I said 'I hear your logic, but for my part my rights say that I should have me [sic] lawyer advise me. Let me talk with Tony'.
14. Jeans and I had an aside conversation. I then said to Cleary:
'I am not really happy about signing this Guarantee today, it all seems to be too much of a rush; however, what we are guaranteeing is what is in the Letter of Offer?'
Jeans said 'Yes'.
I said 'And the Bank has accepted the take-out funding proposal?'
Jeans said 'Yes'.
I then said to Cleary: 'If we sign this, Steve, who can witness it? Tony and I cannot witness each others guarantee because I think that would have legal holes in it?'
Cleary said 'I will witness and that is acceptable to the Bank'."
137 Mr Bruce's evidence before Sackville J on 31 March 2003 included the following answers in response to Mr Ireland QC (Exhibit A, T514-515):
"And where were you on that day when you were first requested to sign the guarantee or was it on some earlier day? --- It was the day previous we had a phone call from, Mr Jeans advised me that we had a phone call from Steve Cleary to say that the guarantees needed to be signed.
…
And you're telling the court that on 2 June, 1998 he told you that there was a guarantee to be signed by you and by him? --- That's right.
But it was not on that day that you did anything about that? --- No.
How did it come about that you specifically went somewhere else to sign documents, how did that come about? --- Cleary [sic] , I can't imagine, Clearly [sic] didn't ring me and I think I would have only known about the location for the signing from Mr Jeans.
And did you go to the BBC, that is the Business Banking Centre? --- Yes.
In the city? --- Yes.
The Commonwealth Bank? --- Commonwealth Bank, yes.
And did you go there about 2 o'clock? --- I did.
Did you have any engagement that day? ---Yes, in that evening yes, I was rather, put out is not the word, but I was anxious not to be there, be at home with my family.
When you say be there, you mean be at the bank? --- Be at the bank, yes.
You've said in your affidavit that at that stage you had not actually looked at the revised letter of offer dated 2 March, 1998? --- That's right.
When you got to the bank at 2 o' c lock on 3 June, 1998 who was there? --- Cleary only to start with.
I'm sorry? --- Mr Cleary only to start with, Steve Cleary only to start with. Mr Jeans arrived soon after.
And what immediately happened next once you got to the bank, did you speak to Mr Cleary? --- Yes, Mr Cleary indicated that we ---
No, just take it bit by bit. Did you speak to Mr Cleary before Mr Jeans arrived? --- Yes.
Can you tell us please what did Mr Cleary say to you and what did you say to him? --- Mr Cleary was a personable sort of guy and he'd been helpful to us, it was just chit-chat, we didn't start the show until Mr Jeans basically arrived.
And where were you at that stage? --- Sitting in a meeting room adjacent to Mr Cleary's office.
HIS HONOUR: This is at the Business Banking Centre? --- That's right.
MR IRELAND: And you say Mr Jeans arrived soon after that? --- He did.
And how long was it between Mr Jeans arrival and your departure? --- I'm always on time at appointments so I would have been there at 2 o'clock for sure and Mr Jeans would arrive within 5 or 10 minutes and I was gone by 3.
HIS HONOUR: I didn't hear the last part? --- I was gone by 3.
MR IRELAND: And did you leave alone? --- I did.
And when you left do you say Mr Jeans remained or had he gone already? --- No, Mr Jeans was still there when I left."
138 In essence, Mr Bruce told Sackville J that the Defendant had contacted the Plaintiff on 2 June 1998 indicating that the guarantees needed to be signed by Mr Bruce and the Plaintiff and arranging a meeting the next day for that purpose. On 3 June 1998, Mr Bruce arrived first and spoke to the Defendant with the Plaintiff arriving a little later. Mr Bruce signed his guarantee in the presence of the Defendant and the Plaintiff. During a three-way conversation, the Defendant said to the Plaintiff and Mr Bruce that he needed the guarantee signed that day. Mr Bruce left the Bank before the Plaintiff did.
139 Mr Bruce's evidence before Sackville J provides unequivocal support for the Defendant's evidence that a meeting took place on the afternoon of 3 June 1998 at the Bank premises involving the Plaintiff, Mr Bruce and the Defendant and that the purpose of the meeting was to sign security documents including the guarantees.
