Grounds of Appeal
22 It is therefore to be appreciated from the foregoing summary of his Honour's reasons that his Honour reached a number of conclusions, each of decisive significance adverse to the Appellants, which were based mainly upon probabilities perceptibly flowing from preliminary or antecedent facts established to his satisfaction, and from his adverse assessment of the reliability or credibility of the testimonies of Messrs Paterson and Jarrett as principal witnesses for the Appellants. Such findings were in contrast to his essentially favourable assessment of the credibility of the testimonies of the AGC and Barclays officers. The framing of any viable grounds for appeal therefore presented a formidable task to the Appellants, being a task for which the draftsman or draftsmen thereof was or were clearly unqualified to undertake. The draftsman or draftsmen plainly lacked an adequate understanding as to what was required by legal precept to set aside the findings and conclusions of a judge at first instance in relation to factual matters and circumstances, particularly where assessments as to credibility have been made by the judge in support of findings and conclusions. It is appropriate that I set out below the full text of all grounds of appeal the subject of the Notice of Appeal, save as to paragraph 1 which was merely formal and introductory in character, in order to demonstrate how inadequate was the understanding of the Appellants of the task on hand which they were endeavouring to undertake in preparing that document:
"2. His Honour's reasoning in determining (para 17 of Judgment) that "there is no casual link between the misleading conduct or negligence and the loss claimed" suffers from internal inconsistencies:-
(a) His Honour approves of Mr Rodd's suggestion that Endormer obtain a $100,000 overdraft facility (in fact a loan with high interest component) as a means of overcoming under- capitalisation, but unexplainetery (sic) rejects Endormer's claim that it would have traded more profitably if it had been granted a larger wholesale facility under the floor plan ie fixed cheap interest finance (substantially cheaper than overdraft rates) used as and when required when stock levels fall.
(b) His Honour finds that Endormer would not have been mislead into believing that AGC would provide a Wholesale Floor Plan of $2.35Million when McGilvray himself believed the application would be approved as "he had not previously had any application of this type rejected…." [para 18(2)]
3. His Honour misdirected himself as to the relevance of facts:-
(a) Even if it is true that Endormer failed to disclose to AGC the Nissan Termination the evidence from McGilvray and other AGC witnesses was that the Nissan withdrawal of support from dealers throughout Australia was well known throughout the industry. It was relevant to determine whether AGC was aware; not whether AGC had been informed by Endormer.
(b) Whether or not Mr Crighton would continue with Endormer was irrelevant since AGC had made the offer of a $2.35Million floor plan facility.
(c) His Honour fails to consider the fact that Endormer wrote substantial retail business in excess of $100,000 per month for AGC and on several occasions was AGC's most successful Retail Dealer.
(d) His Honour fails to consider how, given the tight audit procedures adopted by AGC at the relevant time, Endormer could have physically moved and sold in excess of forty cars over such a short period of time without AGC being able to produce one witness - even after a Westpac fraud investigator working with "Australia's best Receiver" had spent months looking at documents including Messes Jarrett's and Paterson's personal diaries and effects which had been unexpectedly seized when they were locked out of the Endormer premises.
(e) Generally His Honour failed to address the failure by AGC to produce original documents in support of its case when it had full control of same over a number of years together with the unreliability of evidence given by AGC's own lawyers as to the whereabouts of the original documents.
4. His Honour failed to understand and to properly take into account industry practice in relation to:-
(a) The true nature of the relationship between Dealer and the Wholesaler Floor Plan Financier; the relationship being alike to a partnership rather than master/servant.
(b) The Retail Business arising from the wholesale floor plan was "The cake"; not the "icing on the cake" as stated by His Honour at paragraph 9 of the Reasons.
(c) The ex-Barclays officers admitted that the floor plan financing was also aimed at expanding Barclays' Banking business; the theory being that purchasers of cars financed by Barclays would also eventually hold bank accounts and home finance loans with Barclays.
(d) There was ample evidence given by AGC witnesses about the efficient intelligence gathering by AGC and their aggressive push to recapture their previous superiority in the car retail business; their adventures into development financing having crashed disastrously. Given this it is difficult to explain how Barclays knew of the Hyundai proposal by Endormer but AGC did not.
