Investa Properties Pty Ltd v Nankervis

Solicitor for the Fourth Respondent: Carter Newell

BETWEEN: INVESTA PROPERTIES PTY LTD ACN 084 407 241 First Applicant

INVESTA RESIDENTIAL GROUP PTY LTD ACN 098 527 390 Second Applicant

AND: ASHLEY COLIN NANKERVIS First Respondent

ADAM KIMBERLY BARCLAY Second Respondent

OLIVER HUME SOUTH EAST QUEENSLAND PTY LTD ACN 128 863 230 Fourth Respondent

AND BETWEEN: ADAM KIMBERLY BARCLAY Cross-Claimant

AND: ASHLEY COLIN NANKERVIS Cross-Respondent

JUDGE: COLLIER J DATE OF ORDER: 31 MAY 2018

1. The Applicants' claim for equitable compensation in respect of Lot 170 and Lot 191 be dismissed.
2. The cross-claim filed on 15 November 2013 by the Second Respondent against the First Respondent be dismissed.
3. The matter be listed for case management in respect of costs at 9.15 am on 12 June 2018. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

Background 1 The background to the current proceedings is set out, in detail, in Investa Properties Pty Ltd v Nankervis (No 7) [2015] FCA 1004; (2015) 333 ALR 193 (the primary judgment). That judgment was the subject of a number of appeals to the Full Court of this Court. Relevantly to the matters currently before me, orders were made by the Full Court in Oliver Hume South East Queensland Pty Ltd v Investa Residential Group Pty Ltd (QUD 923 of 2015), Investa Properties Pty Ltd v Nankervis (QUD 924 of 2015), Investa Properties Pty Ltd v Nankervis (QUD 925 of 2015) and Barclay v Oliver Hume South East Queensland Pty Ltd (QUD 1002 of 2015). Reasons for judgment of the Full Court in QUD 923 of 2015, QUD 924 of 2015, QUD 925 of 2015 and QUD 1002 of 2015 were given in Oliver Hume South East Queensland Pty Ltd v Investa Residential Group Pty Ltd [2017] FCAFC 141; (2017) 348 ALR 385 and Oliver Hume South East Queensland Pty Ltd v Investa Residential Group Pty Ltd (No 2) [2017] FCAFC 175. Materially for present purposes, it is now clear that each of Mr Nankervis, Mr Barclay and Oliver Hume South East Queensland Pty Ltd (Oliver Hume) breached their fiduciary duties to both the first and second applicants in respect of the acquisition and resale of Lot 170 and Lot 191 (as defined in the primary judgment). 2 A number of matters remain to be determined relating to the primary proceedings and the cross-claims. The subjects of this judgment are: the amount, if any, to which Investa Properties Pty Ltd (the first applicant) is entitled to be paid by the respondents in the primary proceedings by way of equitable compensation for the breaches in respect of Lot 170 and Lot 191; and whether the second respondent, Mr Barclay, is entitled to equitable contribution from the first respondent, Mr Nankervis, pursuant to the cross-claim filed by Mr Barclay on 15 November 2013. 3 At the most recent hearing in these proceedings there was no appearance by Mr Nankervis. In so far as I am aware no explanation has been provided by Mr Nankervis for this non-appearance. All other parties appeared, represented by Counsel. I was informed by Ms Painter QC for the applicants that Mr Nankervis had sought leave to be excused by the Full Court on the first day of the hearing of the appeals against the primary judgment, and has not participated in any subsequent litigation or litigation-related communications between the parties. 4 Certainly it is evident from the Court file that Mr Nankervis has been copied into correspondence from the Court to all parties to the proceedings in relation to orders made and relevant listing dates, including the listed hearing of the proceedings relating to this judgment. It also appears that Mr Nankervis has been copied into correspondence between the parties to the proceedings in relation to the progression of this litigation. Mr Joshua Mountford, solicitor for the second respondent, filed an affidavit on 18 April 2018 in which he swore that relevant correspondence had been sent to Mr Nankervis, but there had been no response from Mr Nankervis. 5 I am satisfied that all reasonable steps have been taken to inform Mr Nankervis of the progress of this litigation, including the listing date of the most recent hearing of this matter on 17 April 2018, and that he has chosen not to appear.

Equitable compensation 6 It is common ground that, at the conclusion of the evidence, the applicants elected to claim an order for equitable compensation for breach of fiduciary duties by the respondents rather than seek an account of profits for their claimed losses concerning Lot 170 and Lot 191. The orders sought by the applicants are: 1. The Respondents are to give equitable compensation to Investa Residential, as follows: a. In respect of Lot 170 i. The sum of $1,303,361 (being the value of Lot 170 at 20 February 2009 of $2,757,906, less the purchase price of $1,454,545), ii. Interest on the amount in 1 (a)(i) above, calculated on a simple basis. b. In respect of Lot 191: i. The sum of $95,000 (being the value of Lot 191 at 23 December 2009 of $290,000, less the purchase price of $95,000), ii. Interest, on the amount in 2 (a)(i) above, calculated on a simple basis. 2. The Respondents are to pay the Applicants' costs of the primary proceedings and costs of and incidental to matters remitted to the Primary Judge. 7 In relation to the second order sought by the applicants, I formed the view after hearing the parties on 17 April 2018 that in the interests of justice the matter should be relisted at a later date after delivery of this judgment, for further submissions concerning costs. 8 Oliver Hume and Mr Barclay submitted, in summary, that: in respect of Lot 170 the applicants' claim be dismissed, or alternatively there be no order for the payment of equitable compensation; and in respect of Lot 191 the applicants' claim be dismissed, or alternatively equitable compensation be assessed at either $4,200 or $95,000. 9 These respondents also submitted that there should be no order for interest. 10 As the Full Court observed in Blackmagic Design Pty Ltd v Overliese [2011] FCAFC 24; (2011) 191 FCR 1 at [97]: The Court's power to award equitable compensation is not in doubt. In the well-known case of Nocton v Lord Ashburton [1914] AC 932 ("Nocton v Lord Ashburton"), Viscount Haldane LC affirmed the power of a court of equity to order compensation if a fiduciary has lost his constituent's property by acting in breach of duty. In McKenzie v McDonald [1927] VLR 134, Dixon A-J, sitting as an Acting Justice of the Victorian Supreme Court, awarded equitable compensation for breach of fiduciary duty where it was not possible to restore the property to a plaintiff. In Breen v Williams, Gummow J said (at 135-136): The fiduciary will be brought to account for any benefit or gain which (1) has been obtained or received in circumstances where a conflict or significant possibility of conflict existed between the fiduciary duty and personal interest in the pursuit or possible receipt of the benefit or gain or (2) was obtained or received by use or by reason of the fiduciary position or opportunity or knowledge resulting from it. Where the breach of duty produces not a gain to the fiduciary but a loss to the party to whom the fiduciary duty was owed, then the judgments of Viscount Haldane LC in Nocton v Lord Ashburton and of Sir Owen Dixon in McKenzie v McDonald show that there is an obligation to account for the loss by provision of equitable compensation. (Citations omitted.) 11 Similarly in Parker, In the matter of Purcom No 34 Pty Ltd (In Liq) (No 2) [2010] FCA 624 Gordon J summarised relevant principles in the following terms: 1. It is a "cardinal principle of equity" that the remedy is "fashioned to fit the nature of the case and the particular facts": Warman International Limited v Dwyer [1995] HCA 18; (1995) 182 CLR 544 at 559; see also Hill v Rose [1990] VicRp 13; [1990] VR 129 at 143. 2. Where a breach of fiduciary obligation occurs, compensation is available in equity to make good the loss (Nocton v Lord Ashburton [1914] AC 932) and the plaintiff must elect between the remedy of equitable compensation and account of profits: Nocton [1914] AC 932 at 956-957; Warman [1995] HCA 18; 182 CLR 544 at 558; R Meagher, D Heydon, M Leeming, Equity: Doctrines & Remedies (4th ed, 2002) at 837. 3. Equitable compensation is assessed at the time of trial, with the full benefit of hindsight and common sense, not at the date of breach: Youyang Pty Limited v Minter Ellison Morris Fletcher [2003] HCA 15; (2003) 212 CLR 484 at [35]; Re Dawson (deceased); Union Fidelity Trustee Co Ltd v Perpetual Trustee Co Ltd [1966] 2 NSWR 211 at 216; O'Halloran v RT Thomas & Family Pty Ltd [1998] NSWSC 596; (1998) 45 NSWLR 262 at 273 and 276. 4. The objective of equitable compensation is compensatory - to restore the principal to the position it was in prior to the breaches and to make good any loss caused by the fiduciary's wrongful conduct: see [75] of the Reasons; Nocton [1914] AC 932 at 952; Re Dawson (deceased) [1966] 2 NSWR 211; O'Halloran [1998] NSWSC 596; 45 NSWLR 262 at 272-273. No element of penalty is involved: R Meagher, D Heydon, M Leeming, Equity: Doctrines & Remedies (4th ed, 2002) at 837-839. 5. Unlike common law damages, equitable compensation is not limited or influenced by common law principles of remoteness of damage, forseeability or causation: Hill v Rose [1990] VicRp 13; [1990] VR 129 at 144; Canson Enterprises Ltd v Boughton & Co [1991] 3 SCR 534 at 556; O'Halloran [1998] NSWSC 596; 45 NSWLR 262 at 273. 6. However, there does have to be some causal connection between the breach of fiduciary obligation and the loss for which compensation is recoverable. It is necessary for the plaintiff to establish that the loss would not have occurred but for the breach: O'Halloran [1998] NSWSC 596; 45 NSWLR 262 at 275-6. The necessary enquiry is whether the loss would have happened had there been no breach, not whether the loss was caused by or flowed from the breach: O'Halloran [1998] NSWSC 596; 45 NSWLR 262 at 276-277. 12 See also Harris v Digital Pulse Pty Ltd [2003] NSWCA 10; (2003) 56 NSWLR 298. 13 The point of an award of equitable compensation is the restoration of the beneficiary to the position it would have been in had no breach of fiduciary duty occurred. The conduct of the fiduciary may be relevant, although, historically the purpose of the equitable jurisdiction is restorative and compensatory, the Courts have because rejected the principle that an award of equitable compensation can include punitive elements: see for example the observations of Spiegelman CJ and Heydon JA in Harris v Digital Pulse at [45], [54], [57], [299], [305], [338]. 14 In light of these principles, I now turn to consideration of the claims of the applicants in respect of Lots 170 and 191.

