Nguyen v Phan

Supreme Court of Victoria|2015-11-24|Before: ELLIOTT J

EQUITY - trusts - express trusts - agreements - whether intention to create trusts manifest - certainty of intention - whether agreements existed - whether election not to perform agreement or purported agreement.

EQUITY - fiduciary duties - company directors - employees - whether duties as pleaded established.

CORPORATIONS - directors and officers - duties - whether duties as pleaded established.

1 This is an unfortunate case. It involves a family who travelled to Australia from Vietnam in a situation of adversity. A number of the family members worked together to establish themselves in Australia, but, having succeeded in business, now find themselves in a bitter dispute.

2 In essence, the dispute concerns whether the first defendant and first plaintiff by counterclaim, Tu Phan (he prefers to be called "Thomas"),[1] agreed to share the ownership of a company business he established from around 2000 onwards. The plaintiffs' case is that Thomas agreed to this, and the manner by which it was to occur, by way of 3 separate agreements. The defendants deny the existence of the alleged agreements and contend the ownership has never been shared, has been wrongly taken from Thomas and, ultimately, Thomas has been improperly excluded from the business altogether.

3 The original business was established by a company incorporated by Thomas, namely the fourth defendant, Roo Sheetmetal Pty Ltd ("Roo Sheetmetal"). Roo Sheetmetal commenced manufacturing airconditioning ducts in approximately July 2001, in the south eastern suburbs of Melbourne. Roo Sheetmetal initially leased a factory located at 36A Cambria Road, Keysborough.[2]

4 On 3 September 2003, another company was incorporated, namely Oz Sheetmetal Pty Ltd ("Oz Sheetmetal"). From around 1 March 2004, Oz Sheetmetal conducted a like business to that conducted by Roo Sheetmetal. It was based in Sunshine North, principally so as to service customers in the west of Melbourne and beyond.[3]

5 On 16 June 2009, Oz Sheetmetal changed its name to Roo and Oz Sheetmetal Pty Ltd ("Roo and Oz Sheetmetal"). Roo and Oz Sheetmetal is the fifth plaintiff and fifth defendant by counterclaim. (Although it is the same entity, I will refer to this company as both "Oz Sheetmetal" and "Roo and Oz Sheetmetal", to accord with its name at the times in question.)

6 From 1 July 2009, the businesses previously conducted by each of Roo Sheetmetal and Oz Sheetmetal were effectively conducted as a single business by Roo and Oz Sheetmetal. In other words, Oz Sheetmetal's business continued to be conducted by the same company (albeit its name was Roo and Oz Sheetmetal), but Roo Sheetmetal wound down its trading operations from 1 July 2009, and its business was conducted by Roo and Oz Sheetmetal. The combined business has been successful.[4]

7 The agreements which the plaintiffs contend were entered into concern discussions in mid 2002 ("the 2002 Agreement"), around August 2003 ("the 2003 Agreement"), and around April and May 2009 ("the 2009 Agreement") (collectively "the Agreements").

8 It is an unfortunate case for a further reason. None of the parties maintained satisfactory records concerning agreements or arrangements entered into. To the extent that documentation was created at the relevant times, in some instances all parties contend for cases that, in significant respects, bear no resemblance to key documents. As a result, the court has been left with oral accounts of events that occurred many years ago with, on some occasions, little reliable contemporaneous documentation. Consequently, there is inherent uncertainty attaching to significant aspects of each of the competing cases.[5]

9 These difficulties were compounded by the manner in which some of the evidence was given at trial. The principal witnesses in this case were Thomas and his older sister, the second plaintiff and second defendant by counterclaim, Thuy Phan ("Thuy"). Neither of them was a satisfactory witness.[6] Both of them were willing to give evidence based on a reconstruction that suited their case. Further, the credibility of both of them suffered from their constant insistence (despite direction to the contrary) on not giving direct answers to questions put to them, and frequently and non-responsively telling their version of the case.

10 In short, in making the findings of fact in this case, I have been extremely circumspect about accepting the evidence of either of them at face value. It appeared that both of them believed they were morally in the right and were willing to give evidence to seek to achieve a particular result, rather than give wholly truthful evidence.

11 The relief sought by the plaintiffs is dependent upon them proving that each of the Agreements was entered into as alleged. Further, although it is not contended by the plaintiffs that any of the Agreements gave rise to a binding or legally enforceable contract, the plaintiffs' case depends upon them establishing that each of the Agreements resulted in an express trust being created by which the legal ownership of the shares in the relevant company was held on trust in accordance with the terms of the Agreements respectively. Consistent with the manner in which the case was put by the plaintiffs, many of the allegations in response were made on the premise that either the plaintiffs were entirely unsuccessful in establishing any of the Agreements or they were successful in establishing all of them.

12 For the reasons that follow, the plaintiffs have established that the 2002 Agreement and the 2003 Agreement were entered into in or about mid2002 and August 2003 respectively. By reason of this, beneficial interests were created in the shares of Roo Sheetmetal and Oz Sheetmetal, as alleged by the plaintiffs. However, the 2009 Agreement was not entered into in April or May 2009, or otherwise. Accordingly, the beneficial ownership of Roo Sheetmetal and Oz Sheetmetal remained unchanged from what was agreed in 2002 and 2003.

13 Another significant issue in the case was whether or not Thomas had a financial interest in a business conducted by Triangle Sheetmetal Pty Ltd, the second defendant and second plaintiff by counterclaim ("Triangle Sheetmetal"). Triangle Sheetmetal was incorporated on 5 October 2011 in Queensland.

14 For the reasons stated below, the plaintiffs have failed to establish that Thomas had any financial interest in Triangle Sheetmetal. The plaintiffs also failed to establish that Thomas breached any of his fiduciary duties with regard to his dealings with Triangle Sheetmetal. It must follow that the case against Triangle Sheetmetal for being knowingly involved in Thomas' breach of fiduciary duties must also fail.

15 The final statement of claim was filed by the plaintiffs on 18 February 2015 ("the Statement of Claim"). The final defence and counterclaim of the defendants was dated 23 February 2015 and filed on 2 March 2015 ("the Defence and Counterclaim"). The final reply and defence to counterclaim was dated 27 February 2015 and filed by the plaintiffs on 2 March 2015 ("the Reply").

16 Given the state of the pleadings and the manner in which the case was conducted, it is not appropriate for the court to seek to formulate any relief which might be granted, until hearing further from the parties.

17 Tuong Phan ("Tuong") and Thuan Lam ("Thuan") (together, "the Parents") lived in Da Nang in Vietnam where they married and had 12 children. One of those children died at a young age. The remainder ("the Phan Children") grew up in Vietnam. Before the communist government came to power in Vietnam, Tuong worked for the government.

18 In the mid1960s, the family left Da Nang, which was apparently then a communist stronghold, and relocated to Quang Tin. A few years later, the family moved to Chu Lai in search of work. In Chu Lai, Tuong found work as a storeman for the United States' army. After some time, the Parents bought a bakery and a pharmacy. At around the same time, the 3 older daughters made and sold clothes to assist the family, while the younger children all attended school.

19 In 1975, after some interaction with the communist government, the family fled. All members of the family left in 1 van. Having departed central Vietnam, the family moved to the south. They settled in a town called Long Khanh, about 80 kilometres from Saigon (now known as Ho Chi Minh City).[7]

20 In Long Khanh, the family purchased a small farm and grew rice. Thuy, the seventh child, was unable to finish her schooling because she had to work on the farm. Then, after a year and a half, Thuy and another daughter set up a small coffee and dessert shop. At this time, Thomas (who is the ninth child and 5 years younger than Thuy) still attended school.