(e) His Honour fails to address at all Mr Rowland's uncontested evidence that the success of the Dealer depended to a substantial extent on the faith of the financier in the dealer. Mr Rowland was very confident about the future of the Hyundai dealership (which has now been shown to be extremely successful) whereas Mr Rodd and others had no knowledge of Hyundai's potential and indeed considered it a negative aspect of the floor plan.
(f) His Honour failed at all to assess the ample uncontested evidence by AGC's own witnesses about the adverse effect upon a dealership within the industry of having its 'automatic approval' withdrawn with regard to purchase of new vehicles by the Dealer.
5. His Honour misdirected himself in the legal analysis of the floor plan arrangements when he considered the relationship to be that between a debtor and a creditor.
6. His Honour failed to properly analyse the formidable problems for AGC in administering the Endormer Account (para 21). The problems were AGC's failure to put into place security documents prior to releasing funds for the Wholesale Plan and their unending and incompetent attempts at recovering their position with Westpac employees such as Mr Rodd now looking over their shoulders and imposing the "Group Culture".
7. His Honour, in upholding the validity of the Receivers appointment failed to consider the numerous misleading statements made by the Receiver both to the Court and to the Liquidator in correspondence.
8. In upholding the propriety of the sale of Twamley Pty Limited His Honour failed to take into account the evidence that an agent of Twamley had some weeks prior to commencement of the Receivership found a pretext to visit the Endormer premises and made other enquiries consistent with an investigation to purchase the business in the near future.
9. The Receiver failed to explain satisfactorily or at all how the same business could have been sold for almost $1Million shortly after the acquisition by Twamley."
In summary, as the Respondents' Counsel has submitted, the grounds of appeal do not purport to demonstrate that the primary judge failed to take proper advantage of his opportunity to see and hear witnesses, or failed to appreciate the weight or bearing of established circumstances, or in what respect or respects the judgment can be seen to be clearly wrong on grounds that do not depend on credibility: Italiano v Barbaro (1993) 40 FCR 303 at 326. They are rather in the nature of rambling commentaries which implicitly invite this appellate Court to re-read the transcript of testimonies given and complex documentation produced in a case involving a hearing extending for more than thirty days. For the reasons appearing below, I am of the opinion that the Notice of Appeal does not disclose any viable ground of appeal.
23 Grounds of appeal numbered 2 to 6 relate or relate mainly to the causes of action for contravention of s 52 of the Trade Practices Act and for negligent conduct on the part of AGC, in relation to which the findings of his Honour are summarised above. The remaining grounds of appeal concern, or concern mainly, the cause of action for negligent conduct of the Receiver in relation to his realisation of Endormer's assets. As I have already indicated, the framing of all grounds of appeal would not appear to have been undertaken by a legally qualified person, and demonstrates a fundamental absence of understanding as to what is required for the expression of viable grounds of appeal, particularly in relation to a judgment at first instance involving many findings on factual issues arising out of conflicting testimonies.
24 Specifically as to grounds of appeal numbered 2 to 6, none of the same propound any viable basis for reconsideration by this Full Court of the conclusions of the primary judge, the substance of which have been extracted already. The drafting of such grounds of appeal fails to come to grips with the findings of his Honour bearing upon his ensuing conclusions, and instead focuses upon either unproved facts, or proved facts which have no decisive bearing upon any crucial findings of the judgment. There is no identification of circumstances which compel different conclusions upon material facts accepted by his Honour. Instead the grounds of appeal are replete with sweeping generalisations not connected to specifically identified facts which may have been unequivocally demonstrated by cogent evidence which, if correct, would necessarily involve the reversal of material findings.
