Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA

Citation : FAZIO -v- FAZIO [2010] WASC 263

Partnership - Inferred agreement - Relevance of subsequent conduct - Release of interest - Accord and satisfaction - Abandonment - Repudiation - Inferences - Jones v Dunkel - Whether judge's findings beyond pleaded case - Sufficiency of evidence - Business records - Proprietary estoppel

Partnership Act 1895 (WA), s 7(1), s 7(2), s 8(3), s 16, s 29, s 33, s 37, s 42, s 43(a), s 43(b), s 44, s 45, s 50, s 51, s 57

First Respondent : Mr C L Zelestis QC & Mr M N Solomon

Second Respondent : Mr C L Zelestis QC & Mr M N Solomon

Third Respondents : Mr C L Zelestis QC & Mr M N Solomon

Fifth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Sixth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Seventh Respondent : Mr C L Zelestis QC & Mr M N Solomon

Eighth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Ninth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Tenth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Eleventh Respondent : Mr C L Zelestis QC & Mr M N Solomon

Twelfth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Thirteenth Respondent : Mr C L Zelestis QC & Mr M N Solomon

Adler v Australian Securities and Investments Commission [2003] NSWCA 131; (2003) 179 FLR 1

Agricultural & Rural Finance Pty Ltd v Gardiner [2008] HCA 57; (2008) 238 CLR 570

Albrighton v Royal Prince Alfred Hospital [1980] 2 NSWLR 542

ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue [2012] HCA 6

Allen v Carbone [1975] HCA 14; (1975) 132 CLR 528

Australian Securities and Investments Commission v Rich [2009] NSWSC 1229; (2009) 236 FLR 1

Banque Commerciale SA (in liq) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279

Barnes v Addy (1874) LR 9 Ch 244

Barnes v Alderton [2008] NSWSC 107

Barrier Wharfs Ltd v W Scott Fell & Co Ltd [1908] HCA 88; (1908) 5 CLR 647

Beattie and Sutherland v Osman (No 4) [2009] NSWSC 834

Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) and (No 10) [2008] WASC 239; [2009] WASC 107; (2008) 39 WAR 1

Blatch v Archer [1774] EngR 2; (1774) 1 Cowp 63

Booth v Booth [1935] HCA 15; (1935) 53 CLR 1

Brambles Holdings Ltd v Bathurst City Council [2001] NSWCA 61; (2001) 53 NSWLR 153

Brandi v Mingot (1976) 12 ALR 551

Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; (2001) 117 FCR 424

Brown v Wren Brothers [1895] 1 QB 390

Butler v Wilson [2011] NSWSC 262

Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd [1974] HCA 22; (1974) 131 CLR 321

Carr v The Queen [1988] HCA 47; (1988) 165 CLR 314

Commissioner of State Taxation of the State of South Australia v Cyril Henschke Pty Ltd [2010] HCA 43; (2010) 242 CLR 508

Connell v Bond Corporation Pty Ltd (1992) 8 WAR 352

DHJPM Pty Ltd v Blackthorn Resources Ltd (formerly called AIM Resources Ltd) [2011] NSWCA 348

Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557

DTR Nominees Pty Ltd v Mona Homes Proprietary Ltd [1978] HCA 12; (1978) 138 CLR 423

EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2010] WASCA 78; (2010) 41 WAR 23

Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523

Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95

Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89

Fazio v Fazio [2010] WASC 263

Federal Commissioner of Taxation v Everett [1980] HCA 6; (1980) 143 CLR 440

Festic v Atkinson (Unreported, WASCA, Library No 8484, 19 September 1990)

Fifteenth Eestin Nominees Pty Ltd v Rosenberg [2009] VSCA 112; (2009) 24 VR 155

Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420

Fox v Percy [2003] HCA 22; (2003) 214 CLR 118

G v H [1994] HCA 48; (1994) 181 CLR 387

Geraghty v Minter [1972] HCA 42; (1972) 142 CLR 177

Gould & Birbeck & Bacon v Mount Oxide Mines Ltd (in liq) [1916] HCA 81; (1916) 22 CLR 490

HML v The Queen [2008] HCA 16; (2008) 235 CLR 334

Holloway v McFeeters [1956] HCA 25; (1956) 94 CLR 470

Hughes v NM Superannuation Pty Ltd (1993) 29 NSWLR 653

Integrated Computer Services Pty Ltd v Digital Equipment Corporation (Aust) Pty Ltd (1988) 5 BPR 11,110

Intelmail Explorenet Pty Ltd v Vardanian (No 2) (2009) FCA 1018; (2009) 82 IPR 281

Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298

Jones v Sutherland Shire Council [1979] 2 NSWLR 206

Jorgensen v Boyce (1896) 22 VLR 408

Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115

Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; (2011) 243 CLR 361

Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363

Lang v James Morrison & Co Ltd [1911] HCA 49; (1911) 13 CLR 1

Leeder v The State of Western Australia [2008] WASCA 192

Lewis v Lewis [2001] NSWSC 321

Lighting by Design (Aust) Pty Ltd v Cannington Nominees Pty Ltd [2008] WASCA 23; (2008) 35 WAR 520

LJ Hooker Ltd v Dominion Factors Pty Ltd [1963] 63 SR (NSW) 146

Lukin v Lovrinov (Unreported, SASC, Perry J, 9 April 1998)

Luxton v Vines [1952] HCA 19; (1952) 85 CLR 352

MacRobertson Miller Airline Services v Commissioner of State Taxation (WA) [1975] HCA 55; (1975) 133 CLR 125

Manly Council v Byrne [2004] NSWCA 123

Marist Brothers Community Inc v Shire of Harvey (1994) 14 WAR 69

Marminta Pty Ltd v French [2003] QCA 541

Martin v Osborne [1936] HCA 23; (1936) 55 CLR 367

Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd [1950] HCA 55; (1950) 82 CLR 101

Massoud v NRMA Insurance Ltd (1995) 62 NSWLR 657

McDermott v Black [1940] HCA 4; (1940) 63 CLR 161

Meares v Safecar Security Ltd [1983] QB 54

Moore v Morgan (1900) 21 LR (NSW) Eq 158

Morgan v Babcock & Wilcox Ltd [1929] HCA 25; (1929) 43 CLR 163

Moss v Elphick [1910] 1 KB 846

Mullins v Laughton [2003] 2 WLR 1006

Osborn v McDermott [1998] 3 VR 1

Palmer v Moore [1900] AC 293

Paterson v MacKenzie [1921] NZGLR 43

Peacock v Peacock [1809] EngR 130; (1809) 2 Camp. 45

Rowella Pty Ltd v Abfam Nominees Pty Ltd [1989] HCA 65; (1989) 168 CLR 301

RPS v The Queen [2000] HCA 3; (2000) 199 CLR 620

Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd [2003] QCA 210; (2003) 1 Qd R 320

Ryder v Frohlich [2004] NSWCA 472

Sanpine v Koompahtoo Local Aboriginal Land Council (2005) NSWSC 365

Scaffidi v Perpetual Trustees Victoria Ltd [2011] WASCA 159

Scott v English [1947] VicLawRp 67; [1947] VLR 445

Securities Pty Ltd v Challenger Group Holdings Pty Ltd [2008] NSWCA 193

Seltsam Pty Ltd v McGuiness [2000] NSWCA 29; (2000) 49 NSWLR 262

Sobell v Boston (1975) 1 WLR 1587

Summers v The Commonwealth [1918] HCA 33; (1918) 25 CLR 144

The Administration of the Territory of Papua and New Guinea v Daera Guba [1973] HCA 59; (1973) 130 CLR 353

The Trustees of the Property of Cummins v Cummins [2006] HCA 6; (2006) 227 CLR 278

Thompson v De Lissa (Unreported, NSWSC, Powell J, 16 February 1990)

Thorner v Major [2009] UKHL 18; [2009] 1 WLR 776

Truong v Lam [2009] WASCA 217

United Builders Pty Ltd v Mutual Acceptance Ltd [1980] HCA 43; (1980) 144 CLR 673

Vroon BV v Foster's Brewing Group Ltd [1994] VicRp 53; [1994] 2 VR 32

WA Country Health Service v Wright [No 2] [2010] WASCA 120

Walker v Melham [2007] NSWSC 264

Wallera Pty Ltd v CGM Investments Pty Ltd [2003] FCAFC 279

Watson v Foxman (1995) 49 NSWLR 315

West v Government Insurance Office of NSW [1981] HCA 38; (1981) 148 CLR 62

Williams v The Minister Aboriginal Land Rights Act 1983 and the State of New South Wales [2000] NSWCA 255

1 PULLIN JA: This is an appeal against a judgment which dismissed the appellant's claim for a declaration that he was a partner in Italia Limestone. The firm was established in the 1950s. By the 1960s the partners consisted of three groups, each holding a one-third share. One group was the Fazio family, the second the Catalano family and the third the Mignacca family. The Mignacca and Catalano families were not concerned about how the Fazios held their one-third interest. The appellant became a partner in Italia Limestone, taking a share of the Fazio family's one-third interest, sometime in the late 1960s or early 1970s. In 1975 the Fazio partners acquired the interests of the Mignacca family. As a result, the Fazios then held two-thirds of the partnership and the Catalanos held one-third.

2 Mr Fazio senior, the appellant's father, was the dominant figure in the Fazio group. The appellant worked in the partnership doing physical work. The appellant fell out with his father and he ceased working for the firm in 1984.

3 The central issue in the case was whether the appellant and his father reached an agreement whereby the appellant retired from the partnership in 1984. The retrospectant circumstantial evidence led at trial overwhelmingly revealed that the appellant and the other parties conducted themselves on the basis that the appellant had retired from the partnership and had no further interest in it. For example, the evidence revealed that the appellant signed a business name form in 1984 which stated that, with effect from 1 July 1984, he ceased to carry on business under the business name of Italia Limestone and the other partners were continuing to carry on business under that name. The other partners also signed the form and it was lodged with the relevant department. The evidence also revealed that at no time after October 1984 did the appellant, in many statements of his assets and liabilities, refer to any interest in the partnership either as an asset or a liability. The subsequent tax returns did not disclose any income from the partnership and the partnership's tax returns made no further mention of the appellant as a partner. The appellant knew, as was the fact, that he did not receive any share in partnership profits and was not called upon to sign any legal documents relating to partnership affairs. Unlike the period before 1984, he never received partnership accounts. He was never called upon to contribute capital to the partnership or to guarantee any borrowings.

4 Then, nearly 20 years later in 2003, the appellant wrote a letter to the firm's accountants asking for partnership records and asserting that he was a partner. This request for records was not complied with and the appellant made no similar assertion until after his father died in 2007. The appellant then commenced proceedings alleging that he was still a partner and seeking, inter alia, a declaration to that effect, a winding up of the partnership and an account.

5 Despite the appellant's denial that he had retired from the firm, the trial judge found that there had been an agreement between the appellant and his father which provided that:

(a) the appellant would retire from the partnership with effect from 1 July 1984;

(b) the partnership would continue without there being a winding up of its affairs;

(c) the appellant would be absolved from any liabilities arising from the future conduct of the partnership business; and

(d) the appellant and his wife would be given a property in Barrett Street, Spearwood, in consideration for the appellant's surrender of his interest in the partnership.

6 The trial judge inferred that the other partners acquiesced in, and consented to, the agreement between the appellant and his father in those terms, given that they continued to operate the business and to prepare and sign documents which are consistent with that finding (trial judge's reasons [439], [441]).

8 There were nine numbered paragraphs in the grounds of appeal, but there were 57 subgrounds in one of them, each containing a separate allegation of error. Despite the number of separate allegations of error, they were ineffectual in demonstrating error in the trial judge's finding of an inferred agreement. They were ineffectual because even if there were merit in those grounds, there were other circumstances found by the trial judge which are unchallenged and which on their own, pointed overwhelmingly to the existence of the agreement. For example, the list of circumstances found and recorded in the trial judge's reasons at [228] were unchallenged. That paragraph read:

The plaintiffs accept that after 1984 none of the usual indicia of partnership suggested that Jack remained a partner in Italia Limestone. He did not receive any share of partnership profits, nor did he return any partnership income in his own taxation returns. Given his evidence with respect to the magnitude of the dispute that had arisen in relation to his taxation liability in respect of partnership profits during the year ended 30 June 1984, the significance of this cannot have escaped his attention. Similarly, he would have been well aware that he was no longer required to pay provisional tax in respect of anticipated partnership profits. Before 1984 he was called upon to sign legal documents relating to partnership affairs, but after 1984 he was not called upon to sign any such documents. He never asked for, nor received partnership accounts after 1984, and never enquired, nor was he advised in any detail as to the state of the partnership's assets and liabilities until he asserted an interest in the partnership in December 2003. He was never called upon to contribute capital to the partnership. He was not called upon to guarantee any partnership borrowings after 1984, nor was it ever suggested that he would be responsible for partnership debts, notwithstanding the financial difficulties which the partnership suffered in the early 1990s. Jack also accepts that when preparing statements of his own assets and liabilities for the purpose of borrowing, at no time after 1984 did he refer to a partnership interest in those statements, as either an asset or a liability.

9 The undisputed circumstances and evidence that property, namely real estate in Barrett Street, Spearwood, was transferred to the appellant and his wife around the time of the agreement, supports the trial judge's conclusion that he could infer the existence of the agreement referred to above.

10 In Hughes v NM Superannuation Pty Ltd (1993) 29 NSWLR 653, 670, Sheller JA said:

As had been said by this Court, in B Seppelt & Sons Ltd v Commissioner for Main Roads (1975) 1 BPR 9147 at 9149 and 9154-9156, subsequent communications may be taken into consideration as a factor in order to determine whether prior dealings between the parties gave rise to a binding agreement.

This demonstrates that retrospectant circumstantial evidence is admissible to prove the existence of a contract. See also the other cases cited by Murphy JA on this subject in his overview to ground 4.

11 During the hearing of the appeal, counsel for the appellant was closely questioned about the primary submission that there was insufficient evidence from which to infer that the appellant did retire as from 1 July 1984 on terms that the remaining partners would continue business in the partnership name. Counsel for the appellant, who may have recognised the futility of that primary submission, then developed the alternative argument that if there were such an agreement, then there was no evidence that the agreement involved any consideration in exchange for the appellant relinquishing his interest in the partnership;

and that in consequence the appellant was entitled on this alternative basis for relief under s 55 of the Partnership Act 1895 (WA).

12 However, as the trial judge found and as Murphy JA has explained, the evidence revealed that such consideration was paid in the form of the transfer of the Barrett Street property.

13 What is set out above is the essence of the reason why the appellant's claim was correctly dismissed by the trial judge and why the appellant's appeal should be dismissed. Murphy JA has dealt with the appellant's appeal in much greater detail. Subject to these reasons, I agree with Murphy JA's reasons dismissing the appeal. I would also uphold those aspects of the respondent's notice of contention upheld by Murphy JA, for the reasons given by him.

14 NEWNES JA: I agree with Murphy JA, for the reasons his Honour gives, that none of the grounds of appeal has been made out and the appeal should be dismissed. I would add that to the extent the appellant sought to rely on the appeal on an alternative contention that the appellant was entitled to relief under s 55 of the Partnership Act 1895 (WA) because there was no consideration for the relinquishment of his interest in the partnership upon his retirement, that contention must fail. As Murphy JA has set out, the consideration was the transfer to the appellant of the Barrett Street property. I agree with Murphy JA in relation to the notice of contention.

15 This is an appeal from a judgment in which the primary judge dismissed a claim by a son in a family partnership dispute concerning disputed events going back to the 1960s. The family was the Fazio family. The appellant and his wife commenced proceedings after the appellant's father, the senior member of the family and, historically, the driving force behind the family's interest in the partnership, had passed away. The appellant and his wife contended that the appellant remained a partner of the partnership until it was dissolved upon the death of the appellant's father in 2007. The first to third respondents (the other partners) denied this. The appellant and his wife also contended that the appellant's brother had never been admitted to the partnership.

16 Broadly speaking, the principal issues in the case at trial were whether the appellant's brother had been admitted to the partnership and whether an agreement had been made in or about mid-1984, under which the appellant had agreed, for consideration, to retire from the partnership and to relinquish his interest in it, with effect from 1 July 1984. There were also estoppel claims, including a claim that the father's estate, the mother, and the brother, held one-third of the non-partnership family assets on trust for the appellant.

17 The primary judge found that the appellant's brother had been made a partner of the partnership. He also held that by an agreement made in mid-1984, the appellant had retired from the partnership and relinquished his interest in it, the consideration for which involved the appellant and his wife being given, for no payment, a property in Barrett Street, Spearwood (the 'Barrett Street property').

18 The second, but not the first, finding is under challenge in this appeal. The estoppel claims were dismissed and the dismissal of one of the estoppel claims is also under challenge. Although the appellant's wife was a plaintiff in the action below, she was not an appellant in this appeal.

20 The respondents, by notice of contention, allege that the primary judge's decision should be upheld on additional grounds, including that the appellant had, it is to be inferred, abandoned his interest in the partnership in favour of the other Fazio members. Had it been necessary, I would have allowed the notice of contention on this particular ground.

21 These reasons will, in large measure, adopt the terminology used by the primary judge in identifying the parties and the participants in the events the subject of the proceedings:

• Italia Limestone Company (Italia Limestone) - the business name of the partnership in question.
• The Fazio family - various members of whom were partners of the relevant partnership.
• Vince (or Vincenzo) Fazio - the (late) father of the appellant and his siblings.
• Giuseppina - Vince's wife and the mother of the appellant and his siblings.
• The appellant - Jack (or Giacomino).
• Maria - Jack's wife.
• Rudy (or Ridolfo) - Jack's brother and the other son of Vince and Giuseppina.
• Sarina - the sister of Jack and Rudy and the daughter of Vince and Giuseppina.
• The Catalanos - the family which held a one-third interest in the partnership. The relevant family members are Sebastiano (also called Sam) Catalano and his wife, Rosaria Catalano.
• The Mignaccas - the family which held an interest in the partnership up to about early 1976 and thereafter ceased to have an interest in it.
• Danehill Nominees Pty Ltd - a trustee company, the units in which were, in effect, held as to two-thirds by the Fazio family (through Anham Nominees Pty Ltd as trustee for the V Fazio Family Trust) and as to one-third by the Catalano family (through Dangan Nominees Pty Ltd as trustee for the Catalano Family Trust).

Overview of the litigation and the judge's findings of agreement Overview

22 The judge gave the following overview of the litigation: Fazio v Fazio [2010] WASC 263 [1] - [8], [345].

23 Vince and his wife Giuseppina Fazio, migrated to Australia from Italy in 1952 with their 3-month-old son, Jack. Their second child, Rudy, was born in Perth in 1961. Their third child, Sarina, was born in Sicily in 1967 while the family was visiting Italy.

24 In 1956 Vince started a limestone quarrying and stone masonry business known as Italia Limestone, in partnership with a number of other Italian immigrants. The composition of the partnership changed over the years, as some proprietors left, and were replaced by others. By the late 1960s, the proprietors of the business were members of the Fazio family, members of the Catalano family and members of the Mignacca family. At some point around then, or perhaps in the early 1970s, Vince and Giuseppina brought Jack into the partnership, giving him an equal portion of their share in the partnership business. In December 1975, the Fazio partners, in effect, acquired the interest of the Mignacca partners, whereafter the Fazio partners held two-thirds of the interest in the partnership, and the Catalano partners held one-third.

25 Jack worked in the partnership business and was paid wages. However, there was disharmony between Jack and his father, Vince, and in 1984, Jack ceased to work in the business. Generally speaking, after 1984, the documents and records relating to the partnership do not record or suggest that Jack remained a partner.

26 The relationship between Jack and his father deteriorated further over time, and, in the last five years of Vince's life, there were a number of incidents involving hostility and aggression between the two of them. Jack's relationship with his father impacted adversely upon his relationship with his siblings, and he became estranged from them, as well as from his parents.

27 In the latter part of 2003, Jack wrote to the partnership accountants seeking access to all partnership records which they held, and contending that he was a partner. The accountants did not state a definitive position on the subject of his interest in the partnership, but refused him access to the partnership records which they held.

29 Despite some fluctuating fortunes, particularly in the early part of the 1990s, when the business was under significant financial pressure, the partnership's business prospered, and assets were acquired by various corporate entities related to and controlled by the proprietors of the partnership. Often those assets included land in proximity to the outer suburbs of Perth, which was quarried for limestone used in building houses and in other construction work in those suburbs, or in coastal groynes. As Perth expanded in size, the business became a substantial enterprise, and had a significant turnover.

30 The proceedings were commenced by Jack and his wife, Maria, on 12 March 2008.

31 Under Vince's Will, Vince left Jack $1 million and conferred financial benefits on Jack's and Maria's children.

32 The primary judge found, in effect, that there was an agreement, for consideration, for Jack to retire from the partnership and relinquish his interest in it with effect from 1 July 1984, and that the agreement was made in the middle of 1984. His Honour's findings are summarised at [439] - [441]:

I find that at some point around the middle of 1984, it was agreed between Jack and Vince that Jack would retire from the partnership with effect from 1 July 1984, on the following terms:

(a) the partnership would continue, without there being a winding up of its affairs;

(b) Jack would be absolved from any liabilities arising from the future conduct of the partnership business; and

(c) Jack and Maria would be given the lot in Barrett Street, Spearwood in consideration for Jack's surrender of his interest in the partnership.

The defendants asserted that it was also agreed that Vince would pay for the cost of architect's plans for the house to be built in Barrett Street, as part of the consideration for Jack's retirement from the partnership. However, the evidence falls short of establishing that connection.

It is to be inferred that the other partners acquiesced in, and consented to the agreement between Jack and his father in these terms, given that they continued to operate the business, and to prepare and sign documents which are consistent with this finding.

33 The appellant accepted, as did the respondents, that the finding in [439] is to the effect that it is to be inferred that there was an express (oral) agreement between Jack and Vince, in the terms stated, made in mid-1984. The appellant contended, however, that on the proper construction of the judge's reasons, the judge did not find an agreement under which the other partners were bound. This contention is addressed later in these reasons.

Nature of the appeal and disposition - overview Introduction

34 The scope and detail of the appellant's challenges in this appeal are considerable, to say the least. Whilst there are only nine grounds of appeal, ground 4 alleges 57 separate errors, many of which contain multiple contentions. It was to ground 4 that most of the arguments, in written and oral form, were directed in the appeal. The errors alleged in ground 4 all attack the finding that the first to third respondents had established that Jack had retired from the partnership in 1984. Grounds 1 to 3 alleged other very discrete errors in relation to partnership issues, and grounds 5 and 6 attacked certain estoppel findings. The grounds of appeal, in their totality, contend in effect that the judge fundamentally erred in his approach to fact-finding.

35 Interspersed amongst the errors alleged in the grounds, and, in particular ground 4, were, it seems to me, seven principal propositions contended for by the appellant. These seven propositions are, I think, conveniently addressed together, rather than where they expressly or implicitly appear in their manifestations in support of various grounds. Accordingly, I will address those seven propositions before addressing, in detail, each of the appellant's grounds and contentions in support of the grounds. After dealing with the seven propositions, I will address grounds 4.1 to 4.57, then grounds 5 and 6, then grounds 1 to 3 and finally grounds 8 and 9.

36 Even before dealing with the appellant's seven principal propositions, it is appropriate to explain, in broad overview, why the appeal, with respect to the partnership issues, must fail. I will do that in the remaining parts of this section of these reasons, under the following subheadings:

37 In relation to his general approach to fact-finding, the judge said (reasons [49]):

A significant number of witnesses were called, including many (but not all) of the principal players. Of course, one of the most significant players, Vince, is deceased. The other principal witnesses were required to give evidence of events which took place over the course of many years. One of the most significant periods in the history of the various events involving the Fazio family which were addressed by the evidence was the period between 1982 and 1984, leading up to Jack's departure from full-time engagement in the Italia Limestone business. That period was more than 25 years prior to the trial. It would not be reasonable to expect any witness to have a precise recollection of the exact sequence of events, or of particular dates, or of the precise terms used in conversations at that time. Accordingly, I have allowed a significant degree of latitude in evaluating evidence given by witnesses of events and conversations which took place many years ago.

38 The judge then referred to the schism and conflict within the Fazio family and continued (reasons [51] - [52]):

Given the inherent doubts which must attend oral recollections of events which occurred many years ago, in most instances decades earlier, and the partiality of most of the witnesses, I have placed significant weight upon contemporaneous documentary evidence and upon the inferences properly drawn from that evidence. Where it is possible to establish objective facts from that evidence, I have then assessed the oral testimony in light of the inherent probabilities of a particular version of events, in the context of the established objective facts.

I am not convinced that any witness gave evidence which he or she knew to be false. As will be seen, however, I have in many instances rejected the oral testimony that was given by one or other witness as a result of the process I have just described. In those instances, generally speaking, I consider that the evidence which I have rejected was given because of the insidious influence and effect of the family conflict which I have described upon the honest recollection and perception of the witness.

39 The judge also indicated that for the most part, he did not rely on the demeanour of the witnesses in making findings of fact. However, he was critical, in particular, of certain non-party witnesses called by the respondents and had some reservations about the evidence of Rudy and Sarina, based on their demeanour (reasons [53] - [55]).