What was the relevant loss? 15 At the hearing Counsel for the applicants informed the Court that the applicants did not seek to adduce fresh evidence of loss in respect of Lot 170. It follows that any loss alleged by the applicants should be assessed as at 20 February 2009 (Lot 170) and 23 December 2009 (Lot 191). 16 In the course of the primary judgment I found that: Lot 170 was not sold at an undervalue. The sale price of $1,454,545 was the market value of the property as at 20 February 2009, being the date of sale: primary judgment at [373]; and Lot 191 was sold at an undervalue in the amount of $95,000. A fair valuation of Lot 191 as at 23 December 2009 (being the date of the execution of the relevant deed of put and call ) was $290,000 (rather than the amount of $195,000 which was the exercise price): primary judgment at [354]. 17 At the time of delivery of the primary judgment I ruled that the measure of compensation either in equity or under the Corporations Act 2001 (Cth) was a matter for further submissions by the parties: primary judgment at [374]. I also directed that the matter be relisted for further case management in respect of remedies. It is not in dispute that, in light of the lodgement of multiple appeals against the primary judgment, the further case management hearing was deferred until after delivery by the Full Court of their judgments, and accordingly I have not yet made final orders in respect of remedies in these proceedings.

Lot 170 18 Notwithstanding the submissions of the applicants concerning the egregious conduct of the respondents, Lot 170 has been subdivided and re-sold, and it is not possible to restore the applicants to the position they were in prior to the sale of Lot 170 by ordering that that Lot be retransferred to them. In circumstances where I have found in the primary judgment, after detailed consideration of the evidence, that Lot 170 was sold at market value, prima facie the logical conclusion is that the applicants are not entitled to an award of equitable compensation in respect of Lot 170. 19 However, the applicants submit that the Court is in a position to reconsider the value of Lot 170 as at 20 February 2009. In particular, they submit: Based on the evidence before the Court at the trial of the proceedings, the true value of Lot 170 as at 20 February 2009 was $2,757,906. Each of the respondents was, and continues to be, a defaulting fiduciary of a significant order in respect of both Lots. The time at which equitable compensation is to be assessed is at the discretion of the Court, and the Court is enjoined to do justice between the parties in the particular circumstances of each case. It beggars belief to think that Mr Nankervis and Mr Barclay would have designed the elaborate scheme in question to purchase the Lots at a fair value. In light of orders of the Full Court in the appeals in this matter, it is open to me to reconsider the value of Lot 170. 20 In particular, at the hearing Counsel for the applicants submitted as follows: So the deferring by you of these issues until after other matters were attended to, taken together with a remittal by the Full Court of the whole of the matters operates as a remittal to you of the whole question as if from scratch, and you are not limited, we say, in this resumed hearing to any findings that you may have made before, and you're not limited because (a) the Full Court has sent back to you something much more broad than merely an ascertaining of the loss. They have sent back to you for consideration afresh, the issue of value, and that requires an understanding and a review of the evidence that I will take your Honour to in a minute and to which our written submissions refer. There's also it couldn't be controversial that because there are no orders finalising the question of loss or value, your Honour is able to, by uncontroversial longstanding authority, and again, the authority, coupled with the clear remittal of the Full Court to review as if afresh these questions on value… (Transcript 17 April 2018 p 9 lln 13-27) … So in the circumstances where the nature of the fiduciary obligations has been expanded to quite a significant degree, the nature of the fiduciary breaches has been expanded to quite a significant degree, where the Full Court has said - suggested that there may be matters which were not considered which should be considered, taking into account the passage of time that is nobody's fault but has just occurred, and the idea behind 37M, the overarching principle that we try to give justice to all parties, it is appropriate, we say, for you to reconsider those aspects of your preliminary findings, as I've articulated them today. (Transcript 17 April 2018 p 99 lln 26-35) 21 In relation to orders of the Full Court, the applicants direct my attention to the following orders: Order 1 in QUD 923 of 2015 which provides: 1. The appeal is dismissed and the Court notes that the subject matter which gave rise to Grounds 10 and 11 of the Notice of Appeal concerning the value of, and loss, if any, arising from the sale of Lot 191 may be considered by the primary Judge in respect of the separate issue of remedy. Order 3 in QUD 924 of 2015 which provides: 3. The cross-appeal is dismissed and the Court notes that the subject matter of Grounds 6 and 7 of the cross-appeal by Mr Barclay filed on 23 October 2015 concerning the value of, and loss, if any, arising from the sale of Lot 191 may be considered by the primary Judge in determining questions of remedy. Order 1 in QUD 925 of 2015, which provides: 1. The appeal is dismissed and the Court notes that matters concerning the value of Lot 170 and loss, if any, arising from the sale of Lot 170 are matters that may be considered by the primary Judge in determining questions of remedy. Orders 4 and 5 in QUD 1002 of 2015, which provide: 4. The cross-claim of the first respondent against the appellant filed on 10 December 2012) (the subject of Order 5 of 10 September 2015) be remitted to her Honour Justice Collier for determination according to law and in accordance with the reasons of the Full Court published on 1 September 2017. 5. The cross-claim of the appellant against the second respondent filed on 15 December 2012 (the subject of Order 4 of 10 September 2015) be remitted to her Honour Justice Collier for determination according to law and in accordance with the reasons of the Full Court published on 1 September 2017. 22 The respondents strongly disputed the submissions advanced by the applicants in respect of this issue. 23 In my view there is no room to reconsider aspects of my findings relating to the value of Lot 170 as at 20 February 2009. I have formed this view for the following reasons. 24 First, in their submissions the applicants have inaccurately portrayed the nature of my findings in the primary judgment concerning the value of Lot 170. Those findings were not "preliminary findings" as submitted by the applicants. In [314]-[374] of the judgment I examined the submissions of the parties concerning the loss or damage attributable to the breach of fiduciary or statutory duties in respect of Lot 170, Lot 191 and the Sales Office (as defined in the primary judgment). I also examined the expert evidence relied on by the parties, namely that of Mr John McEvoy (on behalf of the applicants) and Mr Brian Cox (on behalf of Oliver Hume) as well as the CB Richard Ellis report, which valued Lot 170 for the ANZ Banking Group as at 5 November 2008. I further considered the evidence of various witnesses concerning the effect of the global financial crisis on the business of the applicants during the relevant period, including evidence of witnesses Mr Dearlove, Ms Prout, Mr Jenkins and Mr Waters (primary judgment at [356]-[359]). In the course of that examination I rejected the opinion of Mr McEvoy that Lot 170 should be valued in excess of $3 million as at 20 February 2009. Those findings were conclusive, preparatory to making final remedial orders. 