25 Thus Ground 2 may be seen as failing to confront any of the conclusions of his Honour in any viable and comprehensive way, such as to necessarily require a reversal of a finding of his Honour upon a materially conclusive issue. Paragraph (a) thereof attributes findings to his Honour not apparent from the text of the judgment, and seems to be predicated upon some postulated entitlement of Endormer to "a larger wholesale facility under the floor plan" than was ultimately provided by AGC by way of the $1.75 million facility, without articulating any basis in law why Endormer should have been granted the larger facility, notwithstanding the matters set out in [21] above. His Honour's reference to Endormer obtaining an overdraft facility was made merely in the context of the need for Endormer to cope with the inevitable fluctuations in liquidity of an under-capitalised business, something plainly not potentially decisive upon any issue addressed by his Honour. Paragraph (b) fails to take account of a preceding finding of fact by his Honour , namely "I do not accept that Mr McGilvray said that the person authorised to approve the facility had actually done so….", being a finding which renders Mr McGilvray's mere belief foreshadowed to Endormer as to what would happen in that regard of no relevant significance. Moreover as his Honour found, the Appellants did not disclose to AGC in the context of Endormer's application to AGC for a $2.35 million facility that Nissan had served notice of termination of the Drummoyne Nissan franchise, and as AGC has rightly submitted, the Appellants could not have been misled into believing that AGC would have ultimately provided any such $2.35 million facility for the benefit of a non-existing or shortly to be non-existing franchise. Moreover whatever Mr McGilvray may have said to Mr Paterson and Mr Jarrett at the time or times which he did could not have conceivably related to a proposed new Hyundai franchise.
26 Ground 3 divides of course into five paragraphs, each asserting supposedly relevant facts concerning which his Honour is said to have "misdirected himself", but in relation to none of which is any significance assigned by way of repudiation of material findings by his Honour. Paragraph (a) thereof is confusingly framed, but in any event, apart from what has been already pointed out above, the significance assigned by his Honour to non-disclosure of notice of termination of the Nissan franchise was related only to the issue of the credibility of Messrs Paterson and Jarrett. Paragraph (b) is similarly confusing, in that it is seemingly predicated upon AGC having made an offer of financial assistance in the sum of $2.35 million for acceptance by Endormer, but the only AGC offer actually made, as his Honour found, was confined to $1.75 million, following upon AGC's rejection on 30 June 1992 of Endormer's earlier application for the larger facility. As to paragraph (c), the same does not identify with precision or at all the evidence tendered to his Honour to the effect predicated by this ground of appeal, and in any event, what his Honour identified in his judgment, by way of the critical financial disability of Endormer, was that it "… was starved of necessary working capital which was the root cause of the later financial problems which caused the damage" and further that Endormer "… at all times was chronically undercapitalised, and, in particular, had a critical shortage of working capital - namely, a deficiency of current assets compared with current liabilities… which caused the financial collapse". The Appellants have plainly failed to come to issue in the conduct of the appeal in relation to such radical findings. Obviously enough, high turnover without profitability does not alleviate chronic undercapitalisation. Moreover, there is no established basis of relevance involved in the circumstance that AGC wrote retail business for Endormer. It typifies the unconnected assertions of a notice of appeal which has disclosed no real comprehension of the function which it is required to perform. Paragraph (d) relates to the finding of his Honour as to the quantum of the judgment in favour of AGC on the cross-claim against the Appellants. The findings set out in [58-60] of the judgment below do not disclose in any prima facie way error on the part of his Honour. Paragraph (d) merely invites the Full Court to speculate for the purpose of reversing factual findings of his Honour based upon calculations made from business records of Endormer compared subsequently with those of AGC, AGC's records having been based in the first place necessarily on information which emanated from Endormer; in that regard of course, it was Endormer which effected the sales of motor vehicles the subject of the wholesale floor plan provided by AGC, and AGC was dependent upon Endormer giving prompt and accurate information as to such sales, which his Honour found not to have occurred. Paragraph (e) provides no viable ground of appeal, it not being thereby asserted that accurate copies of any material documents were not made available to the Appellants in order to enable Endormer to establish any supposedly critical proposition; it is not asserted that any alleged failure by AGC to produce original documents had any bearing of a material or decisive nature on any identifiable issue in the proceedings.
