Plaintiff v Defendants

1 Simon Braham ('Braham') is an ear, nose and throat surgeon and the director of Braham Investments Pty Ltd ('plaintiff'). The third defendant, Charles Wantrup ('Wantrup'), is and was at all material times a solicitor trading as Wantrup & Associates. Since this proceeding commenced, the first defendant, Sovereign MF Ltd ('Sovereign'), and the second defendant, Eos Janus Capital Pty Ltd ('Eos'), have gone into liquidation.[1]

2 These proceedings relate to three separate transactions concerning three payments made by the plaintiff to Wantrup & Associates over the period of December 2011 to September 2012 in connection with the plaintiff's investments in a café business in Prahran and a 'Land Fund' in Tarneit, both in Victoria. Each of those investments was managed by Sovereign, involved Eos, and each also involved Wantrup & Associates receiving, banking and disbursing the funds provided by Braham by means of the three payments in issue. The total of the three payments was $1.1 million .

3 The three relevant payments, in each case from the plaintiff to Wantrup & Associates, were as follows:

(a) the first payment; a payment of $500,000 was made on 8 December 2011 ('the first payment'), relating to a proposed investment in the redevelopment of a café known as 'Kush' in South Yarra in the State of Victoria;

(b) the second payment; a payment of $100,000 was made on 22 August 2012 ('the second payment') in relation to a proposed further investment in respect of Kush;[2]

(c) the third payment; a payment on 26 September 2012 ('the third payment') of $500,000 in connection with the Tarneit Land Fund.

4 The first payment and the second payment were each made by the plaintiff and were deposited into Wantrup & Associates' general trust account ('Wantrup Trust Account'). In relation to the first payment the plaintiff transferred funds by EFT into the Wantrup Trust Account. In relation to the second payment, Wantrup received a cheque from the plaintiff made payable to 'Charles Wantrup & Associates Trust Account'. In respect of the third payment, the plaintiff provided a bank cheque made payable to 'Charles Wantrup & Associates',[3] which was deposited in the Wantrup & Associates general office account.

5 Each of the above three payments by the plaintiff was made following meetings and discussions between Braham and Nickolas Giorgio ('Giorgio') who was a Director of both Sovereign, the first defendant, and Eos, the second defendant, at all material times until their liquidation.[4]

6 Prior to the three above transactions in issue, the plaintiff, Sovereign, Eos and Wantrup, were involved in several investment enterprises, some of which are alleged by the plaintiff to be material to this proceeding.

7 The plaintiff claims that the first, second and third payments to Wantrup in relation to the Kush and Tarneit land investments were to be held on trust by Wantrup and were not to be disbursed without further direction from the plaintiff and finalisation and execution of documentation reflecting Braham's agreement to invest in the said investments and securing Braham's investments.[5]

8 The central and key question which in the above circumstances arises in this proceeding is whether the plaintiff's moneys received by Wantrup & Associates were held in trust on behalf of the plaintiff, subject to certain conditions, or were held by Wantrup on behalf of his client, Sovereign.

9 The dramatis personae in this matter are as follows:

(b) Wantrup, Australian lawyer trading as Wantrup & Associates, Solicitors, and at all relevant times was acting as the solicitor for Sovereign;

(c) between 8 June 2012 and 26 April 2013, Wantrup was a non-executive Director of Sovereign and from 21 December 2012 a shareholder of Eos in his capacity as trustee of the Kalidonis Family Trust;

(d) the plaintiff also pleads that from prior to November 2011 Wantrup was Eos' solicitor;[6]

(e) Sovereign, at all times from 12 May 2003, held an Australian Financial Services Licence number 238142 pursuant to which it acted as Responsible Entity for the Sovereign Aged Care Property Fund and the Sovereign Tarneit Land Fund;

(f) at all material times in connection with projects for which Sovereign was Responsible Entity, including the Aged Care Property Fund and the Tarneit Land Fund, Eos:

(ii) received from Sovereign funds invested by investors in the projects; and

(iii) disbursed funds and made payments on behalf of Sovereign in respect of the projects;

(g) Nickolas Giorgio is and was at all material times from:

(iii) together with Michael Kalidonis, the controller of each of Sovereign and Eos;

(h) at all relevant times Demian Walton ('Walton') of B2B Lawyers acted as solicitor for the plaintiff and Braham;

(i) Krema Pty Ltd was an entity associated with Sovereign.

10 The parties in essence allege the following in relation to the three payments in issue.

11 Following a meeting between Braham and Giorgio in November 2011 at a restaurant in South Yarra, Victoria, the plaintiff transferred $500,000 into the Wantrup Trust Account in relation to his investment in the proposed redevelopment of the Kush Café, also in South Yarra. The transfer, as the plaintiff acknowledges, served 'to demonstrate [Braham's] interest in the proposed investment' in the Kush Café.[7] This first payment was deposited by the plaintiff electronically on 8 December 2011 into the Wantrup Trust Account.[8]

12 Wantrup denies any intent or agreement that the money was to be, or was, held on trust for the plaintiff.[9] The relevant trust account receipt in relation to the first payment records that the $500,000 was received on behalf of Sovereign as an 'investment'.[10]

13 At a further meeting on about 15 or 16 August 2012[11] at a restaurant or café in South Yarra, between Giorgio and Braham, Giorgio, on behalf of Sovereign, invited the plaintiff to invest a further $100,000. The plaintiff alleges that those further funds were required in relation to the Tarneit Land Fund to 'demonstrate the plaintiff's interest in the proposed further Tarneit investment'.[12] On 22 August 2012, the plaintiff deposited a further $100,000 into the Wantrup Trust Account.

14 On 21 September 2012, following an earlier meeting in August 2012 at a restaurant in South Yarra at which Giorgio had informed Braham that a further $500,000 would be required for the Tarneit Land Fund investment, Braham provided Wantrup with a cheque for that amount payable to Wantrup & Associates, after providing an initial cheque which was dishonoured.[13] This third payment was deposited into the Wantrup & Associates' General Office Account[14] on 26 September 2012.

15 Accordingly, the total amount paid by the plaintiff to Wantrup & Associates as a result of the three above payments was $1.1 million. It is that sum, which it appears has been lost as a result of the investments to which it was applied being unsuccessful, plus interest and costs, which the plaintiff now claims in these proceedings.[15]

16 The plaintiff does not allege any fraud or dishonesty in relation to the three subject payments and associated transactions.

17 In these proceedings the plaintiff in essence seeks to recover the money he provided in relation to the ultimately unsuccessful investments in the 'Kush' café and the Tarneit Land Fund via his claim that the $1.1 million he provided was always impressed with a trust and provided subject to certain conditions.

18 The plaintiff also seeks relief in the nature of equitable compensation and damages, and a declaration as against all defendants, to the extent that they continue to hold any part of the $1.1 million, that they hold that sum on trust.

19 Wantrup denies any liability to the plaintiff in relation to the three payments.

20 Wantrup by his Further Amended Defence dated 15 March 2016 also maintains that if he is liable to the plaintiff in respect of the claim, that claim is an 'apportionable claim' and Wantrup seeks redress against the first and second defendants as concurrent wrongdoers.[16]

21 The remaining issues in the proceeding are whether Wantrup in the circumstances held the plaintiff's money subject to fiduciary duties, and whether Wantrup is in breach of his fiduciary duties or of his obligations under the Legal Profession Act 2004 ('the LPA'), together with an associated issue as to the plaintiff's ability to bring a private action under s 3.3.14 of the LPA.

22 The determinative issues in this proceeding are summarised in a series of questions which the plaintiff has posed in its Closing Submissions as follows:

Wantrup received 3 amounts totalling $1.1 million from the plaintiff. He disbursed each amount on the instructions of Sovereign. The following fundamental questions arise:

(i) on whose behalf did Wantrup receive each amount? In other words, at the time of each payment, who was the beneficial owner of the moneys;

(ii) did the plaintiff pay the moneys to Wantrup with the intention that Wantrup would hold them on trust for the plaintiff;

(iii) alternatively, did the plaintiff pay the moneys with an intention that, upon receipt by Wantrup, Sovereign would become the beneficial owner of the moneys;

(iv) did the plaintiff manifest an intention to transfer beneficial ownership of the moneys (before or after they were paid to Wantrup)? [17]

23 The additional further questions arise for determination in this proceeding:

(a) whether, as claimed by the plaintiff, s 3.3.14 of the LPA confers a private right of action in the circumstances, and whether in any event in respect of that asserted cause of action the moneys in question were trust moneys within the meaning of the LPA; and

(b) ancillary questions, including, if liability is established in the third defendant whether that liability should be apportioned amongst concurrent wrongdoers pursuant to Part IVAA of the Wrongs Act 1958 (Vic).