25 Second, those findings have not, to date, been disturbed by the Full Court. The remittals of the cross-claims by Orders 4 and 5 of the Full Court in QUD 1002 of 2015 do not require me to reconsider my findings in respect of the value Lot 170 as at 20 February 2009. The applicants make much of the language of the orders of the Full Court in QUD 923 of 2015, QUD 924 of 2015 and QUD 925 of 2015 where the Full Court noted that matters concerning the value of, and loss, if any, arising from the sale of Lot 191 (QUD 923 of 2015 and QUD 924 of 2015) and Lot 170 (QUD 925 of 2015) "may be considered by the primary Judge in respect of the separate issue of remedy". However, these orders did not constitute a remittal of that aspect of the case concerning findings of value. 26 The explanation of the words "may be considered by the primary Judge in respect of the separate issue of remedy" in the relevant orders of the Full Court can be seen in the reasons of Greenwood and White JJ, with which Dowsett J concurred, in Oliver Hume South East Queensland Pty Ltd v Investa Residential Group Pty Ltd (No 2). There, their Honours said: 8 First, the appeals are concerned with grounds relied upon and contentions made concerning the question of whether the primary Judge erred in making, on 10 September 2015, any of Declarations 1 to 5 and any of Orders 1 to 7. As we said in the reasons for judgment, the question of remedy is yet to be determined by the primary Judge. One of the matters agitated before the Full Court was a question of whether the primary Judge erred in making a finding that the market value of Lot 191 at 25 June 2010 was $290,000. Another matter agitated before the Full Court was whether the primary Judge erred in finding that there was no evidence, or no sufficient evidence, to support a finding that Lot 170 had a greater value than the price paid by Two Eight Two Nine Pty Ltd of $1,454,545 exclusive of GST. 9 In the reasons for judgment, we observed that questions of value and valuation only go to the quantification of the claim and that it would be premature for the Full Court to express a view on those findings and those issues more generally: [25], [26], [383], [384], [417]. As we said in the reasons for judgment, no party contended that the Court could presently determine, in the appeal proceedings, questions of valuation. That position no doubt arose because, first, there was no "order" appealed from to which the assessments of value related and, second, questions of relief were separated out by the primary Judge for later determination. 10 The primary Judge will in due course determine questions of remedy and it may be that the findings of the primary Judge in relation to value concerning each Lot will be challenged if and when a challenge is made to a dispositive order or a declaration concerning a remedy which engages the factual question of valuation. 11 That is why Order 1 in QUD 923 of 2015; Order 3 in QUD 924 of 2015; and Order 1 in QUD 925 of 2015 recite that the matters the subject of the relevant grounds as recited in those orders concerning the value of, and loss, if any, arising from the sale of Lots 170 and 191 are matters the primary Judge may consider in determining the separate issue of remedy. (Emphasis added.) 27 In summary, the Full Court recognised that no orders in respect of remedies have been made, at first instance, in these proceedings. Their Honours therefore noted that matters concerning the value of, and loss (if any) arising from the sale of both Lot 170 and Lot 191 could be taken into account by me in respect of the separate issue of remedy. This is logical. It was not a direction by the Full Court for the Court at first instance to reconsider, ab initio, issues of valuation, as contended by the applicants. 28 Third, as Dowsett J observed in the primary judgment at [25], because I have not to date made orders in respect of remedies the appellate jurisdiction of the Court was not invoked in respect of those matters. 29 Fourth, in the absence of a successful appeal against orders reflecting my findings concerning the value of Lot 170, and in the further absence of a clerical error in orders requiring correction under the slip rule (see Esposito v Commonwealth of Australia [2015] FCAFC 160 at [138]), I do not have power to revisit my findings in Investa Properties Pty Ltd v Nankervis (No 7). Ms O'Brien for Mr Barclay drew my attention, quite properly, to the decision of the Court of Appeal of New South Wales in Todorovic v Moussa [2001] NSWCA 419; (2001) 53 NSWLR 463. In his Honour's reasons, Beazley JA referred to the following observations of Wilmer LJ in Bromley v Bromley (No 2) [1965] P 111 at 114: … If there were ever a case in which it could be shown that, after delivering judgment and after drawing up of the order, the judge had in substance rewritten his judgment, so as to put a completely different complexion on the issues in dispute, then I apprehend that this court would not be slow to censure any such behaviour on the part of the judge … 30 That which Willmer LJ deplored in Bromley is the path being urged upon me by the applicants, namely rewriting my judgment insofar as concerns my findings relating to the value of Lot 170 and placing a completely different complexion on those issues. It is a path that I should properly reject. 31 At the hearing before me the applicants relied in particular on Wenkart v Pantzer [2006] FCA 1387 and Aristocrat Technologies Australia Pty Ltd v IGT (Australia) Pty Ltd [2007] FCA 1529; (2007) 73 IPR 545. Both of these judgments considered applications to re-open the case after reasons for decision had been given and prior to entry of orders. In this respect they are entirely distinguishable from the current proceedings before me where no application to re-open the case has been made. 32 Finally, I note that even if I had a discretionary power to revisit my findings in respect of the value of Lot 170, I would refuse to exercise it in the absence of an explicit direction by the Full Court. I made those findings in respect of the value of Lot 170 after consideration of the evidence before me, at the conclusion of a lengthy trial where witnesses were subject to cross-examination by all parties. Ultimately, I preferred the evidence of certain witnesses to that of others. Witnesses gave their evidence during the course of a trial which commenced more than four years ago. 33 No application for fresh evidence has been made by the applicants. Reconsideration of the evidence in relation to Lot 170 would require, in effect, a retrial of that part of the case. I have no power to conduct such a retrial as matters currently stand. 34 I also note that the applicants were, at all times, represented by a major law firm and experienced Counsel. No basis has been advanced to the effect that the applicants were denied a clear and adequate opportunity to argue their case, or that they were denied procedural fairness (see Wenkart v Pantzer at [7]). 35 In circumstances where the applicants have suffered no loss in respect of Lot 170 which can be the subject of equitable compensation, their application for equitable compensation for breach of duty by the respondents in respect of Lot 170 must be dismissed.

Lot 191 36 The applicants do not seek review of my finding that, as at 23 December 2009, the market value of Lot 191 was $290,000. They submit that they are entitled to equitable compensation in the amount of $95,000, being the difference between the resale price and the amount they received for the property. The applicants also seek simple interest on the amount of $95,000. 37 Mr Barclay and Oliver Hume argue however that the appropriate orders in respect of Lot 191 are: The claim in respect of Lot 191 be dismissed; or in the alternative, Equitable compensation in respect of Lot 191 is assessed at $4,290; or in the alternative, Equitable compensation in respect of Lot 191 is assessed at $95,000. 38 They also argue that the applicants are not entitled to interest. 39 In light of the restorative nature of an award of equitable compensation, the maximum amount to which the applicants would be entitled in respect of Lot 191 is the amount of $95,000.