27 Ground 4 sets out six matters as to so-called industry practice which the primary judge is said to have failed to understand and properly to have taken into account, yet without indicating, by reference to the judgment below, the consequences of any such alleged failures to any critical or material findings contained in the judgment. In any event, it is not stated why industry practice should have prevailed to the exclusion of facts established by his Honour. As his Honour found, the relationship between the parties was governed by contract, and no basis was advanced as to why such a finding was wrong in law. As to paragraph (a), no basis is asserted as to why the so-called "true nature of the relationship" was governed otherwise than by the documents entered into between AGC and Endormer (and Kwikday), such as the Deed of Charge, Bailment Plan and Guarantees; obviously AGC had a business or financial interest in Endormer succeeding, so that Endormer could meet its financial obligations to AGC; to aver however in terms of "alike to a partnership", without significantly more, takes the Appellants nowhere. The same may be said as to paragraphs (b), (c) and (d) of Ground 4 where none of the material alluded to is even purportedly linked to a decisive finding of his Honour upon a material issue. As to paragraphs (e) and (f) of Ground 4, once again nothing therein contained purports to confront any material finding by his Honour, or to explain why any finding upon a material issue was wrong, quite apart from an absence of identification in the Notice of Appeal of the so-called "uncontested evidence" of Mr Rowland and "AGC's own witnesses".
28 Ground 5 is similarly incomprehensible as a viable ground of appeal, in that the same fails to identify what aspect or aspects of "the legal analysis of the floor plan arrangements" the complaint is intended to address, much less to assign any significance to the consequences of his Honour's supposed misdirection. As to Ground 6, the same can only be described as meaningless and incomprehensible, and in any event also omits to assign significance to material findings of his Honour the subject of his Honour's alleged failure of analysis.
29 Grounds 7 to 9 relate to the cause of action for negligent conduct on the part of the Receiver, concerning which the findings of the primary judge are summarised above. Ground 7 is misconceived, or at least deficient in articulation, since the Receiver's unidentified "numerous misleading statements made… to the Court and to the Receiver in correspondence" have no conceivable bearing upon the validity of the Receiver's appointment in the first place, as Ground 7 infers. Ground 8 is, as the Receiver has submitted, quite meaningless, the same having no cognisable bearing upon or connection with the Receiver, and in particular the Receiver's conduct in disposing of Endormer's assets allegedly at an undervalue. Ground 9 purports to address an issue of inadequacy of the consideration obtained by the Receiver from Twamley for the sale of Endormer's assets, but does not purport to refer to or distil any error on his Honour's part in relation to his findings which have been summarised above, even if a period of seventeen months can be rightly described in terms of "shortly", and $900,000 rightly described as "almost $1 million".
30 In the result, none of the grounds propounded on behalf of the Appellants, as set out in the Notice of Appeal, were viable on their face or in their content as grounds of appeal according to law. At no stage did the Appellants seek to amend their Notice of Appeal, whether by reference to their subsequent Outline of Submissions to this Court or in their Submissions in Reply. Nevertheless the Court adopted the practical course of receiving all of the submissions put forward by Mr Jarrett, whether or not foreshadowed in the Notice of Appeal.
31 The Appellants' submissions repeated at least for the most part the case advanced at first instance to the primary judge and rejected by his Honour, for reasons identified in his Honour's reasons for judgment. It is very difficult to distil from such submissions any alleged reasons as to why his Honour was wrong in the findings he made, or why the case put to this Court should be accepted in lieu of what his Honour found. For instance, Mr Jarrett did not explain why his Honour incorrectly found that all steps taken by AGC prior to the appointment of the Receiver, of which complaint is made, accorded with the contractual rights of AGC, or why there was an absence of evidence of any of industry practices for the existence of which the Appellants contended, including practices inconsistent with such contractual rights. One example of the former exercise of contractual rights was the increase in the interest rate payable to AGC, which his Honour found to have been made in any event to compensate for an increase in risk that had occurred.