24 The plaintiff submits that the primary question in this proceeding relates to intention, namely with what intention did the plaintiff make the relevant payments, in particular did the plaintiff transfer the funds in issue with the intention that Wantrup would hold them in trust for the plaintiff, or that Sovereign should hold those funds beneficially.[18]

25 The plaintiff claims that Wantrup held the moneys in relation to the three payments in issue in the Wantrup Trust Account:

(a) on trust for the plaintiff, to be disbursed only on the plaintiff's instruction;

(b) alternatively, that Wantrup owed the plaintiff a duty under s 3.3.14 of the LPA to hold the moneys in the Wantrup Trust Account for and on behalf of the plaintiff, to be disbursed only on the plaintiff's instruction; or

(c) that Wantrup owed the plaintiff fiduciary duties with respect to the moneys to act prudently in the plaintiff's best interests in dealing with those moneys, to observe the terms upon which the moneys were entrusted, and to disburse them only on the plaintiff's instruction.[19]

26 Wantrup denies the above claims[20] and asserts that even if any moneys were held on trust, they were held on behalf of Sovereign, not the plaintiff.[21]

27 The plaintiff's emphasis is on the plaintiff's intention when Braham made the relevant transfers and the argument that Wantrup ought to have appreciated that the moneys were paid with the intention that they be held on trust, given the prior conduct and communications at the time of the payments.

28 Further, the plaintiff's case is that Wantrup dealt with the moneys (prior to disbursing them absent plaintiff's instructions) in a way consistent with holding the moneys on behalf of the plaintiff.

29 Wantrup emphasises that the relevant intention to create an express trust is that of both parties, to be determined by words and facts known to both parties and that this intention must be communicated to the alleged trustee.[22] Wantrup's submission is that there must be a mutual intention on the part of Braham and Wantrup to create an express trust in relation to the first, second and third payments.

30 Wantrup submits that what is determinative is whether it was the parties' intention that Wantrup would hold the moneys in question on trust for the plaintiff, to be released only on the plaintiff's instruction.

31 The plaintiff observes, and Wantrup agrees, that intention to settle a trust must be determined objectively.[23] In this respect, the plaintiff points to the fact that the first payment of $500,000 was deposited into the Wantrup Trust Account and not provided to Eos or Sovereign directly. The plaintiff relies on this circumstance as part of its asserted proof of Wantrup's knowledge that he was not to dispose of the money however and whenever the investors saw fit, or that Eos or Sovereign were to enjoy beneficial ownership of the money, but rather that money was to be held on trust until further instruction by a solicitor bound by equitable and statutory duties.[24]

32 Wantrup submits that Braham did not reserve beneficial ownership in the moneys transferred by the three payments to itself.[25]

33 The plaintiff also contends that Wantrup's knowledge of the nature of the proposed trust that it relies upon can in part be implied from the course of past conduct between the parties, which establishes what the plaintiff asserts to be 'the interests and expectations' of the parties.[26] The plaintiff asserts that the past conduct it relies upon is consistent with Wantrup holding the subject moneys on behalf of the plaintiff and/or those moneys only being used for a specific purpose, that is secured investments based on written agreements.[27] The plaintiff also relies on certain past conduct as a basis to establish Wantrup's knowledge of the true nature of the three payment transactions in December 2011 and August and September 2012.[28]

34 In particular, Wantrup held $2.6 million for the plaintiff in late 2010 for the purpose of funding a proposed loan advance 'subject to final legal details'[29] and $1.675 million for another loan advance in mid-2011. On the plaintiff's case the understanding on Wantrup's part of the course of conduct which developed in relation to these historic transactions was that moneys would, inter alia, only be released to Sovereign or Eos at the direction of the plaintiff, alternatively upon completion of the preparation of and entry into an agreement and securities in respect of the proposed Kush Investment.[30]

Earlier course of conduct relied on by the plaintiff

35 In relation to the abovementioned $2.6 million investment, the plaintiff alleges that on 22 November 2010 Wantrup communicated with the plaintiff's solicitor, Walton of B2B Lawyers, about the prospect of a loan funds advance to Sovereign on the security of a first mortgage over a property in Glen Waverley.[31] On 25 November 2010 Walton sent an email to Wantrup to inform him that:

Our client wishes to proceed on the terms proposed, subject to agreement as to the form and finer detail of the legal documents ... Could you please provide the proposed security documents.[32]

36 The plaintiff alleges that on 27 November 2010 Giorgio suggested to Braham that the loan be made by depositing the $2.6 million into the Wantrup Trust Account.[33] On 1 December 2010 Braham emailed Wantrup, Giorgio and Walton explaining that he had 'wanted to proceed in the investment last week subject to the finer details of the legal documents'.[34]

37 I note that Braham's above email of 1 December 2010 expressly insists upon that proposed investment being 'subject to the finer details of the legal documents' and expressly stipulates that subject to the finalisation of Braham's requirements, he would be happy to place the sum of $2.6 million in trust in an interest bearing account with B2B Lawyers. Braham's email of 1 December 2010 also in my view, in relation to that particular proposed transaction, exhibits caution and a commercially sophisticated approach to the topics under correspondence, on Braham's part.

38 On about 6 December 2010 the above proposals were revived and Braham, in an email to Wantrup, recorded his understanding that he would place funds in Wantrup's trust account to demonstrate commitment to the investment, 'subject to final legal details etc'.[35] Wantrup made inquiries and stated that one of the issues for him was holding those funds at Braham's direction.[36] In an email exchange on 7 December 2010, Braham enquired of Wantrup as to the receipt of funds and review of documents. Wantrup confirmed that funds were 'at you [sic] direction'.[37]

39 Accordingly on the plaintiff's case, although the trust account receipt in that instance stated that the sum of $2.6 million was received by Wantrup on behalf of Sovereign, rather than Braham or the plaintiff,[38] it is clear from this exchange of emails that Wantrup understood that as far as this particular transaction was concerned, funds could not be released without Braham's direction. The loan was settled on 14 December 2010 and funds duly released after execution of documents.[39]

40 In about mid-2011, Giorgio also invited Braham to invest in the Tarneit Land Fund. On 8 June 2011, Walton requested 'the proposed transaction documents' from Giorgio, and confirmed that '[t]here is no binding agreement until transaction documents have been entered into'.[40] Giorgio forwarded Walton's email to Wantrup and asked him to attend to it.[41]

41 Braham was given the trust account details and, on 16 June 2011, emailed the Commonwealth Bank of Australia his instruction to pay funds in the sum of $875,000[42] into the Wantrup Trust Account.[43] That same day, Braham emailed Wantrup (copying in Giorgio and Walton), confirming that 'I have asked Pat Couty of the CBA to transfer the amount of $875,000 into your trust account for the purposes of investment with Sovereign subject to agreement to terms and documentation', which Giorgio '[n]oted and agreed' to.[44] The relevant trust account receipt, which Braham was not shown,[45] stated that the funds had been received on behalf of Sovereign.[46]

42 In due course a further payment of $800,000 was made by the plaintiff for the same Tarneit Land Fund investment, bringing the total provided by the plaintiff in relation to that investment to $1.675 million.

43 In respect of these moneys, Braham's email of 3 July 2011 to Wantrup, Giorgio and Walton stated:

I met with Nickolas today and gave him a cheque in favour of Charles Wantrup trust for purposes of investing in Tarneit. The funds are to be invested for 2 months to repay the bank guarantee and held in deposit by the bank. [47]

Braham also specified that funds would be released from the Wantrup Trust Account to Sovereign upon 'satisfactory completion of the securitization documentation', which was once again '[n]oted' by Giorgio.[48] In Braham's email of 3 July 2011 he also stated that Wantrup was to provide the required securitisation documentation to his lawyer, Walton, when available, and Braham noted 'the documentation to support the $875,000 investment as a first mortgage deed will follow the successful completion of the first investment'.[49]

44 The relevant trust account receipt prepared the next day, on 4 July 2011 recorded that $800,000, was received on behalf of Sovereign.[50] Again, Braham was not shown this receipt.[51] The plaintiff contends that Braham intended, and Wantrup and Giorgio understood, that release of funds depended upon execution of security documentation. It is to be noted that Walton's email of 8 July 2011 reminded Wantrup of the conditions of release, namely, 'the funds are obviously to remain in your trust account until security documents are in place'.[52] In due course permission was given by Braham for the release of the funds and the funds were duly released.[53]

The significance of past course of conduct relied on by the plaintiff

45 In relation to both the $2.6 million and $1.675 million investments, in late 2010 and mid-2011 Wantrup's submissions referred to Braham's 'completely unusual' refusal to authorise the release of trust moneys until the relevant documents were completed.[54]

46 Wantrup submits that this 'shows that [Braham] was able to confirm expressly when he wanted to impose a condition on the use of the money',[55] which Wantrup asserts he did not do with respect to the payments in issue in this proceeding.

47 The plaintiff relies on the knowledge which it asserts may be imputed to Wantrup from the above past dealings with the plaintiff,[56] and on that basis submits that it was 'patently obvious' that disbursements of the funds it provided had to await execution of security documents, and that in relation to the advances in issue 'such a thing was not required to be said' yet again.[57]

48 The plaintiff stresses the alleged creation of an implicit, mutual understanding with Wantrup that the plaintiff did not ever authorise the release of funds without instruction and due execution of security documents.

49 The plaintiff also pleads that Eos and Sovereign knew of the matters giving rise to Wantrup's knowledge of the plaintiff's intent that the payments be held on trust, including the conditional nature of the payments subject to entry into an agreement and the provision of security.[58]

50 Wantrup, however, submits that the 'two earlier transactions involving Braham were conducted in different circumstances'.[59] Wantrup's case is also that the earlier previous investments relied on by the plaintiff to establish a course of conduct were quite distinguishable in the way in which Braham and Walton dealt with their preconditions, and the requirement for the earlier $2.6 million and the $1.9 million Aged Care Property Fund and the Tarneit Land Fund investments in 2010 and early in 2011.