21 The coffee and dessert shop that Thuy ran, ultimately with 2 of her sisters, was successful. Thuy worked hard in the years 1975 to 1980, supporting the family and enabling the younger children to finish their schooling. It was mainly from the proceeds of the shop that the family was able to afford a boat, which would later enable some of the family to leave Vietnam.

22 In 1978, Tuong had raised with the family the idea that they should escape from Vietnam by boat. In 1979, a boat was purchased, and the family spent a year restoring the boat so that it would be fit for travel. The timing of the departure had to be hastened, as the sixth child, Son Phan ("Son"), was conscripted to fight for the Vietnamese army in its war with Cambodia. Son is the third plaintiff and third defendant by counterclaim.

23 By 1980, the family was ready to implement an escape. Detailed preparations were made, which involved others. Although the boat was designed for only 79 or 80 people, 164 boarded the boat. It was agreed 6 siblings would depart. Son, Thuy and Thomas were amongst them. Others stayed behind. This allowed the coffee shop to remain open, and was done to create the impression that nothing had changed. The Parents also stayed behind.

24 In July or August 1980, the boat left Vietnam. The boat trip lasted 5 days and 5 nights, enduring a large storm, and 3 attacks from pirates. It reached Changaroo, Malaysia. The Phan siblings stayed in an immigration camp in Malaysia for approximately 6 weeks. During this time, Thuy looked after her younger siblings, including Thomas; in effect she took over the role of mother.

C. The Phan family progressively settle in Australia

25 Australia accepted the Phan siblings into its refugee program. Towards the end of 1980, they arrived in Australia.

26 The Phan siblings initially settled in Hobart and began to learn English. Some became more proficient with English than others.

27 Thomas and the younger children went to school. Thuy worked at a nursery, earning about $142 per week. From that income, Thuy bought clothes and food for the family. It was apparently a happy time and the siblings stuck together. The Catholic Church lent the family money for the purchase of a home. Initially, it appears they all lived in the home that was purchased.

28 Son worked in a bakery in Hobart, but after approximately a year and a half he moved to Sydney for work and to help repay the loan. Son worked 7 days a week. Also, at a time which is unclear, the fourth child, Tru, moved to Melbourne. After some time, Tru worked in the sheetmetal industry, and gained know-how concerning airconditioning ductwork fabrication.

29 Thuy stayed in Hobart to look after the children, including Thomas, and to raise them. She continued to work full time in the nursery.

30 In about 1987, Tru called Thuy and asked her to move to Melbourne to look for a better job. Thuy agreed to do so. Son had already moved to Melbourne, from Sydney, in 1986.

31 Thomas, meanwhile, had gone to Launceston to study marine engineering. While in Launceston, Thomas stayed with a local family. He would return to Hobart on the weekends.

32 Thuy borrowed $5,000 from Son to buy an over-locking machine and a sewing machine. Thuy then borrowed $25,000 from a family friend. They became partners in a sewing business in Brunswick, a suburb of Melbourne. Within 2 years, Thuy and her business partner had managed to build up the sewing business so that it had around 20 employees, and Thuy was able to repay the business loans.

33 In 1989, the Parents left Vietnam and moved to Melbourne. The family all lived together in a double-storey house in Keysborough that Son had purchased.

34 In around 1990, Thomas completed his bachelor of marine engineering in Launceston. He began working on ships, for weeks on and then weeks off. On the weeks off, Thomas would come to Melbourne and stay in what had become the family home in Keysborough. Thomas married Thuy Tran (known as "Tina"). Tina would stay in the Phan family home rent free, while Thomas worked on the ships. This continued until Thomas and Tina purchased their own house in Noble Park.

35 In the early 1990s, Thuy set up a new sewing business based in North Melbourne.[8]

36 In 1992, Thuy and Trung Nguyen ("Trung") married. In January 1994, Thuy and Trung had a baby and sold the North Melbourne sewing business. As a result of conducting the sewing businesses, Thuy came to learn "a bit about bookkeeping". However, neither then nor later did Thuy become proficient with accounting or computers.

37 The familial relationships relevant to the proceeding are intricate. It is necessary to discuss further the connections and arrangements.

38 Annexure "A" to this judgment is a family tree ("the Family Tree"). The Family Tree records, amongst other things, the names and dates of birth of the relevant members of the extended Phan family. The persons shaded green gave evidence for the plaintiffs. Those shaded orange were witnesses for the defendants.

39 Tuong was born on 2 June 1925 and Thuan was born on 2 October 1928. By the time the Parents had moved to Australia in 1989, most of the Phan Children had already immigrated to Australia. At the time of the events relevant to the proceeding, the Parents lived in Hampstead Road, Maidstone, Victoria.

40 Neither of the Parents gave evidence in the proceeding. However, it is clear from evidence given by other members of the Phan family that the Parents have been, and remain, an important part of the extended Phan family.

41 Of the 11 Phan Children, 7 are involved, either directly or indirectly, in the proceeding. The relevant individuals are (in order from eldest to youngest): Tru, the fifth child Danh Phan ("Danh"), Son, Thuy, the eighth child Tinh Phan ("Tinh"), Thomas and the youngest child Nga Phan ("Nga") (together, "the Relevant Children").

42 Tru, Danh, Tinh and Nga, although involved in some of the relevant events, are not parties. Tinh and Nga's involvement includes the fact that each of their spouses, namely Hoa Nguyen (he prefers to be called "Joseph") and Minh Nguyen ("Minh") respectively, are plaintiffs and defendants by counterclaim.[9]

43 For convenience, in summary, Minh, Thuy, Son and Joseph are each plaintiffs and Thomas is a defendant. I will refer to these individuals collectively in the judgment as "the Family Members". Roo and Oz Sheetmetal is the remaining plaintiff. Triangle Sheetmetal and Roo Sheetmetal are the remaining defendants.

44 Son was born in 1959. Son is married to Thuy Tran and together they have 2 children. Shortly after Son moved to Melbourne in 1986, he was employed full time as a diecast machine operator with Australian Die Casting Company, where he remained until 2007. As well as working full time, from 1995 to 1999 Son also worked part time at Double T Sheetmetal Pty Ltd ("Double T Sheetmetal").

45 Until approximately 2012, Son and his family lived in Leonard Avenue, Noble Park, Victoria. They now live in Mayfield Drive, Keysborough, Victoria.

46 Son is presently employed as a production manager at Roo and Oz Sheetmetal.

47 Son gave evidence at trial in relation to (amongst other things): his involvement and employment part time from 1995 to 1999 at Double T Sheetmetal,[10] Roo Sheetmetal, Oz Sheetmetal, and Roo and Oz Sheetmetal; the Agreements; and the circumstances surrounding Thomas' exit from Roo and Oz Sheetmetal.

48 Thuy was born in 1960. Thuy and Trung have 2 children.

49 Thuy and her family live in Village Way, Maribyrnong, Victoria. They have lived at that address since around 2009. However, between around 2002 and 2004, Thuy and Trung experienced some problems in their marriage. As a result, Thuy lived periodically with her sister Nga, and Minh, in Saltwater Crescent, Maribyrnong, Victoria.[11] Thuy was close to Nga and Minh. She was also close to her other siblings at the time.

50 Some of Thuy's employment history is set out above. That history demonstrates that, by 2002, she had some experience in business. However, she had only limited computer and accounting skills at that time.

51 Thuy is employed by Roo and Oz Sheetmetal and is also a director of that company. Trung is not a party to the proceeding. He was not called as a witness at trial.