32 Mr Jarrett claimed that it was "a well known fact by AGC" that Nissan was reducing the number of its dealers, but no transcript or documentary reference was cited, and in any event of course, it was surely a matter of business integrity for Endormer to have notified AGC promptly that it was one such dealer, in the light of its pending application for the $2.35 million facility. His Honour thus explicitly found that Endormer failed to disclose to AGC that it had received notice of termination of its franchise from Nissan. Moreover Mr Jarrett's several references to the AGC officer Mr Rodd appear to be misplaced, because by the time of Mr Rodd's involvement, AGC had taken over the entirety of Barclays' funding role, and the changeover from Nissan to Hyundai had been duly documented.
33 Contrary to the findings of his Honour, Endormer submitted that the reason for Barclays' termination of its funding of Endormer was a lack of supply of retail business on Endormer's part to Barclays, because Endormer had been favouring AGC with that particular species of financing; such proposition was denied by Barclays' officers, and his Honour accepted their testimony. His Honour rejected Mr Jarrett's claim that AGC had "enticed" Endormer away from a supposedly happy relationship with Barclays, concluding "I am satisfied that the Barclays personnel were delighted to receive the information that AGC would be paying out the Endormer indebtedness, as it relieved them of any anticipated problem".
34 One matter in particular which Mr Jarrett raised in address on appeal was the contention that after AGC granted the subject bailment facility of $1.75 million to Endormer (and to Kwikday as a wholly owned subsidiary of Endormer), it proceeded to reduce the funds available therefrom below that monetary level. In response, Counsel for AGC referred the Court firstly to the following AGC inter-office memorandum of Mr Rowland of 29 September 1992 to the "Senior Manager, Credit", the opening terms whereof read as follows:
"SUBJECT: CREDIT - APPLICATIONS - ENDORMER PTY LIMITED
You approved the following Wholesale Bailment for Endormer Limited to open their new outlets in the City:
New : $1,000,000
Used : $ 750,000
TOTAL: $1,750,000
The Dealer Principal has approached us to convert $200,000 of this limit to Asset Purchase Limit, which was not provided for, to cover:
- computes
- Telecom
- workshop equipment
- shuttle bus
Plus $78,000 to provide a guarantee to the Sydney City Council. They bank Westpac, therefore, we would guarantee Westpac and they would supply the Guarantee to the Council. The rearrangement of limits would then be:
New: $972,000
Used: $500,000
Asset Purchase: $200,000
Westpac Guarantee Rent: $78,000
TOTAL $1,750,000
The rundown on the Nissans is happening faster than expected and they will not be over their limit during the transition period.
They have also received further assistance from Hyundai, with five months rent-free at Kingsford, four months rent-free at Broadway and four months rent-free at Cleveland Street and also a commitment from Hyundai that the rent at Kingsford will not exceed $550.00 per month for the first three years. As well, Hyundai is completing the fit out on Cleveland Street this week and they are hoping to open on 3rd October 1992.
Your approval to the above is recommended.
D.A. Rowland."
Mr Rowland, the former employee of AGC earlier identified, was called by the Appellants to give evidence in their case. Mr Jarrett submitted on behalf of the Appellants that the implementation of such re-arrangement of the facilities as set out in the above memo caused financial difficulties to Endormer in the ongoing conduct of its business. The transcript of Mr Rowland's cross-examination reveals however that the re-arrangement was undertaken at the request of Endormer, albeit not in the exact terms set out in his inter-office memo. That precise proposal apparently did not proceed and on 2 December 1992, Mr Paterson wrote to Mr Adams of AGC as follows (omitting formal parts):
"Further to our discussion re demos, company cars etc, may I suggest the following for consideration:
· We put on a twelve months lease (say with a 60% residual) $150,000.00 worth of company cars at our cost. This would take care of parts, service and F & I personnel.
· The balance of used cars all on normal used car floor plan with curtailments of 10% at six months pay out at twelve months.
Our facilities are then: New Cars $800,000
Used Cars $600,000
Lease Cars $150,000
Equipment $200,000
TOTAL $1,750,000
DAVID PATERSON."