Causation 40 In summary, the respondents submit that the applicants have not addressed a fundamental flaw in the pleaded case relating to the issue of causation. 41 The respondents rely on separate judgments of the Full Court in Oliver Hume [2017] FCAFC 141; (2017) 348 ALR 385, specifically where their Honours commented on the pleaded case of the applicants and the issue of causation in respect of Lot 191. Relevant comments of the Full Court were as follows: Dowsett J said: 97 Some aspects of the Lot 191 option require further explanation. It was originally entered into on 23 December 2009 and was for a period of 90 days, suggesting that it would have expired on 23 March 2010. The appellants pleaded, at para 122 of the statement of claim, that on 20 April 2010, it was extended until 24 May 2010. I do not understand that matter to be in dispute. The contract with Spencer Projects was executed on 25 June 2010, suggesting that the extended Lot 191 option had previously expired. However, in the course of the hearing of the appeal, we were informed that there had been a further extension until 31 July 2010. There is no express pleading that the contract (between Investa Residential and Spencer Projects) was entered into as the result of a nomination by QPC pursuant to the Lot 191 option. Nor is there any pleading of a further extension of that option. … 113 Finally, there is a question as to the declarations made concerning Lot 191. Whilst fiduciary obligations may have survived the termination of the agency relationship, Investa Residential did not plead such continuing duties as against Mr Barclay or Oliver Hume. The duties are pleaded at paras 102J and 102L. In each case, the duties are said to have existed "while [Oliver Hume or Barclay was] providing real estate agent services in relation to Lot 191 ...". If Investa Residential wished to assert ongoing duties, it should have expressly so pleaded. 114 One difficulty with the declarations concerning Lot 191, Oliver Hume and Mr Barclay (declarations 3 and 4) is that they do not identify the relevant conduct or the timeframe in which it occurred. The problem is compounded by the confusion which has emerged on appeal concerning the extension of the Lot 191 option, the circumstances in which the sale to Spencer Projects was made and the error concerning Ms Barclay's involvement with that company. 115 It is not clear to me that any ongoing non-disclosure had consequences for Investa Residential. As I understand its case, it is that it derived less than the true value of Lot 191 as the result of its entering into the Lot 191 option on 23 December 2009. The ultimate sale to Spencer Projects may offer some evidence as to Investa Residential's loss as the result of non-disclosures prior to its entering into the Lot 191 option. However it cannot be said that it suffered loss as the result of the ultimate sale which was, apparently, pursuant to extensions of the option. It might be said that had Investa Residential become aware of the undisclosed matters after 10 February 2010, it could have terminated the Lot 191 option, or refused to extend it. However the case seems not to have been conducted on that basis. Further, it would not have added anything to the claim based upon the grant of the option in December 2009. The loss is either a consequence of entering into the Lot 191 option or it is not. 116 Given Investa Residential's failure to plead any ongoing duty after 10 February 2010, and the apparent lack of utility attaching to any declaration relating to conduct after that date, I would limit the declaratory relief as against Oliver Hume and Mr Barclay, concerning Lot 191, to the period expiring on 10 February 2010. 117 Declarations 3 and 4 made by her Honour should be amended to reflect the fact that, in each case, the proven breach of duty related only to conduct prior to 8 February 2010. (Emphasis added.) 42 Greenwood J did not agree with the view of Dowsett J that the declaratory relief as against Mr Barclay and Oliver Hume should be limited to the period expiring on 10 February 2010. His Honour observed: 388 The critical consideration concerning Mr Barclay is that he owed (and conceded it to be so) fiduciary duties to Investa Residential from the date of Oliver Hume's appointment on 16 July 2009 until at least the date of termination of the retainer on 8 February 2010. He failed to discharge his duty by failing to disclose, at least during the period of the fiduciary relationship and thus at any time prior to 8 February 2010, his wife's interest in QPC and the subdivisional opportunities for Lot 191. 389 Oliver Hume also owed a fiduciary obligation to Investa Residential to make those disclosures at least at any time up to 8 February 2010 because it had Mr Barclay's knowledge of the relevant matters, as a matter of imputation as discussed earlier, and thus had an obligation of disclosure. 390 At [117], Dowsett J concludes that Declarations 3 and 4 made by the primary Judge should be amended so as to reflect a proven breach of duty by conduct of nondisclosure prior to 8 February 2010. I would, respectfully, depart from such amendments because once it is accepted that Mr Barclay owed a duty of disclosure to Investa Residential of the relevant matters, his duty of disclosure did not conveniently end with the termination of Oliver Hume's retainer. Although the fiduciary relationship might have come to an end, he had a continuing obligation of disclosure from the moment the obligation arose and the duty to do so did not fall away on termination of the retainer. There was a continuing breach of the duty to tell Investa Residential of the material things. Oliver Hume had its own duty of disclosure which did not end on termination of the retainer, either. Each of them, whether before or after 8 February 2010, ought to have told Investa Residential of the material matters and their failure to do so was a continuing breach on and after 8 February 2010. 391 Dowsett J observes that whilst fiduciary obligations owed to Investa Residential may have survived the termination of the agency relationship, Investa Residential did not plead a case, as against Oliver Hume and Mr Barclay, based on continuing duties. Rather, the duties were said to have subsisted "while [Oliver Hume or Barclay was] providing real estate agent services in relation to Lot 191 ...". 392 However, both Oliver Hume and Mr Barclay concede that they owed fiduciary obligations to Investa Residential from the period of the appointment on 16 July 2009 until termination of the retainer on 8 February 2010. Notwithstanding the limitation they place on the scope of the concession, the appellants have nevertheless made good their case (ultimately by reason of the concession) that Oliver Hume and Mr Barclay owed Investa Residential fiduciary obligations by reason of their engagement to provide "real estate agent services in relation to Lot 191". It follows, as a matter of law, that the termination of the retainer did not conveniently extinguish the obligation to disclose the relevant matters after 8 February 2010. (Emphasis added.) In respect of causation Greenwood J continued: 395 A question will, no doubt, arise about whether the loss said to have been suffered by reason of the sale of Lot 191 to Spencer Projects is causally related to the conduct the subject of the declarations but that is a matter for the split hearing on loss and damage. Obviously enough, the loss will need to be demonstrated to be a "but for" loss related to the nondisclosure. The nondisclosure after 8 February 2010 might be shown to have resulted in a sale at an undervalue (if a sale at an undervalue ultimately be the proven case). That will, no doubt, raise the sequence of events concerning the grant of the option to QPC, its extension and other related matters. However, I would not limit the declarations in the way suggested by Dowsett J although I accept that the declarations need to be framed carefully so as to precisely reflect the relevant conduct. At [415] White J stated that he agreed with the reasons of Greenwood J for rejecting the grounds of appeal by Barclay and Oliver Hume, but also agreed with the reasons of Dowsett J on the topic, subject to the following qualification: … save that I do not agree with the part of his Honour's reasons which result in the declarations [3] and [4] made by the primary Judge being amended so as to limit them to breaches occurring before 8 February 2010. 43 Mr Collins for Oliver Hume submitted that the failure of the applicants to prove causation can be traced to the pleadings. It was alleged, and not disputed, that Lot 191 was listed with Oliver Hume for sale as the real estate agent, and that the retainer was terminated in February 2010. 44 Materially, in the further amended statement of claim (Statement of Claim) the applicants pleaded the relevant fiduciary duties of the respondents, in particular: In respect of Mr Nankervis: 16. By reason of the positions of Development Manager and Senior Development Manager held by Nankervis, and the responsibilities that he discharged, and the relationship between Investa Properties and Investa Residential Group as alleged in paragraphs 1A and 2 above, at all material times during his employment, Nankervis: (a) had fiduciary obligations to Investa Properties and Investa Residential Group to: (i) act in good faith and with fidelity; (ii) avoid and disclose to Investa Properties or to Investa Residential Group all actual or perceived conflicts of interest; (iii) act in the best interests of Investa Properties and Investa Residential Group; and (iv) give Investa Properties and Investa Residential Group the full benefit of his knowledge and skill, and in particular, pass on to Investa Properties or to Investa Residential Group all information that he had about the marketing and sale of the properties that were the subject of his employment, that might be relevant to the marketing and sale; (v) not profit from his position, other than by receiving remuneration in the course of his employment with Investa Properties, without full disclosure to and the informed consent of Investa Properties and Investa Residential Group; and (vi) not assist • any person with whom he was associated; or • any entity in which he had an interest; or • any person or entity from whom or from which he could expect a benefit, to purchase any of the properties he was engaged in the marketing and sale of, without full disclosure to and the informed consent of Investa Properties and Investa Residential Group; and (b) … In respect of Mr Barclay: 102L. Because of the facts alleged in paragraph 102K above, Barclay had fiduciary obligations to Investa Residential Group