52 Thuy gave extensive evidence at trial in relation to (amongst other things): the Phan family's immigration to Australia; her involvement in the affairs of each of Roo Sheetmetal, Oz Sheetmetal, and Roo and Oz Sheetmetal; the Agreements; and the circumstances relevant to Thomas' exit from Roo and Oz Sheetmetal.

53 Thomas was born on 12 July 1965. Thomas and Tina have 3 children.

54 Since early 2009, Thomas and his family have lived in Latrobe Street, Hughesdale, Victoria. Before this time, Thomas and Tina lived in Wilela Court, Noble Park, Victoria.

55 Thomas is the sole director of both Roo Sheetmetal and Mega Sheetmetal Pty Ltd ("Mega Sheetmetal"). Mega Sheetmetal was the third defendant and third plaintiff by counterclaim. On 17 December 2014 (ie the fourth week of the trial), the plaintiffs informed the court they no longer pursued any claim against Mega Sheetmetal. Consequently, Mega Sheetmetal was removed as a party to the proceeding. Thomas was never a registered director of Oz Sheetmetal (or Roo and Oz Sheetmetal).

56 Thomas gave extensive evidence at trial in relation to (amongst other things): the establishment and affairs of various sheetmetal companies in Australia, including Double T Sheetmetal, Roo Sheetmetal, Oz Sheetmetal, Roo and Oz Sheetmetal and Triangle Sheetmetal; the establishment and affairs of various duct and airconditioning companies in Vietnam, including Thuan Phuoc Co Ltd ("Thuan Phuoc") and Xuyen Viet; the Agreements; and the circumstances surrounding his exit from Roo and Oz Sheetmetal.

57 Tina was born on 21 July 1970. Tina is not a party to the proceeding, but she was called as a witness by the defendants.

58 Tina gave evidence in relation to (amongst other things): the establishment of Roo Sheetmetal; Thomas' involvement in Double T Sheetmetal and Roo Sheetmetal; the 2002 Agreement; and the circumstances surrounding Thomas' exit from Roo and Oz Sheetmetal.

59 Linh Cong Tran ("Linh") is Tina's older brother. He was born on 5 July 1967. Linh lives in Da Nang City, Vietnam. Linh is not a party to the proceeding. He was called as a witness by the defendants.

60 Linh gave evidence at trial in relation to (amongst other things): his relationship with Thomas; the establishment of Thuan Phuoc and Xuyen Viet in Vietnam; and Thomas' involvement in each of those companies.

61 Chinh Cong Tran ("Chinh") is Tina's and Linh's first cousin. He was born on 2 November 1978. Chinh also lives in Da Nang City, Vietnam. Chinh is not a party to the proceeding. He was called as a witness by the defendants.

62 Chinh gave evidence at trial in relation to (amongst other things): his involvement in Thuan Phuoc and Xuyen Viet; and the working relationship between Thuan Phuoc and each of Roo Sheetmetal, Oz Sheetmetal and Triangle Sheetmetal.

63 Nga was born on 30 November 1968. As already noted, she is not a party to the proceeding and did not give evidence. Her husband, Minh, was born on 2 October 1965 in Vietnam and arrived in Australia as a refugee in 1984. Minh is employed by, and is a director of, Roo and Oz Sheetmetal. Together Nga and Minh have 2 children.

64 In Australia, Minh completed his high school education. In 1987, he studied for a bachelor of electronic engineering degree, but after a year transferred to maths and computing, a degree he completed in 1992. In contrast to the other family members who gave evidence, Minh speaks very good English.

65 Until approximately 2011, Minh and his family lived in Saltwater Crescent, Maribyrnong, Victoria. Since that time, Minh and his family have lived in Market Street, Essendon, Victoria.

66 Minh gave extensive evidence at trial in relation to (amongst other things): his involvement in each of Roo Sheetmetal, Oz Sheetmetal, and Roo and Oz Sheetmetal; the 2003 and 2009 Agreements; and the circumstances relevant to Thomas' exit from Roo and Oz Sheetmetal.

67 Tuanh Nguyen ("Tuanh") is Minh's niece. Tuanh was born on 19 June 1983. She lives in Deer Park, Victoria. Tuanh is not a party to the proceeding. She was called as a witness on behalf of the plaintiffs.

68 Tuanh is a senior associate in the corporate department of the law firm Baker & McKenzie (who are also the solicitors for the plaintiffs in the proceeding). Tuanh has worked at Baker & McKenzie since commencing as an articled clerk in March 2006. She was admitted to practice in 2007. Tuanh was appointed a senior associate on 1 July 2011. In this proceeding, she facilitated communications between the plaintiffs and the litigation lawyers at Baker & McKenzie.

69 Tuanh gave evidence at trial in relation to (amongst other things): her involvement in the proposed "merger" of the businesses of Roo Sheetmetal and Oz Sheetmetal; and, in particular, the 2009 Agreement.

70 Tinh was born on 8 June 1963. She is not a party to the proceeding and did not give evidence. Her husband, Joseph, was born on 19 October 1967 in Vietnam. He immigrated to Australia in 1984, and initially lived in Sydney. After marrying Tinh in 1989, Joseph moved to Melbourne and started work as a mechanic. Initially, Thuy lived with them in Brunswick.

71 In 1991, Joseph purchased an existing motor mechanics business, trading as "P & Son Auto Repairs". Thomas, Thuy and Tru each invested $5,000 in the business. When Thomas was not working on a ship, he would assist Joseph. Thomas sold his share in the business to Joseph in around 1995 or 1996. Joseph sold the entire business in August 1998 for $35,000, inclusive of stock.

72 Joseph is a manager at, and a director[12] of, Roo and Oz Sheetmetal. Tinh and Joseph live in Village Way, Maribyrnong, together with their children.

73 Joseph gave evidence at trial in relation to (amongst other things): his involvement in Double T Sheetmetal, Roo Sheetmetal, Oz Sheetmetal, and Roo and Oz Sheetmetal; the Agreements; and the circumstances surrounding Thomas' exit from Roo and Oz Sheetmetal.

D.4.1 The remaining Relevant Children: Tru and Danh

74 Tru was born on 20 June 1954. Tru is not a party to the proceeding. He did not give evidence at trial.

75 Tru was, however, the subject of evidence of both sides in the proceeding in relation to his involvement in and ownership of Double T Sheetmetal.

76 Danh was born on 17 May 1957 in Vietnam and immigrated to Australia in 1980. Danh lives in Oak Park, Victoria. He is an accountant and a director of Phan Campbell & Associates, an accounting practice he founded in 1994. Danh is not a party to the proceeding. He was called as a witness by the defendants.

77 Danh acted as accountant for Roo Sheetmetal from its inception. Upon the incorporation of Oz Sheetmetal, Danh also acted as its accountant. Danh no longer does any work for either company.

78 Danh gave evidence at trial in relation to (amongst other things): the creation and lodgement of documents, and the preparation of accounts, reports and tax returns, for various entities associated with the Phan family, including the Phan Family Trust, the PN Unit Trust, Roo Sheetmetal, Oz Sheetmetal, Roo and Oz Sheetmetal and PN & Nominees Pty Ltd ("PN & Nominees"). PN & Nominees is the sixth defendant by counterclaim, and is the trustee of the PN Unit Trust.[13]

79 Vien Phan ("Vien") is the Phan Children's cousin. He is the son of Tuong's younger brother. Vien was born in Vietnam on 27 November 1976. He now lives in Sunshine West, Victoria and works at Roo and Oz Sheetmetal as an estimator.

80 Vien is not a party to the proceeding. He was called as a witness by the plaintiffs. Vien gave evidence at trial regarding his relationship with Thomas and his involvement with Thuan Phuoc and Xuyen Viet in Vietnam.