40 With respect to Jack and his wife Maria, his Honour said that the impression he formed from their demeanour was that, in general, they were doing their best to provide truthful answers to the questions provided, but nevertheless their perception and the accuracy of their recollections had been overtaken by the conflict to which his Honour had referred. In some instances, his Honour concluded 'that their evidence had been fashioned to assist the case which they [sought] to advance' (reasons [53]).

41 The judge rejected Jack and Maria's evidence on numerous issues (eg, reasons [151], [193], [223], [245], [267], [277], [308], [322], [340]). In relation to the partnership issues, the judge also made express adverse findings about Jack's credibility on important matters, including, at least on some occasions, having regard to demeanour. In relation to one matter, for example, his Honour said that Jack's 'dissembling answers, and his reluctance to acknowledge that his evidence-in-chief was wrong, when plainly it was, reflect adversely upon his general credibility' [94]. The judge also said that Jack's 'transparently disingenuous attempts to distort the true nature of [one] transaction reflect adversely on his credibility generally' [151]; that Maria's evidence on an aspect of a matter concerning the Barrett Street property 'was not given confidently or plausibly' [173]; that Jack's explanation of a matter in cross-examination was 'plainly an invention' [215]; that Jack's cross-examination on another matter told 'very strongly against his credibility generally' [266]; and that in relation to the possession of certain partnership financial documents, the evidence of Jack and Maria 'was given in an attempt to avoid the obvious forensic significance of their discovery of those documents' [378].

42 The judge's observations of the inherent doubts which must attend oral recollections of events occurring many years earlier echoed the observations of the plurality in West v Government Insurance Office of NSW [1981] HCA 38; (1981) 148 CLR 62, 69 that (in an accident case in which four passengers were not called) the 'delay [of over 10 years] between accident and trial would surely have grossly affected the recollection of those witnesses of such a long-past event'.

43 It is also to be observed that the judge's general approach in placing significant weight on contemporaneous documents and in evaluating oral testimony in the light of the inherent probabilities of the event in question is broadly consistent with the approach referred to by the Victorian Court of Appeal in Fifteenth Eestin Nominees Pty Ltd v Rosenberg [2009] VSCA 112; (2009) 24 VR 155. In that case, involving a family dispute, the court said at [112] - [113]:

The witnesses were giving evidence many years after the representations had allegedly been made. The circumstances make applicable the approach described by Tamberlin J in Lake Cumbeline Pty Ltd v Effem Foods Pty Ltd (t/as Uncle Ben's of Australia) (in a passage cited with approval by the High Court when it upheld his Honour's decision):

'[Given the lapse of time] between the events and conversations raised in evidence and the hearing of the evidence before me, the only safe course is to place primary emphasis on the objective factual surrounding material and the inherent commercial probabilities, together with the documentation tendered in evidence. In circumstances where the events took place so long ago, it must be an exceptional witness whose undocumented testimony can be unreservedly relied on. The witnesses in this case unfortunately did not come within that exceptional class. The discussions referred to in evidence were capable of bearing quite opposed meanings depending on subtle differences of nuance and emphasis, and a proper appreciation of the significance of those matters must necessarily be considerably diminished over such a long period of time.'

Difficulties of recollection are likely, in our view, to be even greater in a case such as the present, where the dispute in question concerns dealings between members of the same family about family finances and inheritance. Recollections of what was said, or intended, are inevitably clouded by the overlay of emotion and by the intrusion of individual hopes and expectations and feelings of entitlement. The emotional overlay is all the more significant where, as here, those contending that promises were made, and relied on, are seeking to make good their sense of disappointed expectations. (footnotes omitted)

44 The limited reliance on demeanour adopted by the judge also accords with the tenor of the observations of Gleeson CJ, Gummow and Kirby JJ in Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 [31]:

Further, in recent years, judges have become more aware of scientific research that has cast doubt on the ability of judges (or anyone else) to tell truth from falsehood accurately on the basis of such appearances. Considerations such as these have encouraged judges, both at trial and on appeal, to limit their reliance on the appearances of witnesses and to reason to their conclusions, as far as possible, on the basis of contemporary materials, objectively established facts and the apparent logic of events. This does not eliminate the established principles about witness credibility; but it tends to reduce the occasions where those principles are seen as critical. (footnotes omitted)

Reference may also be made to Watson v Foxman (1995) 49 NSWLR 315, 318 - 319 in this regard.

45 Much of the appeal was concerned with the drawing of inferences by the primary judge. It is convenient at the outset to mention the relevant principles.

46 The drawing of an inference is 'an exercise of the ordinary powers of human reason in the light of human experience': G v H [1994] HCA 48; (1994) 181 CLR 387, 390. In Morgan v Babcock & Wilcox Ltd [1929] HCA 25; (1929) 43 CLR 163, 173, Knox CJ and Dixon J said that the matter 'must inevitably be judged by considering whether general human experience would be contradicted, if the proved facts were unaccompanied by the fact sought to be proved'; see also Martin v Osborne [1936] HCA 23; (1936) 55 CLR 367, 385; Jones v Sutherland Shire Council [1979] 2 NSWLR 206, 222 - 227. In Martin v Osborne, Evatt J said that in the 'ordered processes of logical thought ... regard must be had to every hypothesis which can compete with the hypothesis suggested by experience and knowledge of human affairs' (381). His Honour observed that in that case the course of argument 'laid bare the paucity both in number and quality of the hypotheses which might be advanced' as alternative explanations for the hypothesis suggested by experience and knowledge of human affairs in that case.

47 Martin v Osborne was a criminal case in which the respondent was charged with driving a commercial passenger vehicle on a particular day, whilst unlicensed. The informant was required to prove, beyond reasonable doubt, that the passengers on the day in question were being carried for reward. The informant did not call direct evidence from any passengers of payment for carriage. The informant did call evidence to show that the defendant had, on the two preceding days, and the day in question, carried people between Melbourne and Ballarat. Evidence of the fact of carriage on the two preceding days had been objected to. Latham CJ, Dixon, Evatt and McTiernan JJ (Starke J dissenting) held that the evidence was admissible to show that the respondent was operating the car regularly for the carriage of passengers between the two places and held that, from this fact, the proper inference was that the respondent was doing so for reward, including on the day in question. Hence the prosecution's case was proved. The inference was properly drawn in proof of the offence, notwithstanding the absence of direct evidence from any passengers. (See especially Latham CJ (370); Dixon J (377 - 378); Evatt J (380 - 381, 401 - 402); McTiernan J (404).)

48 The drawing of inferences was referred to by the High Court in Bradshaw v McEwans Pty Ltd (1951) 217 ALR 1, 5 in the following terms, quoted in Luxton v Vines [1952] HCA 19; (1952) 85 CLR 352, 358:

Of course as far as logical consistency goes many hypotheses may be put which the evidence does not exclude positively. But this is a civil and not a criminal case. We are concerned with probabilities, not with possibilities. The difference between the criminal standard of proof in its application to circumstantial evidence and the civil is that in the former the facts must be such as to exclude reasonable hypotheses consistent with innocence, while in the latter you need only circumstances raising a more probable inference in favour of what is alleged. In questions of this sort, where direct proof is not available, it is enough if the circumstances appearing in evidence give rise to a reasonable and definite inference: they must do more than give rise to conflicting inferences of equal degrees of probability so that the choice between them is mere matter of conjecture: see per Lord Robson, Richard Evans & Co Ltd v Astley [1911] AC 674, at p 687. But if circumstances are proved in which it is reasonable to find a balance of probabilities in favour of the conclusion sought then, though the conclusion may fall short of certainty, it is not to be regarded as a mere conjecture or surmise: cf per Lord Loreburn above, at p 678. (emphasis added)

49 See also Holloway v McFeeters [1956] HCA 25; (1956) 94 CLR 470, 480 - 481; Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298, 304 - 305, 309 - 310; and see The Trustees of the Property of Cummins v Cummins [2006] HCA 6; (2006) 227 CLR 278 [45] - [48] in relation to an assessment, on the facts of that case, of competing hypotheses in the drawing of inferences.

50 Characterisation of a reasoning process between permissible inference and conjecture often occurs on a continuum, in which there may be no bright line division: cf Seltsam Pty Ltd v McGuiness [2000] NSWCA 29; (2000) 49 NSWLR 262 [84].

51 In order for an appellate court to interfere with a trial judge's findings of fact, it is necessary for an appellant to demonstrate error by the trial judge: Fox v Percy [27]; Leeder v The State of Western Australia [2008] WASCA 192 [84]; Adler v Australian Securities and Investments Commission [2003] NSWCA 131; (2003) 179 FLR 1 [16] - [17]; Williams v The Minister Aboriginal Land Rights Act 1983 and the State of New South Wales [2000] NSWCA 255 [60]; Branir Pty Ltd v Owston Nominees (No 2) Pty Ltd [2001] FCA 1833; (2001) 117 FCR 424 [23] - [28]. In Williams v The Minister Aboriginal Land Rights Act [60], Heydon JA (as his Honour then was) said (Spigelman CJ & Sheller JA agreeing):

The plaintiff bore the burden in the appeal not merely of showing that on the facts her contentions might be available or even correct, but of showing that the trial judge's conclusions ought to be reversed. The plaintiff made only limited challenges to the credit-based findings of the trial judge. Most of her challenges were to inferences drawn, or characterisations made, by the trial judge. Even in relation to those challenges, however, the Court of Appeal is in the same position as that ascribed to the Full Federal Court in Minister for Immigration, Local Government and Ethnic Affairs v Hamsher [1992] FCA 184; (1992) 35 FCR 359 at 369 per Beaumont and Lee JJ:

'... the court is not obliged to proceed to make new findings of fact on all relevant issues and discharge the judgment appealed from if those findings differ from those of the trial judge and do not support the judgment. The court must be satisfied that the judgment of the trial judge is erroneous and it may be so satisfied if it reaches the conclusion that the trial judge failed to draw inferences that should have been drawn from the facts established by the evidence. The court is unlikely to be satisfied if all that is shown is that the trial judge made a choice between competing inferences, being a choice the court may not have been inclined to make but not a choice the trial judge should not have made. Where the majority judgment in Warren v Coombes [(1979) [1979] HCA 9; 142 CLR 531] (at 552-553) states that an appellate court must not shrink from giving effect to its own conclusion, it is speaking of a conclusion that the decision of the trial judge is wrong and that it should be corrected. (See also Edwards v Noble [1971] HCA 54; (1971) 125 CLR 296, per Barwick CJ (at 304), per Menzies J (at 308-309) and per Walsh J (at 318-319).)'

52 Numerous arguments by the parties centred upon the nature of partnership, the nature of a partner's interest in a partnership, and the legal effect of dissolution. It is convenient to outline the relevant principles at this point.

Partnership - relation springing from agreement

53 Partnership is the relation which exists between persons carrying on business in common with a view to profit: s 7(1) of the Partnership Act 1895 (WA). Partnership is a relation springing from agreement, express or implied: Booth v Booth [1935] HCA 15; (1935) 53 CLR 1, 27. Under the general law, the agreement may be inferred from the circumstances proved in evidence: Peacock v Peacock [1809] EngR 130; (1809) 2 Camp. 45; the court may impute to the parties a tacit agreement to operate a business as partners: Booth v Booth (27). The general law principle is reflected, in this State, in s 7(2) of the Partnership Act, which provides that in deciding whether a partnership does or does not exist, the court may have regard to the contract and intention of the parties as appearing from the whole of the facts of the case. See also s 29 of the Partnership Act, which provides that the mutual rights and duties of partners, whether ascertained by agreement or defined by the statute, may be varied by the consent of all the partners, and such consent may be either express or inferred from a course of dealing.

54 Where a person is said to be a partner of a business, it is necessary to consider whether the business is being conducted by the persons conducting it, both on their own behalf, and as agent for the person alleged to be a partner: Lang v James Morrison & Co Ltd [1911] HCA 49; (1911) 13 CLR 1, 11; Paterson v MacKenzie [1921] NZGLR 43, 44.

55 A partner's interest in a partnership is an equitable chose in action: Federal Commissioner of Taxation v Everett [1980] HCA 6; (1980) 143 CLR 440, 446 - 447; United Builders Pty Ltd v Mutual Acceptance Ltd [1980] HCA 43; (1980) 144 CLR 673, 688; Commissioner of State Taxation of the State of South Australia v Cyril Henschke Pty Ltd [2010] HCA 43; (2010) 242 CLR 508 [27] - [28].

56 The right is not a title to specific property, but a right to the partner's portion of the surplus after the realisation of assets and the payment of liabilities: s 33 of the Partnership Act; Canny Gabriel Castle Jackson Advertising Pty Ltd v Volume Sales (Finance) Pty Ltd [1974] HCA 22; (1974) 131 CLR 321, 327 - 328. The interest of each partner can be finally ascertained only upon completion of the winding-up and the identification of any surplus share: Commissioner of State Taxation v Cyril Henschke Pty Ltd [25].

57 This reasoning is reflected in a provision such as s 50 of the Partnership Act: Commissioner of State Taxation v Cyril Henschke Pty Ltd [25]. Section 50 provides, in effect, that a partner is 'entitled' to have the assets applied to the payment of the partnership's (or firm's) debts and liabilities and to have the surplus assets applied in what is due to the partners (usually on the taking of accounts). The entitlement includes, in the absence of agreement to the contrary, the sale of the goodwill of the partnership business: s 51. By s 57 of the Partnership Act, in settling accounts between the partners after a dissolution, the statutory regime therein set out is to be applied, subject to any agreement to the contrary, leading to what is referred to as the 'ultimate residue' to be shared amongst the partners in the proportions in which profits are divisible. The 'ultimate residue' in s 57(3)(d) relates to the surplus remaining after external creditors have been paid (subpar (a)), and the partners have received out of the assets of the partnership a return of the advances they had made and of the capital they had contributed (subpars (b) and (c)). The 'ultimate residue' is in the nature of profit and not capital: Rowella Pty Ltd v Abfam Nominees Pty Ltd [1989] HCA 65; (1989) 168 CLR 301, 306 - 307.

58 It has also always been accepted that a partner has an interest in every asset in the partnership, and that the interest is a 'beneficial interest' of its own kind (sui generis): Canny Gabriel (328); Commissioner of State Taxation v Cyril Henschke Pty Ltd [24]; see also Maslen v Perpetual Executors Trustees & Agency Co (WA) Ltd [1950] HCA 55; (1950) 82 CLR 101, 129. The partner's interest before a winding-up is more than a 'mere equity' for priority purposes, even though the partner's precise entitlement (to the surplus) can only be ascertained once the winding-up of the partnership has been completed: Canny Gabriel (328); Commissioner of State Taxation v Cyril Henschke Pty Ltd [26]. It is a present beneficial interest in the nature of a proprietary interest: Connell v Bond Corporation Pty Ltd (1992) 8 WAR 352, 365. Thus, even in an insolvent partnership in respect of which there will be a deficiency, and not a surplus, there is, nonetheless, a proprietary interest in such assets as constitute the partnership property pending realisation: Connell v Bond (368).

59 A partnership may be 'dissolved' in the sense of terminated or determined - as opposed to 'dissolved' in the other sense in which it is sometimes used to connote the winding-up of the business - in a variety of ways. (As to dissolution in the sense of termination, see, eg, Lindley and Banks on Partnership (19th ed, 2010) [24-01]; Geraghty v Minter [1979] HCA 42; (1979) 142 CLR 177, 180 - 181, 181 - 182, 190 - 192.) Dissolution in the sense of termination can include, for example, subject to any agreement to the contrary, dissolution by the death or bankruptcy of a partner (s 44 of the Partnership Act), or where the partnership was for a fixed term or a single venture and the fixed period has expired or the single venture has terminated (s 43(a) and (b)).

60 A partnership may also be determined by curial decree in a variety of specified circumstances, including where an order is made on a 'just and equitable' ground: s 46.

61 A partnership is also dissolved by the happening of an event which makes it unlawful to carry on the business: s 45.

62 A partnership (whether for a fixed term or at will) may be determined by mutual agreement: Maslen v Perpetual Executor Trustees (112); Lindley and Banks on Partnership [24-04].

63 The statute provides that in the case of a partnership for a fixed term, a partner may not retire except, in effect, by the consent or agreement of the other partners: s 36. The statute also provides that for a partnership where no fixed term is agreed, a partner may, unilaterally, determine the partnership by giving written notice to the other partners: s 37(1). Such written notice does not have to be given under seal, even where the original partnership agreement was constituted by a deed: s 37(2). Unless the partners otherwise agree, the partnership is dissolved on the date specified in the notice or, if no date is specified, as from the date of the communication of the notice: subs (c) and the concluding words of s 43. (Note also the overlap between s 37 and s 43 generally, which is discussed in relation to the broadly equivalent English provisions (s 26 and s 32) in Lindley and Banks on Partnership [9-01] - [9-03], and where the learned authors observe, in effect, that both sections (and not just s 43), will take effect subject to any agreement between the partners to the contrary - see also Moss v Elphick [1910] 1 KB 846).

64 A retirement of a partner, mutually agreed or unilaterally effective, has the consequence of dissolving the partnership: Commissioner of State Taxation v Cyril Henschke Pty Ltd [11].

65 Where a partner retires by mutual agreement on terms that the remaining partners will continue in partnership and take on the assets and liabilities of the old firm, without a break in the continuity of the business, the dissolution of the firm effected by the retirement of the partner is in the nature of what is often called a 'technical dissolution', or a 'notional dissolution' and the 'continuing' partners are, in point of law, operating a new partnership: see Commissioner of State Taxation v Cyril Henschke Pty Ltd [11] - [12], [19], [24] - [29]; Lindley and Banks on Partnership [19-09], [24-01] - [24-04]; Rushton (Qld) Pty Ltd v Rushton (NSW) Pty Ltd [2003] QCA 210; (2003) 1 Qd R 320 [9]. As McPherson JA observed, however, in Rushton v Rushton [9], the reference to a 'technical' or 'notional' dissolution is somewhat of a misnomer, because it is not the dissolution itself, but the winding-up which is notional. Where there is a binding agreement involving a 'technical dissolution' of the former partnership, with consideration being given for the retiring partner's chose in action, the former partner's chose in action is extinguished by accord and satisfaction: Commissioner of State Taxation v Cyril Henschke Pty Ltd [19], [28].

66 Dixon J in McDermott v Black [1940] HCA 4; (1940) 63 CLR 161 said at 183 - 185:

The essence of accord and satisfaction is the acceptance by the plaintiff of something in place of his cause of action. What he takes is a matter depending on his own consent or agreement. It may be a promise or contract or it may be the act or thing promised. But, whatever it is, until it is provided and accepted the cause of action remains alive and unimpaired. The accord is the agreement or consent to accept the satisfaction. Until the satisfaction is given the accord remains executory and cannot bar the claim. The distinction between an accord executory and an accord and satisfaction remains as valid and as important as ever. An accord executory neither extinguishes the old cause of action nor affords a new one.

...

The distinction depends on what exactly is agreed to be taken in place of the existing cause of action or claim. An executory promise or series of promises given in consideration of the abandonment of the claim may be accepted in substitution or satisfaction of the existing liability. Or, on the other hand, promises may be given by the party liable that he will satisfy the claim by doing an act, making over a thing or paying an ascertained sum of money and the other party may agree to accept, not the promise, but the act, thing or money in satisfaction of his claim. If the agreement is to accept the promise in satisfaction, the discharge of the liability is immediate; if the performance, then there is no discharge unless and until the promise is performed.

67 There may also be accord and conditional satisfaction: Scott v English [1947] VicLawRp 67; [1947] VLR 445, 453; Osborn v McDermott [1998] 3 VR 1; Scaffidi v Perpetual Trustees Victoria Ltd [2011] WASCA 159 [27] - [33].

68 Where there is a retirement by agreement, the agreement may be formal (eg, as reflected in the formal instrument in Commissioner of State Taxation v Cyril Henschke Pty Ltd), or informal, including partly or wholly oral, or partly or wholly inferred. Sobell v Boston (1975) 1 WLR 1587 appears to be an example of an oral agreement, which had been executed (see Goff J, as his Lordship then was, at 1588 - 1590) where, although it is not clear, the court arguably inferred or implied a term of the agreement as to how the retiring partner's interest was agreed to be dealt with - see Truong v Lam [2009] WASCA 217 [27]. Insofar as the term was inferred or implied, it appears to have been aided by the circumstance that the agreement had been executed, and was not merely executory (1590 - 1591). On the implications of terms in executed contracts, see the authorities collected in Lewison K and Hughes B, The Interpretation of Contracts in Australia (2012) [6.19].

69 As to inferred or at least partly inferred agreements respecting dissolution on the departure of a partner, see, for example, Jorgensen v Boyce (1896) 22 VLR 408; Palmer v Moore [1900] AC 293, and in the court below - Moore v Morgan (1900) 21 LR (NSW) Eq 158; Fitzgerald v Masters [1956] HCA 53; (1956) 95 CLR 420, 431, 439 - 440; Cutts v Holland [1965] TAS SR 69, 71 - 72; Thompson v De Lissa (Unreported, NSWSC, Powell J, 16 February 1990), 52; Lukin v Lovrinov (Unreported, SASC, Perry J, 9 April 1998), 22.

70 In the cases of Palmer v Moore, Cutts v Holland and Lukin v Lovrinov, the inferred agreement in question has been described as an 'abandonment'. See also in this regard Ryder v Frohlich [2004] NSWCA 472 [135] - [152]; Walker v Melham [2007] NSWSC 264 [28].

71 Some caution, however, may be required in using the word 'abandonment' with respect to an inferred agreement for dissolution, as the word may connote two different types of agreement. One is in the usual sense of abandonment, or abrogation, as an inferred agreement for the discharge of the contract involving the mutual release of future, unperformed obligations: DTR Nominees Pty Ltd v Mona Homes Proprietary Ltd [1978] HCA 12; (1978) 138 CLR 423, 434; see also Carter J W, Carter's Breach of Contract (2011) [12-18] and the cases there cited. Such an abandonment of the executory obligations and promises of the partnership agreement does not effect, in itself, a release of the outgoing partner's interest, and the outgoing partner may enforce such existing rights as he or she has consistent with the terms, ascertained and properly construed, of the agreement for retirement and subject to any statutory or equitable constraints on relief: see, for example, Walker v Melham [28]. In that case, the plaintiff and the defendant became partners in about 1979 and carried on a business of house cladding and window fitting. In 1984, they purchased an area of land as tenants in common in equal shares, upon which they constructed, and operated, a ski lodge. It was a term of their agreement that both partners would contribute towards the day-to-day management and control of the ski lodge business. They did so up to and including the 1993 ski season. However, prior to the commencement of the 1994 season, their relationship deteriorated and the plaintiff decided to embark on a new business in Sydney. In May 1994, the parties had an acrimonious meeting, following which they went their separate ways. The judge, in the circumstances of that case, inferred an abandonment or abrogation of the contract with respect to future performance, but not an abandonment of the plaintiff's interest.

72 The second type of agreement involves not just the mutual release of future performance, but also an agreed release of the outgoing partner's existing equitable chose in action represented by his or her interest in the partnership - see, eg, Jorgensen v Boyce; Palmer v Moore. In the latter case, at (297), the Privy Council referred to the relevant abandonment in terms of the outgoing partner having 'totally abandoned his interest in favour of his co-adventurers' (emphasis added).

73 Where the outgoing partner's chose in action is 'released' in favour of the 'continuing partners', pursuant to an agreement, the effect is to enlarge the interests of the 'continuing partners' in the assets to be applied by them in the conduct of the business of the new partnership: Commissioner of State Taxation v Cyril Henschke Pty Ltd [28] - [29].

74 The abandonment of a contract, in the sense of the mutual release of future obligations, being an inferred agreement, does not depend upon the subjective intention of the parties, but upon whether their conduct (both acts and omissions) viewed objectively manifests an intention to discharge the contract: Summers v The Commonwealth [1918] HCA 33; (1918) 25 CLR 144, 151 - 152; Wallera Pty Ltd v CGM Investments Pty Ltd [2003] FCAFC 279 [2], [40], [57]; DTR Nominees Pty Ltd v Mona Homes Pty Ltd (434); Marminta Pty Ltd v French [2003] QCA 541 [21] - [22]. The length of the term of the agreement is a matter of some relevance in assessing the likelihood of abandonment: Wallera Pty Ltd v CGM Investments Pty Ltd [50] (Kiefel J (as her Honour then was), Ryan & Gyles JJ agreeing). It seems to me that the formalities of a particular agreement may also be a relevant factor. It may, depending on all the circumstances, be more difficult to infer an agreement of abandonment where the parties have, in setting up their contractual relationship, expressed in detail in a formal instrument, the terms of their relationship, including the terms as to termination.

75 Similarly, whether there is an abandonment involving an agreement for release will depend upon the inference to be drawn from the conduct of the parties, viewed objectively. The topic of inferred agreements is discussed more generally in [188] - [195] below.

76 I also mention, later in these reasons, the allegation of termination by acceptance of repudiation, raised by the first to third respondents in their notice of contention. As discussed later, it is unnecessary, for the purposes of the disposition of this appeal, to consider whether a partnership may be terminated by the acceptance of a contractual repudiation: see Hurst v Bryk [2002] 1 AC 185, cf Ryder v Frohlich [127] - [133].