Such letter omitted to take into account the sum of $80,000 previously proposed for the rental guarantee. Hence on 9 December 1992, the AGC Area Manager Mr Adams wrote to his superior Mr Rowland and recommended approval to a "rearrangement of our facilities" as follows:
"New cars $760,000
Used cars $560,000
Lease cars $150,000
Equipment $200,000
Westpac Guarantee $80,000
Rent
TOTAL $1,750,000"
The submission therefore of the Appellants to the effect that AGC "squeezed" Endormer by reducing the amount of the floor plan facility was misconceived, or in any event unsupported by documentary evidence.
35 Another matter raised by the Appellants at the hearing of the appeal, which warrants mention, was that in the course of the AGC/Endormer relationship, AGC subjected Endormer to so-called "manual release", the significance of which was that Endormer was required to obtain AGC's permission to sell vehicles the subject of the bailment plan. That restriction was however authorised from the outset by Clause 5(a) of the AGC Bailment Plan bearing date 1 September 1992 made between AGC, AGC (Advances) Limited, Endormer as "Retailer" and Kwikday as "Wholesaler". In any event, by letter dated 27 April 1993, AGC wrote to Messrs Paterson and Jarrett as follows:
"1. New and used sub-limits - you may switch undrawn used sub-limit to new sub-limit at any time without restriction.
2. Vehicle releases - automatic release is reinstated."
36 The examples of misconceived complaints addressed in [31-33] above demonstrate why his Honour found it appropriate to say that "In view of my conclusions we do not propose to go though the individual complaints…". Moreover, having regard to various matters addressed by his Honour, including those for instance set out above, it was to be expected that the documentation tendered by the Appellants at the original hearing would have been replete with complaints and accusations, or references to previous complaints and accusations, levelled by the Appellants at AGC. No such documentation was identified by Mr Jarrett in writing or by oral submission, and the Court was informed by Counsel for AGC that no such documentary material emerged throughout the trial, obviously a factor adverse to the Appellants' case, who raised a litany of such complaints about AGC and its officers both at first instance and now on appeal.
37 In the course of oral submissions, Mr Jarrett sought to dislodge the findings of the primary judge concerning the Receiver's sale of assets to Twamley. Mr Jarrett referred to minutes of a meeting between the Receiver and AGC officers, which was held on 12 May 1994, and which was subsequent in point of time to completion of the Receiver's disposition of Endormer's assets to Twamley on 20 April 1994, Minutes of that meeting reported inter alia the following matters:
(i) the fact that the directors of Endormer had "obviously anticipated" the appointment by AGC of the Receiver and had undertaken prior discussions with the liquidator, who was appointed at the same time as the Receiver ;
(ii) Endormer's offices "had been cleared out prior to 13 April 1994";
(iii) virtually "all available cars" had been "wholesaled in the last seven days prior to receivership".
The third event above described, according to these minutes, apparently had enabled Endormer's overdraft of $145,000 with Westpac to have been "cleared", and the directors third party guarantees to have been released.
(iv) the following issues were said to arise for consideration:
"(ii) Westpac Overdraft Account
- The overdraft of $145K was cleared in the seven days prior to appointment.
- Following clearance of the overdraft the directors had immediately sought to have third party guarantees released.
- There is a risk to Westpac that a liquidator could attack the payments to clear the overdraft as a preference. Two issues must be addressed before the release of third party securities:
(i) Westpac must get an indemnity from liquidator that he will not pursue the preference.
(ii) AGC must investigate the possibility of a claim against Westpac that realisations from bailment cars should have been paid to AGC. This could allow Westpac to pay AGC and then rely on the third party guarantees, thereby maximising the return for the Group.
(iii) Liquidator
- Tony Vero of Clayton Utz advises that a Court would be likely to find that the Charge under which PH was appointed was created in July 1993. This may enable the liquidator to obtain a declaration that the charge is void, since it was not registered within the required 45 days. Whilst there are still defences the position is not secure.
- PH noted that the estimated dividend to AGC under the floating charge is only $27,000, being receiver costs. There seemed little point in prolonging the expensive legal process of defending the liquidator's attempt to declare the charge void, if a settlement could be reached with the liquidator."