81 Like Vien, Dao Phan (also called "Francis") is the Phan Children's cousin. Francis was born on 7 December 1978. He is employed by and is a director and shareholder of Triangle Sheetmetal.

82 Francis is not a party to the proceeding. He did not give evidence. Francis was the subject of evidence given at trial, in particular, in relation to: his relationship with Thomas; his involvement in each of Roo Sheetmetal, Oz Sheetmetal, Roo and Oz Sheetmetal and Triangle Sheetmetal; and his involvement in the circumstances leading up to Thomas' exit from Roo and Oz Sheetmetal.

83 Tu Nguyen ("Uncle Tu") is not a member of the Phan family. However, he is referred to by Thomas as "Uncle Tu".

84 Uncle Tu was born in Vietnam on 12 August 1927. He worked for many years in different roles, including as a bookkeeper, with the South Vietnamese army.

85 In 1993, Uncle Tu immigrated to Australia, together with his wife and an adopted child. Thomas acted as Uncle Tu's sponsor for the purposes of his application for immigration. During 2009, Uncle Tu assisted Thomas with the renovation of Thomas and Tina's house in Hughesdale.

86 Uncle Tu was not a party to the proceeding. He was called as a witness by the defendants. Uncle Tu gave evidence at trial in relation to (amongst other things): his relationship with Thomas, his renovation of the house in Hughesdale and the preparation of exercise books in which he kept records relevant to the renovation.

87 As stated above,[14] PN & Nominees is the trustee of the PN Unit Trust. In early 2003, Thuy approached Danh and asked Danh to arrange the establishment of PN & Nominees. Thuy did not explain to Danh the purpose of incorporation. No one other than Thuy gave instructions to Danh. Thuy flatly denied giving instructions to Danh concerning PN & Nominees and the PN Unit Trust. She also asserted Danh explained the proposal to "all the siblings".[15] Much of her evidence on this topic was non-responsive and conclusory. It was not credible. Indeed, some of the evidence must be treated as a complete fabrication. The plaintiffs' counsel put none of Thuy's evidence on these matters to Danh when he was in the witness box.[16]

88 According to Thuy, it was Minh's idea to set up the PN Unit Trust.[17] This appears to be correct. Broadly, it was supported by Minh's and Joseph's evidence. Minh said it was both his and Thuy's idea. At the time, Minh said the strategy was to reduce tax.[18] Joseph said Minh or Thuy made the suggestion. Joseph also said the incorporation of a company was discussed in or before March 2003, and that all the Family Members were present. In substance, Joseph's evidence was supported by Thuy and Minh. I accept this evidence. The family met regularly. Although there was no precision as to exactly when or where such discussion took place, it is highly likely that such things were discussed at family gatherings.

89 PN & Nominees was incorporated on 24 March 2003. The registered office and principal place of business was Minh's home address in Saltwater Crescent, Maribyrnong. The defendants seem to suggest the use of this address was part of the covert operation being put in place. I reject this submission. Minh was a director. Further, in 2003, Thuy spent much of her time living at Minh's home. In the circumstances, where Thuy was responsible for looking after the financial affairs of the family business, Minh's home address was an obvious address to choose.

90 Shortly after incorporation, on 28 March 2003, PN & Nominees was appointed as the trustee of the PN Unit Trust. The trust deed was executed by each of Trung (as trustee for the Village Family Trust, being the family trust of Trung and Thuy),[19] Minh (as trustee for the Nga Phan Family Trust), Joseph (as trustee for the Vincent Family Trust), Thomas (as the sole trustee for the Phan Family Trust) and Son (as trustee for the Phan Family Trust).[20] Each of the trustee signatures was witnessed by Danh.[21]

91 Thomas and Minh were appointed as the directors of PN & Nominees. They both ceased to hold this position on 1 September 2003, and were replaced by Joseph. Danh could not recall why this occurred. Joseph said it occurred with the agreement of Thuy, Son, Thomas and Minh, but he could not recall the details of any discussion, when it occurred or why it was agreed. Minh suggested it was because the other Family Members (except for Son) were registered as directors and shareholders of the other companies, so it was decided Joseph should have a similar position for PN & Nominees. This appears to be a logical explanation.

92 Minutes of a meeting of the board of PN & Nominees, signed by Joseph, documented the resignations and his appointment. Joseph could not recall whether the meeting occurred. Later, consistent with Joseph's appointment as the sole director, bank statements were directed to Joseph's home address. This was done by Thuy. Joseph said it was done, after discussion among all the Family Members, just for convenience, but he could not recall any details.

93 In his evidence in chief, Thomas said he was unaware he had been a director of, and had never heard of, PN & Nominees or the PN Unit Trust. He suggested the first time he became aware of PN & Nominees was during discussions with his lawyer in 2013. This is difficult to reconcile with the fact that he signed a consent to act as a director of PN & Nominees dated 24 March 2003. Thomas accepted that, by putting his signature on the consent form, he was holding himself to the document he had signed, and that, by so doing he had accepted becoming a director. His explanation for signing the consent form was that he signed it because Thuy told him to.

94 But this does not explain away his assertion he had never heard of PN & Nominees before 2013. The explanation has even less weight given Thomas' signature on the PN Unit Trust Deed dated 28 March 2003. The signature page refers expressly to PN & Nominees. Thomas also signed various other documents that expressly referred to PN & Nominees or the PN Unit Trust, or both.[22] The circumstances in which these documents were signed, as footnoted below, also lead me to reject Thomas' alleged lack of knowledge of PN & Nominees or the PN Unit Trust.

95 It is unnecessary to go in detail through each and every document Thomas signed referable to PN & Nominees and the PN Unit Trust. By way of illustration of Thomas' unsatisfactory evidence concerning documents he signed, I refer to a guarantee and indemnity signed by Thomas in November 2009, in favour of National Australia Bank Limited ("National Australia Bank") by which the guarantor (who included Thomas and PN & Nominees) guaranteed performance of the obligations of Roo and Oz Sheetmetal.

96 When taken to this document, Thomas said he understood that signing a guarantee was a serious matter and that the guarantors would have to pay the debt if the company could not pay. When it was put to him that he understood that in 2009, Thomas first answered "2009?". When it was put to him again he answered "I can't recall it". When Thomas was then asked when he first learnt what a guarantee meant, he gave a non-responsive answer. When pressed with the same question, he accepted he learnt what a guarantee was in 1992. He then accepted he knew what a guarantee was in 2009.

97 Next, Thomas was taken to his signature on the guarantee that he executed in November 2009. That signature was immediately below the words "Signed, sealed and delivered as a deed by the guarantor" and had the words "Guarantor's signature" in bold immediately below the signature. Thomas acknowledged it was his signature, but when it was put to him that he knew he was agreeing to sign as a guarantor when he signed the document, he answered "no". In rebutting the suggestion that he knew, he said that normally Thuy told him where to sign. However, his signature was witnessed by a bank officer, not Thuy. Thomas said he remembered the bank officer signing her name as a witness after he signed. Whether or not the bank officer explained the document to Thomas (which Thomas said she did not), I do not accept that Thomas did not appreciate he was signing a guarantee in these circumstances.

98 This evidence was typical of Thomas seeking to avoid giving direct answers to questions concerning documents that he signed from time to time.

99 Another relevant document concerning PN & Nominees recorded Thomas resigning as a director on 1 September 2003. This document contained a signature above Thomas' name. In the defendants' closing submissions, they stated that Thomas was adamant that the signature on his purported resignation was not his signature. This did not accurately reflect the evidence.

