of any part of the period from the time the cause of action arose until the time the judgment takes effect".

208 The purpose of the Court's discretion to award interest is to permit a successful party to be properly compensated for the actual loss it has suffered. Authorities therefore exist to say that successful plaintiffs who obtain a money judgment should generally be entitled to award of interest. See for example Ruby v Marsh (1975) 132 CLR 642 at 644.

209 One must also consider Falkner v Bourke (1990) 19 NSWLR 574 at 576 where it is suggested that interest will almost invariably be awarded.

210 However, such authorities were decided on similar legislation before that similar legislation was amended. The relevant amendments are now contained in subsections (4) and (5) of section 100. Those subsections are in the following terms: "(4) In any proceedings for damages, the Court may not order the payment of interest under this section in respect of the period from when an appropriate settlement sum was offered (or first offered) by the defendant unless the special circumstances of the case warrant the making of such an order. (5) For the purpose of subsection (4), appropriate settlement sum means a sum offered in settlement of proceedings in which the amount for which judgment is given (including interest accrued up to and including the date of the offer) does not exceed the sum offered by more than 10 per cent."

211 The legislative intention is clear. The legislative intention is firstly to encourage settlement and secondly, to discourage unnecessary litigation.

212 On 18 March 2005 the first defendant sent under the hand of the second defendant a letter to the plaintiff in the following terms: "Without any admissions, and without prejudice to our rights generally at law, we tender herewith a bank cheque for $157,075.49 (including $14,279.59 GST) as full and final payment for any claim, interest and costs related to your claimed leasing fee for the above property. The banking of this cheque by you will be deemed as your acceptance of our offer. In the event that you reject this offer, the same must be returned to us. In the event that you do not accept this offer, this letter may be produced in evidence as to the offer now made."

213 That letter was put into evidence without objection, as was a copy of the bank cheque drawn on the Westpac Banking Corporation at Dee Why.

214 On 29 March 2005 the plaintiff wrote to the defendant rejecting the offer and returning the cheque. It is common ground that the cheque is for half commission. In other words, the defendant had tended to it on or shortly after 18 March 2005 a bank cheque for the amount of the damages that are payable under these reasons for judgment. It appears to me that the policy behind the section 100(4) requires me in the current circumstances to refuse to award interest on the sum of the damages payable.

215 The objections raised by the plaintiff to such a course can be shortly stated. The first objection is that the claim was not a claim for "damages" but a claim for "debt". No doubt Mr Stoljar was relying on the bracketed matter appearing at the commencement of section 100(1) to which I have quoted above. However here I would categorise the monies payable pursuant to these reasons for judgment, as damages for breach of contract. The usual remedy for breach of contract is damages, sometimes damages are liquidated and other times they are not. Here the claim essentially would have or ought to have been for liquidated damages for half of the commission and in my view I must reject the plaintiff's contention. Even if the plaintiff's contention be correct, sound policy would require me to follow in the exercise of discretion the policy underlying subsections (4) and (5). To do so would be merely to discourage settlement and to encourage unnecessary litigation.

216 The next point raised by the plaintiff is that the offer was made before any proceedings were commenced and therefore subsections (4) and (5) are inapplicable. Strictly that is correct, however I must glean the policy to be applied in exercising discretion from the statutory provision and in my view the policy being clear, I should apply that policy in exercising the discretion which I have under section 100. I have had cause to refer to a similar principle in a completely different context in Devlin v The Department of TAFE (NSW) (1998) 16 NSWCCR 103. Here facts must be considered. The defendant's offer was rejected on 29 March 2004.

217 Proceedings commenced on 20 April 2005, some 22 days later. There was a directions hearing on 17 August 2005 when a timetable was fixed. The parties were ordered to provide discovery by 7 September 2005. The defendant gave discovery on 9 September 2005 outside of the period prescribed by the timetable but the period of time was so small as to be of no significance. Inspection was ordered to take place by 21 September 2005 and that was done.

218 The rejection of the offer and the commencement of proceedings are but some three weeks from each other. In the circumstances it would be improper in my view to award interest because if the offer had been made three or four weeks later and rejected after commencement of proceedings, interest would not be ordered.

219 Finally the plaintiff says that there are special circumstances. In my view there are none. The plaintiff points in particular to the failure of Mr Jones to provide to the plaintiff a copy of his reply to Mr Ali's facsimile transmission on 28 May 2002. In that regard it clearly would have been available at the time of discovery. However on 2 March 2005 Mr Robert Gishen, to whom I have earlier referred, visited Mr Jones at his home. During that meeting, Mr Jones showed to Mr Gishen his file going back to 1995, including correspondence between Mr Ali and Mr Jones regarding the agreement to pay fifty per cent of the fee. After some general small talk Mr Gishen indicated to Mr Jones that he would need to speak about the matter with Mr Ali and seek more information.