51 On the Wantrup submission there were distinct and important differences in the way the parties conducted themselves in one series of investment as compared with the other. Wantrup submits that in the earlier transactions in relation to $2.6 million and $1.675 million, 'there was an express acknowledgement ... that the money would not be transferred from the trust account'.[60] Wantrup submits in substance that the fact that there was no 'express acknowledgement' in respect of subsequent transactions supports Wantrup's case that the parties were not operating on the same basis or understanding in relation to the December 2011, August 2012 and September 2012 payments in issue.

52 Wantrup's submission also stresses the requirement of communicating an intention to settle a trust to the trustee and that depositing funds into a solicitor's trust account does not, in itself, establish that intention to the requisite objective standard.[61] Wantrup's submission is that there must be more than a mere depositing of moneys into a trust account. Wantrup argues that 'it must be established that those who gave the funds were persons 'for whom' the money was received and was to be held'.[62]

53 The plaintiff points to the payment of moneys into the Wantrup Trust Account, both in prior dealings and in relation to the events now in contention, and submits that this itself evidences an intention of the parties that those moneys would be held on trust.[63]

54 Wantrup replies that such payment 'is at best neutral and at worst is positively adverse to the plaintiff's case',[64] because it was within the plaintiff's ability to stipulate the conditions on which moneys would be held and it is not alleged that this was done. In relation to the three payments in issue, Wantrup submits, nothing in the circumstances suggested that Wantrup was holding the moneys as trustee for the plaintiff.[65]

55 Wantrup submits that the circumstances at the time of the earlier transactions in late 2010 and mid-2011 established a clear intention to settle a trust on specific conditions. Wantrup further submits the same or similar circumstances did not exist in relation to the dealings now in contention.

56 Specifically, Wantrup relies on the fact that he acted for the opposite party in the earlier transactions and that Wantrup's duty, well understood to all concerned, was to act solely in Sovereign's interest. Wantrup submits that these obligations were not modified and that Wantrup furnished no undertaking to assume trusteeship on behalf of Braham, or the plaintiff.[66]

57 Wantrup adds that acting on the plaintiff's behalf might have given rise to a conflict of interests; that Wantrup did not seek instructions from Sovereign that he was authorised to hold any moneys on the plaintiff's behalf and there was no acknowledgement that Wantrup intended to modify the right to exercise a lien in respect of money held in his trust account.[67]

58 Wantrup also points out that the first payment, the second payment and the third payment were all at the time recorded as loans to Sovereign,[68] 'until the accounts were amended after the commencement of this proceeding'.[69]

59 Wantrup notes in his submissions in relation to the first payment that Walton was shown the Trust Ledgers for review and 'did not raise any queries about the withdrawal of funds from the trust account'.[70] Wantrup submits that it should be inferred and concluded that the plaintiff knew and understood the nature of the transaction as a loan to Sovereign, not as the settling of a trust which was subject to strict conditions.

60 The plaintiff draws attention to 'incipient or continuing negotiations which assumed the prompt provision and/or consideration of draft documents'.[71] The plaintiff's argument is that legal conditions and requirements were still being worked out and that the invitation from Sovereign, via Giorgio, was that the money being held by Wantrup should not be disposed of in the meantime. Wantrup's response is that the plaintiff's solicitor knew that moneys had been transferred without any express reservation.[72]

61 The plaintiff also argues that Wantrup was treated 'as a trusted adviser' and had previously held moneys on behalf of Braham in connection with other litigation, that Wantrup in fact held himself out as Braham's advisor, and that the trust account was used in this context.[73] The plaintiff contends that these prior arrangements and matters provide important context for the later payments.

62 Wantrup submits that the plaintiff engaged its own solicitor, Walton, at all times, and therefore the plaintiff's solicitor was at all material times the plaintiff's trusted advisor.[74]

63 Finally, the plaintiff relies on oral evidence to demonstrate a common intention to settle a trust and to establish that Braham did not ever understand from his communications with Giorgio and Wantrup that beneficial ownership of the funds in issue would pass to Eos or Sovereign.[75] Wantrup argues against any such intention being accepted on the evidence and also submits that Braham's oral evidence should not be accepted, given the inconsistencies in, and reliability of, Braham's evidence.[76]

64 The plaintiff submits that certain evidence amounts to an admission against interest by Wantrup.

65 The plaintiff's submissions cite the decision in Herdegen v Federal Commissioner of Taxation,[77] in which Gummow J stated that:

In some factual situations where the existence of an express trust is in issue, it will be against the interest of the alleged trustee to admit the trust. Thus evidence of acts by him subsequent to the date of the alleged declaration of trust which tend to show the existence of the trust will be admitted as admissions against (but not for) his interest ...[78]

66 The plaintiff relies on this passage as authority for the proposition that admission against interest may be used against an alleged trustee.[79]

67 The plaintiff asserts that the following evidence amounts to such an admission against Wantrup's interest:[80]

(a) The Consolidated Trust Ledger which the plaintiff asserts was first discovered by Wantrup on the second day of trial.[81]

'On any reasonable analysis', the plaintiff submits, this 'is a consolidation of different 'client' ledgers prepared and maintained in accordance with reg 3.3.17' of the Legal Profession Regulations 2005.[82]

Wantrup submits in reply that the Consolidated Trust Ledger was part of the documentation produced by Giorgio to his solicitors and not produced by Wantrup,[83] and Wantrup further points out that he was not cross-examined in relation to that material.

Further, Wantrup submits that it was not suggested at trial that the Consolidated Trust Ledger formed part of his Trust Account Ledger,[85] nor was it established why this ledger was prepared or that any purpose for its creation was authorised by Wantrup. Wantrup submits that there is no evidence that the Consolidated Trust Ledger was reviewed and approved by him. Accordingly, Wantrup argues, the ledger cannot be used as an admission against him.

In my view the Consolidated Trust Ledger was not established as a document which recorded or reflected Wantrup's view or position as to its purpose or the accuracy of its contents, because that document was not established as a record which he created, or was involved in creating, or that he approved. Further the plaintiff's failure to put the Consolidated Trust Ledger to Wantrup and establish his acceptance of the accuracy and import of its contents also in my view greatly lessens the potential probative value of that document as an admission by Wantrup against his interest.

Further, Wantrup's evidence was in substance limited to confirming that document CB232 was the trust ledger of his firm, and the evidence was that the Consolidated Trust Ledger[86] was part of the documentation produced by Giorgio to the solicitors for Wantrup.[87]

(b) The entry in Wantrup's trust ledger which lists Braham as the client.[88]

The plaintiff contends that each ledger was created and updated in accordance with reg 3.3.17 of the Legal Profession Regulations 2005, and that each ledger identifies the person on whose behalf Wantrup held the funds: namely, Braham.[89] The plaintiff contends that it is likely that Ms Rebecca Naumovski, an employee of Wantrup (though not a lawyer),[90] prepared and sent Braham the ledgers in accordance with Wantrup's instructions.[91]

Wantrup's evidence is that he did not authorise the preparation of the ledger and was unaware of its being sent to Braham.[92] Wantrup argues that for this reason this Ledger cannot be used as an admission against his interest.[93]

In my view the Trust Ledger entry referring to Braham as a client was not established as a document which recorded or reflected Wantrup's view or position as to its purpose or the accuracy of its contents, because that document was not established as a record which he created, or was involved in creating, or that he approved.

Further insofar as the plaintiff contends that each of the relevant Wantrup Ledgers was created and updated in accordance with Regulation 3.3.17 and that each ledger identifies the person on whose behalf Wantrup was holding funds, I consider that any presumption of regularity and the prima facie position which otherwise may be established by the consolidated trust ledger[94] and the Braham ledger[95] is displaced in this instance by the clear evidence given by Wantrup which contradicted the plaintiff's assertions about the effect of the ledger.

(c) The email of 15 March 2013 from Wantrup to Carol Mason, Administration Manager of Sovereign, attaching an email of the same date from Carol Mason to Wantrup, concerning the 'WA Trust Ledger for Simon Braham/Sovereign'.[96]

This document is alleged to be an admission against Wantrup's interest.

Wantrup submits that this document is 'a Sovereign document' and was not produced by Wantrup.[97]

The substantive part of the document here relied on by the plaintiff is a communication from Sovereign and for that reason in my view cannot, without more, amount to an admission against the interests of Wantrup.

(d) Trust Account Receipts dated 29 November 2011 and 6 December 2011.

The plaintiff points out that both Receipts refer to Simon Braham as the person that money is received from and on whose behalf it is received, and both Trust Account Receipts state 'disbursements - INVESTMENT' as the purpose for which the money is received.[98]

Wantrup's evidence is that these documents were prepared without his knowledge,[99] and that the 'whole concept of them being a disbursement is just nonsense'. Further Wantrup's evidence was that these Trust Account Receipts were incorrect in that they referred to 'Simon Braham' as the person on whose behalf money had been received.[100]

I do not consider that these Trust Account Receipts relied on by the plaintiff constitute admissions against Wantrup's interest, because he has sworn that he had no knowledge of those receipts, and in accepting that evidence as I do, I also accept that Wantrup's conduct cannot be said to be acceptant of the accuracy or appropriateness of these receipts.