100 Under cross-examination, when first taken to the document, Thomas denied it contained his signature. When asked if he knew whose signature it was, Thomas that the first part of the signature was his but the end part was not. Having reviewed many signatures of Thomas that appear throughout the court book, it is clear that the first part of the signature on this page strongly resembles Thomas' signature.

101 When Thomas gave these answers, senior counsel for the plaintiffs declined to cross-examine on the issue further without obtaining instructions. Later, having obtained those instructions, he again pressed that Thomas had signed the document. Thomas disagreed stating that the signature finished in the wrong way. Based on this evidence, I cannot be satisfied that Thomas signed the document. However, I am equally not satisfied that someone purported to sign on his behalf. The strong resemblance of the first part of the signature to Thomas' signature cannot be ignored. Further, senior counsel for the defendants did not put to any witness that the document had been falsely signed on behalf of Thomas.

102 Not all documents recording Thomas' involvement in PN & Nominees are probative of Thomas' knowledge. For example, minutes of a purported meeting between Joseph (as chairperson), Minh and Thomas, recording the appointment of Joseph as a director of PN & Nominees, together with the resignations of Minh and Thomas, do not satisfy me that the meeting ever occurred. When taken to the minutes, Joseph said he could not recall the meeting, but it had occurred because he signed he minutes. When pressed, he repeated he could not recall any such meeting. Minh gave no evidence of attending any meeting consistent with the minutes.

103 In the circumstances, there is substance to the defendants' submission that the meeting as recorded in minutes dated 1 September 2003 was "a paper fiction". I am not satisfied the meeting occurred. However, I reject the submission that "there were no consultations with Thomas as to the changes to the corporate structure of PN & Nominees". The weight of the evidence compels a contrary conclusion.

104 Another reason for rejecting Thomas' evidence as to his lack of knowledge of PN & Nominees is that the family then enjoyed an entirely harmonious and cooperative relationship.[23] Further, to the extent the defendants were suggesting that Minh and Thuy were seeking to deprive Thomas or Roo Sheetmetal of assets he or it owned, if that were the plan, it made little sense to have Thomas sign a consent to act as a director of the company he was supposed to know nothing about. There was no need to have Thomas as a director of the trustee, in addition to having him sign the trust deed.

105 Furthermore, it is not insignificant that, when Thomas tell out with the other Family Members and retained a solicitor in about late July 2012, the solicitor was "searching everything", and that the searches conducted included a search of PN & Nominees (8/3932).[24]

106 The issue of Thomas' knowledge of PN & Nominees and the PN Unit Trust cannot be completed without a reference to the manner in which Thomas gave evidence on the topic when it was first addressed in cross-examination. When asked when he first heard of PN & Nominees, Thomas stated he did not know "anything about that, the trust or anything". When asked why he referred to the trust when asked about PN & Nominees, Thomas responded "what do you mean trust". The following exchange then took place:

When I asked you, when did you first hear about PN & Nominees, do you remember, just now?---I don't remember that.

You don't remember me just asking you one minute ago when you first heard of PN & Nominees?---No, no.

I do not accept that Thomas had failed to remember a question asked of him only 3 questions previously. In giving the evidence that he did, Thomas was being deliberately evasive.

107 In summary, the evidence shows that from around March 2003 the Family Members were involving Minh in some way.[25] At this time, Thomas also wanted to help his youngest sister, Nga. With these objectives in mind, Thomas agreed to the PN Unit Trust being established and for each of the Family Members to be involved.

108 On 2 June 2005, the Phan United Family Trust was established, with Thomas, Thuy, Son, and Joseph appointed as trustees.[26] Each of them executed the trust deed.

109 Consistent with some other evidence given by Thomas concerning documents that he signed, when first taken to the deed, Thomas indicated a complete lack of knowledge of the circumstances in which the Phan United Family Trust deed was executed. Thomas said he was not familiar with the trust.

110 When it was put to Thomas that it was his idea to set up the trust, he said he did not know anything about it. Thomas said that it could have been Thuy's idea, but he did not know whose idea it was. In contrast, Thuy said it was Thomas' idea.

111 Thuy's evidence was supported by Joseph. It was put to Joseph in cross-examination that it was Thuy's idea. Joseph rejected this, stating it was Thomas' idea as Thomas had said at the time that Thomas wanted to purchase properties through a trust. This was consistent with Thuy's evidence that Thomas wanted to be able to take money from Roo Sheetmetal as rent.

112 I do not accept Thomas' account of his level of knowledge. Thomas was plainly sufficiently proficient in reading English to have graduated successfully in his tertiary studies in Launceston many years before. The exams he passed were both oral and written, and in English. Since graduating in 1990 and before establishing Roo Sheetmetal, Thomas had worked on a ship and worked at Double T Sheetmetal speaking with co-workers, customers and suppliers in English.

113 Notwithstanding this background and that Thomas had been living in Australia for over 30 years, when his defence was filed in this proceeding ("the Original Defence"),[27] it contained an allegation that Thomas had a limited grasp of written English. This allegation was subsequently withdrawn.

114 Thomas gave his evidence in English. Although his English was not perfect, generally speaking, Thomas appeared more than capable of understanding what was being put to him. Also, when Thomas needed to read and respond to documents in English in the witness box, he was able to do so.[28]

115 His bare assertion that he was not familiar with the Phan United Family Trust, or the execution of the deed was not credible. By this stage, he had previously signed trust deeds.[29] Further, it was he who arranged for the document to be witnessed by a friend of his; this was not a case where Thomas simply signed a document by placing his signature where he was asked to sign. When pressed, Thomas acknowledged that he would have had to ask his friend to come to witness the document. Thomas volunteered that Thuy did not know the friend.

116 Furthermore, properties were purchased after the trust was created in accordance with Thomas' plan. It is hard to accept that Thomas could have no idea that such transactions, involving large sums of money, occurred without Thomas having any understanding at all as to how the properties were to be owned. On the contrary, Thomas was actively involved in the decision-making concerning the purchase of property and the decision to pay rent, and the implementation of such decisions. In addition, Thomas himself was involved, at least once, in giving written instructions on behalf of the Phan United Family Trust.[30]

117 Moreover, Thomas executed documents referable to the property dealings of the Phan United Family Trust over an extended period of time. As late as November 2011 and February 2012, Thomas signed such documents relating to substantial sums of money.[31]

118 It should be noted that, before giving his evidence, Thomas appears to have instructed his counsel that it was Thuy's idea to have the Phan United Family Trust established. During the cross-examination of Joseph, Thomas' counsel specifically put to Joseph that Thomas' evidence would be that it was Thuy's idea.[32] I expect that, in a case of this size, Thomas had forgotten his previous instructions to his counsel by the time it came for him to give his evidence. In any event, the apparent previous inconsistent instructions of Thomas seriously undermined his initial attempt to suggest he knew nothing about whose idea it was to establish the Phan United Family Trust.

119 The trust deed was revisited in around 2007. Some of the names of the specified beneficiaries had been misspelt in the original deed. Thomas initialled these corrections. These initials were placed on a document already executed by all the parties. If Thuy or others were seeking to conceal what was going on, it seems highly unlikely they would reintroduce Thomas to a document already executed. Thomas agreed in cross-examination that he had initialled the document and, although he could not recall doing that, he accepted he had initialled a change to correct a spelling mistake.

120 Subsequently, a further trust deed was prepared in which the specified beneficiaries were included with their names typed correctly. Different solicitors were used to those who had prepared the previous deed. Thuy suggested she did not give instructions to create a new deed.[33] This version of the trust deed, which was executed on or about 20 February 2007, recorded Thuy as the only trustee. Thuy could give no explanation for this other than it was a mistake. This trust deed was only executed by Thuy, Son and an accountant. There were no documents produced which suggested any of Son, Thomas or Joseph had resigned as a trustee.