77 There was evidence, which the judge accepted, as to the following matters, upon which the judge, in effect, made findings of primary fact. Save to the very limited extent indicated below, these findings of primary fact are not challenged in this appeal.

The wedding gift of the South Terrace, Fremantle property to Jack and Maria

78 Vince acquired a property in South Terrace, Fremantle in 1976, and the property was unconditionally gifted to Jack and Maria for their wedding (reasons [90] - [91], [103], [405]).

79 The business of the partnership was largely conducted by the male partners (reasons [362]).

80 Jack understood that, with respect to the Fazio family's interest in the partnership, membership of the partnership was ultimately determined by Vince as the head of the family (reasons [357]).

81 Jack obtained his interest in the partnership from his parents as a gift (reasons [183], [421]).

82 Jack's principal efforts on behalf of the partnership had, up to 1984, involved labouring activities.

83 By mid-1984, Jack had become dissatisfied with his role as a labourer, and the remuneration it provided, and desired to cease work in the limestone business (reasons [405], [437]). Following an incident on 8 October 1984, he never returned to any labouring or other work in the business (reasons [196] - [197]).

Jack's qualification as a real estate salesman in mid-1984

84 In mid-1984 Jack qualified as a real estate salesman and commenced working with another person in a real estate business (reasons [171], [412], [434]).

Partnership business name - mid to late 1984

85 In mid to late 1984, Jack signed a business name form, bearing the date 22 June 1984, which stated that with effect from 1 July 1984 he ceased to carry on business under the business name of Italia Limestone and that the other partners (the Catalanos, and Vince, Giuseppina and Rudy Fazio) were continuing to carry on business under that name. The document was signed by all the partners, including Jack, and was lodged with the relevant department on 10 October 1984 (reasons [194], [436], [437]). (The finding that Jack signed the document is challenged in this appeal, but, as explained subsequently, the challenge is unmeritorious.)

Jack's statements of assets and liabilities after 1984

86 Jack, when preparing his own many statements of his assets and liabilities (for the purpose of financing), at no time after October 1984 referred to any interest in the partnership, as either an asset or a liability of his (reasons [407]).

Jack's tax return in respect of the 12-month period from 1 July 1984 to 30 June 1985

87 Jack knew in the 12-month period from 1 July 1984 to 30 June 1985 that unlike in previous years, he was no longer being required to pay provisional tax in respect of anticipated partnership profit (reasons [228]).

88 Jack's tax return for the 12-month period from 1 July 1984 to 30 June 1985 (and other subsequent years) did not disclose any income from the partnership (reasons [228]).

The partnership's accounts and tax return for the 12-month period from 1 July 1984 to 30 June 1985

89 The partnership's year-end accounts and tax return for the 12-month period from 1 July 1984 to 30 June 1985 made no mention of Jack. They showed the Fazio (two-thirds) interest in the partnership as being held by Vince, Giuseppina and Rudy Fazio. The Catalanos continued to hold the other one-third interest. See reasons [228], [418], [434].

Liabilities incurred by the partners - August 1984

90 In August 1984, a mortgage document, securing funds advanced to the partners of the limestone business, recorded the names of all the partners with Jack's name typed in the text, but Jack's name had been struck out by hand, with the other partners signing and initialling the document (reasons [414]).

Partnership affairs and Jack's role after 1984

91 In the period after 1984 (reasons [228], [407]):

• Jack knew, as was the fact, that he did not receive any share of partnership profits, nor did he return any partnership income in his own taxation returns, and he knew, as was the fact, that he was not required to pay provisional tax in respect of anticipated partnership profits.
• Jack was not called upon to sign legal documents relating to partnership affairs, unlike the period prior to 1984.
• Jack never received partnership accounts and never asked for them, except on two occasions in early 1985 and 2003, when his requests for documents were rejected; nor was he advised, nor did he inquire into, the state of the partnership's assets and liabilities.
• Jack was never called upon to contribute capital to the partnership.
• Jack was not called upon to guarantee any partnership borrowings, nor was it ever suggested that he would be responsible for partnership debts, notwithstanding the financial difficulties which the partnership suffered in the early 1990s.

92 The judge described the above as constituting 'massive hurdles in the path of the plaintiff's proposition that Jack remained, or believed he remained a partner in Italia Limestone after 1984' (reasons [229]). Jack sought to overcome those hurdles by pointing to a number of transactions subsequent to 1984 which he said showed that he continued as a member of the partnership. The transactions relied on by Jack for this purpose numbered 13 in total. At reasons [230] - [308], the judge in each of the 13 cases, rejected the contention that the transaction showed that Jack remained a partner after 1984. The judge concluded (reasons [309]):

I have now set out my findings in relation to all the transactions after 1984 upon which the plaintiffs rely. In general terms, I have not found anything in those transactions which materially advances the plaintiffs' case, and I have found a number of aspects of those transactions which are fundamentally inconsistent with that case.

93 Only the findings with respect to four of the 13 transactions relied upon by Jack at trial are under specific challenge in this appeal.

94 Amongst the findings of fact which are not challenged in relation to the other transactions are the following:

(a) in relation to the 'Hope Valley' transaction, there is nothing in the dealings which would support Jack's case and, to the contrary, those dealings suggest that Jack and his interests were kept separate and distinct from the interests of the partnership and that dealings between the respective entities were undertaken at arms length (reasons [233]);

(b) in relation to the 'Flynn Drive quarry' transaction, the proposal was structured in a way which provided Jack with an interest separate and discrete from the partnership's interest, which is fundamentally inconsistent with the proposition that Jack was, or believed he was, a partner in the partnership (reasons [277]);

(c) in relation to the 'Seabird land', Jack and Maria supplied limestone from it to one of the partnership's competitors, which is inconsistent with the proposition that Jack was, or believed he was, a partner in the partnership (reasons [293]).

Jack's other business interests since 1984

95 Jack had interests in 'many many companies' and had been 'very entrepreneurial' in undertaking property transactions on his own behalf since 1984 (reasons [411]).

Jack's failure between 1984 and 2008, to commence proceedings to assert any interest

96 Jack did not make any written assertion of any interest in the partnership until he requested documents from the partnership's accountants in December 2003, and did not commence proceedings asserting any interest until 2008, after Vince's death (reasons [6], [228], [327] - [333]).

97 Moreover, Jack knew, from at least 2002, that it had been asserted by the Fazio family (Rudy in the presence of Vince) that Jack had no interest in the partnership (reasons [326] - [327]).

The transfer of the Barrett Street property to Jack and Maria July/September 1984

98 In July to September 1984, steps were taken to transfer to Jack and Maria, for no payment by them, a property at Barrett Street, Spearwood, registered in the name of Danehill (the trustee company the units in which were held by companies representing the Fazio and Catalano families in the same proportion as those families held their interest in Italia Limestone - reasons [16]).

99 The Barrett Street property was registered in the name of Jack and Maria on 6 September 1984. The relevant transfer of the property had been executed on 19 July 1984.

100 A few days earlier, on 16 July 1984, Jack had signed an agreement with 'Fazio Homes' for a house to be built on the Barrett Street property. See reasons [177] - [178].

101 There was also admitted into evidence (without any objection under s 79C(6) of the Evidence Act 1906 (WA)), the following business record of Danehill.

102 Danehill's journal for the year ended 30 June 1984 recorded (reasons [181]):

Lot 209 Barrett Street Being property withdrawn for private use. (Used as settlement for Jack Fazio's share in Italia Limestone.)

103 On the findings of primary fact referred to in [78] - [97] (ie, without reference to the Barrett Street transaction and the Danehill journal), the following inferences, as discussed below, were open, and capable of being drawn.

104 First, that Jack had retired from the partnership with effect from 30 June 1984 and that he had done so consensually rather than unilaterally. There was thereby a termination of the partnership as it had existed up to 30 June 1984. Secondly, the agreed terms of Jack's retirement included that there would not be a general dissolution, that the other partners would continue to trade under the name of Italia Limestone in a new partnership without Jack, and that the new partnership would take over the assets of the former partnership and use them in the discharge of the debts and liabilities of the former partnership as well as for the discharge of the debts and liabilities of the new partnership. Thirdly, the inference was open that, upon his retirement, Jack had abandoned or released his interest in the partnership in favour of the Fazio 'continuing' partners. The inference may be collected from the whole of the conduct of the parties, that is, their acts and omissions in and from mid-1984. Jack's conduct, in mid to late 1984, in signing the business name form, commencing work in a real estate business, ceasing any work for Italia Limestone and in failing to assert any claim on or interest in the partnership, may be assessed in light of the fact that in his many statements of assets and liabilities after 1984 in relation to financing, Jack omitted reference to any interest in the partnership. It is, objectively, unlikely that as an applicant for loan funds, he would have deliberately understated his assets, ie, his right to a surplus from the former partnership (or understated his liabilities if he believed the partnership to be insolvent). It is also doubtful that a person of his entrepreneurial acumen would have done so by neglect. It is also to be borne in mind that there was no suggestion at trial or on this appeal, by any party, that there was an express or implied agreement to the effect that Jack's share would be dealt with on the basis that it should be valued and the resulting sum paid to Jack by the 'continuing' partners (cf Sobell v Boston). In these circumstances, the inference was fairly open, and capable of being drawn, that Jack had no subsisting interest in the former partnership as from 1 July 1984 and that, consequently, his interest had been released. The corollary of the release, by necessary implication, is that Jack would be indemnified by the Fazio 'continuing' partners in respect of partnership debts and liabilities up to 30 June 1984. Fourthly, Jack's retirement from the partnership was, in practical terms, principally a decision for the Fazio family members, rather than the Catalanos. It is to be expected that any such agreement would have been initially reached between Vince as head of the Fazio family, and Jack. Further, and for similar reasons, it would be expected that any agreement between Vince and Jack in relation to Jack's retirement from the partnership would be agreed to by the other Fazio partners (Giuseppina and Rudy), and the Catalanos. It would be expected that the other members of the partnership would signify their concurrence by acting upon the basis of the agreement reached between Vince and Jack, rather than by an express restatement of the agreement.

105 In substance, the judge found an agreement along the above lines, subject to the matter to which I will refer in a moment. As I have indicated, an agreement along these lines was, in my view, fairly open on the evidence to which I have referred.

106 The judge also found, however, an additional element of consideration for the release of Jack's interest in the partnership on his retirement. His Honour found that it was agreed that Jack and Maria would be given, without payment by them, the Barrett Street property which was, at the time, registered in the name of Danehill. Danehill was a trustee company, the units in which were, generally speaking, held by companies representing the Catalano and Fazio families in the proportions in which those families held their interests in Italia Limestone. The transfer from Danehill to Jack and Maria was executed on 19 July 1984. It was registered on 6 September 1984. As the judge indicated at [421], the timing of the events concerning the Barrett Street transfer is significant. The inference is fairly open that the Barrett Street property was part of the arrangement for Jack's retirement from the partnership. The following matters are particularly significant in this regard: the timing of the transaction; the fact that Jack and Maria were not required to pay for the property; the fact that they did not pay for the property; the fact that they had been gifted another property (South Terrace) for their wedding present and that it would be difficult to account for Barrett Street as simply parental largesse or benevolence; and the fact that Jack's and Maria's only explanation for the conferral of this benefit, which was the only alternative hypothesis presented at trial, was disbelieved and rejected by the judge. The inference is confirmed by, but not dependent upon, the Danehill journal entry which records, in terms, the relationship between the two matters.

107 In light of the foregoing, the appeal on the partnership questions must fail. Jack retired from the partnership pursuant to an agreement which included a term involving the transfer to Jack and Maria of the Barrett Street property, as the judge found. Alternatively, Jack abandoned his interest in favour of the 'continuing' Fazio partners as alleged in the notice of contention.

The appellant's seven principal propositions

108 It seemed to me, from the way the appellant's case was presented, that the appellant's submissions centred upon seven principal propositions. The first was that the judge did not, on the proper construction of his reasons, find an agreement binding all the partners under which Jack resigned from and relinquished his interest in the partnership. The second was that the judge could not have found an agreement in mid-1984 to transfer the Barrett Street property as consideration, because the judge had not found that Jack had executed the business name form prior to the transfer of that property to Jack and Maria. The third was that the judge had committed 'jurisdictional error' by deciding the case on a basis outside of the pleadings. The fourth was that the judge was not entitled, as a matter of law, to infer the existence of the agreement which he found, because the Catalanos, or at least Sam Catalano, had not been called as a witness. The fifth was that, putting aside the question of the absence of Mr Catalano's evidence, there was no or insufficient evidence from which the judge could have inferred the existence or terms of the agreement which he found. The sixth was that the judge erred in placing any reliance on the Danehill journal which recorded that the Barrett Street property was used in settlement of Jack's share in the partnership of Italia Limestone. The seventh was that the judge erred in not approaching the onus of proof on the basis that the first to third respondents bore the onus of proving that Jack had not remained a partner.

109 The appellant contended that the judge's reasons disclose that he had not found an agreement giving rise to an accord and satisfaction, because the agreement found by the judge was one between Jack and Vince only. The appellant contended that the judge's reasons show that the other partners had not themselves been parties to an agreement on the terms found by the judge. The foundation for this submission, as I understand it, is that the words 'acquiescence' and 'consent' are, it is said, generally inapposite to convey the concept of agreement, and that those words cannot be read, in the judge's reasons, in a way which signifies the language of agreement.

110 I do not accept the submission that the words 'acquiesced in, and consented to' (reasons [441]) are inapposite in this context to convey the notion of an agreement at law. For example, in MacRobertson Miller Airline Services v Commissioner of State Taxation (WA) [1975] HCA 55; (1975) 133 CLR 125, Stephen J said at 136 - 137:

This doctrine, of the formation of contracts by offer and acceptance, encounters difficulties when sought to be applied, outside the realms of commerce and conveyancing, to the everyday contractual situations which are a feature of life in modern urban communities. Contracts for the carriage of passengers, one of the most common classes of contract in a commuter society and one which ordinarily involves the attempted imposition of contractual restrictions upon the passenger's rights should he suffer loss or injury, provide an instance of these difficulties....the contract being 'inferred from the acquiescence of the carrier in the presence of the passenger on the conveyance' - Lord Dunedin in Hood v Anchor Line [1918] UKHL 2; [1918] AC 837 at 846, and see Wilkie v London Passenger Transport Board [1947] 1 All ER 258, per Lord Greene MR, at 259. (emphasis added)

111 In my view, on the proper construction of the judge's reasons in [439] - [441], particularly when read in the context of the reasons as a whole (in particular, [2], [9], [59], [79], [317], [359], [362], [380] and [381]), the primary judge found an agreement in mid-1984 by all the partners involving the extinguishment of Jack's chose in action in the partnership. It is unnecessary to decide in this appeal whether the executory promises in favour of Jack in the agreement were themselves given in satisfaction of the relinquishment of Jack's interest in the partnership, or whether they represented an accord with satisfaction conditional upon the actual transfer to Jack and Maria of the Barrett Street property, given that there is no dispute that the property was transferred to them.

112 The first proposition has not been established by the appellant.

The second principal proposition - the transfer of Barrett Street

113 By the second proposition, the appellant drew attention to the judge's finding in [436] that he could not say when the business name form had been signed by Jack, other than to say that Jack had executed it at some time in the middle or latter part of 1984. The appellant contended, in effect, that it was not, as a consequence, open to infer an agreement in mid-1984 for the transfer of the Barrett Street property to Jack in consideration for his retirement from the partnership, given that the transfer of the Barrett Street property was signed on 19 July 1984, and was lodged for registration on 6 September 1984 (reasons [177]). This was said to be inconsistent with the finding at [436]. The contention was that if the judge could not conclude that the business name form had been signed prior to the registration of the transfer of the Barrett Street property (on 6 September 1984), then the judge could not have inferred that a binding agreement was reached in mid-1984.

114 I do not see any inconsistency of the kind alleged.

115 On the one hand, the judge found an agreement made in mid-1984, a term of which included an agreement to transfer the Barrett Street property to Jack. The performance of that term was effected by the execution of a transfer by Danehill in July 1984 and its registration by Jack on 6 September 1984. Even if the business name form had not been executed by Jack (or the other partners) until after registration of the transfer of land, it nevertheless recorded that Jack was ceasing to carry on business under the partnership business name with effect from 1 July 1984. Execution of the business name form even after 6 September 1984 is not inconsistent with the hypothesis that Jack had agreed in mid-1984 to retire from the partnership with effect from 1 July 1984 on terms that he would receive a transfer of the Barrett Street property.

116 Accordingly, I do not accept the appellant's second principal proposition.

117 The third proposition is that the judge committed 'jurisdictional error' in his findings at [439]- [441]. Notwithstanding the awkward nomenclature, the substance of the point is said to be that the primary judge erred in law in deciding the case on a basis that had not been litigated: Farah Constructions Pty Ltd v Say-Dee Pty Ltd [2007] HCA 22; (2007) 230 CLR 89 [132] - [133]; EDWF Holdings 1 Pty Ltd v EDWF Holdings 2 Pty Ltd [2010] WASCA 78; (2010) 41 WAR 23 [137]. In Farah v Say-Dee [132], the High Court had referred to the Court of Appeal in that case deciding the appeal 'on an independent ground which was never pleaded'.

118 The appellant in this appeal placed particular reliance upon the observations of Isaacs and Rich JJ in Gould & Birbeck & Bacon v Mount Oxide Mines Ltd (in liq) [1916] HCA 81; (1916) 22 CLR 490, 517 - 518, in which their Honours cited a decision of the Privy Council to the effect that, as a rule, 'relief not founded on the pleadings' should not be granted. The appellant also referred to the observations of Mason CJ and Gaudron J in Banque Commerciale SA (in liq) v Akhil Holdings Ltd [1990] HCA 11; (1990) 169 CLR 279 at 286 - 287:

The function of pleadings is to state with sufficient clarity the case that must be met. 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. (citations omitted)

119 Banque Commerciale was applied in WA Country Health Service v Wright [No 2] [2010] WASCA 120, another case relied upon by the appellant. In that case, the plaintiff sued a hospital for having contracted sepsis in consequence of the hospital's alleged failure to diagnose pneumonia: [10] - [12], [44] - [47]. The primary judge was unable to find that the appellant had pneumonia, and put the issue of pneumonia to one side, and found the hospital liable to the plaintiff on the 'pared down' basis that the hospital was negligent in discharging the plaintiff in all the circumstances of the case. The decision of the trial judge was overruled because the issue on which the plaintiff had succeeded was not litigated. The judge did not simply 'pare down' the plaintiff's case, but, rather, departed very substantially from it: [49] - [54].

120 The principles, in essence, were not in dispute in this appeal, and 'each case must depend for the proper application of the principle upon its own facts': Gould v Mount Oxide (517 - 518). It is, accordingly, necessary to examine the pleadings.

121 The respondents pleaded, in effect, that there was an agreement made on or about 22 June 1984 between the then existing partners (including Jack) under which it was agreed that:

(a) with effect from 1 July 1984, Jack would retire from the partnership and would relinquish or transfer his interest to the continuing Fazio members in shares to be determined by Vince;

(b) Jack would receive, as consideration, in effect:

(i) a property known as 223 South Terrace, Fremantle;

(ii) the Barrett Street property and architect's plans for a proposed residence on that property;

(iii) a release of all the debts and liabilities of the partnership.

122 It was necessarily implicit in the plea that upon Jack's retirement, it was agreed that the remaining partners would continue to operate the business of the former firm and that there would not be a winding-up. This point was expressly adverted to by the first to third respondents in written and oral opening submissions in the court below.

123 It seems to me that the agreement found by the judge contains, in essence, the same terms alleged by the first to third respondents in their pleading, save that the judge was not satisfied that the transfer of 223 South Terrace, Fremantle, or the provision of the architect's plans for the Barrett Street property, formed part of the consideration. (He found the former to have been a gift.) The terms of the agreement, as found by the judge, did not, in my view, fall outside of the scope of the respondents' pleaded case. Whilst the scope of the consideration for the agreement was found to be narrower than that pleaded, the finding was nevertheless 'available' on the pleadings (cf Banque Commerciale (286 - 287)). It could not be said that it was not 'founded' on the pleadings (Gould v Mount Oxide (518)), or that it was, in substance, an 'independent ground ... never pleaded': Farah v Say-Dee [132].

124 Further, it cannot be said that, in substance, the judge transgressed in finding a contract beyond the litigated case merely because the judge characterised the agreement in a form somewhat differently from that in the defence filed by the first to third respondents. The first to third respondents had pleaded that the agreement was partly oral (including in conversations between the appellant and the father in or about June 1984), partly written (the written part being contained in or to be inferred from the executed business name form), and partly inferred (from a lengthy series of particularised conduct and events). The judge found, in effect, that it was partly oral and partly inferred, and that the executed business name form was a circumstance relevant to the formation of the inference (reasons [195], [437] - [441]). These differences in characterisation do not point to any denial of natural justice to the appellant, or to any departure by the trial judge from the principles in the authorities relied on by the appellant. The observations of Walsh J in LJ Hooker Ltd v Dominion Factors Pty Ltd [1963] 63 SR (NSW) 146, 150 are pertinent by analogy in a case such as this where a principal actor had passed away, many of the events occurred over 25 years prior to the trial and, as the judge found, inherent doubts must inevitably attend oral recollections of events of that antiquity (reasons [51]). Walsh J (as his Honour then was) said:

When the evidence in each action is given it may appear that it does not accord precisely in its language with what was stated in the particulars given. It would not necessarily follow, if that should turn out to be so, that the plaintiff would fail. It seems to me it is not right to treat the particulars given in relation to a verbal contract in the same way as one would treat a clause in a written contract in seeking to determine with certainty what the contract really was.

125 I would reject the appellant's third principal proposition.

The fourth principal proposition The proposition

126 The fourth proposition is that the judge erred in law in drawing inferences from the evidence to which he referred because the drawing of inferences from such evidence was impermissible in circumstances where the respondents had failed to call direct evidence from Mr and Mrs Catalano on the question of whether Jack had agreed in mid-1984 to retire from the partnership for consideration. The appellant's principal contention was that the evidence relied on by the judge had to be positively disregarded, as a matter of law.

127 The appellant's contention, in this context, is that none of the inferences drawn by the judge from the evidence in the case was open to be drawn because Mr and Mrs Catalano were partners in the partnership at the relevant time and were parties to the proceedings. They, together with Giuseppina and Rudy, had pleaded the agreement alleging Jack's retirement from the partnership, and bore the onus of proving it. The agreement was alleged to be partly oral. The Catalanos were not called as witnesses. It followed, so it was said, that the law required the result that no inference could be drawn from any evidence in the case on the topic of whether there was an agreement for Jack to retire from partnership in mid-1984 for consideration by way of accord and satisfaction.

128 The appellant's submissions need to be seen in the context of the pleadings. The first to third respondents (being Rudy, Giuseppina and the Catalanos) pleaded that insofar as the agreement for Jack's retirement in 1984 was oral, it was between:

(c) Vince and Mr Catalano (there was no mention of Mrs Catalano).

129 Mr Catalano's conduct and his dealings with Vince and the partnership were also particularised as part of the materials upon which the first to third respondents alleged that the agreement pleaded was to be inferred.

130 In their particulars of the defence, the first to third respondents included allegations that:

(a) from 1 July 1984, the continuing partners (including the Catalanos):

• assumed sole responsibility for the conduct of the business and affairs of the partnership and did not treat Jack as a partner or involve him in the business and affairs of the partnership;
• incurred debts and liabilities (including borrowings, which were guaranteed and secured by the continuing partners) in the course of conducting the business and affairs of the partnership;
• assumed responsibility for and discharged the debts and liabilities of the partnership from time to time (including by use of their private assets) but never called upon Jack to contribute to the discharge of the debts and liabilities of the partnership;
• did not provide Jack with any income distributions from the partnership;
• caused the partnership accounts to be prepared and the partnership tax returns to be lodged on the basis that Jack was no longer a member of the continuing partnership.

(b) Vince had accounted to the Catalanos for the transfer of the Barrett Street property from Danehill to Jack and Maria in 1984.

131 As to the alleged participants in the oral communications particularised, Vince was, obviously, unavailable to give evidence as the proceedings had not been commenced by Jack and Maria until after Vince had passed away. Giuseppina was called. Rudy was called. Mr Catalano was not called and accordingly he did not give evidence of any conversation in June 1984 between him and Vince on the topic of Jack's retirement.