220 Clearly such a discussion took place because on 7 March 2005 Mr Gishen telephoned Mr Jones and in that conversation Mr Gishen told Mr Jones that he had spoken with Mr Ali who had "no recollection" of the fifty per cent agreement. I referred to that much earlier in these reasons for judgment. In other words, on 2 March 2005 Mr Gishen was given an opportunity to go through Mr Jones' file, and did so, and could himself have seen the email in response to Mr Ali's email of 28 May 2002.

221 That is referred to in Mr Gishen's letter to Mr Jones of 9 March 2005 when Mr Gishen points out that, at the meeting on 2 March 2000, Mr Jones advised Mr Gishen of his facsimile reply to Mr Ali but clearly not only was Mr Gishen told about it, he had the opportunity of viewing the document in question. It appears that Mr Jones failed to provide a copy of the file to the plaintiff after 2 March 2005 based on some legal or paralegal advice.

222 The plaintiff was accordingly, at all material times, well aware of what the defendant's position was. In those circumstances no special circumstances in my view exist why I should order interest on the sum of damages.

223 I commenced giving these reasons at 10am. It is now 6.30pm. I inquired of counsel if any further reasons for judgment were required. The only matter raised was by counsel for the plaintiff who advised that he was pressing a claim for interest between the delivery of the invoice of the plaintiff to the defendant on or about 27 December 2004 to the date when the offer was made by the defendant on 18 March 2005. Counsel being able to agree on that sum it is consistent with the provisions of s 100(4) of the Civil Procedure Act 2005 that the plaintiff is entitled to interest for that sum. Otherwise no further reasons for judgment are required. The amount of the damages payable is $157,075.49 together with interest in the sum of $3137.21 making a total figure of $160,212.70.

224 For those reasons I give verdict and judgment for the plaintiff against the first defendant for $160,212.70. I give verdict and judgment for the second defendant against the plaintiff. I will hear counsel on the question of costs but is consistent with my earlier reasoning that the order ought be that the plaintiff pay the costs of both defendants. Do you want to be heard?

STOOD OVER PART HEARD TO FRIDAY 21 JULY 2006 AT 10AM

225 HIS HONOUR: I commenced giving reasons for judgment yesterday morning at ten. I finished giving those reasons for judgment at approximately 6.30pm and during that eight and a half hour period I took breaks amounting to one hour. Accordingly it took me seven and a half hours to deliver judgment. At the end of my reasons I expressed a preliminary view as to costs and that preliminary view was that the plaintiff ought pay the defendant's costs.

226 Mr Stoljar for the plaintiff then addressed me and certain further evidence was tendered. At 6.55pm I adjourned the matter until this morning. Mr Stoljar was unable to be here this morning but he told me before I rose last night that he had said everything that he wished to say. I have heard Mr Kidd for the defendant this morning and then I have heard in reply Mr Maloney, Mr Stoljar's instructing solicitor, who has said all that could be said on the plaintiff's behalf in reply.

227 Within the next fortnight I will have been sitting on a bench for twelve years. The one constant thing that I can observe about that twelve year period of judicial life is that nothing excites the zeal, the ardour and the passion of the legal profession than an argument about costs. The original statement of claim filed on 20 April 2005 made a claim based in contract, a contract entered into on 26 May 2000. The sole defendant at that time was the first defendant, Ziani Corporation Pty Limited. An amended statement of claim was filed on 26 July 2005 which joined Mr Raymond John Jones as the second defendant and pleaded claims in addition to the original pleaded claim based on a equitable estoppel, on quantum meruit and on breaches of the Trade Practices Act 1974 (Cth).

228 At the conclusion of the address of learned counsel for the defendants, and at my urging, the plaintiff was given leave to file in court a further amended statement of claim adding as an alternative to the four causes of action already pleaded a cause of action based on a oral contract made between Mr Jones on behalf of his company, Ziani Corporation Pty Limited and Mr Ali on behalf of his employer, the plaintiff, for remuneration by the first defendant of the plaintiff for half the commission if the plaintiff assisted the first defendant in obtaining the New South Wales Institute of Sport as a tenant in a building to be erected by the first defendant on its land at Homebush Bay.

229 Yesterday, for reasons which I gave, I rejected the claims based on the contract of 26 May 2000, on equitable estoppel, on the Trade Practices Act, and also on the quantum meruit because I found for the plaintiff on the alternative claim which was pleaded at the close of the defendant's submissions.

230 In fact, it was not necessary really for me to find on that further alternative claim because the first defendant admitted that it was liable for the half commission. The only difference between the half commission and the judgment which I entered yesterday at approximately 6.30pm was the princely sum of $3,137.21 being an amount for interest between 27 December 2004 and 18 March 2005. In my view that sum is of such small magnitude that it can be effectively ignored. De minimis non curat lex.