121 Son was asked no questions about the circumstances in which he signed this document. Joseph was cross-examined as to why he was not recorded as a trustee. His response was, incorrectly, that it was a different trust. He said he recalled some explanation by Thuy that there were problems with the names, but he could not recall why there had been a change in the trustee name. No determination is required in this proceeding concerning the validity or otherwise of the deed executed on 20 February 2007.

122 Finally with respect to Thomas' knowledge, he attended a meeting in late April or early May 2009 at which the Phan United Family Trust owning land was specifically referred to.[34] There was no suggestion from any witness that Thomas expressed any surprise about the existence of the trust.[35]

123 Before leaving this topic, I refer to a document signed by Thuy purporting to record a meeting of the "Trustee of The Phan United Family Trust". It has a date stamped on it of 18 May 2012. It concerns the distribution of investment income. The "minutes of meeting" recorded Thuy, Son, Thomas and Joseph were present. The meeting never occurred. When Thuy was confronted with this suggestion, she said it was because they could not find Thomas. When asked when she was provided with the document, she could not say.[36] Whenever the document was provided, the position was unsatisfactory.

124 To understand the dynamics and the context of communications between the Family Members in this proceeding, it is necessary to appreciate the closeness of the family before the matters in dispute arose. Speaking generally, the Family Members (and others) would get together every 2 weeks or so. These were not formal occasions. There would be more at some gatherings than others. However, not infrequently, all of the Family Members would meet with their respective partners. At these family gatherings there would often be informal discussions about the family business.

125 Accordingly, without being specific, it is highly likely that many matters were discussed on numerous occasions in the lead-up to the discussions that were relied upon in this proceeding.

E. Overview of the witnesses and their evidence

126 The lack of reliable contemporaneous documentation, and the considerable lapse of time between the relevant events and the trial, necessarily requires the court to make a careful assessment of the credibility and reliability of each of the key witnesses. Accordingly, I will make some further observations in this regard before turning directly to the issues in the case.

127 The approach the court is to take in assessing the evidence is helpfully summarised in the following passage:[37]

[T]o assess the evidence ... by reference to various individually-pleaded particulars, as though running through items on a check list, is apt to mislead. The evidence is to be evaluated as a whole in order fairly to consider whether the party bearing the onus of proof has established what is ultimately sought to be proved. The object of the exercise of evaluation is to discover whether the evidence paints a picture reflecting real life, rather than to place a tick or a cross against paragraph after paragraph of torpid pleading. A true picture is to be derived from an accumulation of detail. The overall effect of the detailed picture can sometimes be best appreciated by standing back and viewing it from a distance, making an informed, considered, qualitative appreciation of the whole. The overall effect of the detail is not necessarily the same as the sum total of the individual details.

(Emphasis added.)

128 As already noted,[38] Thuy was a most unsatisfactory witness. Notwithstanding constant directions during cross-examination from senior counsel, and occasionally from the court, Thuy repeatedly refused to give direct answers to simple questions. Further, she often defiantly insisted or sought to be able to tell her "story", rather than confine her evidence to the questions asked.

129 It was not only the manner in which Thuy gave evidence that was unsatisfactory. On occasion, there were contemporaneous documents that were inconsistent with the evidence she gave. Often when she was confronted with this contradiction, she simply explained away the documents as being wrong or a mistake. Whilst such an explanation is possible, often no satisfactory further explanation was given as to why so many documents were inconsistent with the evidence Thuy gave in court.

130 In summary, Thuy was a witness who was convinced that she was entitled to maintain her interest in each of the companies in question as pleaded, along with the Family Members. When she thought it necessary, she tailored her evidence to support this position.

131 It does not follow from what is stated above that all of the evidence of Thuy necessarily ought to be rejected by the court. However, based on the above matters, a great deal of care needs to be afforded to considering the probative value of the evidence given by Thuy.

132 Consistent with the approach taken by Thuy, when Minh gave evidence he would often advance the case of the plaintiffs, rather than directly answer questions put to him. He persisted with this approach throughout the days that he gave evidence, notwithstanding directions to the contrary.

133 Another characteristic of the evidence of Minh was to constantly purport to give evidence on behalf of all of the plaintiffs. Frequently, when asked questions about his position, he would only respond in terms of asserting an agreed position of all of the plaintiffs, rather than what he had said or done. Again, he chose to ignore directions that he confine his evidence to answering the question directly, rather than seeking to advance the plaintiffs' case.

134 As time went on, it was Minh who, in close consultation with Thuy, was largely responsible for directing how the affairs of Roo and Oz Sheetmetal would be conducted. By 2012, he considered himself as the effective "boss" and did not tolerate dissention. He stated that this proceeding was issued because he wanted to protect Roo and Oz Sheetmetal from Thomas. This appeared to have very little, if any, plausibility in circumstances where, at the time this proceeding commenced, Thomas was no longer working for Roo and Oz Sheetmetal and was not conducting any business in Victoria.

135 Minh believed Thomas was involved in the business of Triangle Sheetmetal in Queensland. Indeed, at 1 point, Minh agreed the whole reason for commencing the proceeding was to stop Thomas from assisting Francis to establish Triangle Sheetmetal. Roo and Oz Sheetmetal did not do, and has never done, any business in Queensland. There was no real threat to the business of Roo and Oz Sheetmetal by reason of any conduct of Thomas in relation to Triangle Sheetmetal in Queensland.[39] There was no suggestion that Triangle Sheetmetal intended to do business outside Queensland.

136 Although Minh suggested that, in around 2011, Roo and Oz Sheetmetal hoped to start a business in Queensland some time in the future, no decision had been made then, or at the time of trial, to take such a course. When Minh was asked directly as to when a decision was made to expand to Queensland, he did not give a responsive answer. Minh did not suggest that Thomas was ever told of or involved directly in any decision of Roo and Oz Sheetmetal to expand to Queensland. There was no paperwork at all to corroborate an intention to conduct business in Queensland either in 2011 or at any later time. Further, none of Thuy, Son or Joseph made any mention of such a plan.[40] In the circumstances of this isolated and vague evidence of Minh, I am not satisfied that any such plan ever existed in any real or substantive form.[41]

137 Indeed, in closing submissions, senior counsel for the plaintiffs could put the position no higher than that there was no evidence it was impossible for Roo and Oz Sheetmetal to open a business in Queensland.[42] In short, it was fanciful to suggest that Thomas was in any way harming the business of Roo and Oz Sheetmetal by any involvement he may have had in a business in Queensland. However, Minh persisted with this position throughout.[43] In my view, the decision to commence this proceeding (with Minh as the first plaintiff) was an extension of what had been playing out for some time; namely Minh, together with Thuy, considered they were in charge and they would not allow others to gainsay their position.

138 In summary, like the position with Thuy, the credibility of Minh was not entirely satisfactory and circumspection is required when assessing his evidence.

139 Joseph was a more satisfactory witness than Thuy or Minh, although from time to time he also adopted the practice of seeking to put the plaintiffs' case rather than answering a question directly. It also appeared that the witness statement prepared for, and adopted by, him went beyond what he actually recalled.[44]

140 Further, with respect to the affairs of the companies in this case, Joseph did not exercise an independent mind as to what decisions ought to be made or how matters should be transacted. This is most clearly demonstrated by the fact that, from 1 September 2003, Joseph was the sole director of PN & Nominees, but had no idea why things were handled in the manner they were with respect to that company; other than, for example, giving evidence that all the Family Members agreed, or he signed documents because "all the paperwork [was] just with my sister, Thuy" or "there must be some reason but I really can't tell", or he "didn't take any notice because [he was] not dealing with the paperwork".