while providing real estate services in relation to Lot 191: (i) To act in good faith and with fidelity; (ii) To avoid and to disclose to Investa Residential Group all actual or perceived conflicts of interest; (iii) To act in the best interests of Investa Residential Group; (iv) To give Investa Residential Group the full benefit of his knowledge and skill, and in particular, pass on to Investa Residential Group all information that he had about the marketing and sale of the properties that were the subject of his employment that might be relevant to the marketing and sale; (v) Not profit from his position, other than by receiving remuneration in the course of his employment, without full disclosure to and the informed consent of Investa Residential Group; and (vi) not assist • Any person with whom he was associated; or • Any entity in which he, or a person with whom he was associated, had an interest; or • Any person or entity from whom or from which he could expect a benefit, to purchase Lot 191, without full disclosure to and the informed consent of Investa Residential Group In respect of Oliver Hume: 102J. Further and alternatively, because of the agreement alleged in paragraph 26A above and the relationship of real estate agent and principal to which it gave rise between Oliver Hume SEQ and Investa Residential Group, Oliver Hume SEQ had fiduciary obligations to Investa Residential Group while acting as real estate agent in relation to Lot 191: (i) To act in good faith and with fidelity; (ii) To avoid and to disclose to Investa Residential Group all actual or perceived conflicts of interest; (iii) To act in the best interests of Investa Residential Group; (iv) To give Investa Residential Group the full benefit of his knowledge and skill of its employees, and in particular, to pass on to Investa Residential Group all information that it or they had about the marketing and sale of the properties that were the subject of its appointment, that might be relevant to the marketing and sale; (v) Not to profit from its position, and not to allow its employees to profit, other than by receiving remuneration in accordance with its appointment, without full disclosure to and the informed consent of Investa Residential Group; and (vi) Not to assist • Any person with whom it or any of its employees was associated; or • Any entity in which it, or any of its employees, or a person with it or any of its employees was associated, or had an interest in; or • Any person or entity from whom or from which it or any of its employees could expect a benefit, to purchase Lot 191, without full disclosure to and the informed consent of Investa Residential Group. 45 The applicants also pleaded material facts relating to the breaches of duty by the respondents: 109. On 21 October 2009, Kym Barclay, Barclay's wife, incorporated Queensland Property Centre Pty Ltd (ACN 140 138 692). 110. On or about 18 December 2009, Nankervis approved the sale price in respect of a Deed of Put and Call Option for Lot 191 to Queensland Property Centre, in the amount of $195,000… 111. The price for Lot 191 that Nankervis approved, as alleged in paragraph 110 above, was $15,000 less than the price of $210,000 (after rebate) that Investa Properties had approved on 23 October 2009, as alleged in paragraph 102 above. 112. Investa Properties and Investa Residential Group did not grant approval for the sale of Lot 191 at $195,000. 113. On or about 23 December 2009, Investa Properties caused Investa Residential Group (then known as Clarendon Residential Group Pty Ltd) to enter into a Deed of Put and Call with Queensland Property Centre for the purchase and sale of Lot 191 at the reduced sale price of $195,000. 46 Therefore, [113] pleads the action taken by the applicants in ignorance of the conduct of the respondents, and is related to their breach of fiduciary duty. The pleading continues: 114. Nankervis and Barclay were involved in taking further steps to subdivide Lot 191 into two lots after the Lot 191 Approved Sale Price was approved … 115. On 8 April 2010, Kym Barclay confirmed acceptance for development application to subdivide Lot 191 into two lots … 116. Between 21 October 2009 and 10 November 2010, Kym Barclay was, for all intents and purposes, the sole director and sole shareholder of Queensland Property Centre. 47 It appears that, at the hearing of the appeals, an issue emerged concerning the factual correctness of the allegation in [116], and whether, in fact, it transpired that the sole director and shareholder of Queensland Property Centre was Mrs Barclay's daughter. In any event, materially the pleading continues: 119. Nankervis did not at any time disclose to Investa Properties or to Investa Residential Group that the other party to the Deed of Put and Call alleged in paragraph 113 above, namely, Queensland Property Centre, was a company owned and controlled by Barclay's wife. 120. Barclay did not at any time disclose to Investa Properties or to Investa Residential Group the other party to the Deed of Put and Call alleged in paragraph 113 above was a company owned and controlled by Barclay's wife. 120A. Oliver Hume SEQ did not at any time disclose to Investa Properties or to Investa Residential Group the other party to the Deed of Put and Call alleged in paragraph 113 above was a company owned and controlled by Barclay's wife. 121. On 20 April 2010, Queensland Property Centre requested that the expiry date for the call option for Lot 191 be extended to 24 May 2010 … 122. On 20 April 2010, Nankervis approved Queensland Property Centre's request that the Call Option Expiry Date for Lot 191 be extended to 24 May 2010 … 125. [sic] On 10 June 2010, Kym Barclay incorporated Spencer Projects Pty Ltd (ACN 144 564 438) 126. On or about 18 June 2010, Nankervis approved the sale price of Lot 191 to Spencer Projects as trustee for the Spencer Trust in the amount of $290,000 … 127. On or about 25 June 2010: (a) Investa Properties caused Investa Residential Group to enter into a contract dated 25 June 2010 for the sale of Lot 191 to Spencer Projects, as trustee for the Spencer Trust, at the sale price that Nankervis had approved, namely $290,000; and (b) Kym Barclay signed the contract for Lot 191 on behalf of Spencer Projects. 128. The contract for Lot 191 settled on 28 July 2010. 129. Between 10 June 2010 and 10 November 2010, Kym Barclay was, for all intents and purposes, the sole director and shareholder of Spencer Projects. 132. [sic] Nankervis did not at any time disclose to Investa Properties or to Investa Residential Group that the company to which Lot 191 was being sold, Spencer Properties, was owned and controlled by Barclay's wife. 133. Barclay did not at any time disclose to Investa Properties or to Investa Residential Group that the company to which Lot 191 was being sold was owned and controlled by Barclay's wife. 135. [sic] Oliver Hume SEQ did not at any time disclose to or to Investa Residential Group that the company to which Lot 191 was being sold was owned and controlled by Barclay's wife. 48 At [136], [137] and [139] of the Statement of Claim the applicants plead breaches of fiduciary duties by, respectively, Mr Nankervis, Mr Barclay and Oliver Hume. 49 At [136] the applicants plead: 136. As a result of the following facts, namely: (a) Nankervis and Barclay were involved in taking steps to subdivide Lot 191 into two lots prior to recommending the Lot 191 Approved Sale Price, as alleged in Paragraph 103 above; (b) Nankervis and Barclay were involved in taking further steps to subdivide Lot 191 into two lots, as alleged in paragraph 114 above; (c) Nankervis recommended a sale price of $210,000 (after rebate) without disclosing to Investa Properties or to Investa Residential Group the facts alleged in (a), and did not disclose the facts alleged in (b) above; (d) Nankervis approved the sale price of $195,000 in respect of the Deed of Put and Call Option for Lot 191, as alleged in paragraph 110 above; (e) Nankervis did not disclose that the Deed of Put and Call Option for Lot 191 was with a company owned and controlled by Barclay's wife, as alleged in paragraph 119 above; and (f) Nankervis did not disclose that Lot 191 was being sold to a company owned and controlled by Barclay's wife, as alleged in paragraph 132 above, Nankervis breached: (i) His fiduciary obligations to Investa Properties and Investa Residential Group; and (ii) Section 182 of the Corporations Act; and (iii) Section 183 of the Corporations Act. Particulars Breaches of Fiduciary Obligations (1) Nankervis did not act in good faith and with fidelity towards Investa Properties and Investa Residential Group at all times during his employment with Investa Properties because of the facts alleged in paragraphs 103, 104, 105, 114, 119, 126 and 132. (2) Nankervis did not avoid and disclose to Investa Properties or to Investa Residential Group actual or perceived conflicts of interest because of the facts alleged in paragraphs 103, 104, 105, 114, 119, 126 and 132. (3) Nankervis did not at all times act in the best interests of Investa Properties and Investa Residential Group because of the facts alleged in paragraphs 103, 104, 105, 114, 119, 126 and 132. (4) Nankervis did not pass on to Investa Properties or to Investa Residential Group ball information he had about the marketing and sale of the properties that were the subject of his employment and that might be relevant to the marketing because of the facts alleged in paragraphs 103, 104, 105, 114, 119, 126 and 132. (5) Nankervis gave assistance to persons with whom he was associated to purchase the properties which he was engaged in the marketing and sale of without full disclosure to Investa Properties or to Investa Residential Group because of the facts alleged in paragraphs 103, 104, 105, 114, 119, 126 and 132. … 50 At [137] the applicants plead: 137. As a result of the following facts, namely: (a) Nankervis and Barclay were involved in taking steps to subdivide Lot 191 into two lots prior to recommending the Lot 191 Approved Sale Price, as alleged in paragraph 103 above; (b) Nankervis and Barclay were involved in taking further steps to subdivide Lot 191 into two lots, as alleged in paragraph 114 above; (c) Barclay did not disclose to Investa Properties or to Investa Residential Group the facts alleged in (a) and (b) above; (d) Barclay did not disclose to Investa Properties or to Investa Residential Group that the Deed of Put and Call Option for Lot 191 was with a company owned and controlled by his wife, as alleged in paragraph 120 above; and (e) Barclay did not disclose to Investa Properties or to Investa Residential Group that Lot 191 was being sold to a company owned and controlled by his wife, as alleged in paragraph 133 above, Barclay breached his fiduciary obligations to Investa Residential Group. Particulars (1) Barclay did not act with good faith with fidelity towards Investa Residential Group because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 120 and 133. (2) Barclay did not avoid, and disclose to Investa Properties or to Investa Residential Group, actual or perceived conflicts of interest, because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 120 and 133. (3) Barclay did not at all times act in the best interests of Investa Residential Group because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 115, 116, 118, 120, 125, 129, 131 and 133. (4) Barclay did not pass on to Investa Properties or to Investa Residential Group all information he had about the marketing and sale of Lot 191 that might be relevant to the marketing and sale of that lot, because of the facts alleged in paragraphs 103, 106, 107, 114, 115, 116, 118, 120, 125, 129, 131 and 133. (5) Barclay gave assistance to persons with whom he was associated, or entities in which he had an interest to purchase Lot 191 without full disclosure to Investa Properties or to Investa Residential Group, because of the facts alleged in 103 [sic], 106, 107, 114, 116, 118, 120, 129, 131 and 133. 