Furthermore, for reasons explained elsewhere, I have found that Wantrup did not intend to receive or hold, and did not hold, the money referred to in the said receipts on behalf of Braham.

(e) The bank reconciliation document.[101]

Wantrup's evidence is that this document appeared to be an internal control document and not a trust account.[102] Wantrup could not identify the purpose for which it was designed. His evidence was however that the bank reconciliation document had been prepared without his knowledge.[103]

The plaintiff, in its submissions, rejects Wantrup's evidence that it was 'an internal document prepared for control' and 'not a trust account',[104] and that he did not authorise its creation. The plaintiff asserts that it is 'tolerably clear' the document was of a kind subject to reg 3.3.15 of the Legal Profession Regulations 2005.[105]

I also reject the plaintiff's submission that the bank reconciliation document referred to amounts to an admission against Wantrup's interest.

I consider that this document is in the nature of a Wantrup & Associates internal financial control document and I am not satisfied that the bank reconciliation is in the nature of a trust account or a document of the kind regulated by reg 3.3.15 of the Legal Profession Regulations 2005.[106] Furthermore, it has not been established that Wantrup personally created or authorised or adopted the bank reconciliation document.

68 In the above circumstances, and absent evidence from Wantrup or any other relevant witness[107] as to the purpose for which the Wantrup & Associates' trust ledger was prepared or any evidence or admission by Wantrup that he authorised the creation of such a ledger for such a purpose or purposes, or that he reviewed and approved that ledger for a specific purpose, I accept Wantrup's submission that neither the consolidated trust ledger,[108] or the Braham ledger,[109] nor the other documents relied upon by the plaintiff,[110] amount to admissions against Wantrup's interest for the reasons that I have earlier outlined.

69 Further, given Wantrup's evidence, which I wholly accept, the reference in the email dated 15 March 2013 to the 'WA Trust Ledger for Simon Braham/Sovereign,[111] and the trust account receipts dated 29 November 2011 and 6 December 2011,[112] and the bank reconciliation,[113] in my view all yield to Wantrup's evidence concerning the true nature of the receipt and placement of the first payment, the second payment and the third payment by Braham to Wantrup & Associates.

70 As its second cause of action, the plaintiff relies upon s 3.3.14 of the LPA, and asserts a private cause of action arising in relation to a breach by Wantrup of that section.

71 Section 3.3.14, which was in force at all material times, provided that a law practice must hold money deposited in a general trust account exclusively for the person on whose behalf it is received, and must only disburse the trust money in accordance with that person's direction.

72 Section 3.3.14 of the LPA is in the following terms:

Holding, disbursing and accounting for trust money

1. A law practice or an approved clerk must -

(a) hold trust money deposited in a general trust account of the practice or clerk exclusively for the person on whose behalf it is received; and

(b) disburse the trust money only in accordance with a direction given by the person.

Penalty: 120 penalty units.

1. Subsection (1) applies subject to an order of a court of competent jurisdiction or as authorised by law.
2. A law practice or an approved clerk must account for the trust money as required by the regulations.

73 It is to be noted that s 3.3.3 of the LPA also provides:

Money involved in financial services or instruments

1. Money that is entrusted to or held by a law practice for or in connection with -

(a) a financial service provided by the practice or an associate of the practice in circumstances where the practice or associate is required to hold an Australian financial services licence covering the provision of the service (whether or not such a licence is held at any relevant time); or

(b) a financial service provided by the practice or an associate of the practice in circumstances where the practice or associate provides the service as a representative of another person who carries on a financial services business (whether or not the practice or associate is an authorised representative at any relevant time) -

is not trust money for the purposes of this Act.

1. Without limiting subsection (1), money that is entrusted to or held by a law practice for or in connection with -

(a) a managed investment scheme; or

(b) mortgage financing -

undertaken by the practice is not trust money for the purposes of this Act.

1. Without limiting subsection (1) or (2), money that is entrusted to or held by a law practice for investment purposes, whether on its own account or as agent, is not trust money for the purposes of this Act, unless -

(a) the money was entrusted to or held by the practice -

(i) in the ordinary course of legal practice; and

(ii) primarily in connection with the provision of legal services to or at the direction of the client; and

(b) the investment is or is to be made -

(i) in the ordinary course of legal practice; and

(ii) for the ancillary purpose of maintaining or enhancing the value of the money or property pending completion of the matter or further stages of the matter or pending payment or delivery of the money or property to or at the direction of the client.

1. In this section Australian financial services licence, authorised representative, financial services and financial services business have the same meanings as in Chapter 7 of the Corporations Act.

74 I further note that a similar exception is contained in s 129(2)(d) of the Legal Profession Uniform Law Application Act 2014 (Vic). That section provides that 'money received by a law practice for investment purposes' is not trust money, unless 'the law practice received the money in the ordinary course of legal practice and primarily in connection with the provision of legal services at the direction of the client' and 'the investment is or is to be made in the ordinary course of legal practice and for the ancillary purpose of maintaining or enhancing the value of the money or property'.

75 The plaintiff asserts that Wantrup received each of the three payments in issue as trust money for or on behalf of the plaintiff, and that therefore his statutory obligation was 'to hold trust money deposited in [his] general trust account exclusively for the benefit of the person ... on whose behalf the money was received by the law practice and to disburse that money only at the direction of that person ...'.[114]

76 The question arising as a result of the plaintiff's pleaded second cause of action is whether s 3.3.14 entitles the plaintiff to bring a private right of action. The plaintiff contends that the provision confers such a right because the LPA does not provide any alternative remedies to the plaintiff,[115] and the terms, scope and policy of the legislation in question indicate so.[116]

77 The plaintiff relies upon O'Connor v SP Bray Ltd,[117] where Dixon J says:

Whatever wider rule may ultimately be deduced, I think it may be said that a provision prescribing a specific precaution for the safety of others in a matter where the person upon whom the duty laid is, under the general law of negligence, bound to exercise due care, the duty will give rise to a correlative private right, unless from the nature of the provision or from the scope of the legislation of which it forms a part a contrary intention appears. The effect of such a provision is to define specifically what must be done in furtherance of the general duty to protect the safety of those affected by the operations carried on.[118]

78 In his submission against the existence of a private cause of action in respect of the above legislative obligations, Wantrup contends that the LPA, as the Explanatory Memorandum for that legislation states, is intended 'to implement a new regulatory framework for the legal profession in Victoria', rather than to protect the class of persons who entrust moneys to their solicitors.[119]

79 Wantrup also contends that a range of remedies afforded to the plaintiff, and those persons which such provisions are intended to protect, are potentially available for breach of the relevant provision and that this renders the private right of action unnecessary, and unlikely to exist.

80 Wantrup also submits that even when new trust money offences were created at the time of the passing of the LPA, a private right of action was not introduced. In this regard, Wantrup cites Gardiner v Victoria,[120] where Phillips JA observes that:

if the statute as a whole can fairly be characterised as passed primarily for the general good rather than for the benefit or protection of some only within the wide community, that is nowadays regarded as pointing strongly against a Parliamentary intention that an individual should be able to sue for non-compliance with some particular provision;[121]

a penal sanction will commonly be found attached to the legislative prescription, and prima facie that excludes the implication of additional civil liability. But if there is no such penalty or other remedy for breach of the statutory duty, or if the penalty which is fixed is considered inadequate (as in Groves v Lord Wimborne [1898] 2QB 402), that can point towards the individual's right to sue for breach.[122]

82 Wantrup further contends that the statutory duty, if it were to exist, would give rise to 'theoretical and practical problems',[123] such as where a purchaser entrusts funds to a law practice to defray the price of land purchased under a contract in respect to which the vendor asserts an entitlement to specific performance. Such a scenario Wantrup submits would give the vendor an interest as beneficiary of the funds entrusted to the law practice for that purpose. Should the vendor then claim the funds pursuant to a Quistclose trust, and the purchaser rescind the contract and demand that the law practice return the funds, the legislature would have facilitated a conflict of duty by the law practice, a result that Parliament could not have intended.[124] Wantrup also points out that such a duty is inconsistent with a solicitor's fiduciary obligation to act solely in the client's interest.[125]

83 Wantrup also argues that 'there is no suggestion that the existing law for the regulation of legal practitioners handling trust money ... is inadequate'.[126]

84 Wantrup argues that the moneys in question are not 'trust moneys' within the statutory meaning, because s 3.3.3(3) excludes moneys entrusted to a solicitor's trust account for investment purposes where the requirements set out in that section are not satisfied. It is submitted by Wantrup that in this case the requirements in s 3.3.3(3)(a) and (b) have not been satisfied.[127]

85 Wantrup submits that the three payments cannot be trust moneys because, on the plaintiff's case, s 3.3.3(3) of the LPA is confined to forming a basis for the plaintiff's claim of breach of a statutory duty, but no wider.[128]

86 Further, Wantrup submits that because the plaintiff relies on a statutory cause of action, which requires there to be trust money held within the meaning of the LPA, if s 3.3.3(3)(a) of the LPA applies, then the subject money is not trust money within the meaning of the LPA and accordingly the plaintiff's second cause of action must fail.[129]

87 Further, with respect to the third payment Wantrup submits that the statutory cause of action under s 3.3.14 fails because that money was not held in a trust account, a condition precedent for the application of that part of the statute to be invoked.[130]