141 The level of Joseph's understanding of things done as a director was apparent from his frank admission that he was not certain of the difference between a trustee and a director.

142 Son had very little idea of the affairs of Roo Sheetmetal or Roo and Oz Sheetmetal beyond what occurred on the factory floor. Effectively, Son had no involvement with Oz Sheetmetal.

143 Son also had difficulty at times understanding questions put to him and repeatedly gave answers that were not responsive to the question. I expect that this was more a matter of lack of comprehension and confusion, rather than deliberate obfuscation.

144 In 2002 or 2003, Son suffered a workplace injury. The accident damaged 1 of his eyes. He also hit his head heavily when he fell backwards on the floor. He lost a lot of blood. Son was taken to hospital and, after a short time, became an outpatient. He had to spend a number of weeks at home before returning to work. Son continued with treatment for over a year.

145 As a result of this accident, Son has serious memory problems. This was readily apparent during the course of giving his evidence when he was unable to recall matters that had been raised with him only a short time before. It was also apparent from the fact that he was unable to recall any details of a guarantee he gave in 2012 for $3.6 million.

146 In short, Son generally had a very poor recollection of events, both recent and distant. That said, it did appear that he had a good recollection of some events, particularly those dealing with the departure of Thomas in 2012, about which he was very emotional.

147 The plaintiffs called 9 persons who were officers or employees of customers of Oz Sheetmetal. It is unnecessary to refer to the evidence of the customers individually. Each of the customers, in broad terms, gave evidence that their relationship with Oz Sheetmetal was principally, if not exclusively, by reason of their relationship with Minh.

148 Further, they gave evidence to the effect that the service provided by Minh at Oz Sheetmetal was very good. Minh was described as very efficient. Generally, the evidence of the customers was the prices offered by Oz Sheetmetal were competitive. Further, evidence was given that the goods produced by Oz Sheetmetal met Australian standards.

149 Vien has known Thomas since they met in Vietnam in the early 1990s. In Vien's school years, Thomas gave Vien's family money to assist with Vien's education. Vien was close to Thomas. He now has a relationship with Thuy and Minh that is also close.

150 Cross-examination of Vien was directed towards establishing that Vien was an unreliable witness because he was beholden to Minh and Thuy. There was nothing in his evidence which suggested that Vien was doing anything other than giving evidence of matters as he recalled them. The fact that Vien was initially reluctant to give evidence when asked to do so does not suggest he was overborne when subsequently he agreed to give evidence in the case.

151 Grant Brown ("Brown") was the penultimate witness called by the plaintiffs. He is a consultant in the construction industry. At the times relevant to this proceeding, he worked as a draftsman, project manager and estimator.

152 Brown was a direct and forthright witness. He considers himself a friend of both Minh and Thomas. He agreed to give evidence at the request of Joseph. Brown said he did not discuss his evidence with Minh, Thuy or Joseph (or, presumably Thomas or Son) before giving his evidence.

153 Brown had an extensive working relationship in the past with both Thomas and Minh. The evidence given by Brown corroborated the plaintiffs' case, especially concerning events surrounding the 2002 Agreement.

154 Tuanh is close to her uncle, Minh. Tuanh attends Nga and Minh's home on approximately a fortnightly basis with her mother, father and sister, as part of regular family gatherings.

155 On the whole, Tuanh was a thoughtful and impressive witness. She was clear as to what she could and could not remember and confined her evidence to her recollection.

156 Comment was made by the defendants that no mention was made of Tuanh in the Statement of Claim and that no witness statement was provided for her by the plaintiffs in accordance with the pre-trial orders. It was submitted that given Tuanh's "apparent recollection", it was noteworthy that she was not called earlier or referred to in the pleadings.

157 Whilst these factual observations as to the lack of reference to Tuanh are accurate, they do not lead to a conclusion that Tuanh's evidence was unsatisfactory or that her recollection was more apparent than real. I expect her absence from the pre-trial court documents is more readily explained from a reluctance to call as a witness a person who, at all times, was employed by the plaintiffs' solicitors. Further, any forensic decision about whether Tuanh ought to be called by the plaintiffs was likely to be influenced by the fact that the defendants served Tuanh with a subpoena requiring her to give evidence as part of the defendants' case.

158 Linh was a witness who answered questions directly. There was no obvious reason as to why his evidence would not be accepted. It is clear that he has a great deal of trust in Thomas, and by reason of that trust was willing to act on Thomas' assurances and advice.

159 Danh gave accounting evidence in relation to Roo Sheetmetal and Oz Sheetmetal for the periods up to 2005. Danh was, at all times, and continues to be the accountant for Double T Sheetmetal. Danh was also Joseph's accountant at the time when Joseph conducted a business as a mechanic, under the name "P & Son Auto Repairs".

160 Danh stated that for the financial years from 2000 to 2002, he received information about Roo Sheetmetal from Thomas and Tina. After this time until early 2005, his instructions came from Thuy. Danh stated that, as the general ledgers and financial statements were the subject of bank reconciliations conducted by his firm, "as far as [he was] concerned", the reports provided by Phan Campbell & Associates were an accurate record of the performance of the businesses. Naturally, it follows that when cash was received by the businesses and not banked, the financial reports would be inaccurate.[45]

161 In addition to Thuy's approaching Danh in 2003 concerning PN & Nominees, Danh was instructed by Thuy alone in 2003 to have another company incorporated, which became Oz Sheetmetal. Again, Danh stated he did not know the purpose of this company. Danh said he usually did not ask many questions. In order to provide the necessary instructions for the incorporation of both companies, Thuy attended at Danh's office. Danh filled out a form based on the information provided by Thuy, which was read back to Thuy to make sure she was happy with it. Those details then became the basis upon which particulars of Oz Sheetmetal and PN & Nominees were registered with the Australian Securities and Investments Commission ("ASIC"). The formal documentation required to be lodged was prepared by another firm retained by Danh. All such documentation requiring signatures were provided by Danh to Thuy. Thuy then arranged for the signing to occur. In relation to these matters, Danh only ever dealt with Thuy.

162 In early 2005, Thuy and Danh had a personal dispute, which resulted in Thuy ceasing to use Danh's accounting firm for accounting and tax services for Roo Sheetmetal and Oz Sheetmetal.

163 Danh was not the subject of any cross-examination by the plaintiffs.

164 Tuan Tran ("Tuan") is an accountant. His firm, Tuan Tran Pty Ltd, was appointed as the accountant of Roo Sheetmetal and Oz Sheetmetal midway through the 2005 financial year. Tuan took his instructions mainly from Thuy. The first appointment he had was with Thuy and Minh when they attended his office, but after that Tuan rarely spoke to or saw Minh. Tuan said that before this time, he may have prepared personal tax returns for Minh.

165 Tuan continues to be the accountant for Roo and Oz Sheetmetal. He ceased being retained as the accountant for Roo Sheetmetal after the 2011 financial year.

166 Tuan said the accounts were prepared for each of Roo Sheetmetal and Oz Sheetmetal based on spreadsheets provided by Thuy. Save for conducting a reconciliation with the company bank statements, the information provided by Thuy would not otherwise be checked.[46] To use Tuan's language, the information was just copied and pasted. Thuy usually provided information each quarter.

167 Tuan was also responsible for preparing personal tax returns. Broadly speaking, such tax returns were prepared on a yearly basis.[47]

168 At no time was advice ever sought from Tuan about any valuation of Roo Sheetmetal or Roo and Oz Sheetmetal. Tuan was not cross-examined by the plaintiffs.