51 At [139] the applicants plead: 139. As a result of the following facts, namely (aa) Nankervis and Barclay were involved in taking steps to subdivide Lot 191 into two lots prior to Nankervis recommending the Lot 191 Approved Sale Price, as alleged in paragraph 103 above (knowledge of which was the knowledge of, or was imputed to, Oliver Hume SEQ); (a) Nankervis and Barclay were involved in taking further steps to subdivide Lot 191 into two lots, as alleged in paragraph 114 above (knowledge of which was the knowledge of, or was imputed to, Oliver Hume SEQ); (b) Oliver Hume SEQ did not disclose to Investa Properties or to Investa Residential Group the facts alleged in (aa) and (a) above; (c) Oliver Hume SEQ did not disclose to Investa Properties or to Investa Residential Group that the Deed of Put and Call Option for Lot 191 was with a company owned and controlled by Barclay's wife, as alleged in paragraph 120A above; and (d) Oliver Hume SEQ did not disclose to Investa Properties or to Investa Residential Group that Lot 191 was being sold to a company owned and controlled by Barclay's wife, as alleged in paragraph 135 above, Oliver Hume SEQ breached: (i) The express terms of the agreement alleged in paragraph 102G above; (ii) The implied term of the agreement alleged in paragraph 102I above; and (iii) Oliver Hume SEQ's fiduciary obligations to Investa Residential Group. Particulars of Lot 191 Contractual breaches (1) … (2) … Particulars of Lot 191 Breaches of Fiduciary Duty (3) Oliver Hume SEQ did not act with good faith and with fidelity towards Investa Residential Group because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 120 and 133. (4) Oliver Hume SEQ did not avoid and disclose to Investa Properties or to Investa Residential Group actual or perceived conflicts of interest because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 118, 120, 125, 129, 131 and 133. (5) Oliver Hume SEQ did not at all times act in the best interests of Investa Residential Group because of the facts alleged in paragraphs 103, 106, 107, 109, 114, 120 and 133. (6) Oliver Hume SEQ did not pass on to Investa Properties or to Investa Residential Group all information it had about the marketing and sale of Lot 191 that might be relevant to the marketing and sale of that lot, because of the facts alleged in paragraphs 103, 106, 107, 114, 115, 116, 118, 120, 125, 129, 131 and 135. (7) Oliver Hume SEQ gave assistance to persons with whom it was associated, or entities in which it had an interest, to purchase Lot 191 without full disclosure to Investa Properties or to Investa Residential Group, because of the facts alleged in 103, 106, 107, 114, 116, 118, 120, 129, 131 and 133. 52 In summary, Mr Barclay and Oliver Hume submitted: They owed ongoing fiduciary duties to the applicants; Relevant facts included the extended put and call option, and ultimately the entry into the contract in June 2010 by Queensland Property Centre and Investa Residential. 53 However - Mr Barclay and Oliver Hume submitted that the applicants never pleaded the causative relationship between the breaches of the relevant fiduciary duties of the respondents, and the decision of the relevant applicant to enter into the actual contract, which allegedly resulted in the loss to the applicants in respect of Lot 191. 54 No written submissions were filed by the applicants in this proceeding in relation to the issue of causation. At the most recent hearing before me, shortly after Counsel for the applicants began her oral submissions, Counsel for Oliver Hume referred me to comments of the Full Court in the appellate judgment, which I have cited above, relating to the issue of causation, and further drew to my attention the absence of any submissions on the part of the applicants addressing the issue. In response, Ms Painter QC for the applicants said: … that the remedy is not tied to common law questions of causation or remoteness. So it is not sufficient, in our submission, to try to make out that this is a standard common law case with a microscopic attention to causation as if it was a personal injury case. It's simply not. Equitable cases are different and this court has treated them differently since its inception and courts of equity have treated equitable compensation differently to common law questions since their inception hundreds of years ago. The question is not is the loss caused by, or even the but for test. The question is whether the loss would have happened if there had been no breach … (Transcript 17 April 2018 pp 9-10) 55 Ms Painter QC for the applicants later continued: We say at 3.2 that: If those breaches had not occurred, those many and varied and continuing breaches had not occurred, Investa Residential would not have transferred Lot 170 to Two Eight Two Nine Proprietary Limited, the eventual purchaser, and it would not have transferred Lot 191 to Spencer Projects, the eventual purchaser. And that conforms with the test, not some common law articulation of causation, but rather the proper equitable compensation question, would the loss have happened if there had been no breach, and we say no, it would not. If there had been no breach, we would not have transferred the properties … (Transcript 17 April 2018 p 12 lln 7-17) 56 In criticising the submissions of the respondents as improperly ascribing a microscopic level of attention to the issue of causation, the applicants have failed to acknowledge that establishing causation is a necessary element in substantiating a claim for equitable compensation. As I noted earlier in this judgment, citing Gordon J in Parker, there must be some causal connection between the claimed breach of fiduciary obligation and the loss for which compensation is recoverable. To varying degrees, all three appellate Judges in these proceedings so observed. The Full Court elsewhere has noted that the only losses that are made good in an award of equitable compensation are those that, on a common sense view of causation, are caused by the breach of duty: V-Flow Pty Limited v Holyoake Industries (Vic) Pty Limited [2013] FCAFC 16; (2013) 296 ALR 418 at [56]. For general articulation of relevant principles, one need look no further than the comments of the Full Court of the Federal Court in ABN AMRO Bank NV v Bathurst Regional Council [2014] FCAFC 65; (2014) 224 FCR 1, in particular the following: 1090 Fourth, the principles of causation in relation to a claim for equitable compensation for breach of fiduciary duty are distinct. The court must identify "criteria which supply an adequate or sufficient connection between the equitable compensation claimed and the breach of fiduciary duty": Maguire v Makaronis [1997] HCA 23; (1997) 188 CLR 449 at 473 and O'Halloran v R T Thomas & Family Pty Ltd [1998] NSWSC 596; (1998) 45 NSWLR 262 at 276-277. What constitutes an adequate or sufficient connection is not predetermined or formulaic. Each case requires a precise focus on both the nature of the obligations and the nature of the breach: Beach Petroleum at 90 [431] and Maguire at 472-473. Any question of "direct" or "immediate cause" is a red herring. The required focus is the nature of the obligations and the nature of the breach because different obligations and breaches may raise different criteria that supply the necessary connection. So, for example, "several matters appropriately will be taken into account when there falls for consideration, in an action against the fiduciary arising other than out of breach of trust, the criteria which supply an adequate or sufficient connection between the equitable compensation claimed and the breach of fiduciary duty" which may not be relevant in breach of trust cases (emphasis added): Maguire at 473. 1091 Indeed, as Spigelman CJ stated in O'Halloran, "[i]n the case of a trustee dealing with trust property, the law has proceeded beyond the invocation of the formulaic "common sense" approach to causation, by adopting a stringent test to the selection of those events preceding loss which are to be taken as causing the loss": at 276-277. Spigelman CJ's reference to the "common sense" approach to causation was to the oft-stated proposition that a court will only make good losses that on a common sense view of causation were caused by the breach of fiduciary duty: Beach Petroleum at 90 [432]; Watson v Ebsworth & Ebsworth (a firm) (2010) 31 VR 123 at 173 [160]; O'Halloran at 272-273; Ganson Enterprises Ltd v Boughton & Co (1991) 85 DLR (4th) 129 at 163 and Target Holdings Ltd v Redferns [1996] 1 AC 421 at 439. So much may be accepted. (Emphasis added.) 57 Turning to the case before me it is evident that, in respect of Lot 191, the applicants have not pleaded a causal link between the alleged breaches of fiduciary duties on the part of any of the respondents and any losses the applicants may have suffered as a result of those breaches. The relevant paragraphs in the Statement of Claim are set out above - however as Mr Barclay and Oliver Hume submit, the causal link is simply not identified. Counsel for the applicants was challenged by the respondents at the hearing to address this issue, and, other than by general observations concerning the overly technical approach of the respondents to this litigation and their egregious conduct in breaching their fiduciary duties, Counsel for the applicants did not do so. Certainly the applicants did not identify where in the Statement of Claim they pleaded the relevant causal link between breaches of fiduciary duties and resultant loss to the applicants. The only conclusion I can draw is that the applicants were unable to do so, because the relevant pleading does not exist. 