Standard of proof in relation to grave allegations

88 Wantrup's closing submissions also contended that a 'cause of action alleging a breach of statutory duty has very serious consequences', and for that reason the plaintiff in this proceeding must establish its allegations to a higher standard.[131]

89 The plaintiff's submission in response contends that there is no higher standard. The plaintiff submits that 'all one needs to look for under the test posed by s 140 of the Evidence Act 2008 is the gravity of the matter and, if there are serious allegations in a Briginshaw sense, one simply needs to be satisfied before making findings that there is a preponderance of evidence. It has got nothing to do about raising the standard of proof, it is just looking for a preponderance of evidence'.[132]

90 As indicated by the plaintiff's submissions summarised above, it claims breach of trust, breach of statutory duty or breach of fiduciary duty, and seeks:

(c) a declaration that Wantrup, to the extent that he holds or continues to hold the sum of $1.1 million or any part thereof, holds that sum on trust for the plaintiff;

(d) an order that Wantrup pay to the plaintiff the sum so held on trust by him;

(e) payment or restitution of the sum of $1.1 million or part thereof;

(g) such other or further orders as the Court considers fit; and

91 As I have noted, Wantrup submits that the court is entitled to take into account the gravity of the matters alleged or the consequences which may flow from a particular finding, when deciding whether a matter has been established to the requisite standard.[134]

92 Further, Wantrup submits that the cause of action here alleging a breach of statutory duty may have serious consequences for him and, for that reason it is appropriate to require that the plaintiff establish its allegations of breach of statutory duty to a higher standard.

93 Section 3.3.14 of the LPA imposes an obligation regarding the receipt and handling of trust moneys in the context of the conduct and practice of a law practice. The obligation the plaintiff asserts arises pursuant to s 3.3.14 of the LPA where trust moneys were deposited in a law practice's or approved clerk's 'general trust account' and requires that the law practice or approved clerk hold such moneys exclusively for the person for whose benefit the trust moneys are received and to disburse the money only in accordance with a direction given by that person. The section further provides that a law practice or approved clerk must account for the trust money as required by the relevant regulations in relation to the LPA.[135]

94 I consider that because the plaintiff's case does not plead fraud or dishonesty and because I have ultimately concluded for reasons which follow that the plaintiff's second cause of action involving alleged contravention of s 3.3.14(1) of the LPA need not be decided, because my findings in relation to the plaintiff's express trust and associated alleged breaches of that section are not made out, and are unsustainable respectively, the remaining determinative issues in this proceeding should be considered and determined to the normal civil test of the balance of probabilities. Here, in my view, no more burdensome level of satisfaction is required.

95 I note, however, that had it been necessary to consider the position as to whether or not Wantrup contravened s 3.3.14 of the LPA, that is, were I not satisfied on the balance of probabilities that the subject three payments were not impressed with a trust, and that for that reason, and in the circumstances, s 3.3.14 of the LPA is not applicable and has not been contravened, it may well have been appropriate and necessary for me to require the establishment of such a contravention on the basis submitted by Wantrup, and to a higher degree of satisfaction than would ordinarily be the case.

96 I have earlier determined these issues raised by the plaintiff.

The plaintiff's claims for relief against the first and the second defendants

97 The plaintiff's Prayer for Relief, in particular its claim for declaratory relief in C and the orders for payment in D, specifically make claims against the first and second defendants. However, these claims were not pressed, or indeed addressed by the plaintiff at trial.[136]

98 The only case or submission ultimately made in relation to the first and second defendants, Sovereign and Eos, was in relation to the third defendant's apportionment claim referred to above.

99 In any event, I consider that my findings below and conclusions in relation to the plaintiff's claims against Wantrup would result in the claims the plaintiff has pleaded against Sovereign and Eos being similarly unsuccessful.

The Law - Express Trusts - The Requirement for Intent

100 The plaintiff in its case emphasised on a number of occasions that the key determinative question in this proceeding is what intention did the plaintiff have when it made the relevant transfers.[137]

101 Wantrup argues that to succeed in this case in its express trust claim the plaintiff must establish the necessary intention from the conduct of parties, here as alleged by the plaintiff and Wantrup.[138] Wantrup submits that this is especially so in this case, as put by the plaintiff, which alleges the relevance of a course of conduct, including in relation to Wantrup's knowledge of the dealings and transactions pursuant to which Wantrup received the three payments in issue.

102 Wantrup also submits that the intention to create a trust must be communicated to the trustee, here alleged to be Wantrup.

103 In Williams v Lloyd,[139] and in particular the passage in Dixon J's judgment citing Jessel M.R. Richards v Delbridge,[140] his Honour relevantly says as follows:

It is true he need not use the words, 'I declare myself a trustee,' but he must do something which is equivalent to it, and use expressions which have that meaning; for, however anxious the Court may be to carry out a man's intention, it is not at liberty to construe words otherwise than according to their proper meaning'... 'the true distinction appears to me to be plain, and beyond dispute: for a man to make himself a trustee there must be an expression on intention to become a trustee, whereas words of present gift show an intention to give over property to another, and not retain it in the donor's own hands for any purpose, fiduciary or otherwise.[141]

104 In its submissions the plaintiff relies heavily on the decision in George v Webb [2011] NSWSC 1608, in which Ward J stated the following at [203]-[210], [252]:

1. As with the determination of the existence and scope of an express trust that (unlike a Quistclose trust) is not said to arise from the purpose for which moneys are paid over, the question as to the existence of any Quistclose trust must be answered by reference to intention. The relevant intention is to be inferred from the language employed by the parties in question (per Gummow J in Elizabethan Theatre Trust, at 502-505; Re Wall ; Ex parte Official Receiver v Kemmis (1979) 25 ALR 615, at 624-5 ). For that purpose the Court is entitled to look into the nature of the transaction and the circumstances of the relevant parties and their relationship (Walker v Corboy (1990) 19 NSWLR 382; Re Australian Elizabethan Theatre Trust, at 503).
2. Spigelman CJ summarised the relevant principles bearing on the formation of an express trust in Mario Salvo v New Tel Ltd [2005] NSWCA 281 at [33], as follows:

It is well established that an intention to create an express trust can be inferred from the full range of relevant circumstances, including the nature of the transaction and the construction of the words used. (See Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107 at 120; Walker v Corboy (1990) 19 NSWLR 382 esp at 395-399; Associated Alloys Pty Ltd v ACN 001 452 106 Pty Ltd (In Liq) [2000] HCA 25; (2000) 202 CLR 588 at [34]; Tito v Waddell (No 2) [1977] Ch 106 at 211. The relevant case law has been summarised by Campbell J in Commonwealth v Booker International Pty Ltd [2002] NSWSC 292 at [34]- [45].) There are cases in which it is pertinent to consider the mutual intention of the parties to a transaction. (See Barclays Bank Ltd v Quistclose Investments Ltd [1970] AC 567 at 580B; Australasian Conference Association Ltd v Mainline Constructions Pty Ltd (In liq) [1978] HCA 45; (1978) 141 CLR 335 at 353; Re Australian Elizabethan Theatre Trust; Lord v Commonwealth Bank of Australia [1991] FCA 344; (1991) 30 FCR 491 at 502-503; Re Goldcorp Exchange Ltd; Kensington v Liggett [1995] 1 AC 74 at 100.)

1. His Honour referred, at [34], with approval to the passage from the judgment of Gummow J in Re Australian Elizabethan Theatre Trust at 503 that:

The relevant intention is to be inferred from the language employed by the parties in question and to that end the court may look also to the nature of the transaction and the relevant circumstances attending the relationship between them: Walker v Corboy (1990) 19 NSWLR 382; Scott, The Law of Trusts , 4th ed, 1987, s25.2. There is no need for particular caution in drawing the inference that a trust was intended: Bahr v Nicolay (No 2) [1988] HCA 16; (1988) 164 CLR 604 at 618-19. However, it also is important to appreciate both the flexibility of the institution of the express trust and the range of equitable institutions which fall short of but have some of the characteristics of a trust.