The cases relied on by the appellant and the relevant principles

132 In support of the fourth principal proposition (and the sixth principal proposition discussed later), the appellant referred to the principles in Blatch v Archer [1774] EngR 2; (1774) 1 Cowp 63, 65; [1774] EngR 2; 98 ER 969, 970, and Jones v Dunkel (308), (312), (321), and in particular their application to a failure by a party to give evidence on an issue in the case. The appellant referred to the observations of Heydon, Crennan and Bell JJ in Kuhl v Zurich Financial Services Australia Ltd [2011] HCA 11; (2011) 243 CLR 361 [63]:

The rule in Jones v Dunkel is that the unexplained failure by a party to call a witness may in appropriate circumstances support an inference that the uncalled evidence would not have assisted the party's case. That is particularly so where it is the party which is the uncalled witness. The failure to call a witness may also permit the court to draw, with greater confidence, any inference unfavourable to the party that failed to call the witness, if that uncalled witness appears to be in a position to cast light on whether the inference should be drawn. These principles have been extended from instances where a witness has not been called at all to instances where a witness has been called but not questioned on particular topics. Where counsel for a party has refrained from asking a witness whom that party has called particular questions on an issue, the court will be less likely to draw inferences favourable to that party from other evidence in relation to that issue. (footnotes omitted)

133 The appellant also relied heavily upon the following passages in Australian Securities and Investments Commission v Rich [2009] NSWSC 1229; (2009) 236 FLR 1, where Austin J said [436] - [440]:

The defendants placed substantial reliance on what they called 'the rule in Blatch v Archer'. Blatch v Archer was an action of debt against the Sheriff of Essex for the escape of a debtor called Moody. The Sheriff issued a warrant for Moody's arrest on the application of the plaintiff, to be executed by old Mr Fenton, the bailiff. In fact the arrest was carried out by Mr Fenton's son, and it was authorised and lawful only if old Mr Fenton was present at the time of the arrest. There was some evidence on this matter, but the plaintiff, who was asserting the lawfulness of the arrest, did not call young Mr Fenton, who could have cleared the matter up. In that context Lord Mansfield remarked that 'it is certainly a maxim that all evidence is to be weighed according to the proof which was in the power of one side to have produced, and in the power of the other to have contradicted'. However, he did not apply that principle against the plaintiff because he held that in the instant circumstances, it would have been improper to have called the son, for the action was in reality an action against his father, the bailiff.

Lord Mansfield's principle has been accepted and applied in modern cases. For example, in Clayton Robard Management Ltd v Siu (1988) 6 ACLC 57, at 62, Kirby P considered what inferences should be drawn, if any, from the failure of the appellants to call evidence. He said:

'In a rational procedure for the resolution of disputed issues of fact, it would not be unreasonable to expect a party in the best position to do so to place before the tribunal of fact the relevant evidence in its possession, at least so far as such evidence was relevant to the resolution of disputed questions.'

Later his Honour referred (at 65) to the 'overriding obligation, oft repeated, to consider and weigh the evidence at the end of the trial according to the respective powers of the parties to produce evidence', and he said that principle, which supplemented the processes of reasoning authorised in Jones v Dunkel, could be traced to Lord Mansfield's judgment in Blatch v Archer. He noted that it was endorsed by the High Court in Hampton Court Ltd v Crooks [1957] HCA 28; (1957) 97 CLR 367 at 371-372, and that it had been applied many times, citing Apollo Shower Screens Pty Ltd v Building & Construction Industry Long Service Payments Corporation (1985) 1 NSWLR 561, at 565.

The relationship between the principles enunciated in Blatch v Archer and Jones v Dunkel was further explained by Hodgson JA (with whom Beazley JA agreed) in Ho v Powell [2001] NSWCA 168; (2001) 51 NSWLR 572. His Honour said (at [14]) that 'in deciding facts according to the civil standard of proof, the court is dealing with two questions: not just what are the probabilities on the limited material which the court has, but also whether that limited material is an appropriate basis on which to reach a reasonable decision', and he referred to his extra-curial writing on the subject ('The Scales of Justice, Probability and Proof in Legal Fact-finding' (1995) 69 ALJ 731). He continued (at [15] - [16]):

'In considering the second question, it is important to have regard to the ability of parties, particularly parties bearing the onus of proof, to lead evidence on a particular matter, and the extent to which they have in fact done so: cf 69 ALJ at 732-733, 736, 740 ...

The case of Jones v Dunkel (1959) 11 CLR 298 is a particular application of this principle. That case itself related to a situation where there was evidence supporting an inference against a party, and that party did not give or call evidence, which that party was plainly in a position to have given or called, in order to explain or contradict the material presented. In my opinion, a similar principle applies where a person bearing the onus of proof does not give or call evidence which that person is plainly in a position to give or call; and unless some explanation is given of this failure, the tribunal of fact is entitled to infer that this evidence would not have assisted that person's case: cf Commercial Union Assurance Co of Australia Ltd v Ferrcom Pty Ltd (1991) 22 NSWLR 389.'

Presumably Jones v Dunkel is a 'particular application' of Blatch v Archer, in the sense that the reason why the court can be confident about drawing inferences against a party who has chosen not to give evidence is that it was within the power of the party to produce evidence on that matter. Blatch v Archer is a wider principle because it is also available against the person bearing the onus of proof, where that person does not adduce evidence that he or she was plainly in a position to adduce.

There is another respect in which Jones v Dunkel is a particular application of Blatch v Archer, again indicating that the latter has a wider operation. Whereas Jones v Dunkel reinforces an inference drawn against the party who has not called evidence, to the effect that the evidence would not have assisted that party's case, Blatch v Archer leads either to the drawing of such an inference, or to some other assessment of the weight of evidence, unfavourable to the party against whom the principle is applied. In Shalhoub v Buchanan [2002] NSWSC 99 at [71], Campbell J explained the point as follows:

'Failure to call all those witnesses still has a consequence, even though I do not go through the process of drawing any Jones v Dunkel inferences concerning them. I would infer that Mr Shalhoub, Mr Atallah, one or more of the salespeople, and at least some of the other people who attended the auction, were available. I shall assume that all of these witnesses, apart from Mr Shalhoub, were available to be called by either party. Even making that assumption, failure of a party who bears an onus of proof to call an available witness who could cast light on some matter in dispute can be taken into account in deciding whether that onus is discharged, in circumstances where such evidence as has been called does not itself clearly discharge the onus. This is an application of Lord Mansfield's maxim.'

134 Although not referred to by the appellant, it is also to be noted that in civil cases, the unexplained failure of a party to give evidence, call witnesses or tender material is not treated as evidence of fear that it would expose an unfavourable fact, nor as an assertion of the non-existence of the fact not proved: HML v The Queen [2008] HCA 16; (2008) 235 CLR 334 [303]; Brandi v Mingot (1976) 12 ALR 551, 559 - 560; Dilosa v Latec Finance Pty Ltd (1966) 84 WN (Pt 1) (NSW) 557, 582; Manly Council v Byrne [2004] NSWCA 123 [46] - [51].

135 The observations of the majority in RPS v The Queen [2000] HCA 3; (2000) 199 CLR 620 [25] - [26] should also be noted:

It is necessary to keep at the forefront of consideration that the mode of reasoning which is described proceeds from the premise that the person who has not given evidence not only could shed light on the subject but also would ordinarily be expected to do so. ...

In a civil trial there will very often be a reasonable expectation that a party would give or call relevant evidence. It will, therefore, be open in such a case to conclude that the failure of a party (or someone in that party's camp) to give evidence leads rationally to an inference that the evidence of that party or witness would not help the party's case and that:

'where an inference is open from facts proved by direct evidence and the question is whether it should be drawn, the circumstance that the defendant disputing it might have proved the contrary had he chosen to give evidence is properly to be taken into account as a circumstance in favour of drawing the inference.' (emphasis in original) (footnotes omitted)

136 Further, as the learned author in Heydon JD, Cross on Evidence (8th Aust ed, 2011) [1215] said with reference to a consideration of Jones v Dunkel:

The rule cannot be employed to fill gaps in the evidence, or to convert conjecture and suspicion into inference. Nor does the rule prevent any inference favourable to the party who has failed to call the witness from being drawn: other evidence may justify the drawing of the inference.

Thirdly, the rule only applies where a party is 'required to explain or contradict' something. What a party is required to explain or contradict depends on the issues in the case as thrown up in the pleadings and by the course of evidence in the case. No inference can be drawn unless evidence is given of facts 'requiring an answer'. (footnotes omitted)

137 In my view, the fourth principal proposition must be rejected.

138 The authorities referred to above do not support the contention that the judge was obliged to disregard any evidence in the case capable of supporting an inference that Jack had retired from the partnership for consideration in mid-1984 because of the failure to call the Catalanos. Indeed, they point in the opposite direction. The authorities point to the need for the trier of fact to evaluate the whole of the evidence, drawing such inferences of fact as are appropriate from the direct evidence. In the evaluation of the evidence and its sufficiency, the judge should consider whether a party could and would ordinarily be expected to give or call certain evidence on an issue. The failure to call such evidence may (not must) allow the judge to infer that the omitted evidence would not have assisted that party's case on the issue, and to:

• take that matter into account in deciding whether and to what extent to accept other evidence on the issue;
• more confidently or readily draw inferences of fact adverse to that party which might otherwise be open on the issue.

139 Accordingly, I do not accept that the judge erred in law in the manner postulated in the appellant's fourth principal proposition.

140 To the extent that the appellant suggests, in the alternative, that the judge erred in failing to infer that the Catalanos' evidence would not have assisted the case of the first to third respondents, the following observations may be made. First, this was a case where oral evidence would not be expected to be particularly reliable. As I have indicated, the judge said (and I did not understand the accuracy of the observation to have been challenged) that 'inherent doubts must attend oral recollections of events which occurred many years ago' (reasons [51]). Secondly, it could not have been expected that any evidence given by Mr Catalano of a conversation with Vince in mid-1984 would likely be afforded significant weight in favour of the first to third respondents, when Vince was absent and Vince (through his estate) and the Catalanos were effectively on the same side in the litigation. Thirdly, it was not alleged in the defence that Mr Catalano had any direct communication with Jack about the retirement of Jack from the partnership. Further, the defence did not plead any conversation involving Mrs Catalano. Thus, it was not as though evidence of a pleaded conversation between Jack and the Catalanos had been withheld. Fourthly, the question of the departure of Jack from the partnership could not be supposed to have been of critical significance for the Catalanos, in the affairs of a partnership which went back to at least the 1960s. Their interest in the partnership had always been, relevantly, a one-third interest, and the allocation of the other two-thirds within the Fazio family was, essentially, a matter for the Fazio family and, in particular, Vince (reasons [357]).

141 Even if the judge should have inferred that Mr Catalano's evidence would not have assisted the first to third respondents' case on retirement, in light of the matters to which I have referred in the preceding paragraph, and having regard to the scope and weight of the other evidence, the failure to call Mr Catalano could not be regarded as being of any material significance in the court deciding whether it should be reluctant to act upon the other evidence and to draw inferences from it favourable to the first to third respondents. Nor, given the paucity of objective evidence in support of the appellant's contention that he remained a partner, could the failure to call Mr Catalano itself provide any sound foundation for assisting in drawing an inference favourable to the appellant that he remained a partner after 1 July 1984.

142 Accordingly, the judge's finding is not shown to be in error simply because the Catalanos were not called.

The fifth principal proposition The proposition

143 By the fifth principal proposition, the appellant contends that there was no, or insufficient, evidence from which the judge could have inferred the existence or terms of the agreement that he found.

144 The background to this contention is as follows. The first to third respondents had pleaded consensual retirement with accord and satisfaction involving, inter alia, the transfer to Jack and Maria of the Barrett Street property. The appellant did not plead or run a case at trial (or in this appeal) that there was a consensual retirement by Jack in July 1984. On the contrary, the appellant's substantive case at trial was that Jack never retired from the partnership in 1984 and remained a partner until the general dissolution upon Vince's death in 2007. I should note here that there was a curious hypothetical plea in the statement of claim which denied any retirement, but said that 'if' Jack had retired from the partnership in '1984 or at any other time', then the partnership dissolved and Jack was entitled to an order for the winding-up of the partnership and related relief. Nevertheless, as counsel for the appellant, in effect, properly accepted in this appeal, whether Jack was so entitled would depend upon the circumstances and terms of his retirement. The appellant confirmed that there was no ground of appeal alleging that the judge should have found that Jack retired by agreement in 1984, albeit on terms not involving an accord and satisfaction. Further, there is no suggestion by the appellant (or respondents) that the judge should have found an agreement for retirement in 1984 on express or implied terms that Jack would be paid his share valued as at the date of his retirement: cf Sobell v Boston; Truong v Lam.

145 The terms of the agreement found by the judge had three essential features. The first is that Jack retired from the partnership with effect from 1 July 1984. The second is that he did so with the agreement of the other partners. The third is that he relinquished his interest in the partnership and he received consideration for it.

146 The appellant started this aspect of his submissions with the contention that there was no, or insufficient, evidence from which to infer any of those three matters. For example, in relation to the first matter, the appellant (initially) embraced the fact that Jack's financial and fiscal affairs gave no indication that he was a partner after 1984. It was said, in effect, that this signified, at it highest, that he was guilty of a lack of compliance with the tax laws, and that it signified nothing about whether he remained a partner for the 23 years following 1 July 1984.

147 As to the second matter, the appellant confirmed in this appeal that he did not run a positive case at trial that Jack unilaterally retired from the partnership in 1984 (although the plaintiffs had not abandoned their hypothetical plea). Thus, an important forensic focus was whether there had been a retirement at all, and not so much whether any retirement, if found, was consensual.

148 For reasons given previously, it was clearly open to infer from the undisputed and unchallengeable findings of primary fact that Jack consensually retired from the partnership with effect from 1 July 1984, and that he did so on terms that the assets and liabilities of the partnership were taken over by the remaining partners without any break in the continuity of the business.

149 Indeed, the difficulty in sustaining the submission that there was no, or insufficient, evidence from which to infer, at least, a consensual retirement by Jack as from 1 July 1984 on terms that the remaining partners would continue the business, appeared to be appreciated by the appellant in the course of oral submissions. As the submissions developed, the appellant appeared to contend that the more substantive complaint was not that there was no, or insufficient, evidence of a consensual retirement on terms involving the remaining partners continuing the business of Italia Limestone, but rather that there was no, or insufficient, evidence that the agreement involved any consideration in exchange for the relinquishment of Jack's interest in the partnership. In other words, the real complaint was that there was no, or insufficient, evidence to support the third of the three features of the agreement found by the judge.

150 For reasons previously outlined, the inference of the existence and terms of the agreement found by the judge was open on the primary findings of fact referred to earlier, without reference to the Danehill journal. The Danehill journal was consistent with, and confirmed, the drawing of an inference that Jack left and relinquished his interest in the partnership pursuant to an agreement in mid-1984, involving him and Maria receiving a transfer of the Barrett Street property.

151 As indicated earlier, the only competing hypothesis, which Jack ran at trial, was that the Barrett Street property had been transferred to him pursuant to an agreement reached with his father in May 1982 pursuant to what was pleaded as the '1982 agreement' (the detail of which is set out in [212] below). The judge rejected the alleged '1982 agreement' contended for by Jack as his explanation for his receipt, without payment, of the Barrett Street property in the first quarter of the financial year commencing 1 July 1984. The rejection of the evidence led by the appellant in relation to the '1982 agreement' did not, of course, mean that the judge should necessarily draw the inference that he did. A failure to find a matter does not establish the truth of the contrary of that which is alleged: Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363 [60]. Nevertheless, in the evaluation of the evidence for the purposes of determining whether to draw inferences, the court may more readily draw an inference which is open according to 'experience and knowledge of human affairs', in the absence of any plausible competing hypotheses: Martin v Osborne (381).

152 Accordingly, the fifth principal proposition is not made out.

153 The sixth principal proposition is, in effect, that the judge erred in relying on the Danehill journal as having any evidentiary value. The relevant findings are at reasons [182] - [183] and [438].

154 For the reasons given below, I do not accept the appellant's sixth principal proposition, but, in any event, as previously noted, there was sufficient evidence to sustain the finding without reference to the Danehill journal.

155 The journal for Danehill for the year ended 30 June 1984, and Danehill's worksheet for the accounts for the year ended 30 June 1984 record, in substance, that Danehill's assets were reduced by the disposition of the Barrett Street property for $30,380.93, and that its liability to Anham (trustee for the V Fazio Family Trust) was correspondingly reduced.

156 The Danehill worksheet for the year ended 30 June 1984 showed the adjustment under the heading 'journals'.

157 Anham's accounts for the year ended 30 June 1984 record a receivable from Danehill of $56,345.33 which (along with other movements in the intercompany loan account) reflect Danehill's liability to Anham having been reduced by the sum of $30,380.93. The same figure of $56,345.33 appears as a liability in Danehill's balance sheet as at 30 June 1984.

158 The figure of $30,380.93 was the historical cash component cost of Barrett Street.

159 The Catalanos' proportionate interest (through Danehill) in Barrett Street was satisfied by them taking a cash drawing of $15,000 on 19 October 1984. Both Danehill's cashbook and the cheque butt refer in terms to 'S & R Catalano - share 209 Barrett', and payment of $15,000.

160 Consistently with Danehill's journal and year-end working papers, Danehill did not show the Barrett Street property as an asset in its balance sheet as at 30 June 1984, although it continued to hold the legal title to the property until 6 September 1984.

161 Anham's accounts for the year ended 30 June 1984 do not record Barrett Street as an asset. That is not necessarily inconsistent with the judge's finding that there was an agreement in mid-1984 under which it was agreed to transfer Barrett Street to Jack, with the beneficial interest in Barrett Street vesting in Jack.

162 The appellant contends, in effect, that there are three reasons why the judge should have placed no weight on Danehill's journal for the year ended 30 June 1984. First, he says that the journal entry is inconsistent with the drawing of $15,000 by the Catalanos in October 1984 for their 'share' in Barrett Street. The appellant contends that if the journal were correct, the asset must have been transferred to Anham in the 1984 financial year, the consideration for which comprised Danehill's reduction in its loan account to Anham. The argument is that in that case, the Catalanos would be 'double dipping' to take a further $15,000 out of Danehill in cash. The appellant said the idea of 'double dipping' was raised by the primary judge in the course of argument at the trial, but did not appear in his reasons.

163 I do not accept the contention that the journal is inconsistent with the Catalanos receiving $15,000 in cash. The units in Danehill reflected the proportion of two-thirds for the Fazios and one-third for the Catalanos, being the same proportion in which those families held their interests in the partnership. Prima facie, the accounting treatment indicates that although Barrett Street was transferred at cash cost ($30,380.93) to Anham, it was treated as worth approximately $45,000 for accounting purposes between the Fazios and the Catalanos. The Catalanos' drawing of $15,000 from Danehill reflects (generally speaking via their one-third interest in Danehill) their one-third share of the asset valued at $45,000.

164 Secondly, the appellant contends that Danehill did not carry the Barrett Street property as an asset in its books for the year ended 30 June 1983. The appellant says that there are draft Danehill accounts for the year ended 30 June 1983, which show Barrett Street as an asset, but that it was removed as an asset when the final accounts for that year were drawn.

165 The consequence, so the appellant contends, is that the absence of Barrett Street from the final 1983 accounts of Danehill shows that it was not regarded as an asset of Danehill, and, moreover, is only consistent with the hypothesis that, at all material times, Jack was the beneficial owner of Barrett Street pursuant to the '1982 agreement' allegedly entered into in May 1982. Pausing here, if that were so, it is not clear why Barrett Street would have gone into Danehill's draft accounts for the period 1 July 1982 to 30 June 1983 at all. In any event, I am unable to accept the appellant's substantive submission.

166 The version of the 1983 accounts which the appellant contends were draft accounts, which contain Barrett Street as an asset, appear prima facie to be the final accounts for that year. That is because that version comprises assets and liabilities, and assigns values to them, as at 30 June 1983 which are consistent with the opening balances on 1 July 1983, for the next (1984) financial year as recorded in Danehill's worksheet. The other versions of the 1983 accounts not only do not include Barrett Street as an asset, but also do not include other items recorded as assets on 1 July 1983 (eg, Dalison Road, Paulik Way, Postans Road and the sailing club pen). That conclusion might also be thought to be supported by a further consideration. The other versions record, as a current asset, a deposit paid for lot 478 Marvell Avenue, which was the asset involved, as the non-cash consideration, in the transaction to acquire Barrett Street. Accordingly, those versions would appear to be earlier versions of the accounts for the year ended 30 June 1983, before completion of the purchase of Barrett Street by Danehill. However, the significance of the deposit as a current asset was not argued, and in the end I place no reliance on it.

167 As part of his submissions on this issue, the appellant pointed to certain handwriting on the versions of the 1983 accounts which did not contain a reference to Barrett Street. The handwriting referred to lots in a property known as the Hamilton Hill Commercial Centre. It was argued that it should be inferred that the other versions of the accounts are the later (and final) product of the accounts after corrections had been made in accordance with the handwritten annotations. I would not draw that inference. The versions which the appellant contends are later versions are different in detail and could not simply be characterised as the product of corrections of an earlier version.

168 The same handwritten notations appear on the 1984 accounts and, although the writing is obscure, they also appear to be recorded on Danehill's worksheet for 30 June 1984. This suggests that the notations were made on the 1983 accounts in the 1984 year. However, whatever may be the significance of the handwritten annotations on the 1983 accounts, their presence does not seem to me to raise serious doubts about them being subsequent to the versions upon which the appellant relies, for the reasons given earlier.

169 The appellant also contends that at trial senior counsel for the first to third respondents tendered versions of the 1983 accounts not containing Barrett Street as the final version of the accounts for that year. Although senior counsel referred to the documents as 'originals' rather than copies, no admission was made in the tender that those versions, as opposed to the version containing Barrett Street as an asset, were the final year-end accounts for 1983.

170 Moreover, the appellant's proposition that Barrett Street was not regarded as an asset of Danehill appears to me to be inconsistent with the cash drawing of $15,000 from Danehill for the Catalanos' 'share' of Barrett Street - the latter being a fact not disputed by the appellant.

171 Thirdly, the appellant contends that the accounting material is, at least, sufficiently unclear that in the absence of calling the accountants to give oral evidence, the court could place no weight on the 1984 journal of Danehill. The appellant referred, in this regard, to disparate other versions of accounts of Danehill and Anham in evidence.

172 Despite the evidence of disparate versions of some of the documents, a coherent accounting picture does emerge from the materials as discussed above. Moreover, the journal itself has the hallmarks of a conventional accounting record. The journal contains 19 entries, each sequentially numbered, each recording conventional accounting information for a business of this kind. Each item recorded, in the conventional way, a debit and credit of a ledger account, with the debits and credits matching. The journal entry in question is number 18. There is nothing remarkable about its appearance. It sits between items 17 and 19, without any unusual features. The handwriting for each of the 19 items appears to be the same. No suspicion is raised on the face of the document about the figures or information in it. In each item, the language used in the journal to explain the entry is precisely the same. For example, each of items 1 to 17 and 19 commences with the explanation 'Being ... '. Thus, for example, item 17 describes the entry as: 'Being interest on loan brought to a/c'. Item 19 describes the entry as: 'Being unidentified deposit transfer to correct a/c'. Item 18, the journal entry in question, describes the entry as: 'Being property withdrawn for private use. (Used as settlement for Jack Fazio's share in Italia Limestone.)' Further, it is doubtful that any real light could be expected to be shed on whether an agreement was made in mid-1984 for Jack to retire from the partnership on terms involving accord and satisfaction, by calling oral evidence of the accountants in connection with accounting entries in books going back to 25 years ago. Nor, in this case, could it realistically be expected that the accountant could recollect, from this distance, drafts or particular versions of documents with sufficient precision to shed any greater light on their reliability and accuracy than would be revealed by an objective examination of the documents in question.

173 I do not accept the appellant's sixth proposition.

174 The appellant's seventh proposition is that the judge failed to recognise that the respondents bore the onus of proving that Jack was not a partner of the partnership after 1984 and up to 2007. The appellant contended, in effect, that once it was established (as it was) that he had been a partner of a partnership prior to 1984, there arose a presumption that he continued as a partner over the next 23 years, which presumption was required by law to be accepted by the judge as proof that Jack was a partner in 2007, unless the respondents proved to the contrary on the balance of probabilities. The presumption contended for was presumably (although not expressed in these terms) a presumption of law rather than a presumption of fact: see Heydon JD Cross on Evidence [1605] - [1615], [7295] - [7310] on rebuttable presumptions of law and presumptions of fact.

175 The appellant relied upon the observations of McLelland CJ in Eq in Massoud v NRMA Insurance Ltd (1995) 62 NSWLR 657, 661 for the proposition for which he contended.

176 In Massoud, the plaintiff took out a 12-month motor vehicle policy in January 1992. The policy was renewed in January 1993 and again in January 1994. In April 1994, the insurer (defendant) cancelled the motor vehicle policy on the basis that the plaintiff had fraudulently misstated how the motor vehicle was damaged when making a claim under the policy. The insurer also cancelled a personal effects policy of the plaintiff and told the plaintiff that it would not offer any other insurance to the plaintiff thereafter. The plaintiff sued the insurer and sought declarations to the effect that:

• the (purported) avoidance of the motor vehicle policy in April 1994 was unlawful (orders 1 and 2 were to this effect, but in the reasons, McLelland CJ in Eq refers to this claimed order as 'order 2');
• a declaration that the motor vehicle policy remained in full force and effect (order 3);
• a declaration that the (purported) avoidance of the personal effects policy was unlawful;
• a declaration that the personal effects policy remained in full force and effect; and
• a declaration that the insurer's refusal to offer any further insurance to the plaintiff was unlawful.