58 In oral submissions the applicants denigrated the contentions of the respondents as "taking of these types of narrow pleading points" (transcript 17 April 2018, lln 22-23). Counsel for the applicants submitted that the respondents had been criticised by the Full Court during the hearing of the appeals for this approach, although I was not directed to any specific criticisms or transcript in this respect. 59 Certainly both the High Court and the Full Court of this Court have has recognised that, despite the critical importance of pleadings to the conduct of a case, evidence adduced at trials may diverge from the pleaded particulars to some degree. As Mason CJ and Gaudron J observed in Banque Commerciale SA (En Liqn) v Akhil Holdings Ltd (1990) 169 CLR 279: The function of pleadings is to state with sufficient clarity the case that must be met: Gould and Birbeck and Bacon v. Mount Oxide Mines Ltd. (In liq.), per Isaacs and Rich JJ. In this way, pleadings serve to ensure the basic requirement of procedural fairness that a party should have the opportunity of meeting the case against him or her and, incidentally, to define the issues for decision. The rule that, in general, relief is confined to that available on the pleadings secures a party's right to this basic requirement of procedural fairness. Accordingly, the circumstances in which a case may be decided on a basis different from that disclosed by the pleadings are limited to those in which the parties have deliberately chosen some different basis for the determination of their respective rights and liabilities. See, e.g., Browne v. Dunn; Mount Oxide Mines. Ordinarily, the question whether the parties have chosen some issue different from that disclosed in the pleadings as the basis for the determination of their respective rights and liabilities is to be answered by inference from the way in which the trial was conducted. It may be that, in a clear case, mere acquiescence by one party in a course adopted by the other will be sufficient to ground such an inference… (Footnotes omitted.) 60 See also the recent observations of the Full Court in Stefanovski v Digital Central Australia (Assets) Pty Ltd [2018] FCAFC 31 at [65]. 61 In this case I have made extensive findings about breaches of duties by the respondents. Those findings have been reviewed and modified by findings of the Full Court on appeal. 62 It is now for the applicants to substantiate their entitlement to remedies based on those findings. 63 In this respect I note the following: The authorities are clear that a causal connection must be established between the claimed breach of fiduciary duty or duties, and the loss for which equitable compensation is sought. The parties have been aware since delivery of the primary judgment in 2015 that the issue of remedies would be considered separately, following delivery of judgments in the various appeals. Various comments were made by their Honours in the Full Court, expressing varying opinions regarding whether causation had been pleaded. Certainly Dowsett J, with whom White J agreed on this point, expressed strong reservations about whether causation had been properly pleaded by the applicants. As I noted earlier in this judgment the applicants have, at all times, been advised and represented by experienced solicitors and Counsel. Further, the Statement of Claim is the third version of that document. The applicants have had ample opportunity to ensure that it accurately and comprehensively pleaded their case. In written submissions filed prior to the most recent hearing, lawyers for Mr Barclay and Oliver Hume put all parties on notice that they would be raising the issue of causation. The applicants have not met those submissions; alternatively they have been unable to meet those submissions. 64 While it is clear from such cases as Banque Commerciale SA and Stefanovski that the manner in which a trial progresses may diverge from the way in which the case is initially pleaded, the applicants have not, in either written or oral submissions, taken me to any material which demonstrates that, notwithstanding the absence of a pleaded causal link, the manner in which the trial was conducted meant that the relevant causal link was part of the applicants' case in respect of Lot 191 which the respondents were required to meet. The applicants have not directed me to any material from which I can infer that the parties have litigated this case in a manner different from that disclosed in the pleadings, or any material to the effect that the respondents had accepted the existence of a causal link. 65 Rather, the applicants have re-emphasised the egregious conduct of those respondents (for example, transcript 17 April 2018 p 13 ln 21, p 37 ln 46 and p 87 ln 38). But a breach of duty, however egregious, does not, of itself, automatically flow into the loss which has been claimed in this case. Contrary to the submissions of the applicants, the position advanced by the respondents cannot be characterised as an overly technical approach to the pleadings in this case. Rather, as is apparent from the general principles of equitable compensation I cited at the beginning of this judgment, the fact that the respondents breached fiduciary duties to the applicants is not enough in itself to warrant an order for equitable compensation in the applicants' favour where a causal link has not been established. 66 The power of a court of equity is restorative - in the absence of circumstances permitting an aggrieved beneficiary to be returned to its position prior to the breach, an order for compensation can be made only if the beneficiary has suffered loss as a result of a fiduciary acting in breach of duty. If no case is argued that the beneficiary has suffered loss as a result of that breach of duty, there is no room for an award of equitable compensation. 67 In the event that I am wrong, however, the question then arises as to whether it is necessary for the applicants to establish that the loss they claim in respect of Lot 191 would not have occurred "but for" the breach of duty by the respondents. 68 The historical development of this principle was examined by Kirby J in Maguire v Makaronis (1997) 188 CLR 449 at 491-492, and identified by his Honour as a variant of the rule in Brickenden v London Loan & Savings Co [1934] 3 DLR 465. In obiter in Oliver Hume South East Queensland Pty Ltd v Investa Residential Group Pty Ltd, Greenwood J at [395] appeared to adopt this variant, referring to the requirement of the applicants to demonstrate that the loss they suffered was a "'but for' loss" related to relevant breaches of duty. As a general proposition, however, I note that it is by no means clear that the "but for" test is applicable in respect of consideration of equitable compensation awards. The Full Court in ABN AMRO Bank NV at [1095]-[1096] accepted the views of Lord Thankerton in Brickenden at 469 as stating the law, and in the context of that case relied on observations in Furs Ltd v Tomkies (1936) 54 CLR 583 at 592 to the effect that [t]he consequences of such a conflict (the non-disclosure of material facts) are not discoverable. Both justice and policy are against their investigation … 69 In this case not only is no such causal link between the breaches of duties and the loss pleaded by the applicants in respect of Lot 191, the applicants have not, in any way, explained what the causal link between the relevant breaches of fiduciary duties and their loss would be. It is the applicants' case, the causal link is for the applicants to prove, and they have not done so. 70 Further, taking guidance from the obiter comments in the judgments of the Full Court in the appeals in this case, and assuming that the applicants are required to establish that the loss they claim would not have occurred "but for" the breaches of duty by the respondents as pleaded by the applicants in the Statement of Claim, I note the powerful submissions of the Counsel for Mr Barclay and for Oliver Hume to the effect that the applicants have established no such thing. In particular, I note the evidence before the Court that: At the relevant time the applicants were implementing a divestment strategy aimed at selling lots to boost cash flow, including bulk discount sales and reduction in the purchase prices for individual lots, and were not interested in retaining parcels of land with subdivision potential (including Lot 191). In this respect I note, for example, the evidence of Mr Lloyd Jenkins (transcript p 434 ln 36), Mr Andrew Murray (transcript p 1296 lln 44-47), Ms Nicole Prout (transcript p 268), Mr Gavin Stubbs (transcript p 529), Mr Damien Long (transcript p 770 lln 5-30) and Mr Cameron Holt (transcript p 822 lln 10-30). The applicants were prepared to sell certain lots at an average price of $194,000 per lot, and had approved the sale of Lot 191 at a recommended sale price of $210,000 (affidavit of Cameron Holt Exhibit 57(A) Annexure CH-165). As apparently emerged before the Full Court hearing - the person who owned and controlled Spencer Projects (namely the entity which was acquiring Lot 191) was not Mrs Barclay as pleaded by the applicants, but Ms Jaide Crosbie, the daughter of Mrs Barclay. 71 No submissions were made by the applicants in respect of this evidence, other than a general submission that the relevant question is not whether the loss is caused by the breach of duty, or even the "but for" test, but rather whether the loss would have happened if there had been no breach of duty (transcript 17 April 2018 p 10 lln 7-8). While a "but for" test as submitted by the respondents may imply a stricter standard than the question posed by the applicants, the applicants have nonetheless not advanced arguments or evidence to support their own articulation of the applicable principle of causation. To that extent, the submissions of the respondents and the evidence the respondents have adduced are unchallenged. 72 In the circumstances, the applicants have not established a causal link between the breaches of duties on the part of the respondents relating to Lot 191, and any loss that would be compensable. Even if such a link could be established, the evidence to which I have been directed would not support a finding that the loss the applicants claim in respect of Lot 191 followed from the breaches of fiduciary duties by the respondents. 73 The claim by the applicants for equitable compensation in respect of Lot 191 is dismissed.