38 Precisely what assistance Mr Jarrett considered was available to the Appellants from the foregoing materials is unclear. The same were somehow considered to be directed to the unsuccessful attempt of Endormer to set aside the Deed of Charge, as against Endormer and the Guarantors. What is suggested is conduct on the part of Endormer in disposing of motor vehicles held pursuant to the Bailment Floor Plan, and directing the proceeds of sale in a manner which would relieve the directors from exposure under their guarantees of Endormer's overdraft to Westpac. We agree with Counsel's response to the introduction of this material that there is no ground of appeal to which the material is relevant:
"As to findings by his Honour concerning the expeditious disposition of assets by the Receiver in favour of Twamley, there is nothing in the material referred to above which puts these findings in doubt. Moreover as AGC further submitted, a fundamental fallacy in the Appellants' case has never been adequately addressed, namely the absence of demonstration of how any conduct of AGC in relation to the securities occasioned actual loss or damage to Endormer.":
39 A further subject raised by Mr Jarrett during the hearing of the appeal was Endormer's record of introductions of retail finance transactions to AGC. Mr Jarrett referred to the document presented by AGC's Area and Dealer Account Managers as follows:
"AUSTRALIAN GUARANTEE CORPORATION LIMITED
CONGRATULATES
SYDNEY CITY MOTOR GROUP
FOR INTRODUCING A RECORD $761,660
FOR THE MONTH OF OCTOBER 1993"
The document takes Endormer's case nowhere. For one matter, achievement of high turnover of retail sales does not bespeak the conclusion that the same rendered its operations profitable contrary to the findings of his Honour. Mr Jarrett also directed the Court's attention to various AGC monthly accounts for so-called "guarantees" payable under the Bailment Plan, showing how the "APPROVED LIMIT" in respect of the month of April 1993 was $1,750,000 inclusive of $867,027 for "New or Combined Total", whereas that for the month of May 1993 was $1,322,000 inclusive of $866,366.00 for "New or Combine(d) Total". However Mr Jarrett did not thereby demonstrate how any such material established error, much less decisive error, in any material findings of the primary judge. By drawing attention to such May 1993 figures, Mr Jarrett did not demonstrate the existence of any default on the part of AGC under the Bailment Floor Plan. Indeed it does not appear from anything reproduced in the Appeal Books that Endormer made any complaint in writing of default on AGC's part in performance of its obligations under the Bailment Floor Plan, at least prior to the time that Endormer for its part moved to place Endormer in liquidation.
Various other attacks were advanced by Mr Jarrett, in the course of his submissions, purportedly in relation to a number of other findings by his Honour; none of such attacks advanced the appeal to any material extent, as appears from the following examples:
(i) The Barclays relationship with Endormer was not "doomed in any event" in the circumstances found by the primary judge,Mr Jarrett's submission being that "There was never any difficulty with the relationship with Barclays…" ;
(ii) AGC's calculation of its Cross-Claim in the sum of $975,143.69 could not be accurate, since Endormer had paid out "substantial sums" (not however quantified on appeal) to AGC in the course of operations pursuant to the bailment plan;
(iii) If Endormer's financial situation had been of the inadequate nature described by his Honour at the time of the changeover of financing from Barclays to AGC, he would not have invested $100,000 of his own or his own family's funds in Endormer's business;
(iv) Being made aware of Endormer's financial position at the time it granted the limited $1.75 million facility, AGC had a duty to manage Endormer's account with AGC in the light of that limitation, and thus not to "… impose any further restrictions on that account that would further reduce the possibility of cash flow," such as the increase of the interest rate by 1%;
(v) As to the second mortgage taken by AGC over Mr Jarrett's home, the original document was destroyed by him on learning of the appointment of the Receiver, and all that remained were photostat copies, which "… they'd actually somehow managed to register…".