177 McLelland CJ in Eq dismissed the plaintiff's claim on the basis that, with respect to 'order 2', the plaintiff had not established that he had not knowingly falsely stated how the car came to be damaged, and that the other declarations were academic.

These decisions illustrate what I consider to be the principles by which the incidence of the onus of proof is to be determined, namely:

(1) a party who seeks relief has the burden of satisfying the Court of facts which (in the absence of proof of other facts) would justify the grant of that relief;

(2) what those facts are depends principally upon:

(a) the nature of the relief sought; and

(b) the operation of any relevant presumptions;

(3) in the case of relief by way of declaratory order, the precise terms of the declaration assume particular significance in that (subject to any relevant presumption) the party seeking the declaration has the burden of proof of any matter which is a necessary element of the declaration sought (even if in proceedings by that party for relief of another kind, or in proceedings by the other party, that matter would not arise unless raised (and the burden of proof consequently assumed) by the other party).

...

Although the terms of order 3 include an implicit assertion that nothing has happened since the issue by the defendant of the plaintiffs policy to terminate its operation, and the plaintiff has the burden of satisfying the Court of the truth of that assertion, that would in the circumstances involve no more than proof that the policy was issued in respect of a period which has not expired by effluxion of time, since there is a presumption that a contract once made continues in existence. (Such a presumption may of course be rebutted by proof of termination of the contract, for example, by a valid cancellation thereof, but the burden of proof of such a termination would rest on the party alleging it.) A presumption of continuance of this kind is ordinarily relied on in any proceedings to enforce a contract, since the making of the contract invariably precedes its enforcement, and generally speaking the plaintiff has the burden of proving the making of the contract whereas the defendant has the burden of proving any matters alleged to have resulted in the termination of the contract subsequent to its formation. It is immaterial in such a case whether declaratory relief is claimed or not: for example, an order for specific performance of a contract is traditionally preceded by an order declaring the present existence and/or enforceability of the contract. (emphasis added)

179 His Honour's observations were referred to with approval by Campbell J in Sanpine v Koompahtoo Local Aboriginal Land Council (2005) NSWSC 365 [180] - [181]. That case concerned a joint venture contract which expressly provided that it should continue until the occurrence of one or more specified events [29]. (Note that the decision in Sanpine was overturned by the New South Wales Court of Appeal, but, in effect, reaffirmed by the High Court in Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115.)

180 The first to third respondents contend that caution is required in the application of presumptions, and that any presumption will depend upon the nature and terms of the contract, its subject matter, the underlying circumstances of the dispute between the parties, and the character of the dispute. The first to third respondents contend that, in the circumstances of this case, there is no presumption of the kind alleged by the appellant. Here, it is said by the first to third respondents, the relevant circumstances include the following: that the subject matter of the contract involved a joint enterprise involving the carrying on of business together for a profit; that the partnership agreement was informal and the partnership was terminable at will; and that the dispute was concerned with a dispute between partners as to whether their partnership had continued. It was said that these circumstances combine to indicate that it would be inappropriate to apply any presumption of the kind alleged by the appellant.

181 They also, correctly, submit that in other contexts, caution has been expressed as to the utility of general presumptions which do not correspond with common experience: Carr v The Queen [1988] HCA 47; (1988) 165 CLR 314, 342 (Gaudron J). Also, it may be accepted that in the contractual context, care must be taken to avoid mischaracterising the effect of presumptions, and extending them beyond their true scope and purpose: Ermogenous v Greek Orthodox Community of SA Inc [2002] HCA 8; (2002) 209 CLR 95 [26] - [28].

182 Neither party drew the court's attention to Brown v Wren Brothers [1895] 1 QB 390, in which a presumption of continuance was applied in a partnership context. There, the presumption appears to have been one of fact, and operated in favour of a third party dealing with the (alleged) partnership, and not in proceedings between the partners themselves.

183 Massoud v NRMA Insurance and the presumption of continuance was also discussed in the case of Beattie and Sutherland v Osman (No 4) [2009] NSWSC 834, which was also not referred to by the parties. In that case White J said at [45]:

The so-called presumption of continuance is not a true presumption but a description of the process of reasoning by which inferences of fact can be drawn. Whether an inference should be drawn depends on the particular circumstances and the chance or likelihood of intervening circumstances having altered the original state of affairs.

184 It is unnecessary to determine the appellant's contention in this case. That is because, even if a presumption arose, evidence was called on the topic of whether the appellant remained as a partner for the years following 1 July 1984, and the asserted presumption had no inherent superadded weight: Cross on Evidence [7280]. To the extent that there was any force in the presumption that the appellant remained a partner over the next 23 years, it was swamped by a tide of evidence to the contrary.

185 I would not uphold the appellant's seventh principal proposition.

186 Ground 4 alleges that the judge erred in 'finding that the first to third respondents established that the appellant [Jack] retired from the ... Partnership in 1984'. Fifty-seven points are then enumerated, many of which contain multiple contentions. Most challenged the judge's findings of fact, and the inferences drawn. There is also the 'jurisdictional error' point to which I have earlier referred and addressed.

187 Although not discussed in terms by the judge, it is to be inferred that his Honour had regard to two bodies of legal principle in his finding of the agreement. One concerns the admissibility of subsequent conduct in relation to the identification of an informal contract and its terms. The other concerns inferred agreements.

188 As to the latter, it is well established that strict adherence to the classical theory of contract formation is not necessary; a contract may be inferred in the absence of an identifiable offer and acceptance: Brambles Holdings Ltd v Bathurst City Council [2001] NSWCA 61; (2001) 53 NSWLR 153 at [1] Mason P; [74] Heydon JA (as his Honour then was); Integrated Computer Services Pty Ltd v Digital Equipment Corporation (Aust) Pty Ltd (1988) 5 BPR 11,110, at 11,117, McHugh JA; Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) and (No 10) [2008] WASC 239; [2009] WASC 107; (2008) 39 WAR 1, [2653]; Lighting by Design (Aust) Pty Ltd v Cannington Nominees Pty Ltd [2008] WASCA 23; (2008) 35 WAR 520 [90], [204] - [205]; Branir Pty Ltd v Owston Nominees (No 2) [369]; Marist Brothers Community Inc v Shire of Harvey (1994) 14 WAR 69, 74 - 75; Vroon BV v Foster's Brewing Group Ltd [1994] VicRp 53; [1994] 2 VR 32, 79 - 80. For example, an agreement by a creditor of the firm to release a retiring partner (who stands, as between himself or herself and the 'continuing partners' as a surety for the debt), may be inferred from conduct: s 24(3) of the Partnership Act and see ALH Group Property Holdings Pty Ltd v Chief Commissioner of State Revenue [2012] HCA 6 [32] and Morison C B , Rescission of Contracts (1916) at 26 - 27.

189 A contract may be inferred from the acts and conduct of parties, as well as or in the absence of their words: Integrated Computer Services v Digital Equipment Corporation (11,117); Empirnall Holdings Pty Ltd v Machon Paull Partners Pty Ltd (1988) 14 NSWLR 523, Lighting by Design v Cannington [21], [90], [204]. The parties' dealings with each other are relevant both 'for what was said and not said': Branir Pty Ltd v Owston Nominees (No 2) [369].

190 The question is whether the parties' conduct, viewed objectively, reveals a tacit understanding or agreement, or a manifestation of mutual assent, which evinces an intention to create legal relations: Bell Group Ltd (in liq) v Westpac Banking Corporation (No 9) and (No 10) [2659]; Lighting by Design v Cannington [204]; Branir Pty Ltd v Owston Nominees (No 2) [369].

191 In Brambles Holdings v Bathurst City Council [81], Heydon JA (in observations adopted by Le Miere AJA in Lighting by Design v Cannington [205]) posed the following question for determination:

In the light of the above cases, it is relevant to ask: in all the circumstances can an agreement be inferred? Has mutual assent been manifested? What would a reasonable person in the position of [one party] and a reasonable person in the position of the [other party] think as to whether there was a concluded bargain?

192 In relation to the admissibility of subsequent conduct, the general principle is that subsequent conduct is not to be used as an aid in the construction of an instrument or written agreement: The Administration of the Territory of Papua and New Guinea v Daera Guba [1973] HCA 59; (1973) 130 CLR 353, 446 per Gibbs J, citing James Miller & Partners Ltd v Whitworth Street Estates (Manchester) Ltd [1970] AC 583, 603; Agricultural & Rural Finance Pty Ltd v Gardiner [2008] HCA 57; (2008) 238 CLR 570 [35].

193 Where, however, an informal agreement (oral or inferred) is alleged to have been made on or by a certain date, the conduct of the parties, including conduct subsequent to the postulated date, may be considered in deciding whether a contract has been concluded: Allen v Carbone [1975] HCA 14; (1975) 132 CLR 528, 532 - 533; Barrier Wharfs Ltd v W Scott Fell & Co Ltd [1908] HCA 88; (1908) 5 CLR 647, 669; Brambles v Bathurst [25]. Such conduct may be considered for the purpose of inferring not only whether a binding agreement had been reached, but also its subject matter and the identification of its necessary terms: Bell Group [2665] - [2672]; County Securities Pty Ltd v Challenger Group Holdings Pty Ltd [2008] NSWCA 193 [7] - [27], [45] (Spigelman CJ); Australian Estates Ltd v Palmer (Unreported, NSWCA, 22 December 1989). In the last-mentioned case, Samuels JA (with whom Kirby P and Meagher JA agreed) said:

While it is true that a court cannot have regard to the subsequent conduct of the parties as an aid in the interpretation of a term in a written contract (see James Miller and Partners Ltd v Whitworth Street Estates (Manchester) Ltd [1970] AC 583, Wickman Machine Tool Sales Ltd v L Schuler AG [1973] UKHL 2; [1974] AC 235), this is merely an application of the parol evidence rule. Thus, as Stephenson LJ (with whom O'Connor LJ and Sir Stanley Rees agreed) said in Meares v Safecar Security Ltd [1983] QB 54 at 77, dealing with an oral contract:

'There is nothing in those authorities which prevents the court from looking at the way the parties acted for the purpose of ascertaining what that term was. Commonsense suggests that their subsequent conduct is the best evidence of what they had agreed orally but not reduced to writing, though it is not evidence of what any written terms mean;'

194 The above passage was cited with approval by Moore J in Intelmail Explorenet Pty Ltd v Vardanian (No 2) (2009) FCA 1018; (2009) 82 IPR 281 [53].

195 The quote from Meares v Safecar Security Ltd [1983] QB 54 referred to in Australian Estates Ltd v Palmer was also cited with evident approval in Bell Group at [2668] and [2672]. See also in this context the discussion by Heydon J in Cross on Evidence [39,290] and the cases cited at footnotes 307 - 311.

196 The complaints in grounds 4.1 to 4.4 are directed to the respondents' pleaded case and are to the effect that the judge erred in:

(a) failing to infer, from the respondents' failure to call the Catalanos, that the Catalanos' evidence would not have assisted the respondents' pleaded case;

(b) failing to find that the mother's (Giuseppina's) evidence did not support the agreement pleaded by the respondents;

(c) failing to find that Rudy's evidence did not support the agreement pleaded by the respondents.

197 As to the first complaint, I have addressed the issue of the Catalanos' evidence earlier, and held that his Honour's findings ought not be disturbed on the basis that the Catalanos were not called. It is to be recalled that the Catalanos signed the business name form recording Jack's departure from the partnership on 30 June 1984; the trustee company, Danehill, which was operated for their benefit and the Fazios, and in which they were unit holders, executed the transfer of Barrett Street to Jack and Maria on 19 July 1984 and did so, it is to be inferred, with their knowledge; they were paid their 'share' of Barrett Street in October 1984; and the partnership records from 1 July 1984 overwhelmingly indicate that they 'continued' the business of Italia Limestone, without Jack as a partner, in a partnership with Vince, Giuseppina and Rudy, from 1 July 1984. Moreover, as I have said, even if the judge had inferred that the Catalanos' evidence would not have assisted the respondents, that in itself does not demonstrate error by the judge in reaching the finding he made.

198 As to the second and third complaints, it is evident that the judge considered that the mother's evidence and Rudy's evidence could not be relied upon to support the agreement pleaded by the respondents, insofar as the plea alleged that the transfer of the South Terrace property in Fremantle was part of the consideration for the relinquishment of Jack's interest in the partnership. For the reasons previously given, however, the judge did not err in finding the agreement that he did, albeit that the consideration for it was found to be narrower than that pleaded by the respondents, and that the judge did not find the agreement precisely in accordance with the respondents' particulars.

199 Insofar as the second and third complaints might be understood as contending that, irrespective of the pleading point, the inference of an agreement of the kind found by the judge was not open on the direct evidence of Giuseppina and Rudy, the following observations may be made.

200 First, their evidence is to be considered in the context that both Giuseppina and Rudy executed the business name form which recorded Jack's departure from 30 June 1984, and that, overwhelmingly, the business records indicate that both 'continued' to carry on the business of Italia Limestone from 1 July 1984 in partnership with the Catalanos and Vince, and without Jack as a partner.

201 Secondly, Giuseppina said in-chief that Vince would always talk to her about buying and selling property and matters of that kind, but that 'in the end, the decision was his'. She also said, in effect, that she could not remember why the appellant was given the Barrett Street property, but she knew that the appellant had left the business, and that Jack was given Barrett Street around that time. Her evidence did not materially alter in cross-examination. In cross-examination, she also said that 'the one who was the boss was my husband, and nothing else, and whatever he wanted my children would carry on'. Her evidence is not inconsistent with the proposition that she knew that Jack was retiring from the partnership and she knew that Vince had made some arrangements with Jack for the transfer of the Barrett Street property, and that she was content with whatever arrangements Vince had made with Jack in that regard.

202 Thirdly, Rudy's evidence was that after Rudy had signed the business name form in the presence of his father, Jack said, 'If you are smart you will do the same thing because with that man you will never get anything'. Rudy also said that 'nobody ever suggested to me that the Barrett Street property was a wedding gift to Jack and Maria. My parents never mentioned that'. Rudy's evidence in cross-examination included evidence to the effect that he had understood from Vince that Barrett Street was tied up with Jack getting out of the partnership. Rudy's evidence was consistent with the notion that Rudy understood that Jack was receiving Barrett Street in connexion with Jack's retirement from the partnership.

203 The appellant has also made some observations about Sarina's evidence in the context of the judge's finding that Jack retired from the partnership on the terms found by the judge. Although in general terms Sarina's evidence supported the case pleaded by the respondents, she was not a partner and any agreement did not involve her. To that extent, the observations made by the appellant about her evidence in this context appear to be irrelevant.

205 These grounds allege, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that:

(a) the judge erred in finding that Vince was not overseas when the first contract to acquire certain land known as the 'Mandurah land' was executed; and

(b) the finding was not open because Jack had executed a mortgage to secure borrowings with respect to the acquisition of the Mandurah land as a partner on 20 June 1984, two days 'before the effective date of him retiring from the Partnership'. (This appears to be a reference to the business name form dated 22 June 1984.)

206 The Mandurah land contained a large limestone resource. Jack negotiated the purchase of the land and entered into a contract for its acquisition in conjunction with another family, the Merlinos, in late 1983. Jack did not speak to his father, Vince, about the original acquisition because he intended to acquire the land in his own interest (reasons [136] - [140]). Whilst Jack had asserted in evidence that he did not speak to his father about it because Vince was overseas, the judge rejected that evidence and referred to Jack's inconsistent versions of the events in question and Jack's 'implausible attempt' to reconcile the inconsistencies (reasons [130] - [132], [140]).

207 The first point in these grounds asserts that the judge ought to have found, as Jack had said, that his father was away overseas when the first contract was entered into. The judge summarised the evidence (reasons [133]) on the topic of Vince's movements overseas in the latter part of 1983, including the evidence which gave support to Jack's contention that his father was overseas at the relevant time. The judge concluded, having regard to Department of Immigration records and the evidence of the Monastras, that Vince had left Australia to bury his father in his native Sicily on 23 September 1983, and had returned to Australia on 17 October 1983. The finding was clearly open on the evidence. The appellant's contention that the immigration records were incomplete because they appear to omit a movement prior to 23 September 1983 does not demonstrate error by the judge. The judge was entitled to find that the records were accurate as far as they went, at least for the period covering late 1983 and early 1984.

208 As to the appellant's second point, the judge found that Jack intended to acquire the land in his own interest, and only intended to involve Vince 'to the extent necessary to make up any shortfall in funding the acquisition' (reasons [138]). Jack subsequently put a syndicate together, in the course of which he approached his father for finance, in the latter part of February 1984. The Mandurah land was eventually acquired by MG Constructions Pty Ltd (a company controlled by Jack and his wife), Danehill, and a spread of other investors (reasons [142] - [146]). The acquisition of the Mandurah land was in part financed by a financier, which took a mortgage over the property. The mortgage document required the partners of Italia Limestone to be additional covenantors, and the document listed the partners as including Jack (reasons [149]). In response to the proposition put before the primary judge, and repeated in this part of the appeal, that it is improbable that Jack would have executed the mortgage two days before the effective date of his retirement from the partnership, the judge said (reasons [150]):

The plaintiffs assert that it is improbable that Jack would have entered into this document as an additional covenantor only two days before he executed a form providing notice under the Business Names Act that he would be ceasing to trade as a proprietor of the partnership with effect from 1 July 1984. However, it is to be remembered that a company controlled by Jack and Maria, MG Constructions, was one of the principal covenantors, and that Jack had an interest in the finance being granted other than through his interest in the partnership. Accordingly, I do not consider his execution of the mortgage on 20 June 1984 to tell strongly against the proposition that he also executed the business names form two days later.

209 The appellant says that the judge erred because Jack had sufficient money to acquire his own share of the interest in the Mandurah land. That seems to me to be beside the point. Jack would not have acquired any interest without the partnership taking an interest in the land, and the partnership required external funding to finance its share of the acquisition. No error of fact or law is revealed in the judge's reasoning.

Grounds 4.8 to 4.15 (Barrett Street property) Background

211 These grounds concern the transfer by Danehill to Jack and Maria of the Barrett Street property. As noted earlier, the respondents had pleaded, and the judge found, that the consideration for Jack's agreement to retire from the partnership included the transfer to Jack and Maria of the Barrett Street property. For his part, Jack had pleaded that he received the Barrett Street property as part of a different agreement, namely 'the 1982 agreement', involving the resolution of a dispute relating to Jack's employment with the partnership.

212 Jack had pleaded, with respect to the alleged '1982 agreement' in effect, that:

(a) by 3 May 1982 he and Vince had had various disputes about his (Jack's) remuneration from the partnership;

(b) Jack, in consequence, 'terminated his employment by the partnership';

(c) on or about 3 May 1982, Vince, on behalf of the partnership, and Jack, on his own behalf, agreed under the 1982 agreement that:

(i) Jack would return to work as an employee of the partnership;

(iii) the partnership would transfer to Jack and Maria the Barrett Street property subject to settlement of the partnership's acquisition of that property;

(iv) the partnership would contribute up to $120,000 towards the cost of construction of a house on Barrett Street for Jack and Maria, to be completed over a period of approximately 24 months;

(v) the partnership would pay Jack a regular, reasonable weekly income;

(d) pursuant to the 1982 agreement, Jack returned to work full-time on or about 12 August 1982;

(e) Vince and the partnership partially honoured the 1982 agreement by causing the transfer of Barrett Street to Jack and Maria and by causing the partnership to pay Jack $9,780 in four lump sums, but failed to otherwise comply with the terms of the 1982 agreement, save that in 1989 Vince caused 10% of the issued share capital of another company, Radroc Pty Ltd, to be transferred to Jack in satisfaction of the partnership's obligation to contribute $120,000 towards the cost of the construction of a house in Barrett Street.

213 Jack's evidence was that the background to the 1982 agreement was that he had unpaid wage entitlements of approximately $300,000. The judge found this to be 'inherently implausible' and a 'gross exaggeration' (reasons [159]). Those findings are not challenged in this appeal.

214 The judge rejected Jack's contention that he had entered into an agreement with Vince in 1982 for the transfer of the Barrett Street property and that he was given the Barrett Street property pursuant to the 1982 agreement.

215 As noted earlier, the judge found that the Barrett Street property was transferred to Jack in consideration for the relinquishment of his interest in the partnership.

216 The oral evidence given at trial concerning an agreement for the transfer of the Barrett Street property came from Jack, his wife Maria, and Sam Fazio. Vince was, obviously, unable to give evidence because the proceedings had not been commenced prior to his passing. As discussed further below, Jack did, however, rely upon a statement made by Vince in other proceedings and upon a testamentary statement by Vince on this issue.

217 The judge noted that Jack had not mentioned in his evidence-in-chief any direct conversation with Vince concerning the alleged 1982 agreement. He observed, nevertheless, that the evidence given by Jack, Maria and Sam Fazio, given in witness statements which were adopted as evidence-in-chief, 'was generally consistent ... However, it unravelled in cross-examination' (reasons [165] - [166]).

218 The judge gave detailed reasons explaining how the evidence of Jack, Maria and Sam 'unravelled' (reasons [166] - [193]). His Honour found an aspect of Jack's explanation with respect to this topic was 'implausible' and that it 'bordered on the incoherent' (reasons [190] - [191]). He also found Maria's evidence on a related aspect to be 'unconvincing' (reasons [192]). As to Sam's evidence, his Honour found that Sam had fallen out with Vince and Rudy over his investment in the Mandurah land and had been on opposing sides to them in litigation in respect of that land. His Honour also found that Sam had been a good friend of Jack for many years and, after observing a number of factual discrepancies in Sam's evidence, concluded (reasons [171]):

Given his partisanship and his erroneous recollection relating to the work which Jack did during the period he was apparently not working for Italia Limestone, the discrepancies in his evidence as to the year in which the conversation took place, and the objective evidence which makes it improbable that there was an agreement of the kind alleged, I do not accept the evidence given by Sam Fazio.

219 These grounds allege, in substance, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that he erred in the following six respects:

(a) finding that the Barrett Street property had been transferred in consideration for the appellant surrendering his interest in the partnership and failing to find that it was transferred in accordance with the 1982 agreement pleaded by Jack;

(b) rejecting the evidence of Sam Fazio regarding the alleged 1982 agreement;

(c) failing to find that statements made by Vince in other litigation and in his Will, to the effect that Barrett Street was a gift, were consistent with an agreement for the transfer of the property separate from an agreement involving Jack's retirement from the partnership, and inconsistent with the property having been transferred as consideration for Jack's retirement from the partnership;

(d) failing to find that certain financial statements of Danehill were consistent with an agreement concerning the transfer of Barrett Street having been reached prior to 30 June 1983, and in giving any weight to the journal entry of Danehill which had recorded that the transfer of the Barrett Street property was in consideration for Jack's retirement from the partnership;

(e) failing to draw a Jones v Dunkel inference in relation to the respondents' failure to call Jack's accountants, and/or the partnership's accountants, and/or the Catalanos; and

(f) failing to find that, given the value of the appellant's interest in the partnership as at 30 June 1984, the transfer of the Barrett Street property was inadequate consideration for the relinquishment of the appellant's interest in the partnership.

220 As to the first of the six alleged errors, the judge was clearly entitled to find, as he did and for the reasons he did, that he was not satisfied that there was an agreement in 1982 as alleged by Jack in his pleadings. The appellant's submissions in this regard take selective matters referred to by the judge and make certain criticisms of them, but the appellant does not attempt to grapple, in any comprehensive way, with all the reasons given by the judge for rejecting the appellant's claim as to the 1982 agreement. No error is shown in the judge's reasons as read as a whole.

221 Moreover, the appellant's arguments in this appeal seemed (as I understood them) to suggest that the judge erred, not so much in finding that the 1982 agreement had not been made in 1982 as alleged, but in failing to find that the 1982 agreement had been made in 1984. The suggested transposition of the 1982 agreement from 1982 to 1984 does not assist the appellant in identifying any error by the judge. The appellant has not demonstrated in this appeal, by reference to any objective evidence in 1984, what circumstances existed in 1984 which would render it more likely than not that the 1982 agreement had been entered into in 1984, as opposed to 1982. Moreover, the evidence to the contrary, referred to in the respondent's submissions with respect to the wage records in 1982 and 1984, has not been effectively gainsaid by the appellant.

222 In any event, whether or not the 1982 agreement is placed in 1982 (as the appellant alleged at trial) or in 1984 (as appeared now to be alleged) it remains, on any view, a rather implausible agreement. Jack made no mention, in-chief, of ever having discussed the agreement with Vince notwithstanding that, as pleaded, the 1982 agreement purportedly involved Vince conferring, on behalf of the partnership, significant benefits upon Jack by way of the resolution of an allegedly serious dispute.

223 Further, on Jack's evidence, the commercial context of the agreement, and its commercial plausibility, involved an acceptance that Jack was owed $300,000 by the partnership. If, as the appellant seems to contend in this appeal, the background to the 1982 agreement is transposed to 1984, the partnership would likely have been hopelessly insolvent if it had owed Jack $300,000, as its net assets as at 30 June 1984 were only $132,420.73. As I have said, the judge's unchallenged assessment of this evidence was that it was 'implausible' and 'grossly exaggerated'. The commercial setting for the agreement makes as little sense in 1984 as it did in 1982. It is incorrect to suggest, as the appellant does in this appeal, that Jack's implausible evidence about the commercial background to the alleged agreement is simply 'not of significance'.