1. In On Equity (Young, Smith and Croft, LawBook Co, 2009 , at [6.1020]), the learned authors note that:

Cases in this area will often depend on a close analysis of the facts, and in particular, whether the person who provided the money annexed a trust or equitable obligation that it was only to be used for the nominated purpose. The mutual intention of the parties and 'the essence' of their bargain will be important. A trust will not necessarily arise just because a lender inquires into the purpose for which a loan is sought and money is paid over for that particular purpose. (my emphasis)

1. Pausing there, when reference is made to the mutual intention of the parties and the essence of their bargain, this seems to be in the context of payments made in circumstances where the bargain as such is between payer and payee (hence the reference to enquiry by the lender as to the purpose for which the loan was sought). Here, the antecedent bargain is that which was reached on 13 October 2008 between Mr George (whether or not acting as agent for his wife) and Mr Burke. It is not suggested that Mr Webb was privy to that bargain (although on his own evidence he was made aware by Mr Burke that some form of arrangement had been reached with Mr George and in summary terms the nature of that transaction).
2. In those circumstances, as between Mrs George (the payer of the money) and Mr Webb (into whose trust account the money was transferred) it would seem that the relevant intention is that of Mrs George as evidenced by the email from her husband in which Mr Webb was informed of the basis of the payment and instructed as to the purpose for which the moneys were to be used (ie to ask whether the person who provided the money annexed to it a trust or equitable obligation, in the words of the authors of On Equity ). In Mario Salvo , at [49] Spigelman CJ noted that:

In this case, as in EVTR, it was the intention of the supplier of funds, relevantly the Appellants, that the money was to be applied and applied only for a specific purpose (ie the purchase of the equipment in EVTR or the Digiplus acquisition in the present case). The money was applied towards a deposit in partial fulfilment of the purpose which was not fulfilled (ie the failure of the equipment purchase in EVTR or the Digiplus acquisition in the present case). The return of the deposit in each case meant that the beneficial interest in the funds of the supplier became an express trust of the deposit in the hands of the recipient. (my emphasis)

1. In Re Australian Elizabethan Theatre Trust, Gummow J said:

The question as to the existence of any express trust will always have to be answered by reference to intention. An example of that basic proposition at work in this court is the decision of Lockhart J in Re Wall; Ex parte Official Receiver v Kemmis (1979) 25 ALR 615 at 624-5. Ordinarily, the relevant intention is that of the alleged settlor, but where the subject matter of the trust is contractual rights against the settlor, conferred by the settlor upon the alleged trustee, the objective (or 'purpose') of the transaction being to benefit third parties, it may be appropriate to look to the mutual intention of settlor and trustee . This is consistent with the approach by Deane J to a similar question in Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 80 ALR 574 ; 165 CLR 107 at 149, but cf Mason CJ, Wilson J at 121. At all events, and as I have said, in Quistclose, supra, at 580, Lord Wilberforce looked to 'the mutual intention' of Quistclose and Rolls Razor and to 'the essence' of their bargain. (my emphasis)

1. In the present case, the relevant intention as to the creation of the trust must be that of the party in the position of the settlor of the trust (Mrs George or her husband acting on her behalf). Where there is no contractual arrangement between the settlor and the alleged trustee, the intention of the latter must be irrelevant.

1. Payment into a trust account (and, in particular, a trust account maintained by a solicitor who is bound by the rules and regulations imposed by the Law Society in relation to the control of such accounts including the separation of such funds) seems to me to be sufficient to indicate an intention that the moneys be dealt with as trust moneys. (Had the moneys been paid as the purchase price owing to Mr Burke in his personal capacity then one would have expected the email to make that clear and it would not then have been necessary for there to be any authorisation given by Mrs George for him to direct the disbursement of the funds - indeed that would be otiose.)

1. I find that the funds paid to Grogan Webb were impressed with a trust, that being that they were to be held and paid out (albeit at the direction, properly issued, of Mr Burke) for the purposes of the Elderslie/Allco HIT acquisition (and by that, having regard to the underlying agreement between Mr George and Mr Burke, whether or not that was for Mrs George as principal, was meant for the purposes of acquiring one or more of the assets of those companies for the purposes of the particular project then being contemplated - as Mr Burke conceded in the witness box).[142]

105 The determination as to the existence and scope of an express trust must always be answered by reference to intention. The relevant intention is principally to be inferred from the language and conduct of the parties in question.[143] For that purpose the court is entitled to look to the nature of the transaction and the circumstances of the relevant parties and their relationship.[144]

106 Accordingly, the intention of the alleged settlor will always by crucial, however in some cases the mutual intention of both alleged settlor and the alleged trustee will be relevant.[145]

107 As observed by Gummow J in Re Australian Elizabethan, ordinarily the relevant intention is that of the alleged settlor, but where the subject matter of the trust is contractual rights against the settlor, conferred by the settlor upon the alleged trustee, the purpose of the transaction being to benefit third parties, it may be appropriate to look at the mutual intention of settlor and trustee.[146]

108 Campbell JA observed in Raulfs v Fishy Bite Pty Ltd [2012] NSWCA 135:

[C]onsistently with Byrnes v Kendle, and the remarks of Gummow J in Australian Elizabethan Theatre Trust, one needs to analyse an individual fact situation for the purpose of deciding whether there is an intention to create a trust, and, if so, on what terms. Quistclose recognises that sometimes there can be a trust whose terms are that the trust property is to be paid to particular people, and if it is not paid to those people, it is to be held for someone else. That is a matter arising from analysis of the facts of the particular case in accordance with well established principles for identifying when there is a trust, not because there is any separate legal institution known as a 'Quistclose trust'.[147]

109 Similarly, as noted by the learned authors in On Equity:

In Re Australian Elizabethan Theatre Trust, Gummow J discussed the current literature on Quistclose trusts and held that it was wrong to speak of the Quistclose trust as some new legal institution; rather, the result reached in the case was merely the application of established trust principles. The significance of the case is that it reminded the commercial community that a debtor-creditor relationship did not preclude the existence of a (resulting) trust.

Cases in this area will often depend on a close analysis of the facts and, in particular, whether the person who provided the money annexed a trust or equitable obligation that it was only to be used for the nominated purpose. The mutual intention of the parties and "the essence" of their bargain will be important. [148]

110 Reference to the essence of the bargain between the settlor and trustee will tend to expose whether in a particular case the mutual intention of the parties is relevant; Re Australian Elizabethan.[149] Accordingly, whether the mutual intention of the parties will be relevant in a particular case will depend on a factual analysis of the circumstances of the case.

111 The authorities establish that in relation to trusts, as with contracts, the search for 'intention' is a search for the relevant intention as revealed in the words the parties used, amplified by facts known to both parties.[150]

112 In Trident General Insurance Co Ltd v McNiece Bros Pty Ltd, Deane J stated:

In equity, 'intention alone will not constitute a trust obligation [and] ... mere conduct without such intention is ineffectual to impose it, or, as Lewin, 12th ed. (1911) at page 88, says to "impute" it': per Isaacs J, Commissioner of Stamp Duties (Q) v Jolliffe [1920] HCA 45; (1920) 28 CLR 178, at 189 and see, now, Lewin, 16th ed. (1964) page 35. The requisite intention to create a trust of a contractual promise to benefit a third party can, however, be formed and carried into effect (either by the contract itself or some other act) by a promisee who would be bemused by the information that the chose in action constituted by the benefit of a contractual promise is property and uncomprehending of the distinction between the law and equity. In that regard, the analogy of Molière's M. Harpagon who unwittingly spoke poetry or 'verse' would arguably have been a more instructive one than that of M. Jordain who merely spoke ordinary prose: see In Re Schebsman [1944] Ch 83, at 104. In the context of such a contractual promise, the requisite intention should be inferred if it clearly appears that it was the intention of the promisee that the third party should himself be entitled to insist upon performance of the promise and receipt of the benefit and if trust is, in the circumstances, the appropriate legal mechanism for giving effect to that intention. A fortiori, equity's requirement of an intention to create a trust will be at least prima facie satisfied if the terms of the contract expressly or impliedly manifest that intention as the joint intention of both promisor and promisee.[151]

113 The Court of Appeal in Commissioner of State Revenue v Snowy Hydro Ltd (2012) 43 109, 130 at [83] stated:

The applicable principles are well established. Courts will recognise the existence of a trust in a commercial setting, notwithstanding the absence of an express statement of intention to create a trust, when:

... it appears from the language of the parties, construed in its context, including the matrix of circumstances, that the parties so intended ... In divining intention from the language which the parties have employed the courts may look to the nature of the transaction and the circumstances, including commercial necessity, in order to infer or impute intention.[152]

Regard may be had to 'what could fairly be inferred to be the interests and expectations of the two sides to the transaction in question'.[153] Subjective intentions are irrelevant.[154] With trusts as with contracts, the court is concerned not with 'the real intentions of the parties, but with the outward manifestation of those intentions'.[155]

114 Also see Legal Services Board v Gillespie-Jones [2013] HCA 35; (2013) 249 CLR 493, Bell, Gaegler and Keane JJ citing Byrnes v Kendle at [119] for the proposition that 'the outward manifestation of the intentions of the parties within the totality of the circumstances' is determinative of whether sufficient trust-creating intention exists.

115 Where, in a contractual context, an express statement of intention to create a trust is absent, the court will determine whether a trust-creating intention should be imputed from the language of contract documents or oral dealings, having regard to the nature of the transaction and the relationship of the parties: Korda v Australian Executor Trustees (SA) Ltd.[156]

116 In Byrnes v Kendle,[157] Heydon and Crennan JJ, referring to the authorities, emphasise the objective nature of the tests for the existence of trust-creating intention.

117 In Peter Cox Investments Pty Ltd (in liq) v International Air Transport Association,[158] O'Loughlin J indicated some of the factual circumstances which might lead a court to find in favour of the existence of such a trust (from [49]), those being whether the relationship between each client and the company was a routine commercial transaction epitomising the business that the company conducted (noting that the courts are reluctant to introduce trusts into such commercial transactions, referring to Walker v Corboy, at 390 per Clarke JA and at 398 per Meagher JA); the existence of discrete evidence pointing to the existence of a mutual intention of the parties to create a trust; evidence as to an agreement or directions or instructions having been given as to how and in what manner the moneys were to be held or applied; other objective indicators, such as how the recipient and alleged trustee have dealt with the funds in question (for example, whether those funds are deposited in a general bank account, which would tend against the finding of a trust, this being a factor seen as important in the decision of Barrett J in Georges v Wieland[159] and Spigelman CJ in Salvo v New Tel Ltd, at [38]) and whether there exists any obligation (statutory or contractual) requiring the recipient separately to account for the paid moneys.