169 Chinh was an entirely satisfactory witness. He answered questions directly and was clear in his evidence.

170 Speaking broadly, Thomas is a hardworking, generous and generally kind-hearted man. In the past he has wanted to give to others, as part of showing his gratitude for what he has in life.[48] For many years in his life, Thomas has been committed to financially assisting those less fortunate than himself. In both Vietnam and Australia, there are many beneficiaries of Thomas' goodwill and charitable gestures.

171 Thomas' generous nature and the fact that Thomas has been willing for many years to give moneys and provide other assistance to a large number of people mean that any payments, or other benefits, given by Thomas cannot be assumed to have necessarily occurred because Thomas was seeking financial gain, or because he sought or had any proprietary interest in any company he may have assisted. In other words, Thomas cannot be presumed to have been acting commercially when making payments or giving to people. As discussed below, the generosity of Thomas was evinced in many ways, including in 2002 and 2003 in his dealings with his family.

172 Thomas, quite justifiably, felt very hurt and let down by the events of 2012, including the highhanded way in which he was treated after he was dismissed and precluded from the day-to-day conduct of the business of Roo and Oz Sheetmetal. By reason of these sentiments, he was willing to colour his evidence to seek to get back a business that was once his alone.

173 Thomas admitted that his recollection of many relevant events was poor. Thomas stated that since things had started to fall apart in his relationship with Thuy and others, he had been under a great deal of stress. He said his wife, Tina, had also suffered from depression as a result of the difficult circumstances.[49] According to Thomas, these combined matters have had a significant effect on him.

174 Like the plaintiffs, Thomas was also inclined, from time to time, to give evidence based on the case he wished to advance, rather than answering a question directly. There were numerous instances where Thomas failed to answer the question put to him.

175 In addition, Thomas fully appreciated he had signed many documents that were not consistent with the case he wanted the court to accept. As a result, whenever such documents were put before him he invariably responded immediately with what appeared to be a well-rehearsed account of how he never read the document in question, and that he simply signed because Thuy told him to sign. Whilst I accept this may have occurred on occasions, I do not accept that, on almost every occasion Thomas signed a document concerning company business or property transactions, he had no appreciation whatsoever as to the nature or content of the document. A glaring example of this course of conduct was when Thomas was taken to a letter dated 21 September 2010.[50]

176 An analysis of the evidence given by Thomas as to the basis upon which he signed documents discloses basic inconsistencies. In his evidence in chief, Thomas stated that he trusted Thuy completely and "usually signed the documents without much discussion about them". He said that "on the majority of occasions" he signed documents without reading them. He also stated he relied on Thuy's advice that the documents he signed were for legitimate purposes of the business. When put to him in cross-examination, Thomas accepted he had been very careful in giving this evidence. It suggested that there were occasions when Thuy discussed the content of documents before they were signed by Thomas.[51]

177 However, later in his cross-examination, Thomas said that Thuy did not give advice to him when documents were signed. Further, when asked about a document that he had signed in another context, Thomas made the unqualified statement that he never read any paperwork Thuy gave to him. When asked if he knew what a mortgage was, Thomas' non-responsive answer was as follows:

A mortgage, but when [Thuy] asked me to sign something, I just signed something but I never look and read it.

178 Another illustration of Thomas' evidence in this regard concerns a bank account in the name of each of Thuy, Son, Thomas and Joseph as trustees for the Phan United Family Trust. Thomas signed a document relating to that account, apparently on 11 February 2008.[52] Although this document had a place for 2 authorised signatories, Thomas was the only person who signed in that capacity. The document was significant. It recorded an agreement for the bank to provide a facility to Thomas, Thuy, Son and Joseph in their capacity as trustees of the Phan United Family Trust in the amount of $1.8 million.[53]

179 When first taken to this document, Thomas said Thuy inserted the date and told him to sign it so he signed. When asked whether he specifically recalled Thuy asking him to sign that document, Thomas responded "she always come and say sign this, sign that and I sign". When asked again whether he remembered Thuy asking him to sign the document in question, Thomas said he did not remember but that "every time she come and say sign this, sign that".

180 On the topic of Thomas signing documents, no case was put by the defendants that Thuy or anybody else had misled him, had acted unconscionably or had exerted any undue influence over him. In such circumstances, the following observation by the High Court in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd should be kept in mind:[54]

It should not be overlooked that to sign a document known and intended to affect legal relations is an act which itself ordinarily conveys a representation to a reasonable reader of the document. The representation is that the person who signs either has read and approved the contents of the document or is willing to take the chance of being bound by those contents, ... whatever they might be.

(Emphasis added.)

181 Further, on occasion, Thomas gave evidence that was simply not credible. For example, when asked whether or not his wife received cash from Roo Sheetmetal, Thomas suggested he had no knowledge of such matters. Very soon thereafter, without any document or other evidence being produced to assist him, he acknowledged that he did know about cash wages being paid to his wife even though his wife never worked in the business. I do not accept that there was any confusion in the mind of Thomas when he gave his first answer, as he tried to suggest later in his evidence.

182 Finally, Thomas asserted that a number of events, which others gave evidence that Thomas attended, never occurred. Given Thomas' poor recollection generally, coupled with the matters referred to above, his evidence needs to be treated with a great deal of caution.

183 Thomas referred to Tina as his boss. He said that he always discussed important matters with Tina. Consistent with Thomas' evidence, Tina acknowledged that she had been suffering from depression from around 2012, which she attributed to the issues between the family (including those the subject of this proceeding).[55]

184 Tina was present at the family home at the time that Thomas met with Thuy, Son and Joseph in June 2002. She gave an extensive account of what was said at that gathering. She purported to have a recollection that enabled her to give almost a line-by-line description of what was discussed. Tina also said she had no occasion to discuss what was said at this meeting with anyone, including Thomas, until approximately 10 years later when issues flared up between the family.

185 I fully expect that Tina's recollection of events in 2002 has been affected by the lapse of time and the highly emotional environment with which she has had to deal in the last 3 or so years.

186 The reason Uncle Tu is an Australian resident is in large part because of Thomas. When Uncle Tu first sought to migrate to Australia, his application was refused. He had been sponsored by his daughter. She did not have a job and her husband did not earn a sufficient amount to satisfy the Australian government's requirements. Having learnt of this situation, Thomas agreed to sponsor Uncle Tu. Thomas took on a financial risk in doing so. In 1992, Thomas travelled to Vietnam and met Uncle Tu in person for the first time. Uncle Tu was allowed to enter Australia in June 1993, with his wife and child.

187 In early 2009, Uncle Tu agreed to travel from Sydney to Melbourne to help Thomas with some renovations on Thomas' family home in Hughesdale. Uncle Tu did this as part of expressing his gratitude to Thomas for his help in the past. Uncle Tu gave evidence that he was with Thomas on the evening of 4 May 2009 (a time at which the plaintiffs allege Thomas was at an important meeting).

188 Uncle Tu acknowledged that his memory was not as good as it used to be and it was difficult for him to remember what occurred on a particular day. He also accepted he did not remember clearly what happened on 4 May 2009. However, he had no doubt as to the timing of events in May 2009. Uncle Tu's evidence was corroborated by meticulous, contemporaneous handwritten notes that he took. In his evidence in chief, Uncle Tu came across as credible and reliable. Nothing that occurred in cross-examination materially altered that position. He made it clear he was relying on the contents of his notebook in giving his evidence as to timing.

F. Further relevant events before the incorporation of Roo Sheetmetal

At a glance

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Before

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Judgment (1524 paragraphs)

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Legislation Cited (1)

Cases Cited (38)