225 As to the second complaint, the judge was entitled to reject the evidence of Sam Fazio for the reasons he gave. There is no merit in this complaint.

226 As to the third complaint, Vince's Will referred to Barrett Street as a 'gift' in 'the 1970's' and the witness statement referred to Barrett Street as having been given as a 'wedding present'. Two points should be made. First, neither document supports the appellant's case that Jack and Maria received the Barrett Street property as part of the 1982 agreement. Secondly, the judge's reasons at [183] disclose no error.

I do not overlook ... the statement of the evidence to be given by Vince in the Mandurah land proceedings, and which Vince signed prior to his death. In that statement he refers to the Barrett Street land as a 'gift' to Jack. However, it is to be remembered that Jack's interest in the partnership was also a gift to Jack, so that Vince could easily have seen the transfer of Barrett Street as also being a gift, even if it were a part of the arrangements relating to Jack's relinquishment of a share in the partnership. Further, it is to be remembered that the witness statement signed by Vince relating to the Mandurah land proceedings was prepared more than 20 years after the transfer of Barrett Street and was prepared for use in proceedings in which the precise characterisation of the Barrett Street transaction was not an issue.

229 As to the fourth complaint, I have dealt with the substance of the point in the part of these reasons concerning the sixth principal proposition.

230 As to the fifth complaint, I have dealt with the substance of the alleged Jones v Dunkel errors in the sections headed 'The fourth principal proposition' and 'The sixth principal proposition'.

231 The sixth complaint begs at least two questions. One is what was the value of Jack's interest in the partnership as at 30 June 1984, and the other is what was the value of Barrett Street in mid-1984? There was no valuation evidence of either given at trial. This court has been asked to infer that the capital account balance for Jack as at 30 June 1984, of $64,664.36, represented the value of Jack's interest in the partnership, but that is mere conjecture (cf Rowella v Abfam (306 - 307)). Even if the figure of $64,664.36 is accepted, the Barrett Street property was sold by Jack and Maria to a third party in late 1984 for $55,000. That figure seems a more reliable guide to the value of the property than the $20,000 assigned to it, apparently for stamp duty purposes, in the transaction in which Vince arranged for the property to be transferred to Jack (reasons [178]). The two figures of $64,664.36 and $55,000 are not widely disparate.

232 Further, Jack was undoubtedly dissatisfied with his lot by mid-1984, and by then had done a real estate course and had commenced work in a real estate business. There is nothing to suggest that he placed a premium on his financial interest in the partnership over his dissatisfaction with his life in the partnership, and over the prospect, at age 32, of starting a new life in business without the yoke of serving the family partnership under the direction of Vince, and with the benefit of a block of land in Spearwood (Barrett Street) at no cost to him and his wife, in circumstances where they had already secured their matrimonial property by way of gift from Vince.

233 Certainly there is no satisfactory evidential basis upon which to make a finding that the value of Jack's interest was so much greater than the value of Barrett Street, as to permit an inference to be drawn that the parties could not, objectively, have reached an agreement of the kind found by the judge. There is no merit in the sixth complaint.

Grounds 4.16 to 4.19 (accountant's letter dated 21 January 1985) Background (reasons [198] - [227])

234 In the financial years prior to the year ended 30 June 1984, Jack, to his knowledge, received two forms of income from the partnership - wages as an employee, and distributions of profit.

235 The partnership tax return for the year ended 30 June 1984 was prepared in December 1984, and showed an allocation of $10,000 by way of profit distribution to Jack for that year. Following this, a dispute arose with Jack concerning tax, and Jack consulted an accountant, Mr Gossati of PM Melsom & Co, in December 1984 or the first half of January 1985.

236 By letter dated 16 January 1985, Mr Gossati wrote, on behalf of Jack, to the partnership's accountants (Francis A Jones & Associates). Mr Gossati's letter said that he had been consulted by Jack and Maria in relation to Jack's tax position in light of Jack's share of the profit from the partnership, and in respect of certain other matters. The letter asked, by way of a preliminary professional courtesy, whether the partnership's accountants had 'any ethical or other objection' to Mr Gossati acting for Jack. Mr Gossati's letter also asked for copies of all financial statements and tax returns for all entities of which Jack or Maria were directors, beneficiaries, shareholders or partners, with such copies 'to cover the period of their involvement in this regard'.

237 A file from the partnership's accountants was produced on subpoena and admitted into evidence at trial. The file contained Mr Gossati's letter of 16 January 1985. It also contained what appeared to be a copy letter, on the letterhead of Francis A Jones & Associates, stamped on the right-hand side with the word 'Copy', dated 21 January 1985. The copy document dated 21 January 1985 was addressed to Jack's accountants (PM Melsom & Co), was marked for the attention of Mr Gossati, and referred in terms to Mr Gossati's letter of 16 January 1985. The document stated that there was no objection to Mr Gossati attending to the future accounting requirements of Jack and Maria. The document also stated that it attached a statement showing amounts paid to Jack for the partnership for the year ended 30 June 1984, and that no other profit or income had been allocated for that year. The document continued that the partnership's accountants had been 'informed by the other partners (Mr V Fazio) that [Jack] reached an agreement whereby he [had] been paid in full for his interest in the partnership'. The document also stated that the partnership's accountants had been instructed not to release any partnership financial statements to Jack.

238 There was no direct evidence that the original of this apparent letter had been posted to, or received, by Mr Gossati.

239 Mr Gossati, nevertheless, evidently proceeded on the basis that there was no professional difficulty in him continuing to act for Jack. He wrote a letter to the partnership's accountants dated 24 January 1985 regarding another business, and lodged a tax return on behalf of Jack which excluded the $10,000 profit distribution from the partnership. The Tax Office rejected the return and issued an assessment which included the $10,000 distribution. Jack lodged an objection to that assessment. The objection was disallowed and the disallowance was advised in a letter from the Tax Office to Mr Gossati in January 1986.

240 In evidence, Jack said that he was shown a copy of Mr Gossati's letter dated 16 January 1985 before it was sent. He also admitted that he knew that Mr Gossati's request for information had been rejected, but he said that he did not learn that fact from the document purporting to be a letter from the partnership's accountants dated 21 January 1985. He said, rather, that he had learned directly from his parents that the request for information had been rejected.

241 The judge rejected Jack's evidence and catalogued his reasons for doing so. His Honour recorded that one aspect of Jack's evidence was 'plainly an invention' (reasons [215]).

242 The judge concluded, in effect, that all the objective circumstances pointed to the likelihood that the partnership's accountants' letter dated 21 January 1985 had been sent to, and received by, Mr Gossati, and that Mr Gossati had communicated its contents to Jack at about the time that it was received (reasons [225]). His Honour also found that Jack took the request for information no further and that the most likely explanation for his failure to pursue the matter was because he was well aware that he had renounced his rights to the partnership and was therefore not entitled to partnership documents (reasons [224]).

243 Further, and in any event, the judge found that irrespective of whether or not the letter of 21 January 1985 had been received by Mr Gossati and communicated to Jack, the letter records instructions to the effect that Jack had reached an agreement whereby he had been paid in full for his interest in the partnership. The judge said that it was a fair inference from the letter, which he drew, that Vince in fact gave those instructions to the partnership's accountants and that it would be highly unlikely that Vince would have given the instructions with a view to them being communicated to Jack if no such agreement had been reached. Accordingly, his Honour found that irrespective of whether the letter of 21 January 1985 was dispatched or received, or whether its terms were passed on to Jack, the fact that the letter was written at all provided cogent evidence when considering the likely sequence of events during 1984.

244 These grounds allege, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that the letter of 21 January 1985 was sent to Mr Gossati and communicated to Jack by Mr Gossati;

(b) finding that the letter of 21 January 1985 was written by the partnership's accountants when there was insufficient evidence to determine who wrote it;

(c) drawing inferences that Vince gave instructions to the partnership's accountants consistent with the contents of the letter and in finding that the instructions were true, in circumstances where there was no, or insufficient, evidence for the drawing of the inferences; and

(d) drawing an inference that Vince gave the partnership's accountants such instructions with a view to them being communicated to Jack, and in finding that Vince would not have done so if no agreement had been reached with Jack, in circumstances where there was no, or insufficient, evidence to allow the inferences to be drawn.

This part of the appeal was conducted by the appellant on the basis that the accountant's file, and the letters and documents on the file, were business records within the meaning of the term 'business record' in s 79B of the Evidence Act, and were admissible under s 79C(2a).

245 Also in oral submissions, counsel for the appellant accepted that a fair, and indeed a probable, inference from the 21 January 1985 document was that the author was an accountant in the firm of Francis A Jones & Associates Pty Ltd (the partnership's accountants), and that the author had not made up the contents of the document out of his own imagination, and that, instead, the author had spoken to Vince and recorded in the document what the author understood to be Vince's instructions in relation to the matters raised in Mr Gossati's letter of 16 January 1985.

246 The above concessions were, in my view, properly made. They also seem to me largely to undermine the grounds of appeal. I would make the following observations.

247 First, the document of 21 January 1985 in terms addresses the letter from Jack's accountants dated 16 January 1985. Secondly, if the accountant took Vince's instructions, it was presumably for the purpose of replying to Mr Gossati's letter. Indeed the natural inference, in the circumstances, is that the accountant had a duty to communicate his instructions in response to Mr Gossati's letter. Thirdly, there is nothing on the face of the document, nor from a consideration of its terms as a whole, which would suggest that it is a draft or that it is incomplete and awaiting further instructions. Fourthly, we were not referred to any other letter which apparently corrected the contents of the 21 January 1985 document or which suggested that the 21 January 1985 document was a draft or had been the subject of further instructions and review. Fifthly, Mr Gossati evidently continued to act for Jack in relation to taxation matters. This suggests that he understood that the professional inquiry as to whether he could continue acting for Jack, had been answered in the affirmative. Sixthly, the word 'copy', which is stamped on the document, implies that there had been an original. The original was not on file, which provides some indication that it was sent. Seventhly, Jack's evidence was that he knew that the information requested by his accountant had not been provided. He gave an explanation for this knowledge which did not involve him seeing the letter of 21 January 1985. The judge regarded Jack's evidence on this topic as 'unsatisfactory' and noted that it involved, in part, a plain 'invention' (reasons [213] - [215]). Jack's accountant would have had a duty to communicate the contents of the letter to Jack. Once Jack's evidence was rejected, the natural inference is that the knowledge, which he accepted he had, derived from his accountant having communicated to him the contents of the 21 January 1985 letter.

248 All the above matters combine to indicate that the judge did not err in the inferences he drew with respect to the letter of 21 January 1985. Nevertheless, the appellant makes in substance a further point. It is alleged that the inferences could not properly be drawn in the absence of the first to third respondents calling Mr Polglase or Mr Gossati as witnesses. As to Mr Gossati, the judge gave reasons at [206] - [207] why he did not draw the inference contended for by the appellant. No error is shown in the judge's reasoning. Nevertheless, the appellant says, that at least Mr Polglase should have been called to describe the office 'systems' with respect to postage and 'copy' letters being left on file. In this regard, he points to some unsigned letters not stamped 'copy' and some which were. He also points to other 'copy' letters with handwriting on them and suggests that these are drafts. It does not seem to me that these matters could be regarded as having any significant bearing on the status of the 21 January 1985 document, which is stamped 'copy', which does appear complete both in its terms and in the context of the 16 January letter, and which on its face is unaltered.

249 The appellant also contends, in effect, that it was incumbent upon the first to third respondents to call direct evidence from Mr Polglase on the topic of Mr Polglase's instructions. It is said that he may have misunderstood and mis-recorded the substance of Vince's instructions.

250 As to this, Vince had passed away and he was not available to give direct evidence. Also, there is no basis for supposing that Mr Polglase in 2010, was in a position meaningfully to give direct evidence about certain instructions which were received on or about 21 January 1985. It was accepted by the appellant that the 21 January 1985 document was a business record. There is no reason to suppose that the memory of Mr Polglase, 25 years later, would be a more reliable source of evidence than the contemporaneous business record.

251 The appellant's other contention in this regard is that the partnership's accountants prepared a set of interim accounts for the period to 31 March 1985, which recorded Jack as maintaining a capital account from 1 July 1984. It is said that this matter points to an inherent unreliability in the statement in the 21 January 1985 document that Jack had been paid in full for his interest in the partnership. It was said that the discrepancy called for an explanation by direct evidence.

252 However, the relevant items of the interim accounts of 31 March 1985 were treated by the accountants as errors which were subsequently corrected when they came to prepare the final accounts for the year ended 30 June 1985. The inconsistency between the contents of the 21 January 1985 letter and the 31 March 1985 capital account entries was explained, on the evidence, through business records which showed that the entries in the 31 March 1985 accounts were anomalous, and were subsequently corrected. The 1985 accounts are the subject of grounds 4.21 and 4.23 and are discussed in more detail later in these reasons.

253 Moreover, even if, as the appellant suggests, an inference should have been drawn that the oral evidence of the accountants would not have assisted the first to third respondents' case as to Jack's retirement, no error is shown in the judge's ultimate findings.

Grounds 4.20 and 4.22 (cash payments and Westpac undertakings)

255 These grounds allege, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred:

(a) in finding that a certain document recorded only cash payments made to Jack; and

(b) in finding that a banker's undertaking which referred to Jack, mistakenly recorded Jack as a partner because of a delay in the bank in updating its records.

256 The relevant findings are at reasons [417] and [423].

257 As to the former matter, the appellant contends that the document was intended to cover all assets transferred to Jack, not just cash payments, and that the 'omission' of any reference to the Barrett Street property is 'telling'. The submission cannot be accepted. The document on its face records only cash payments. The evidence of the author of the document was consistent with this.

258 As to the latter matter, the undertaking in question is a Westpac document. It is not a document of the partnership. Westpac issued a banker's undertaking in favour of the Shire of Mandurah dated 25 February 1985, the terms of which referred to it having been issued at the request of the partners of Italia Limestone, including Jack. The judge found that, as with Rudy's admission to the partnership, the various financiers with whom the partnership dealt took some time to bring their records into line with the changed arrangement (reasons [423]). The reference to Rudy in this context is a reference to the fact that CBFC Ltd, a financier, in its statements of account, had not shown Rudy to be a partner in 1985 even though he was a partner at that time (reasons [388]).

259 The appellant contends that it is 'inherently improbable' that Westpac, the partnership's banker, had not updated its records eight months after Jack retired if, in fact, Jack had retired from the partnership in mid-1984. The submission invites speculation and cannot be accepted. Moreover, the inherent probabilities of the matter are to be weighed in the context of the evidence as a whole. As the judge said (reasons [424]), the Westpac document represented a 'miniscule proportion of the documents in evidence relating to the affairs of the partnership after 1984, the others of which are only consistent with Jack's retirement from the partnership'.

Grounds 4.21 and 4.23 (Interim accounts as at 31 March 1985) Background

261 The partnership accounts prepared for the period ended 31 March 1985 showed Jack as having a capital account, with an opening balance for the year commencing 1 July 1984, and having certain drawings on the account.

262 The 31 March 1985 accounts were inconsistent with the accounts for the year ended 30 June 1985, and all accounts and tax returns thereafter, which omitted any reference to Jack as a partner. The partnership records also included a journal entry for the year ended 30 June 1985 which cancelled the opening balance of Jack's capital account as at 1 July 1984. The correcting entry in the journal is in these terms:

Being correction of opening balances (Giacomino Fazio [Jack] ceased as partner).

263 The judge found that the journal entry was only consistent with somebody having instructed its author that Jack had ceased to be a partner and that it was likely that the accounts for the period 31 March 1985 were prepared in error (reasons [418] - [419]).

264 There was also a journal entry with respect to 31 March 1985 which corrected drawings attributed to Jack and which stated:

Being tfr to correct a/c (entries incorrectly coded).

265 These grounds allege, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that he erred in:

(a) finding that the accounts for the period ended March 1985 were prepared in error, in circumstances where he should have found that the accounts were inconsistent with the partnership's accountants having been instructed that Jack had ceased to be a member of the partnership; and

(b) placing reliance on a journal entry in circumstances where there was no evidence of the identity of the person who prepared the journal entry or the identity of the person who provided the instructions for its preparation and/or in circumstances where the accounts prepared for the partnership and other entities at various times contained numerous anomalies or irregularities.

266 The appellant contends, correctly, that the reference to Jack maintaining a capital account in the 31 March 1985 accounts was both inconsistent with the execution of the business name form and the letter from the partnership's accountants dated 21 January 1985. However, the relevant competing hypotheses were either that the 31 March 1985 accounts reflected the true position, and that Jack did remain a partner from 1 July 1984, or that the interim accounts were incorrect in that respect and that they did not reflect the true position of Jack's status in the period from 1 July 1984. There was contemporaneous evidence in the form of the journal entries which supported the latter hypothesis. The weight of the rest of the evidence in the case including Jack's own conduct, also supported the latter hypothesis. The appellant pointed to two pieces of evidence in support of the former hypothesis - the Westpac undertaking and the CBFC letter. For reasons given elsewhere, neither carries any real weight on the question of whether Jack was a partner after 1 July 1984. The evidence relied upon by the appellant with respect to the former hypothesis has very little to commend it.

267 In relation to the journals, there is no suggestion that the evidence was objected to under s 79C(6) on the basis that the probative value of the statements in them was outweighed by a consideration that their admission may create undue prejudice. The appellant's contention, in effect, amounted to the proposition that because the author of the journal entry was not called, it had no probative weight. That submission cannot be accepted. As Hope JA observed in Albrighton v Royal Prince Alfred Hospital [1980] 2 NSWLR 542, 548 - 549, in the everyday carrying on of the activities of a business, people look to and depend upon business records and use them on the basis that they are most probably accurate. No doubt, mistakes may occur in the making of records, but it is reasonable to think that they would occur no more, and probably less often, than in the recollection of persons trying to describe what happened at some point in time in the past.

268 In this case, both journal entries appear regular on their face. There is nothing to indicate that oral evidence, presumably as to the instructions received by the accountants over two decades earlier for the purpose of preparing the journals, could have been expected to provide a more reliable source of evidence than the contemporaneous records themselves. I would not infer that direct evidence from the author of the journals would not have assisted the case of the first to third respondents. Furthermore, the journals are consistent with the preponderance of other evidence in the case that Jack ceased to be a partner as from 1 July 1984. The judge did not err in his findings, even if it be assumed that the judge should have inferred that direct evidence from the author of the journal would not have assisted the case of the first to third respondents on the question of Jack's retirement.

269 The other anomalies in the accounting records referred to by the appellant in his submissions do not assist in the identification of any relevant error. With the exception of the interim accounts of 31 March 1985, the accounting records from 1 July 1984 onwards were uniformly consistent with the proposition that Jack was not a partner of the partnership after 1 July 1984. The partnership's accounting records in this regard were also consistent with the partnership's tax returns, as well as Jack's statements of assets and liabilities and Jack's tax returns.

271 In August 1984, a company controlled by the Catalanos provided security for funds advanced by a financier, CBFC, to the partnership. The mortgage document had Jack's name typed in as a partner in two places, but his name was struck out by hand in both places and initialled, and Jack was not required to execute the mortgage. The judge found this to be additional evidence to support the conclusion that Jack had retired from the partnership with effect from 1 July 1984 (reasons [414]).

272 The judge also referred to a letter from CBFC dated 23 September 1985, which had referred to Jack as a partner, and upon which Ms Rebelo had made the notation that Jack was 'no longer involved with' Italia Limestone (reasons [415] - [416]).

273 The appellant contends, in effect, that the above evidence was incapable of providing any support for the inference that Jack had retired from the partnership in mid-1984.

274 The appellant contends, in particular, that the striking-through of Jack's name on the mortgage document is more consistent with Jack simply not being available at the relevant time to sign the document. This contention should be rejected. It is merely speculative in nature. There is no foundation for the suggestion that Jack was not available to sign the mortgage.

275 The appellant also contends that as Jack was referred to in CBFC's letter of 23 September 1985 as a partner, CBFC must have considered that Jack was still a partner at that time, and that 'accordingly the striking through of Jack's name on the 23 August 1984 mortgage document could not have involved, or been the result of, a communication to CBFC that Jack had ceased to be a partner'.

276 The judge's finding was not that there had been a representation to CBFC that Jack was not a partner, but rather that the execution of the mortgage document by the partners in August 1984 and the striking-out of Jack's name as a partner, provided some additional evidence in support of the proposition that Jack had retired from the partnership with effect from 1 July 1984. Whether CBFC understood Jack to be a partner or not does not diminish the significance to be derived from the fact that the partners, in executing the mortgage in August 1984, acted on the basis that the liability being incurred was not one which Jack was required to undertake for the partnership.

Ground 4.26 (Partnership accounts after 1984)

278 Ground 4.26 alleges, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in treating the partnership accounts after 1984 as having some evidentiary value on the question of the existence of any agreement with respect to Jack's retirement from the partnership.

279 The allegations are as follows. First, it is said that because Jack did not prepare the accounts after 1 July 1984, or receive them, they had no evidentiary value. Allied to this is the allegation that the accounts 'represented nothing more than a manifestation of Vince's subjective and idiosyncratic belief' that Jack was not a partner. Secondly, it is said that the accounts over 20 years contain numerous irregularities and anomalies, and were inherently unreliable. Thirdly, it was alleged that there were other documents, including documents prepared by the partnership's accountants, which record the partners differently from the judge's findings. Fourthly, in a letter dated 15 December 2003 to Jack, the partnership's accountants, did not unequivocally deny that Jack was a partner. Fifthly, it is said that the court should have inferred that the evidence of the Catalanos and of Mr Polglase (the accountant), would not have assisted the respondents' case.

280 I would reject the first point. The partnership accounts after 1 July 1984 record all the names of the partners said to be carrying on business under the name of Italia Limestone. They purport to be the accounts of the partnership trading under that name, and not just a set of accounts prepared idiosyncratically by or on behalf of Vince for his own idiosyncratic purposes. The accounts were admitted into evidence as business records and provide some evidence of the fact that for over 20 years after 1 July 1984, the persons carrying on the business of Italia Limestone did not include Jack. The fact that Jack, to his knowledge, did not cause to be prepared, or receive, partnership accounts of Italia Limestone after 1 July 1984 without demand or complaint for nearly two decades itself provides some evidence of the fact that he did not conduct himself as a partner over that period.

281 As to the second point, the appellant prepared a schedule of 32 alleged 'discrepancies' over a 21 year period from 1979 to 2000. Items 6, 8, 14, 16 and 17 of the schedule do not seem to record any 'discrepancy' at all. Some items refer to the absence of a record including Rudy as partner. With respect to these items, the appellant seeks to make a virtue of the other significant issue upon which he lost at trial, namely the allegation that Rudy was not a partner. In this appeal, the appellant contends that as Rudy was a partner, and as a number of documents do not include reference to him, then the documents about who the partners of the partnership were must as a whole, be unreliable. Nevertheless, the judge had expressly considered the matter and found that despite the omissions, the partnership accounts over a period of more than two decades were a reliable indicator of the membership of the partnership. His Honour said at [402]:

While it is clear from the other documents to which I have referred, that there have from time to time been documents prepared which omit reference to Rudy when a reference might have been expected, none of those omissions is of sufficient significance to displace the conclusion to be drawn from the documents as a whole.

282 If the accounting records to which the judge referred were sufficiently reliable to prove that Rudy was a partner in that period, there is no reason to think that they were unreliable insofar as they omitted reference to Jack over the period of in excess of 20 years.

283 Other items in the appellant's schedule address certain financial matters. None of the items in the schedule, individually or collectively, cast any doubt, in my mind, on the proposition that the accounts after 1 July 1984 were accurate insofar as they did not include Jack as a partner of the partnership.

284 As to the appellant's third point, the appellant has prepared a schedule alleging discrepancies in the identity of the partners in various records going back to 1956. Many again refer to the absence of a reference to Rudy. For the reasons given earlier, these items do not provide any evidence, or at least any compelling evidence, that the judge could give no weight to the partnership accounts for the period after 1 July 1984 with respect to the question of the identity of the partners of the partnership in that period. The items include reference to the interim 31 March 1985 accounts, which I have addressed earlier. The other items do not refer to any business records emanating from the partnership which record or include Jack as a partner in the period 1 July 1984 to 2007. Again, none of the items individually, or collectively seem to me to cast any doubt on the accuracy of the partnership accounts insofar as they omit reference to Jack as a partner after 1 July 1984.

285 As to the appellant's fourth point, it appears that Jack sought advice from Mario Cattalini of Francis A Jones & Associates Pty Ltd concerning access to partnership records. Mr Cattalini's advice appears to have been that Jack should approach Vince directly. Jack wrote to Vince without receiving a reply. He then wrote to Mr Cattalini on 8 December 2003, saying, in effect, that he had not had a response from Vince. In the same letter to Mr Cattalini, Jack said:

I hereby request from you all records pertaining to my partnership in Italia Limestone and to this day.

286 Mr Cattalini replied on 15 December 2003 to the effect that he had tried to establish whether Jack had continued as a partner after 1984, and had been unable to do so, and that he did not hold records going back to 1984. He added that he was not intending to state one way or another whether Jack had a 'legal right to be identified as a partner'.