40 The foregoing submissions reveal, understandably in the light of Mr Jarrett's absence of legal qualification, much less of advocacy in a court environment, that he had no comprehension of the substantial task he was undertaking in seeking to set aside the findings of his Honour on predominantly factual issues, being findings made by way of inferences and conclusions drawn from a substantial body of documentation, and from the testimonies of many witnesses viewed in the aggregate, including those of Mr Paterson and Mr Jarrett himself in circumstances where their testimonies had been found not to be compelling.In no instance has Mr Jarrett established that his Honour was wrong in reaching any of the conclusions referred to above. Mr Jarrett's approach to the enormity of the task undertaken by him was either to distilldistil some usually isolated passage of a document in evidence or some isolated item of oral testimony, and to propound the material so identified, without attempting to place the same against the wider landscape of his Honour's findings and the impact of such findings upon the reasons. We would illustrate the nature of the task which Mr Jarrett undertook as an unqualified litigant of setting aside the findings of the Primary Judge by reference to the following passage from the judgment of McHugh, Kirby and Callinan JJ in Walsh v Law Society of New South Wales [(1999]) 198 CLR 73 at 91-2:
"Some aspects of the appellate procedure will remain the same where the appeal is conducted solely on written materials, whether those materials be technically evidence in a de novo hearing or the record under consideration in an appeal under s 75A of the Supreme Court Act. In either case, the appellate court will be bound generally to defer to any conclusions on the questions of credibility formed by the court or tribunal from whom the appeal is brought where the latter has seen and heard the witnesses (53). In particular circumstances, it will be open to an appellate court to reach conclusions contrary to those of the court or tribunal below, notwithstanding a credibility finding (54). Sometimes it will be authorised to reject those findings where they are "glaringly improbable"(55) or "contrary to compelling inferences" of the case (56). But the caution required of all appellate courts in such matters has long been recognised and frequently upheld in decisions of this Court (57)."
41 In relation to the several sub-paragraphs contained in [37] above, in the sequence in which they appear:
(i) Mr Jarrett does not address the significance of the testimonies of the Barclays employees who gave evidence, or the Barclays documentation in evidence, which his Honour accepted and upon which he purported to rely; such significance was not to be answered by any bland assertion from the Bar Table as to absence of "difficulty" between Barclays and Endormer;
(ii) Any such generalised attack upon his Honour's calculation of the amount payable to AGC pursuant to the Cross-Claim was required to come to grips with the detailed calculations provided to the Court from documentary materials in the course of AGC's adducement of detailed financial evidence with the assistance of a qualified expert and in relation to which the Appellants had ample opportunity for input, and did indeed take advantage of such opportunity;
(iii) This submission begs the question as to the adequacy of what financial material was provided by Mr Paterson to Mr Jarrett before he made his unfortunate investment and precisely what documentary enquiries Mr Jarrett made in that context; incidentally, Mr Jarrett had been presumably made aware by Mr Paterson that such provision of capital on Mr Jarrett's part was occurring after AGC had approved of the lesser facility of $1.75 million, having earlier rejected the Endormer application for the larger facility of $2.35 million;
(iv) The imposition of a duty of care on the part of a financier in favour of a borrower the subject of this submission is obviously as fanciful as it is novel; as to the interest rate increase, we refer to the circumstances, first, that the manual release procedure was contractually authorised, as was AGC's increase in the interest rate;
(v) This issue was not considered by his Honour; what his Honour addressed was the matter of alteration to the Memorandum of Encumbrances made to the second mortgage over Mr Jarrett's home and whether the alteration was made fraudulently or was material; the issue raised here by Mr Jarrett, seemingly for the first time, seems to misapprehend in any event the significance of secondary evidence by way of an authentic copy of the original, and overlooks the further significance of his prior documentary and prima facie enforceable undertaking to enter into the second mortgage which AGC produced in evidence.
42 The Appellants have failed to articulate any visible basis for setting aside the judgment of his Honour, much less any significant or material aspect thereof. His Honour's reasons were carefully and thoughtfully assembled in the context of a large body of oral and affidavit testimony and documentary evidence provided in the course of a lengthy trial. The task of setting aside the inferences carefully drawn and conclusions carefully reasoned by his Honour was always going to be a formidable task, a fortiori when preparation of the grounds of appeal and written outlines of submissions, and the making of oral submissions to the Court, were to be undertaken by a legally unqualified person. The appeal must be dismissed with costs.
We certify that the preceding forty-two (42) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Lee, Finn ands Lee, Finn and Conti JJJ.