140 In evidence before Sackville J, Mr Bruce stated that he had not seen the Plaintiff sign any guarantee in his presence on 3 June 1998. Mr Bell SC submits that this aspect of Mr Bruce's evidence ought be approached with caution. Shortly before he gave this evidence before Sackville J, the Plaintiff had asserted for the first time that the disputed signature on page 12 of the guarantee was not his. Mr Bruce was seeking to amend his own pleadings in the Federal Court to rely upon the Plaintiff's alleged non-signature in his own defence. Accordingly, Mr Bell SC submitted that Mr Bruce, consciously or subconsciously, had a motive to mould his own evidence to suit his needs at that time. It was this argument which underlay the application to treat Mr Bruce, for certain purposes, as an unfavourable witness under s.38 Evidence Act 1995.
141 Mr Bruce attended in answer to a subpoena to give evidence in the present proceedings. He declined to confer with the Defendant's legal representatives before entering the witness box (T160.6). He confirmed the content of his affidavit sworn 31 January 2002 and his evidence given before Sackville J on 31 March 2003 (Exhibit 3). Mr Bruce asserted before me that the Plaintiff did not sign anything at the meeting with the Defendant on 3 June 1998 whilst he (Mr Bruce) was there (T161.30). Mr Bruce conceded in his evidence before me the possibility that the Plaintiff may not have been present at the meeting with the Defendant on 3 June 1998 and that he may have been thinking of other meetings which he and the Plaintiff had with the Defendant (T180.31).
142 I accept the Defendant's submission that the most reliable account given by Mr Bruce concerning the events of 3 June 1998 was that contained in his affidavit of 31 January 2002. In that account, he stated that a meeting occurred with the Defendant at which both he and the Plaintiff were present on 3 June 1998. His evidence before Sackville J was that the very purpose for this meeting was to enable the security documents, including the guarantees, to be signed by the Plaintiff and himself. All of this evidence supports the Defendant's case that such a meeting took place and undermines the Plaintiff's case that the guarantee would not have been signed at a meeting arranged for that very purpose.
143 It was the evidence of the Plaintiff himself that he went to the Bank's premises on the afternoon of 3 June 1998 with the intention of signing an unlimited personal guarantee with respect to Deangrove's debt to the Bank (T8.49). The Plaintiff states that he signed a variety of documents that afternoon and, indeed, he believed that he had signed the personal guarantee on that occasion. He now denies that a face-to-face meeting took place with Mr Jeans on that afternoon.
144 Mr Bruce cannot be characterised as an ally of the Bank or the Defendant, either at the time of the Federal Court proceedings or at the present time. He said that his business was "in turmoil" in 2003 as a consequence of the Bank's actions (T171.57). He settled with the Bank for $50,000.00 during the course of the Federal Court proceedings (T172.21).
145 I accept Mr Bruce's account that there was a meeting on the afternoon of 3 June 1998 attended by the Plaintiff, the Defendant and himself. I accept Mr Bruce's account that the purpose of this meeting had been expressed to him as the desire by the Defendant to have the personal guarantees signed by Mr Bruce and the Plaintiff. I accept the account of Mr Bruce that he signed his guarantee on that afternoon and that the guarantee was witnessed by the Defendant.
146 It is submitted for the Defendant that I should not accept the evidence of Mr Bruce that he did not observe the Plaintiff signing any documents at that meeting. Given the element of reconstruction and the passage of time emphasised by Mr Bruce himself during his evidence, it remains open, in my view, to conclude that the Plaintiff did sign documents in his presence on that day.
147 However, a significant element of Mr Bruce's evidence before Sackville J was that the Plaintiff and the Defendant remained following his departure at about 3.00 pm on 3 June 1998. Clearly, Mr Bruce is not in a position to give evidence concerning what transpired following his departure from the meeting. There was an opportunity for the Plaintiff to sign documents, including the guarantee, in the presence of the Defendant on that afternoon. The Plaintiff admits that he signed a range of documents that afternoon although (on his version) not in the presence of the Defendant. It is the Plaintiff's case that he believed that he had signed the guarantee at that time. The Plaintiff does not assert that he intentionally withheld his signature from any document on that occasion. The evidence of Mr Bruce serves as support for the Defendant on a number of significant aspects which are relevant to this case.