287 By his fourth point, Jack contends that Mr Cattalini's response 'is wholly inconsistent with a belief that [the accountants'] instructions regarding the members of the Partnership were accurate'. As to this, Mr Cattalini's belief, in itself, would seem to me to be irrelevant on the question of whether Jack was a partner of the partnership as from 1 July 1984.

288 The appellant also contends that it should be inferred that Mr Cattalini spoke to Vince and Vince told him not to deny or confirm that Jack was a partner. I doubt that such an inference is to be drawn from the letter. Mr Cattalini had directed Jack to Vince in the first place, Vince had not responded, and Mr Cattalini's letter has the tone of an accountant who does not want to get involved in a family dispute. However, even if it is to be inferred that Vince told Mr Cattalini not to confirm or deny whether Jack had been a partner after 1 July 1984, it is difficult to know what to draw from that. Vince may have had his own reasons for the instruction at that time. It is certainly not an admission by Vince, let alone the partnership, that Jack had remained a partner after 1 July 1984. The postulated instruction, if given, seems to me to be of inconclusive value on the appellant's case on appeal, in the context of the evidence as a whole.

289 As to the fifth point, I have mentioned earlier that even if it should be inferred that the evidence of the Catalanos and of Mr Polglase would not have assisted the first to third respondents' case, that matter would not in itself dislodge the findings made by the trial judge.

Grounds 4.27 & 4.28 (business name form) Grounds

291 Grounds 4.27 and 4.28 allege, in effect, that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that Jack had executed the business name form in mid to late 1984 when there was no, or no sufficient, evidence to support that finding or from which to draw that inference;

(b) failing to find that Jack either had not executed the business name form, or that if he had executed it, then he had signed it without having 'an appreciation of what he was doing'.

292 The appellant in this appeal says that the business name form contained a signature which appeared to be Jack's. As noted earlier, the business name form stated that Jack had ceased to carry on business under the business name of Italia Limestone on 1 July 1984. It is not in dispute that the business name form was signed by the other partners and was lodged at the Corporate Affairs office. It was lodged on 10 October 1984. On the question of whether Jack had actually signed the form, Jack had pleaded that the document was a forgery:

The [business name] form...was not signed, or not knowingly signed by Jack Fazio and the signature thereon, which is purportedly his, is a forgery.

293 At trial both Jack and the first to third respondents called expert handwriting evidence. Jack's expert said that whilst he could not be dogmatic about it, in his opinion, the signature on the document was not written by Jack. However, he also observed that there was a wide variability in the specimen signatures provided to him for analysis emanating from Jack, 'indeed, to the point where he considered a number of the specimen signatures had also not been written by [Jack]' (reasons [431]).

294 The handwriting expert called by the first to third respondents said that the handwriting analysis could not conclusively determine whether Jack had signed the document, although it was significantly more likely that the author of the signature on the business name form was the same as the author of the specimen signatures provided for examination (reasons [430]).

295 In his principal witness statement, Jack did not say in terms that he did not sign the business name form. He said that he told a 'lady at the counter' at the office of Fair Trading in 2003 that it 'might be a forgery'. He also said 'I thought it was a possibility that it was my signature on the [business name form] - that [Vince's personal assistant] or my dad had shoved ... at me to sign without me reading it'. He also said that he had 'no memory' of signing the document.

296 In cross-examination, Jack's evidence was to the effect that he did not sign the business name form or, alternatively, if he did sign it then he did not know what he was doing.

297 Toward the end of the trial senior counsel for Jack and Maria appeared to retreat considerably from the allegation of forgery. He said:

I am not going to say your Honour ought find it is a forgery but I am going to say that it's possible, your Honour, that it might be a forgery and that's one of the factors your Honour should take into account when determining the matter.

But I will not be seeking any express finding of - well, I won't be seeking a finding of actual forgery.

298 The judge found (reasons [432] - [437]) that the business name form was executed by Jack in the middle or the latter part of 1984. In that regard, the judge, in effect:

(a) preferred the evidence of the first to third respondents' handwriting expert to the effect that handwriting analysis could not conclusively establish, one way or another, whether Jack had signed the document;

(b) did not accept Jack's expert evidence to the effect that the signature was probably not Jack's signature;

(c) found that it was improbable that Jack's signature had been forged;

(d) found that execution of the document by Jack and the other parties was consistent with other facts found by the judge; and

(e) rejected Jack's evidence that he could have signed it without appreciating the general tenor of its contents.

299 In support of these grounds, the appellant contends that the judge erred in preferring the evidence of the handwriting expert called by the first to third respondents over Jack's expert. No reason or explanation is offered in support of this contention. It is a mere assertion which is neither explained nor explicable.

300 The appellant also contends, in effect, that it is to be inferred that it is more probable than not that the document was executed shortly before it was lodged on 10 October 1984, and that the reference on the document to 22 June 1984 involved a 'backdating' of the document. For the reasons given by the judge at [434] - [435], that contention seems to be no more than conjecture, and none of the matters raised by the appellant in this appeal persuade me to the contrary.

301 Even if correct, the appellant's next and final step - the conclusion in the argument - is that, there was no basis for the court to find that the business name document was a 'genuine document'.

302 It is difficult to know what is intended by this last step in the argument. If it is intended to convey the notion that Jack did not sign the document at all, that seems to be inconsistent with the posited anterior step that it was signed shortly before 10 October 1984. If it is intended to convey the notion that Jack signed it, but did not know what he was doing, it is difficult to see how the alleged backdating of the document demonstrates his cognitive failure on the occasion that he did sign it. To the extent that the appellant's submissions impliedly contend that the judge erred in failing to find that Jack's signature was forged, they are inconsistent with the way Jack's and Maria's senior counsel ultimately conducted their case at trial.

303 Moreover, the appellant's contention does not address the judge's specific reasons [437] as to why he rejected Jack's evidence on this topic.

Grounds 4.29 & 4.30 (Usual indicia of partnership) Grounds

305 These grounds allege that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that the absence of the 'usual indicia' of partnership was a significant factor in circumstances where the court should have held that, in the circumstances of the partnership in question, an absence of some or all of the usual indicia did not detract from the likelihood of a person being a partner;

(b) finding that Jack had direct and personal interests in other dealings with Vince or with the partnership which were inconsistent with him remaining a partner after 1 July 1984.

306 The relevant finding is at [228], where the judge said: 'the plaintiffs [appellant] accept that after 1984 none of the usual indicia of partnership suggested that Jack remained a partner in Italia Limestone'. His Honour outlined the following eight findings in that regard:

(a) Jack did not receive any share of the partnership profits;

(b) Jack did not return any partnership income in his own taxation returns;

(c) Jack was no longer required to pay provisional tax in respect of anticipated partnership profits;

(d) Jack was called upon to sign legal documents relating to partnership affairs prior to 1984, but after 1984 was not called upon to sign any such documents;

(e) Jack never asked for, nor received partnership accounts after 1984, and never enquired, nor was he advised in any detail as to the state of the partnership's assets and liabilities until he asserted an interest in the partnership in December 2003;

(f) Jack was never called upon to contribute capital to the partnership;

(g) Jack was not called upon to guarantee any partnership borrowings after 1984, nor was it ever suggested that he would be responsible for partnership debts;

(h) in preparing statements of his own assets and liabilities for the purpose of borrowing, at no time after 1984 did Jack refer to a partnership interest in those statements, either as an asset or a liability.

307 By s 8(3) of the Partnership Act, the receipt by a person of a share of the profits of a business is prima facie evidence that he is a partner in the business. By s 16 of the Partnership Act, every partner in a firm is liable, jointly with the other partners, for all debts and obligations of the firm incurred while he is a partner.

308 The appellant's arguments are not entirely easy to follow. Apparently the point sought to be made by the appellant is that the 'usual indicia' of partnership referred to by the judge in connection with Jack, were equally absent with respect to Vince, Giuseppina, Rudy, Sam Catalano and Rosaria Catalano and that, accordingly, the absence of such indicia with respect to Jack is inconsequential in this case.

309 The appellant did not point to any evidence to the effect that Vince, Giuseppina, Rudy and the Catalanos did not share profits of the partnership after 1 July 1984 or were not responsible for the debts of the partnership after 1 July 1984. Moreover, the partnership accounts and tax returns show that they did share profits and were the persons responsible for the debts of the partnership after 1 July 1984. Further, the appellant did not point to any evidence demonstrating that after 1 July 1984, each of Vince, Giuseppina, Rudy and the Catalanos:

• was never called upon to sign documents relating to partnership affairs;
• never asked for, nor received, partnership accounts;
• was never advised in any detail as to the state of the partnership's assets and liabilities;
• was never required to pay provisional tax in respect of anticipated partnership profits;
• was never called upon to contribute capital to the partnership;
• never guaranteed any partnership borrowings;
• prepared statements of assets and liabilities which did not refer to a partnership interest as either an asset or a liability.

310 The appellant did point to some evidence by Rudy to the effect that although Giuseppina and Mrs Catalano did not work for the partnership they took their share of partnership profits. That evidence, however, is inconsistent with the point sought to be made by the appellant. It does not support it.

311 The appellant also referred to a part of Rudy's cross-examination. He pointed, in particular, to evidence where Rudy said, in effect, that only the male partners attended (informal) partnership meetings. Rudy also gave evidence that he considered that he contributed to the liabilities of the partnership by leaving money in the business to which he was otherwise entitled, and by giving guarantees. None of this evidence supports the proposition now alleged that the absence of the 'usual indicia' of partnership as referred to by the judge applied to the other partners after 1 July 1984.

312 Jack also alleges that he had personal interests, and dealings with other partners, whilst he was a partner in the period up to 30 June 1984, and that, consequently, his personal interests after 1 July 1984 did not point, one way or another, to whether he had ceased to be a partner after 1 July 1984. This submission ignores the question of degree. Jack's personal interests were extensive after 1984. Also, although the appellant points to Jack's wish to acquire a personal interest in the Miguel Sandpit business, the judge found that he did not acquire a personal stake, separate from his interest in the partnership, in the business (reasons [129]). The evidence and findings with respect to the Miguel Sandpit business do not provide a foundation for concluding that the judge erred in finding that Jack had ceased to be a partner from 1 July 1984.

313 Insofar as these grounds allege error in respect of the judge's other findings with respect to Jack's interests and dealings, the detail of the appellant's allegations appear in grounds 4.31 to 4.42. Accordingly, those matters are dealt with in the following section of these reasons.

314 The appellant also included a schedule to his submissions which described documents which are said to show Jack's 'involvement' in the partnership business after mid-1984. In a number of cases, the documents concern matters specifically covered elsewhere in the grounds of appeal, which I have addressed. The arguable relevance of others appears to be oblique at best. None of them demonstrate error by the judge.

Grounds 4.31 to 4.43 (Post-1984 transactions) Grounds

316 By these grounds of appeal, Jack contends that the judge erred in his findings in relation to four (out of the 13) transactions which Jack had relied upon at trial in order to demonstrate that he remained a partner after 1 July 1984.

317 The first transaction is the 'Lime Industries' transaction. Jack's evidence as to the transaction was, in my view, patently implausible for the reasons given by the judge at [241] - [245] and [247] - [248]. The appellant says, in effect, that if the implausibility in Jack's evidence as found by the judge were put to one side, it could be said that the 'way in which the transaction was negotiated supports Jack's evidence'. Even on that attenuated basis, the appellant's argument depends upon an assumption that the parties agreed the cash price for the transaction (but not the loans component it seems) by recognising that the partnership was owed, but had (unaccountably) failed to invoice, debts totalling $500,000, and that the partnership was forgiving that uninvoiced debt. The 'debt' and the 'forgiveness' are not recorded in the deed evidencing the transaction. That omission (if the appellant is correct) is surprising, to say the least. It is all the more surprising given that the deed makes express reference to the provision of other credit by the partnership and provides for the forgiveness of that debt in certain circumstances.

318 The suggestion that this court should infer, from the different figures for the cash component of the consideration which were exchanged in the course of negotiations, that the partnership was owed 'debts' of $500,000, which were not invoiced, and which were then 'forgiven', appears to be no more than an invitation to impermissible speculation.

319 The appellant raises a further point. Jack was given a 10% interest in the company which acquired the interests in Lime Industries. The other 90% of that company was held by Danehill, the trustee company which was, in effect, a corporate extension of the partnership. Jack's 10% interest is evidently held separate from the 'partnership' interest (via Danehill). Jack contends that his separate stake in the company is consistent with him remaining a member of the partnership on the basis, in effect, that the partnership had agreed to give him this 10% stake by way of a variation of the '1982 agreement' which, Jack now says in this appeal, was probably entered into in 1984. Jack says that it is improbable that Vince would have gifted him the 10% interest. As to this last point, the appellant did not refer the court to any evidence which indicated that as at this time, 1988-1989, Vince's attitude to Jack was such that he would not be prepared to include Jack, to a limited extent (10%) in a commercial venture of this kind without requiring payment from him.

320 Moreover, the alleged variation of the '1982 agreement' is itself improbable in that on Jack's own evidence, he never discussed it with Vince. Also, for the reasons given earlier, no error is shown in the judge having rejected Jack's evidence that he entered into the '1982 agreement' with the partnership. Having properly rejected the evidence of the alleged agreement, the allegation that the judge erred in failing to find a variation to the alleged agreement must also fail.

321 No error is demonstrated with respect to the judge's findings in relation to Lime Industries.

322 The next transaction is the 'Dawesville Quarry Land'. The uncontroverted facts are that Jack acquired certain land in Dawesville with a quarry on it, on his own account and for his own benefit. He then sold it to a competitor of the partnership. In relation to the acquisition, Jack negotiated the deal for himself and his associate, and only then asked Vince if he would wish to acquire half the interest. The judge found that there was nothing in this sequence that supported the appellant's case, and to the contrary, the fact that Jack negotiated the acquisition without reference to his father, in his own right, and the right of another associate, and then only offered his father a part interest in the property, is inconsistent with his assertion that he remained a partner in Italia Limestone, or that he believed he remained a partner (reasons [254]). The appellant's submissions do not explain why the judge's findings at reasons [254] are erroneous. In my view, they are correct.

323 On the subsequent sale of the quarry to a competitor, Jack's evidence was less than compelling and at one point he volunteered to the cross-examiner '... I am making a few mistakes here'.

324 The judge found that Jack sold the land to a competitor of the partnership at a time when Vince was himself interested in acquiring the land. The judge recorded that Jack had admitted that he had sold the land to the competitor at a price which was lower than that which he had been discussing with his father. The judge also found that it is unlikely that if Jack believed he was a partner, he would have sold the land to a competitor of the partnership without exhausting the possibility of a sale to Vince (reasons [258]).

325 These findings were plainly open on the evidence and no error is shown.

326 Next the appellant appears to suggest that the court should infer that the partnership itself was not financially in a position to purchase the land prior to Jack selling it to a competitor. Even if that were so, on the judge's findings, which have not been successfully challenged, there is no error in the judge's conclusion that there is nothing in the Dawesville transaction which supports the appellant's case, and that the events relating to the sale of the property support the respondent's case (reasons [259]).

327 The next transaction is the 'Rowley Road Sandpit'. There is no dispute that this was a transaction which Jack, at least initially, identified and in respect of which he pursued his own personal interest in the land. The judge found that Jack's evidence on this topic told 'very strongly against his credibility generally' (reasons [266]), and that his evidence as to the structure of the transaction was 'inherently implausible' (reasons [267]). These findings are not challenged.

328 The judge also found, based on Mr Lombardo's evidence, that by the time the third contract was executed on 31 May 1991 by Questdale, it was 'Vince who was the one who was pushing to acquire the land' (reasons [270]). Although Jack said that he had 'set up' Questdale and the Questdale transaction, the judge concluded that Jack's evidence should be rejected because of his lack of credibility 'with respect to this transaction and generally' (reasons [271]). None of these findings are challenged.

329 The appellant nevertheless contends, in effect, that there is a vestigial remnant of Jack's evidence which remains intact, namely that he concluded the negotiations for the transaction in 1991 on behalf of the partnership once it became evident to him that the pursuit of his personal interest would not come to fruition. The submission is sought to be bolstered by the evidence in chief of Maria and Mr Lombardo.

330 This submission fails for two reasons. First it cannot stand in the face of the unchallenged findings to the effect that it was Vince who was pushing to acquire the land by May 1991.

331 Secondly, it is inherently unmeritorious. Jack's evidence as a whole was implausible. Its unreliability cannot be quarantined in the manner suggested by the appellant. Maria's evidence-in-chief was so vague as to be barely admissible. Mr Lombardo's evidence lacked cogency because of the absence of specificity as to the nature and timing of Jack's involvement. Indeed, on one view of Mr Lombardo's evidence-in-chief, his meetings with Jack only covered the period up to late 1990.

332 No error is shown in relation to the judge's findings in relation to the Rowley Road transaction.

333 The next transaction concerns the 'G & R Wills Building'.

334 As I understand it, the following findings of fact are not challenged (reasons [294] - [299], [301], [303] - [305], [307]). A company, consisting of a syndicate of members, acquired a commercial building in Perth in 1988, using bank debt. Jack and Vince as individuals (through various corporate entities), were members of the syndicate. The partnership was not.

335 In 1990, the rent of the tenant of the building was insufficient to cover the mortgage payments. Matters got much worse in 1992 when the tenant left and the property fell vacant. The lender issued notices of demand to the company and unsuccessful attempts were made to refinance. The members of the syndicate were not making the required payments to the lender and the lender pressed for a sale. By September 1992, a further lender to the company, under another loan facility, was threatening a winding-up. Vince and Jack were guarantors of the company's liability under the other loan facility. By October 1992, a financier advised that it had assumed control of the marketing of the building for sale and had instructed solicitors to commence action under the loan facility.

336 The building was sold in July 1994 at a substantial loss to the syndicate members. Earlier in 1994, Italia Limestone had received an offer of finance conditional upon the sale of the building by the end of that year.

337 In these grounds, the appellant alleges, in effect, that the judge erred in failing to find that the only reason the building was sold was because it was in the financial interests of Italia Limestone to have it sold. The corollary appears to be that the other syndicate members sacrificed their own commercial interests by allowing the building to be sold in order to advance the interests of Italia Limestone, notwithstanding that they had no stake or interest in the partnership. The latter proposition is not only incredible, but unsupported by any evidence.

338 The judge's conclusions were clearly correct. These grounds are manifestly without merit.

339 There are two other matters raised by the appellant which, it is said, the judge erred in treating as insignificant. One concerns the Donnybrook business, about which Jack had given conflicting versions of evidence. Neither version of his evidence provided any material support for the proposition that Jack remained a partner after 1 July 1984 (reasons [280] - [284] and Jack's cross-examination). The other matter, involving an unpleaded topic, was clearly correctly described by the judge as a 'limited and insignificant event' (reasons [286]). No error is shown.

Grounds 4.45 & 4.46 (Sunday dinner in 1994)

341 By these grounds, the appellant alleges that the judge erred in law and in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that the evidence of Jack and Maria in relation to an incident in 1994 at a Sunday dinner, was inconsistent with Jack's case that he remained a partner;

(b) finding that Jack appreciated that it had been asserted in 1994 that he had no interest in the partnership or the Fazio family assets, when the court should have found that such an assertion was made no earlier than about 2002.

342 One could not expect there to be any clarity as to the recollection of words used at a family dinner some 16 years prior to trial, of which there is no objective contemporaneous record. Vince's version of the event is unavailable. The judge recorded Jack's inconsistencies within his own evidence, and Maria's inconsistencies with Jack's evidence. Rudy had no recollection of the event.

343 The evidence of the episode appears to me to be rather obscure. On one view of it, Jack's evidence is open to the construction that Jack understood Vince to say that he (Jack) was not receiving partnership profits and that Vince would ensure that he never would receive them whilst he was not working for the partnership.

344 The inference is also arguably open that Jack knew that Vince did not regard him as a member of the partnership. Overall, I am not persuaded that the judge erred in making the findings that he did, however even if an error were established, the error would not have undermined the ultimate conclusion that Jack had ceased to be a partner with effect from 1 July 1984.

Grounds 4.49 to 4.52 (Baptism June 2002 and 2003 correspondence) Grounds

345 The appellant alleges by these grounds that the judge erred in law and in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that the appellant's letter to Vince dated 19 November 2003 did not assert that he was a partner when, properly construed, the letter did contain that assertion;

(b) finding that the terms of the appellant's letter to Vince dated 19 November 2003 supported a conclusion that the appellant did not believe that he was a partner at the time when he ought to have found that that letter, or a subsequent letter, sent by the appellant to the partnership's accountants, was consistent with a belief by the appellant that he remained a partner in the partnership;

(c) finding that the appellant's understanding in 2003 as to his entitlement to partnership records was relevant to the issue whether the appellant understood in 1985, that a refusal by the partnership's accountants to provide him with copies of the partnership's records implied that he was not a partner;

(d) finding that the letter from the partnership's accountants dated 15 December 2003 must have been seen by the appellant as consistent with the adoption of a position that the appellant was not a partner.

346 The context for these grounds is another incident, in June 2002, addressed by the judge, the findings of which are also challenged by the appellant in submissions.

347 There was another family altercation on the occasion of the baptism of Sarina's son (Jack's nephew) in June 2002. There was an acrimonious business discussion. Rudy asserted that Jack had taken his share of the business when he got out years earlier. Jack was angry. He threw a coffee cup at Vince which missed Vince, and hit the wall. Jack understood at the time that the assertion was that he had no interest in the partnership or the family assets (reasons [325] - [327]).

348 Although there is no ground of appeal to this effect, the appellant submits that the proper inference to be drawn from this incident is that Jack then believed (ie, immediately prior to this incident in June 2002) that he was a partner, and that he reacted angrily when (on the appellant's case - if the 1994 dinner incident is disregarded), he understood for the first time ever that he was not regarded as a partner.

349 That proposition is unsustainable. For nearly twenty years Jack had not participated in the partnership business, he had not taken any financial or other responsibility for the business, he had not been treated as a partner in the business, and his own fiscal and taxation arrangements were conducted on the basis that he was not a partner. His reaction on this occasion was not one of an expression of surprise at hearing some news for the first time. Nor did he seek clarification or explanation, nor was it followed up with a letter of demand or the institution of proceedings to vindicate his legal position. His reaction was visceral. He threw a coffee cup at his father in anger. Jack's reaction is at least equally consistent with a sense of grievance that Vince and Rudy had maintained a full relationship, including a business relationship through the partnership, which he had not sustained, and a brooding recognition of the material benefits to Rudy which that implied in 2002. As noted below, the topic of the entitlements of Jack and his siblings was also on Jack's mind in 2003. By this time, the financial difficulties of the early 1990s had receded.

350 Nearly 18 months later, on 19 November 2003, Jack wrote a letter to Vince. The appellant contends that the judge erred in failing to find that this letter constituted an assertion by Jack, made to his father, that he was a partner. In my view, the judge was correct to find that Jack did not make that assertion. It was certainly not express, nor was it implicit. The letter was a tentative inquiry as to whether Vince (age 76) regarded Jack, as a son, as having equal claim on the family businesses and assets, along with the other two children, Rudy and Sarina. It is to be recalled in this context that Sarina was never a partner of the partnership. No doubt Jack thought that, given Vince's age, the time was propitious to make such an inquiry about how the children would be treated. It was signed 'your Eldest son'. No error, as alleged, is established.

351 Next, the appellant says that the judge erred in finding that it was improbable that Jack would not have asserted he was a partner, if he had believed that to be the case. Two reasons are advanced. One is that Jack had, in cross-examination, said that he wrote the letter with the assistance of Mr Lombardo. That may be so, but it was still Jack's letter. There is no evidence to suggest that Mr Lombardo prevailed upon Jack to omit such a claim. The second reason advanced is that Jack wrote to the accountant three weeks later and did assert that he was a partner. Again, I am not persuaded that the judge erred. Jack's letter dated 8 December 2003 to the accountant indicates that Mr Cattalini had told Jack that he should first obtain Vince's approval, before Mr Cattalini could release partnership documents. Yet, in the letter apparently written to Vince for that purpose, Jack makes no assertion to his father that he is a partner or that he had an entitlement to partnership documents. It was evidently easier for Jack to make the claim to the accountant than to make it directly to Vince - the person in the position best to address such a claim on its merits.

352 The next complaint, in effect, invites the court to infer that Jack's understanding of partnership entitlements changed between 1985 and 2003. There is no evidence to support that claim and the mere fact that there was a lengthy passage of time between those two dates does not in itself provide evidence of the claim.

353 The last complaint is that the judge should not have inferred that Mr Cattalini's letter of 15 December 2003 must have been understood by Jack as consistent only with the adoption of a position that Jack was not a partner. In my view, the letter would, at least, have signified to Jack, and Jack would have understood, that his claim to be a partner had not been accepted. That is somewhat different to the precise inference drawn by the judge, but the difference is immaterial. The ground of appeal (4.52) contends that any error is of such a nature that the judge had erred in the ultimate finding that Jack had retired from the partnership in 1984. Certainly, no error of that kind is established.