118 Accordingly, the above judicial statements refer to certain potential relevant indicators able to be called in aid to determine whether the intention of the settler alone is relevant to determining the existence of any express trust or whether the intention of the alleged trustee is also relevant.[160]

119 The mutual intention of the parties to a transaction has been recognised as pertinent in certain cases, usually those in a contractual context, and in most instances this is provided by some form of antecedent bargain between the party providing the money and the alleged trustee receiving the money.[161]

120 In George v Webb, Mrs George paid money into Mr Webb's trust account. However, no relevant bargain between the payer and payee was established. The bargain found to have been reached was between Mr George (whether or not acting as agent for his wife) and Mr Burke.[162] Importantly, it was not suggested that Mr Webb was privy to that bargain.

121 Ward J observed that in those circumstances, the relevant intention was that of Mrs George, as evidenced by an email from her husband in which Mr Webb was informed of the basis of the payment and instructed as to the purpose for which the moneys were to be used.

122 It was in this context that Ward J held that the payment of moneys into a trust account was sufficient to indicate an intention on the part of the settlor that the moneys be dealt with as trust moneys.

The parties arguments on the relevant intention

123 The plaintiff and Wantrup made the following submissions, respectively, in relation to the question of intention and the decision in George v Webb and the question of whether it is solely the intention of the alleged settlor of the trust, Braham, that is relevant or whether a mutual intention on the part of both the alleged settlor and the alleged trustee, Wantrup, is necessary to establish the requisite intention to create the express trust pleaded.

124 A particular feature of this proceeding is that the plaintiff has pleaded and argued the relevance of a course of conduct to do with a series of arrangements concerning the plaintiff's placement of funds into investments promoted by Sovereign.

125 The plaintiff says that where there is no relevant transaction between Braham and Wantrup, the position as to the question of intention is as was explained in George v Webb.[163] That is, 'the relevant intention as to the creation of the trust must be that of that party in the position of the settlor of the trust ... Where there is no contractual arrangement between the settlor and the alleged trustee, the intention of the latter must be irrelevant'.[164]

126 The third defendant submits that because the plaintiff's pleaded case is in part based on conduct involving Wantrup, the mutual intention of the two parties is relevant, and in this context Wantrup points to the statement of the Court of Appeal in Commissioner of State Revenue v Snowy Hydro Ltd[165] referred to above.

127 In this regard, the plaintiff points to George v Webb, where Ward J found a purpose trust established but found upon analysis of the 'essence of the bargain' in that case was that the relevant intention as to the creation of the trust was the settlor's intention and that, in that particular situation, the intention of the alleged trustee was irrelevant.[166] In coming to this conclusion, Ward J made reference at paragraph [208] to a statement by Spigelman CJ in Salvo v New Tel Ltd,[167] where his Honour noted that 'it was the intention of the supplier of the funds...that the money was to be applied and applied only for a specific purpose' that was the relevant intention.

128 These differing results on the question of whether the mutual intention of settlor and trustee will be relevant and necessary to the establishment of a particular express trust, be it described as one arising from a Quistclose arrangement or otherwise, serves to show that each case turns on the examination of the language and conduct of the parties in question, the nature of the transaction and the circumstances of the relevant parties and their relationship.[168]

Although in George v Webb, Ward J concluded that only the intention of the settlor was relevant, in George v Webb there was no alleged relevant course of dealings argued to be part of the basis of the asserted trust; it was alleged on the basis of an email sent to the solicitor which confirmed that the money was being paid specifically for a particular acquisition. On that basis Wantrup submits that factually George v Webb was a materially different case to this and should be distinguished for that reason.[169]

130 Further, in this case a special purpose Quistclose trust is not alleged by the plaintiff, nor does the plaintiff allege that Wantrup knew that an agreement had been reached between Giorgio and Braham that the money constituted by the three payments was to remain in trust until relevant agreements had been finalised, or that it was agreed between Giorgio and Braham that moneys provided to Wantrup & Associates was only to be disbursed at the instruction of Braham.

131 Wantrup was not a party to any relevant transaction. Indeed on the plaintiff's submission: '[h]e was the solicitor who put his hand up and provided the trust account machinery and the money was transferred in, but he was not party to a contract. He was not party to any arrangement with the plaintiff'.[170]

132 Wantrup argues that George v Webb ought be distinguished on a factual basis because no Quistclose trust has been pleaded in this proceeding and also because the trust in George v Webb was not alleged to have arisen out of a course of dealings as is a feature of the case put by the plaintiff in this proceeding. Wantrup argues that the mutual intention of the parties to the alleged trust is relevant in the inquiry in this proceeding because the case as pleaded relies on a course of dealing, some of which involve Wantrup, and the plaintiff's allegations in support of the trust it asserts expressly relies on Wantrup's knowledge and understanding of the intent and import of the relevant transactions, and consequently, the factual matrix in this case aligns more with the position as Gummow J in Re Australian Elizabethan.

133 In my view, on the particular facts of this case, in particular the transactional nature of arrangements evinced by the communications between the parties in respect of the three payments in issue, and the way the plaintiff pleads and has conducted its case asserting the relevance of a course of conduct, the plaintiff's case calls into issue and requires the establishment of mutual intent, that is the relevant intent of Braham and Wantrup. I also note however, that I have separately considered the alleged intent of the settlor Braham, and found that it has not been established in these proceedings, for reasons that I outline below.

134 As earlier observed the plaintiff in this proceeding does not allege a purpose trust of the type identified in Barclays Bank Ltd v Quistclose Investments Ltd.[171] In most Quistclose-type cases (although Cf George v Webb) an additional element must be established that it was a condition of the settlement, as manifestly intended by both the settlor and the trustee that, in the event that the primary purpose of the settlement was not fulfilled, a secondary trust was created for the return of the funds, absent a relevant second limb of the express trust.

135 In Quistclose, Quistclose deposited the money (borrowed on the agreed condition that it would be used to meet a declared share dividend) into a separate account with Barclays Bank. Barclays in that case knew the money was borrowed and that it was agreed with Rolls Razor that the account would only be used for the purpose of paying the relevant dividend: 'the mutual intention of [Quistclose] and Rolls Razor Ltd, and the essence of the bargain was that the sum advanced should not become part of the assets of Rolls Razor Ltd, but should be used exclusively for payment of a particular class of its creditors, namely those entitled to the dividend'.[172]

136 Chief Justice Gibbs in Australasian Conference Association Ltd v Mainline Constructions Pty Ltd (In liq)[173] considered that the decision in Quistclose was authority for the following proposition:

... that where money is advanced by A to B, with the mutual intention that it should not become part of the assets of B, but should be used exclusively for a specific purpose, there will be implied (at least in the absence of an indication of a contrary intention) a stipulation that if the purpose fails the money will be repaid and the arrangement will give rise to a relationship of a fiduciary character, or trust.[174]

137 As noted by Ward J in George v Webb,[175] the Quistclose principle is not limited in its application to money paid for the purpose of discharging debts but can apply where the funds are to be applied for other purposes, including, as in that case, for the purpose of an investment.

138 It is clear, however, that a Quistclose trust is not a distinctive species of trust,[176] but rather must satisfy the ordinary requirements for any private trust. Accordingly, in cases where the putative trust arises from a Quistclose or special purpose arrangement, reliance upon purpose alone will not be sufficient.

139 As observed by Tate JA in Brereton, an expectation or general understanding of the use of funds for a particular purpose falls short of the necessary mutual intention that funds have been provided on the express condition that they will be earmarked for use exclusively in accordance with an agreed purpose. Rather, it must be shown, as ordinarily required for the creation of an express trust, that the settlor intended that the funds be held on trust, and further, that it was a condition of the settlement, as mutually intended by the settlor and trustee that, in the event that the purpose was not fulfilled, that a secondary trust was created for the return of the funds.[177]

140 Accordingly, in my view, it is difficult to conceive of a 'purpose trust' within the factual parameters of Quistclose where the trustee's intention will not be relevant to the establishment of the required intention.

Payment of funds into a solicitor's trust account

141 The plaintiff relies on the above statement of Ward J in George v Webb[178] in support of its submission that in establishing the relevant intention to create an express trust, the payment of funds into a solicitor's trust account is a critical piece of evidence outwardly manifesting the settlor's intention that those funds be dealt with as trust money:

Payment into a trust account (and, in particular, a trust account maintained by a solicitor who is bound by the rules and regulations imposed by the Law Society in relation to the control of such accounts including the separation of such funds) seems to me to be sufficient to indicate an intention that the moneys be dealt with as trust moneys. [179]

142 On this issue Wantrup relies on Brereton, where at first instance before the Victorian Civil and Administrative Tribunal Mr Brereton was charged, inter alia, with misconduct within the definition in paragraph (a)(i) of s 137 of the _Legal Practice Act 199_6 (Vic) in allegedly failing to maintain separate ledger accounts in his trust ledger in respect of each client or person for whom he received trust money, and doing so in wilful or reckless contravention of rule 19(1) of the Trust Account Practice Rules.

143 Tate JA, with whom the other members of the Court of Appeal agreed, in setting out the Tribunal's finding on this charge, observed:

The Tribunal found that there was no relevant relationship between Mr Brereton and the individual investors. It said:

...