Cross-claim of Mr Barclay against Mr Nankervis 74 By a notice of cross-claim filed 15 November 2013, Mr Barclay sought the following relief from Mr Nankervis: 1. Equitable contribution; further or alternatively 2. Damages; 3. Costs. 75 Mr Barclay filed a Statement of Cross-claim on the same date. I understand that, in circumstances where Lot 170 was sold at market value and accordingly there is no issue of compensable loss suffered by the applicants in respect of that property, the only issue pressed by Mr Barclay concerns the prospect of seeking equitable contribution from Mr Nankervis in respect of Lot 191. As I have dismissed the applicants' claim for equitable compensation in respect of Lot 191 however, there is no basis on which to order equitable contribution from Mr Nankervis. 76 It is appropriate nonetheless for me to make findings in respect of Mr Barclay's claim for equitable contribution in the event that I am wrong in dismissing the applicants' claim for equitable compensation. 77 The starting point is 2 to (o) of the statement of cross-claim (which relate to Lot 191) and 2 to (hh) of the statement of cross-claim (which relate to Lot 170). In respect of Lot 191 Mr Barclay pleads: LOT 191 (g) On or about 19 October 2009 the Cross-Claimant emailed the Cross-Respondent asking whether there would be any issues with subdividing Lot 191. (h) On or about 21 October the First Respondent approved, on behalf of the Applicants, the Lot 191 Approved Sale Price of $210,000. (i) On 23 October 2009 the Applicants approved the Lot 191 Sale Price. (j) On or about 18 December 2009, the First Respondent approved the sale price in respect of a Deed of Put and Call Option for Lot 191 to Queensland Property Centre Pty Ltd, in the amount of $195,000 ("Lot 191 Sales Advice"). (k) The Applicants did not approve the Lot 191 Sales Advice. (l) The Cross-Claimant did not at any time disclose to the Applicants that he was involved in taking steps to subdivide Lot 191. (m) The Cross-Respondent did not at any time disclose that he was involved in taking steps to subdivide Lot 191. (n) On or about 18 June 2010 the Cross-Respondent approved the Sale Price of Lot 191 to Spencer Projects as trustee for the Spencer Trust in the amount of $290,000. (o) On or about 25 June 2010 the Second Applicant entered into a contract of sale with Spencer Projects for $290,000, and that contract settled on 28 July 2010. 78 In respect of Lot 170 Mr Barclay begins as follows: LOT 170 (p) By letter of 16 July 2008, the Applicants offered the Oliver Hume Group the commission for the en globo sale of the Fossil Site and Oliver Hume accepted that offer. (q) Alternatively, by email dated 27 November 2008, the Applicants, by the Cross-Respondent, offered the Cross-Claimant, for Oliver Hume, a commission for the en globo sale of the Fossil Site and the Fourth Respondent accepted that offer. (r) The Cross-Claimant was in a position of confidence in relation to the Applicants in connection with the sales and marketing of the Fossil Site… (s) The Cross-Claimant owed fiduciary obligations to the Applicants… 79 Mr Barclay pleads material facts and continues: (ff) At the time the Cross-Claimant engaged in this conduct he was: (i) Employed by the fourth respondent; (ii) A director of the fourth respondent; (iii) The only director of the fourth respondent resident in QLD; (iv) Authorised by the fourth respondent to sign various identified types of agreements; (v) Operating with the actual and ostensible authority to act for the Fourth Respondent in relation to providing real estate agent services to the Applicants; (vi) By reason of the matters pleaded in paragraphs 162A-162E of the enclosed Statement of Claim, a fiduciary of the Applicants, and was providing services to the Applicants in respect of marketing and sale of the Fossil Site. (gg) At the time the Cross-Respondent engaged in this conduct he was an employee of the First Applicant. (hh) As a result of their breaches of fiduciary obligations to the Applicants, each of the Cross-Claimant and Cross-Respondent are accountable to the Second Applicant for the value of the Fossil Site at the date of the put and call option of 20 February 2009. 80 The cross-claim concludes: 4. If: a. the Cross-Claimant and Cross-Respondent entered into the Agreement with Tonuri (which is denied); and b. as a consequence, the Applicants succeed in their claims against the Cross-Claimant and Cross-Respondent for breach of fiduciary duty, the Cross-Claimant claims equitable contribution by the Cross-Respondent. 5. Further or alternatively: a. if the Cross-Claimant, on behalf of the Fourth Respondent, accepted the Applicant's offer from the First Respondent by email dated 27 November 2008 to act for the Applicants in relation to the Fossil Site (which is denied); and b. as a consequence, the Cross-Claimant relied on the Cross-Respondent's email dated 27 November 2008 in sourcing a buyer for a contract price on the same terms as the previous contract to Brittains Road Pty Ltd; and c. … d. as a consequence the Applicants succeed with their claims against the Cross-Claimant and Cross-Respondent for breach of fiduciary obligations and breach of confidence; then e. the Cross-Claimant has suffered loss and damage as a result of the Cross-Respondent's breach of employment and/or breach of fiduciary obligations; f. the loss and damage is the amount the Cross-Claimant is found liable to the Applicants for. 81 I have already noted that Mr Nankervis did not appear at the hearing of the cross-claim, nor did he file any submissions. I note further, however, that on 12 December 2013 Mr Nankervis filed a defence to the cross-claim in which, relevantly, he: admitted the allegations in paragraphs 2(a), (b), (c)(i) to (c)(v), (e), (f), (j), (n), (r), (s)(viii), (s)(ix), (s)(x), (s)(xi), (t), (u), (v), (w), (x), (y), (z), (aa), (bb), (cc), (dd), (ee), (ff), and (gg) of the Statement of Cross-claim; denied the allegations in paragraphs 2(d), (g), (h), (i), (k), (l), (m), (o), (p), (q), (s)(xii), (s)(xiii), and (hh) of the Statement of Cross-claim on the basis that they did not accurately record the allegations made by the applicants in the Statement of Claim; objected in point of law to the allegations in paragraph 5 of the Statement of Cross-claim and says that no relevant obligation was owed by Mr Nankervis to Mr Barclay to give rise to the alleged cross-claim for damages, and otherwise denied the allegations in that paragraph. 82 The doctrine of equitable contribution has been explained in detail in such cases as HIH Claims Support Ltd v Insurance Australia [2011] HCA 31; (2011) 244 CLR 72 at [36]-[48] and ABN Amro Bank NV at [1009]-[1015]. In particular in HIH Claims Support, Gummow ACJ, Hayne, Crennan and Kiefel JJ observed that: the basic concept of contribution was longstanding and was accepted by both law and equity as one of natural justice, expressed by ensuring equality between persons obliged in respect of a common obligation (at [36]); the principle could be described as one where persons who are under co-ordinate liabilities to make good the one loss must share the burden pro rata (at [36]); and given that natural justice underpins the duty to contribute in respect of co-ordinate liabilities, the search for a common obligation should not be defeated by too technical an approach. It is possible to have a common obligation where the obligation of each of two obligors has a different source provided the obligations can be characterised as of the same nature and to the same extent (at [39]), 83 While Mr Barclay's pleading in respect of Lot 191 is vague, I note that the factual substratum and relief he claims in his cross-claim are relevant to both Lot 170 and 191. For the purposes of this cross-claim, from the findings of the Court both at first instance and on appeal it is clear that each of Mr Nankervis and Mr Barclay breached their fiduciary obligations to the applicants in respect of both Lot 170 and Lot 191. Those breaches related to non-disclosure. They are co-ordinate fiduciary obligations, and of corresponding nature and extent. If there were a loss suffered by the applicants resulting from those breaches of duty it would be the one loss. The respondents would be under a co-ordinate liability to make good any loss, and would be required to share the burden pro rata: Albion Insurance Co Ltd v Government Insurance Office (NSW) (1969) 121 CLR 342 at 350, HIH Claims Support at [36], Watkins Syndicate 0457 at Lloyds v Pantaenius Australia Pty Ltd [2016] FCAFC 150; (2016) 244 FCR 5 at [52]. It follows that Mr Nankervis would be liable to make equitable contribution to Mr Barclay for any compensation award against Mr Barclay. I certify that the preceding eighty-three (83) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Collier.