Grounds 4.44, 4.47, 4.48 & 4.53.1 - 4.53.3 (Delay) Grounds

355 By these grounds, the appellant alleges that the judge erred in law or in fact in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) finding that the appellant delayed in bringing proceedings when the court should have found that there was no material delay;

(b) finding that the appellant delayed in asserting his rights after the existence of the rights became contentious, whereas the judge should have found that the rights became contentious in 2002, that Jack asserted his rights in 2003, and that his rights were not denied at any time earlier than 2006;

(c) finding that a delay by the appellant in asserting his rights cast doubt over whether he believed he was a partner during the period of delay;

(d) failing to infer that the respondents, or Vince, knew that Jack was a partner from the facts that they had not denied that he was a partner subsequent to the letter of 8 December 2003, that Vince had not instructed solicitors when preparing his Will that Jack had retired, and that the respondents intended to transfer the assets from the sixth respondent (Roadstone Quarries Pty Ltd) to the eleventh respondent (Italia Stone Group Pty Ltd) for the purpose of defeating any claim that Jack might bring.

356 The judge had found that Jack appreciated at Sunday dinner in 1994 that it was asserted that he was not a partner. Although that finding is challenged (unsuccessfully), the other finding, that Jack knew from the baptism incident in June 2002 that it was asserted that he had no interest in the partnership or the family assets, is not challenged. Accordingly, it is accepted that Jack knew from at least June 2002 that any interest that he might claim was contentious.

357 I have referred earlier to Jack's letter to his father on 19 November 2003 in which he did not assert any interest in the partnership. The letter from the accountant dated 15 December 2003 involved a rejection of his claim for partnership documents which Jack did not pursue in Vince's lifetime. A further two and a half years passed without Jack making any claim to an entitlement to the partnership or the family assets. In April 2006, however, the claim was made in circumstances involving another family altercation, referred to below.

358 Jack's evidence was that in about April 2006, he rang Mr Levin, a solicitor then in the employ of Italia Limestone to organise a meeting with his father. Jack also rang Mr Cattalini and asked him to attend the meeting to discuss his partnership interest. According to Jack, he told Mr Cattalini that if he did not receive proper answers, he would place caveats on all the properties held in connection with the business. Jack attended his father's office for the purposes of the meeting. He said he heard his father speaking on the telephone to Mr Cattalini about whether Jack could put caveats on company property. After the call was completed, Jack told Vince that he was there to talk about his partnership interest. Vince told Jack, in emphatic terms, to leave. Jack then 'snapped'. He reacted violently and went on a 'rampage of destruction'. He 'started to break things including the granite boardroom table, chairs, windows, the front door, picture frames, and so on' (reasons [339]). Whilst destroying the property he claimed that one third of everything he was breaking (after deducting the Catalanos' interest) was his. The judge found that this sequence of events was explicable by reference to Jack's understanding that his claim of entitlement was disputed by Vince. Although Jack denied this to be the case, the judge rejected his evidence.

359 Shortly after the altercation at the office, Mr Levin assisted Vince to obtain a restraining order against Jack.

360 Shortly after this, Jack said that Mr Levin telephoned him to advise that Vince was looking at his Will, and that Vince would leave everything equally to his children. Mr Levin denied this. Although the judge had general reservations about Mr Levin's credibility, he preferred Mr Levin's evidence on this to Jack's. His Honour regarded Jack's evidence as 'inherently implausible'.

361 His Honour observed that having rejected Jack's evidence, he was 'left with no plausible justification for Jack's failure to commence these proceedings prior to his father's death' (reasons [341]).

362 As to the first alleged error, the appellant contends, as I understand it, that there were two compelling reasons why Jack delayed in bringing proceedings. One was that Jack had been assured by Vince, through Mr Levin, that he would be left one-third of everything in Vince's Will. The judge rejected Jack's evidence of this conversation on the basis that it was plainly inconsistent with Jack's rampage and with the fact that Vince, with Mr Levin's assistance, had just obtained a restraining order against Jack. The judge was undoubtedly correct to find that Jack's evidence was 'inherently implausible'.

363 The second reason advanced by the appellant is that, in effect, he was, at heart, a dutiful Sicilian son who, out of deference to his father, would not take action whilst his father was alive. The notion that Jack was restrained by a sense of filial deference is, at least from June 2002, impossible to accept on the evidence and findings of the judge.

364 As to the second alleged error, it is clear that Jack did not assert to Vince (or any other members of the partnership) any rights to an interest in the partnership in 2003. His letter to the accountant dated 8 December 2003 was unusual in that whilst he claimed an interest in the partnership as a precursor to his request for partnership documents, he had not asserted those rights against Vince. His recourse to the accountant without directly confronting Vince had led nowhere, and he remained mute with respect to any entitlement to an interest in the partnership for a considerable period of time thereafter. It is, in my view, inaccurate to say that Jack's rights were 'denied' until 2006. They had not been relevantly or sufficiently asserted to warrant a denial from the first to third respondents.

365 As to the third alleged error, it is not clear to me whether the appellant asserts that even if the other points with respect to delay fail, it was wrong for the judge to infer that the delay could cast doubt on Jack's asserted belief that he was a partner. If, as I find, none of the grounds have been made out with respect to delay, it was open to his Honour to infer that Jack's failure to assert his claims cast doubt on his alleged belief that he was a partner.

366 The fourth alleged error raises three points. The first alleges that it is to be inferred that the partners of the partnership failed to 'deny' that Jack was a partner after 2003 because they knew that he was a partner. As to this, the appellant accepts in this appeal that Jack knew from June 2002 that it was asserted that he was not a partner. No positive assertion was then made by Jack directly to any of the partners that he was a partner. The claim to the accountants, which accompanied a request for partnership documents, was never pursued. In these circumstances the judge was not in error in not finding that the respondents, by not communicating with Jack to say that he was not a partner, impliedly admitted that he was a partner. The second and third points are related. They relate to Vince's plans for the family and his business after his death. The appellant alleges that neither the instructions for Vince's Will, nor the Will itself, records any agreement by Jack to leave the partnership. That is so, but more importantly, the documents are consistent with an understanding that Jack was not a member of the partnership. The succession planning, as the judge found, involved Vince seeking to prevent any attack by Jack on the assets of the partnership. By this time, in late 2006, Jack had made known his plans to caveat partnership properties. The succession planning does not reflect an implicit admission that Jack was a partner. Rather, it reflects an intention, and a calculated and probably characteristic determination by Vince, to ensure that what he perceived to be his orderly succession planning, should not be disrupted by any claim whatsoever by Jack.

367 Grounds 4.44, 4.47, 4.48 and 4.53.1 - 4.53.3 should be dismissed.

Grounds 4.54 to 4.57 (alleged retirement - alleged other objective facts)

368 The appellant alleges that the judge erred in fact or in law in finding that Jack had retired from the partnership in 1984 in that the judge erred in:

(a) failing to find that the appellant's provision of labour to the partnership during July to October 1984 was inconsistent with the respondents' evidence of his retirement;

(b) failing to have regard to the fact that the appellant's alleged retirement was not in writing, contrary to s 37 and s 42 of the Partnership Act;

(c) preferring the evidence of the respondents' handwriting expert to that of the appellant's handwriting expert;

(d) finding that after 1984 no representations were made to Jack or to Maria to the effect that the appellant was a partner in the partnership when the court should have found that representations of that kind were made as alleged by the appellant.

369 As to the first alleged error, although Jack continued to work as a labourer up to about mid-October 1984, the judge also found, and it is not challenged, that he had completed his real estate course by this time and had commenced work in real estate as well. There may have been reasons why it was convenient for Jack to continue to draw wages for a few months after 1 July 1984 from the partnership, but the mere fact that he did so is not inconsistent with the proposition that he retired from the partnership with effect from 1 July 1984 and had the Barrett Street property transferred to him by September 1984 in consideration for his retirement from the partnership.

370 As to the second alleged error, neither party contended that there was a unilateral retirement by Jack. There was, accordingly, no basis upon which the judge needed to consider whether s 37 of the Partnership Act applied. Nor does the brief and enigmatic reference to s 42 disclose error.

371 As to the third alleged error, the contention that the judge ought to have preferred the evidence of the handwriting expert called by the appellant, remains unexplained and inexplicable.

372 As to the fourth alleged error, the appellant's contentions with respect to the judge's failure to find that representations had been made to Jack and Maria appear as part of grounds 5 and 6 in the appeal. Accordingly, those matters (which, as will be seen, have no merit) are dealt with when I address those grounds.

Grounds 5 and 6 (estoppel claims) Pleaded claims and background

374 The appellant pleaded two types of estoppel, both equitable in nature. One was promissory estoppel. The other was an estoppel concerned with the acquisition of proprietary rights, or proprietary estoppel.

375 The appellant pleaded that on the basis of the estoppels, Jack was beneficially entitled to two-ninths of the partnership assets, and also to one-third of the Fazio family assets other than the partnership assets.

376 The appellant's estoppel claims included pleas to the effect that:

(a) at all material times since 1961 Jack believed and expected that:

(ii) two-ninths of the partnership assets were his property; and

(ii) one-third of the Fazio family assets, other than the partnership assets, 'were to be transferred to him on or before the death of [Vince]';

(b) Vince knew of and encouraged, or alternatively induced, those beliefs and expectations; and

(c) in reliance on those beliefs and expectations, and with the knowledge and encouragement of Vince, Jack contributed to the partnership and contributed to the wealth of the Fazio family in various respects.

377 In the pleaded claim with respect to two-ninths of the assets of the partnership, it was not alleged that Jack believed that he was a partner, and that all the partners of the partnership were estopped from denying that he was a partner. Also, it was not alleged that Vince acted with the actual or apparent authority of the partnership, or even with the authority of Giuseppina and Rudy. Nor was it simply alleged that some portion of Vince's share of the partnership was held on trust for Jack. Although there was a plea that any property received by Giuseppina and Rudy was impressed with a trust in favour of Jack on the basis that they received property either as volunteers or knowing of Jack's alleged beneficial interest, that plea assumes, rather than purports to establish, the existence of Jack's claimed beneficial interest in the partnership assets.

378 The estoppel plea with respect to one-third of the Fazio family assets rested in substance on three statements by Vince allegedly made in 1976 and 1977. The last pleaded act of any arguable detrimental reliance occurred in 1979. Although Jack also referred to having filled out a form in 1990, his evanescent conduct on that occasion as a cipher could not arguably amount to detrimental reliance to found the estoppel claim to a third of the Fazio family assets.

379 The estoppel claim with respect to one-third of the Fazio family assets was described by the judge, with some justification, as one of extraordinary breadth (reasons [452]). In DHJPM Pty Ltd v Blackthorn Resources Ltd (formerly called AIM Resources Ltd) [2011] NSWCA 348 [44], Meagher JA (Macfarlan JA concurring) observed that:

[B]ecause of the different characteristics which give rise to the different species of equitable estoppel, it is necessary ... to attend carefully to the identification of the assumption or expectation which the object of the estoppel is said to be estopped from denying or asserting. This also directs attention to the relevant doctrine which must then be applied in a disciplined and principled way. (references and citations omitted)

380 Insofar as it was alleged that Jack believed, from 1961, that he would have one-third of the Fazio family assets transferred to him 'on or before' Vince's death, it is difficult to discern the true nature and scope of Jack's alleged expectation and belief. In particular, it is not clear whether it is said that Jack believed that Vince had any right to deal with any of the assets he acquired from time to time in the course of his lifetime without first transferring a third interest in each asset to Jack, or whether Jack believed that Vince could acquire and dispose of assets from time to time over his lifetime, providing either that Vince (in effect on his deathbed) assigned a one-third interest to Jack with respect to all of the assets then in existence, or Vince made provision to that effect in his will. A belief of the former kind has an air of commercial unreality about it. The latter is, for all intents and purposes, a belief or expectation concerning the testamentary intentions of Vince, the fulfilment of which could be contingent upon a variety of tangible and intangible factors which, over a lifetime, might emerge to influence the fortunes and circumstances of the family as a whole and individual members within it, and to affect the bonds and relationships between members of the family. This appeal may be disposed of without a consideration of whether statements by Vince had the quality of an assurance or promise upon which a proprietary estoppel might be founded: cf Gillett v Holt [2001] Ch 210, 228 (the very particular circumstances of which were explained in detail at 214 - 224); Barnes v Alderton [2008] NSWSC 107 [53] - [58]; Butler v Wilson [2011] NSWSC 262 [61] - [66]; Thorner v Major [2009] UKHL 18; [2009] 1 WLR 776. Nor is it necessary to consider whether a necessary element of proprietary estoppel is that the assurances given to the claimant should relate to identified property owned, or about to be owned, by the defendant: cf Thorner v Major [61] - [63].

381 The judge rejected the estoppel claim with respect to the partnership assets (reasons [445] - [449]). The judge addressed separately, and also rejected, the estoppel claim with respect to one-third of the Fazio family assets (reasons [452] - [460]).

382 The appellant alleges (with respect to reasons [452] - [460]) that the judge erred in law or in fact in:

(a) failing to find that the respondents were estopped from denying that the appellant had an entitlement to a one-third share of the Fazio family assets or that one-third of the Fazio Family assets were held on trust for the appellant (ground 5);

(b) finding that no representations were made to Jack or Maria to the effect that the appellant would receive one-third of the Fazio family's wealth, when the court should have found that such representations were made as alleged (ground 6).

383 A number of preliminary observations may be made about these grounds. First, they relate (in terms and by reference to the paragraphs the subject of the judge's reasons) only to the estoppel claim with respect to one-third of the Fazio family assets. The grounds do not challenge the judge's findings with respect to the partnership estoppel claim. Secondly, the first ground (ground 5) does not assert, in any comprehensible way, relevant error. It does not identify any particular errors of fact or law. This is a case where, on the appellant's pleading, matters relevant to the estoppel case commenced in 1961 and spanned many years thereafter. Two kinds of equitable estoppel were alleged. The judge made findings, giving explicit reasons, for rejecting each of the equitable estoppels alleged, and did so by drawing on much of his earlier findings with respect to the relationship between the parties and the course of events over many years. The ground, to a very serious degree, fails to comply with the requirement as explained by Malcolm CJ in Festic v Atkinson (Unreported, WASCA, Library No 8484, 19 September 1990) that:

It is essential that grounds of appeal should be formulated with clarity. The manner in which the learned trial Judge is said to have erred in law or in fact should be clearly identified.

384 The second ground lacks utility because even if the judge erred in not finding that certain representations were made, the ground does not challenge the findings (reasons [459]) that Jack did not form a belief that he was entitled to one-third of the assets, and that even if he had formed the belief, he had not acted in reliance on it.

385 The appellant's submissions in support are cursory to the point of being perfunctory. In this regard, the nature and scope of the submissions in support appear to bear an inversely proportional relationship to the breadth of the first ground (ground 5).

386 Limited as they are, the submissions might also (it is not clear) appear to stray, impermissibly and without leave, into a challenge to the judge's findings with respect to the partnership estoppel claim. In any event, nothing in the submissions demonstrate any error by the judge (reasons [449]) with respect to the partnership estoppel claim.

387 As to the estoppel claim with respect to one-third of the Fazio family assets, the submission is to the effect (which is really confined to the second ground of appeal, ground 6) that the judge erred in finding that certain statements were not made by Vince to Jack and Maria because, it is said, the judge found that their demeanour did not warrant the rejection of their evidence. The appellant referred in that regard to [53] of the judge's reasons, the effect of which I have set out earlier in these reasons.

389 First, the judge said, in effect, that based on their demeanour in court, the impression given was that Jack and Maria were 'in general' doing their best to provide honest and reliable evidence, 'but that their perception, and the accuracy of their recollections, have been overtaken by the [familial] conflict' and, further, that '[i]n some instances ... their evidence has been fashioned to assist the case which they seek to advance' (reasons [53]). Accordingly, even if the adequacy of the judge's findings was to be examined simply by reference to his general observations on demeanour at [53], those observations could not of themselves conceivably support the conclusion that the judge must be in error because he failed to accept Jack's and Maria's evidence.

390 Secondly, in any event, the argument suggests that the judge was required to accept the evidence of Jack and Maria providing that he did not form an unfavourable view as to their demeanour. That is not so. In Watson v Foxman, to which I have referred in [44] above, McLelland CJ in Eq said at 319:

Furthermore, human memory of what was said in a conversation is fallible for a variety of reasons, and ordinarily the degree of fallibility increases with the passage of time, particularly where disputes or litigation intervene, and the processes of memory are overlaid, often subconsciously, by perceptions of self-interest as well as conscious consideration of what should have been said or could have been said. All too often what is actually remembered is little more than an impression from which plausible details are then, again often subconsciously, constructed. All this is a matter of ordinary human experience.

Each element of the cause of action must be proved to the reasonable satisfaction of the court, which means that the court 'must feel an actual persuasion of its occurrence or existence'. Such satisfaction is 'not ... attained or established independently of the nature and consequence of the fact or facts to be proved' including the 'seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding': Helton v Allen [1940] HCA 20; 63 CLR 691 at 712.

391 The above observations have been regarded as having general application and as equally applicable to the sufficiency of proof of representations in a claim for equitable estoppel: Lewis v Lewis [2001] NSWSC 321 [70] (Hodgson J).

392 In this case, the evidence of Jack and Maria was contested in cross-examination, and was controverted by Giuseppina and Rudy. Moreover, the judge found (and grounds 5 and 6 do not challenge the findings), that Jack's and Maria's evidence was 'inherently implausible' and inherently improbable (reasons [454], [456] - [457]). The submission that the judge was bound to accept the evidence of Jack and Maria in these circumstances is misconceived.

393 Thirdly, as already indicated, the findings of an absence of belief and an absence of reliance are not challenged in grounds 5 or 6.

395 Grounds 1 to 3 concern the terms of the partnership as it existed in 1968 between three families, the Fazios, the Catalanos and the Mignaccas. It was not in dispute that the Mignaccas had retired from the partnership by about 1976.

396 These grounds relate to a document, described on its face as 'Deed of Partnership' and which, on its face, had been executed by the Catalano and Fazio families, but not the Mignaccas. The typed text of the document referred to June 1968 with a blank space left for the insertion of the relevant date, which had not been completed.

397 The appellant's case at trial was that it should be inferred that this document had been executed by the Mignaccas or, if not executed by the Mignaccas, had been adopted by all the partners as governing the terms of their partnership. The judge declined to draw that inference and grounds 1 to 3 of the appeal contend, in effect, that the judge erred in not drawing the inference for which the appellant contended.

398 The document was found in Mr Mignacca's papers by his son in 2003 and Mr Mignacca's son first gave it to the appellant in 2007, following the death of the appellant's father. The appellant said, however, that he had seen it in or about 1979 in a box of documents. The judge doubted that he did see it, but noted that the appellant had not asserted that he saw a version of the document signed by the Mignaccas (reasons [75]).

399 The judge's reasons for not inferring that it was executed by the Mignaccas or adopted by the partners as governing the terms of the partnership were, in essence, as follows:

(a) there was no evidence that the document was ever referred to or relied upon by anyone in the conduct of the partnership: [62];

(b) the document was prepared by solicitors and it would be expected that the solicitors would secure execution and stamping, yet there is no version of such a document in existence: [68];

(c) draft documents for the dissolution of the partnership upon the retirement of the Mignaccas in 1976 refer to the business being carried on under a verbal agreement, indicating that someone involved with the partnership had instructed solicitors, at or about that time, that there was no written partnership agreement: [69] - [72];

(d) although Jack's evidence was that he saw the document in about 1979 at Italia Limestone, he does not assert that he saw a version signed by the Mignaccas: [75];

(e) no other version of the document has been discovered by any party to these proceedings: [62].

400 None of the above findings are challenged by the appellant. The appellant, nevertheless, contends that the 'inference properly arising' is that the deed was signed in counterparts, and that the Mignaccas had executed their counterpart and given it to the other families, because otherwise an unsigned version would not have been kept in Mr Mignacca's papers all these years. The appellant also contends that the respondents' failure to adduce evidence from Giuseppina and the Catalanos 'regarding' the document should result in the court drawing the inferences contended for by the appellant.

401 The judge's unchallenged findings provide sound reasons for rejecting the inferences propounded by the appellant. No error is shown. The postulation that an unsigned copy would not have been amongst Mr Mignacca's papers unless there were executed counterparts is mere conjecture. There was no evidence that the document had been signed by the Mignaccas. There was no evidence which called for an explanation by the Catalanos or Giuseppina. The submission that the absence of evidence on the topic by the Catalanos or Giuseppina weighs in favour of the appellant's case on this issue, reflects an impermissible attempt to use the rule in Jones v Dunkel to fill the gaps in the evidence of the appellant's case.

402 Moreover, the point goes nowhere. At trial the appellant sought to rely on the document on the basis that there were terms to the effect that a partner was prohibited from transferring an interest in the partnership without the consent of the other partners and which gave any of the other partners the right to require a partner in breach of that term to retire from the partnership and to sell his or her interest to the other partners. The appellant had alleged that Mr and Mrs Fazio had transferred, by gift, part of their interest in the partnership to Rudy in 1976 and thus breached the agreement, entitling the appellant to require his parents to retire from the partnership and to sell their partnership interests to him, which rights he had exercised by notices dated 28 February and 6 March 2008.

403 The judge found, in effect, that even if the terms of the 1968 document did govern the partnership arrangements at the time, the appellant's notice seeking to compel retirement of his parents was not served within one month of the appellant becoming aware of the relevant breach (reasons [66]). The judge found that Rudy was admitted as a partner with the consent of the appellant (reasons [380] - [381]). These findings are not challenged by the appellant. Accordingly, grounds 1 to 3 serve no utility because the appellant had consented to Rudy's admission to the partnership and therefore there was no relevant breach and, in any event, the notice did not comply with the requirements of the document as it was given long after the appellant became aware of Rudy's interest.

405 The appellant alleges that the judge erred in law or in fact in finding that none of the assets belonging to the fifth to thirteenth respondents were held in trust for the partners of the partnership.

406 It is also alleged that the judge erred in law or in fact in finding that the real estate assets used for the purposes of the partnership's trading activities were held by corporate entities in which the partners had an interest equivalent to their interest in the partnership, whereas the judge ought to have found that the shareholdings, and the beneficial interests in trusts for which such entities were trustees, were not held in equivalent proportions to their interest in the partnership.

407 It was also alleged that the judge erred in law or in fact in finding that the appellant's claim was not pleaded on the basis of invoking the principles in Barnes v Addy (1874) LR 9 Ch 244 and that the court should have found that such a claim was raised by pars 43, 43A and 44 of the statement of claim and its particulars.

408 In light of the conclusions reached with respect to grounds 1 to 6, it is unnecessary for me to address these grounds in detail. The following observations are sufficient. I see no error in the judge's findings at [461] - [467]. No adequate basis for the claims had been pleaded or particularised and the appellant's statement of claim read more like a general indorsement than a statement of the material facts that would need to be proved to establish the claims. The particulars did not, in my opinion, cure the defects and there was manifestly no articulated claim on the basis of the second limb of Barnes v Addy. These grounds should also be dismissed.

409 By the notice of contention, the first to third respondents contended that the decision by the primary judge should be affirmed on various other bases, including abandonment in favour of the Fazio partners, acceptance of alleged repudiation by Jack, and various alleged limitation and equitable defences, including laches.

410 As indicated previously, I would, had it been necessary, have allowed the notice of contention insofar as it alleges that Jack abandoned his interest in favour of the Fazio partners.

411 The first to third respondents also alleged that there was a dissolution of the partnership by reason of what is alleged to be Jack's repudiatory conduct in mid-1984. The question of repudiation under the common law requires careful attention to the contract and its precise terms (and not, for this purpose, the equitable obligations attaching in consequence of the resulting relation), the characterisation of terms as essential, 'intermediate' or non-essential, the nature of the alleged breach, whether the repudiation alleged is renunciatory in character or a breach of a term which would justify termination by the other party at law, and the efficacy of the purported acceptance of the repudiation. On the question of repudiation, see generally Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61; (2007) 233 CLR 115 [44] - [56].

412 Termination as a result of abrogation or abandonment, and termination as a result of acceptance of repudiatory breach, both involve the discharge of further performance of the contract, but in the latter case, the innocent party maintains the right to sue for (common law) damages for the breach. Each is an aspect of the common law concerning contracts. The law is that the former effects a dissolution of the partnership. The New South Wales Court of Appeal has found that the latter may also effect a dissolution: Ryder v Frohlich [127] - [133]. There is dicta and authority to the contrary in England: Hurst v Bryk and Mullins v Laughton [2003] 2 WLR 1006 [86] - [93]. It seems to me, with respect, that if, at law, the contract from which the relation 'springs' (see Booth v Booth (27)) has been validly terminated at law (and assuming there is no equitable constraint on the innocent party exercising its legal right to terminate, eg, an equitable estoppel), it is difficult, at least prima facie, to envisage that relation subsisting. However, the point, although the subject of some written submissions, was not tested in the heat of debate at the hearing of this appeal, and it is unnecessary to express a concluded view for the disposition of this case.

413 Nor, in light of the conclusions reached earlier, is it necessary to address the claim for laches, the other alleged defences with respect to delay, and the other aspects of the notice of contention.

414 In my view, each ground of appeal fails, and the appeal should be dismissed.