231 The originating process was filed on 20 April 2005. It is necessary to recapitulate a little as to what happened before that time. Significantly on 18 March 2005 the first defendant had tendered to the plaintiff a bank cheque for the half commission in payment of the claim that had been made upon the first defendant by the plaintiff. That offer was rejected, and the bank cheque was returned by the plaintiff on 29 March 2005. The plaintiff did not agree, essentially, with the position adopted by the defendants, the position which was held to be the correct one yesterday. Furthermore it has to be borne in mind that on 2 March 2005 there was a meeting between the principal of the first defendant, namely Mr Jones the second defendant, and Mr Robert Gishen, a director of the plaintiff company, in which Mr Gishen was given full access to the defendant's file concerning the property in question at Homebush Bay. In other words there had been de facto discovery prior to the commencement of any proceedings and prior to the tender by the first defendant of the bank cheque for the payment of the half commission.

232 The original claim made by the plaintiff was denied by the first defendant and the further claims added by the amended statement of claim filed on 26 July 2005 were also denied by the defendants. The plaintiff was only successful on the pleading that was made on Wednesday afternoon. Notwithstanding the fact that that plea was made and admitted by the first defendant the plaintiff pressed on with all four earlier claims.

233 The first question which in my mind arises is whether the defendant or defendants ought to have pleaded a defence of accord and satisfaction. If such defence were available in my view it ought to have been pleaded. There are authorities, for example, that state that relief must be pleaded Proudfoot v Stubbens (1886) 2 WN (NSW) 46, and also an authority which establishes that payment must be pleaded Young v Queensland Trustees Limited (1956) 99 CLR 560. Since the defence of accord and satisfaction has elements of those two matters it ought be pleaded. However, here there was no accord and satisfaction. The gist of that defence may be taken from the judgment of Scrutton LJ, in British Russian Asset and Trade Outlook Pty Limited v Associated Newspapers Limited [1933] 2 KB 616: "Accord and satisfaction is the purchase of a release from an obligation whether arising under contract or tort by means of any valuable consideration, not being the actual performance of the obligation itself. The accord is the agreement by which the obligation is discharged. The satisfaction is the consideration which makes the agreement operative." 234 Here there was no accord and satisfaction. For there to have been accord and satisfaction the defendants must have acknowledged an indebtedness for the whole commission and then reached a second agreement to compromise that claim by the payment of the half-commission. Here that did not occur. The half-commission was payable under a contract. That was not pleaded by the plaintiff until 18 July 2006. That was, as I have said, probably repeatedly, after counsel for the defendant had addressed. When the pleading of the half-commission contract was made it was admitted by the first defendant.

235 Costs follow the event. On the claim originally pleaded in the statement of claim filed on 20 April 2005 the plaintiff was wholly unsuccessful. On pleadings contained in the amended statement of claim filed on 26 July 2005 the plaintiff was wholly unsuccessful. In the further amended statement of claim filed in Court on 18 July 2006 the plaintiff was only successful on the alternative claim which was formally admitted at the time by the defendant. In other words, on the matters litigated the plaintiff was wholly unsuccessful. Therefore, in my view, the plaintiff ought pay the defendants' costs. Furthermore, it has to be borne in mind that the plaintiff was offered the full half-commission by the first defendant on 18 March 2005 and was offered it in a very inviting form, a bank cheque. For its own reasons the plaintiff rejected that offer and returned the cheque but the reasons which the plaintiff had for so doing have not been held to be valid, that is essentially the findings that I made in my reasons for judgment yesterday.

236 After the commencement of proceedings three different offers were made by the solicitors for the defendants. The first offer was on 13 December 2005 and was essentially an offer to settle the matter for $109,493.15 inclusive of costs. A second offer was made by the defendants on 2 February 2006 for the sum of $173,968.96 inclusive of costs. That offer was made before the hearing commenced before me on 16 February 2006. The defendants' final offer of settlement was made on 1 June 2006 before the hearing recommenced. That offer was for $200,000 and the letter of offer was silent as to costs. The letter of offer of 1 June 2006 states that the offer was made in accordance with rule 20.26 of the Uniform Civil Procedure Rules, which rule requires that such offers be made exclusive of costs. I am advised by counsel for the defendants that those instructing him and he considered that offer to be inclusive of costs. There might be some justification in that because the earlier offers, which were both inclusive of costs, made reference to the same rule. Perhaps the defendants' solicitors should read the rules before they refer to them in their letters of offer.

237 However, it is correct as learned counsel for the defendants has put to me that the consideration of those offers is relevant only to the issue of indemnity costs which, fortunately, from my point of view, he does not seek as that would require further argument.

238 Those offers cannot be seen to displace the primary position that essentially the plaintiff was wholly unsuccessful in the claims agitated in substance before me. Furthermore, to make an award of costs in favour of the plaintiff in these circumstances would be to recompense an unsuccessful litigant for completely unnecessary litigation. It would completely contrary to justice, in my view, to award costs in favour of the plaintiff that has succeeded in obtaining a judgment for a monetary sum when the monetary sum was open to be accepted by the plaintiff prior to the commencement of proceedings.

239 I order the plaintiff to pay the defendants' costs of these proceedings.

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