Given the investors were not clients, for there to be a breach of Rule 19(1) it would need to be established that the investors were persons 'for whom' trust money had been received. ... The rule uses the words 'for whom' not 'from whom', so the mere receipt of funds from the investors is not sufficient to trigger the operation of the rule. It needs to be established that Brereton received the funds from these investors to be held individually on their behalf. They must be capable of being characterised as persons 'for whom' the money was received.[180]

144 It was argued by the Commissioner in Brereton that, because Mr Brereton was a solicitor, in the absence of the Commissioner being able to demonstrate that there was any other basis that would give rise to a fiduciary obligation, the mere receipt of funds from the investors into his trust account was sufficient in itself to impose upon him a fiduciary obligation to the investors. In rejecting this submission, Tate JA stated:

I do not agree, for the reasons the Tribunal gave for rejecting this submission, namely, that mere receipt of funds by a solicitor is not sufficient to ground an equitable obligation; it must be established that those who gave the funds were persons 'for whom' the money was received and was to be held. [181]

145 In my respectful view, properly understood, the statement of Tate JA in Brereton at [106] is not inconsistent with Ward J's statement in George v Webb at [219] in relation to whether the mere receipt of funds into a solicitor's trust account will in itself be sufficient to establish the requisite intention to create an express trust.

146 In George v Webb, Ward J accepted that where the intentions of the settlor alone were relevant and those of the alleged trustee were irrelevant,[182] in determining the intention of the settlor to create an express trust, the act of paying funds into a solicitor's trust account was in those circumstances sufficient to indicate an intention on the part of the settlor that the moneys be dealt with as trust moneys.

147 In Brereton, the submission by the Commissioner on appeal was made in support of an argument for a fiduciary obligation owed by Mr Brereton to the relevant investors who paid moneys into his trust account. That fiduciary obligation was asserted to arise beyond the operation of r 19(1) of the Trust Account Practice Rules, and despite the fact that the investors were not Mr Brereton's clients and that the funds were paid by the investors on behalf of the purchaser under a contract of sale for land.[183]

148 The proposition in Brereton that the mere receipt of funds by a solicitor is not sufficient to ground an equitable obligation, but that it must be established that those providing the subject funds were persons 'for whom' the money was received and was to be held, is limited to the situation where the mere receipt of funds into a trust account is sought to found an equitable obligation owed by a solicitor to the payer of the funds, absent any other basis to infer a trust relationship.

149 The proposition referred to is limited in that way in Brereton because in that case the rejection of the Commissioner's assertion of an equitable obligation arising from the mere receipt of funds into a solicitors trust account occurred in the particular circumstances of that case where the payers were not the solicitor's clients and where the funds were explicitly received on behalf of the vendor under a contract of sale. As Tate JA observed in Brereton, the Tribunal's findings that the investors were not Mr Brereton's clients, and that Mr Brereton at no time held the deposit moneys on behalf of the investors, were critical and raised doubt as to whether, in the circumstances of the case, Mr Brereton owed fiduciary obligations to individual investors.

150 Where parties agree that moneys are to be placed in a trust account, this is likely to be a sufficient indicator that there was an intention that the moneys are subject to a trust, however, such a situation must always be considered in the light of other, perhaps contrary, outward manifestations of intent. The settlor's intention that the subject money be held on trust is always essential, and while payment into a trust account is an indicator of that intention, by itself that act is not sufficient and the indication referred to may be negated by a contrary manifestation of intent, objectively determined.

151 In this case I accept Wantrup's contention that the receipt of trust moneys into the Wantrup & Associates Trust Account does not of itself establish the necessary intention asserted by the plaintiff, and for that reason and also by operation of s 3.3.3(3) of the LPA, the receipt and deposit of the three payments by Wantrup did not result in Wantrup & Associates or Wantrup receiving or holding those moneys on trust under the LPA.

152 I have rejected the plaintiff's arguments in this respect based on the judgment in Brereton. In my view Tate JA's statement, at [106] of Brereton, supports the proposition that the receipt of trust money into a solicitor's trust account does not of itself establish the necessary intention.

153 The plaintiff emphasises that the statement cited 'mere receipt of funds ... is not sufficient' refers to 'the mere receipt of funds into a solicitor's trust account'. This is accurate only insofar as the receipt of funds into a trust account, in conjunction with other elements, evincing intention as a relevant factor going to intention to settle a trust.

154 In relation to the second issue concerning the reasoning in Brereton,[184] that is in relation to her Honour's above words, the plaintiff's submission that Tate JA was repeating a fact-based finding is not supported by [106] of the reasons. Tate JA recorded the manner in which the argument was advanced before the Court of Appeal ('the receipt by him [the solicitor] of money ... was sufficient in itself ...').[185] Her Honour then rejected that submission ('mere receipt of funds ... is not sufficient'). No reliance was placed on a fact based finding of VCAT in the submission advanced or in the reasons of Tate JA.

155 The plaintiff's pleaded case in essence relies upon three key transactions involving each of the three payments to establish Wantrup's liability. Those alleged transactions are in outline as follows:

Pursuant to Giorgio's request, which was in about November 2011, on or about 8 December 2011, Braham caused Braham Investments, as the proposed investor, to transfer cash (by EFT) in the amount of $500,000 into the Wantrup Trust Account, which was deposited and credited to the Wantrup Trust Account on 8 December 2011.[186]

Pursuant to Giorgio's request in or about 22 August 2012, Braham Investments deposited the sum of $100,000 into the Wantrup Trust Account in relation to the Tarneit Land Fund investment.

Following Giorgio's request in or about September 2012, on 26 September 2012, Braham arranged a bank cheque in the sum of $500,000 (second cheque)[187] to be provided by the St Vincent's branch of the Commonwealth Bank of Australia, which was collected by a female employee of Wantrup from Braham at the Victorian Eye and Ear Hospital on that day.

156 The plaintiff's pleaded case identifies the following breaches in relation to the asserted express trust it alleges relates to the three payments, and the associated alleged breach of statutory duty, as follows:

1. Notwithstanding the matters alleged in paragraphs 26 and 27 above and without the consent or knowledge of Braham Investments, Wantrup has:

(a) paid the sum of $500,000 held on trust for Braham Investments for the purposes of the proposed Kush investment to Eos;

Particulars

The sum of $500,000 referred to in sub-paragraph (a) above was paid out of the Wantrup Trust Account to Eos on 8 or 9 December 2011 (CB589, 817).

(b) paid the sum of $100,000 deposited into the Wantrup Trust Account for the purpose of the proposed further Tarneit Investment to Krema Pty Ltd, a subsidiary of Sovereign;

Particulars

The sum of $100,000 was paid out of the Wantrup Trust Account to Krema on 22 August 2012 (CB817).

(c) banked the cheque for $500,000 provided by or on behalf of Braham Investments so that its proceeds were made immediately available to Sovereign.

Particulars

The banking of the cheque for $500,000 (CB817) so that its proceeds were made immediately available to Sovereign is acknowledged and admitted by Wantrup in his letter to Walton dated 15 March 2013 (CB868), a copy of which is in the possession of the solicitors for the Plaintiff and may be inspected by prior arrangement.

157 The plaintiff contends that here it was the intent of the plaintiff that the three payments which were advanced in December 2011, August 2012 and September 2012 were to be held in trust pursuant to either an express trust for Wantrup to hold those moneys and not disburse them without the plaintiff's instructions or direction or, in the alternative, the plaintiff asserts it transferred the three sums of money on a basis which included that they were not to be utilised until agreement and security documentation was executed nor for any purpose outside what the plaintiff asserts was the 'specified purpose', namely for the proposed investment.[188] The plaintiff however does not plead a Quistclose-type trust which is constituted by an express and specific purpose trust and a secondary resulting trust.

158 Wantrup submits that the plaintiff has not pleaded a Quistclose-type trust.[189]

159 Accordingly, there is an issue as to whether it is necessary to plead a special purpose trust and whether to do so a party must plead such a trust as a two limb trust or whether the allegation of payment into trust for a specific purpose implies the return of the money if the purpose fails, as a required component of a secondary and resulting trust, such secondary trust arising if the primary trust fails, with such an intention to be implied in the normal course.[190]

160 I consider that in relation to a Quistclose-type trust it must be pleaded and shown, as ordinarily required for the creation of an express trust, that the settlor intended that the funds be held on trust, and further, that it was a condition of the settlement, as mutually intended by the settlor and trustee that, in the event that the purpose was not fulfilled, that a secondary trust was created for the return of the funds. In my view the plaintiff has not here advanced such a pleading.

161 Further and separately, on the plaintiff's case, the alternative position for which it does not contend, is what the plaintiff describes as 'the other side of the coin'. That position would be that the plaintiff's intent in relation to the relevant advances was to effect an immediate loan advance or effect an immediate investment in each case.[191]

162 The plaintiff asserts that the trust relevant to the first payment arises on the basis of a conversation between Braham and Giorgio in November 2011.

163 As pleaded, the plaintiff relies upon the following to establish the alleged trust in relation to the first payment:

1. In or about November 2011, Giorgio on behalf of Sovereign:
   1. invited Braham to invest $500,000 in the redevelopment of the Kush Café in South Yarra to be conducted by Sovereign; and
   2. requested that Braham, to demonstrate his interest in the proposed investment, deposit $500,000 into the Wantrup Trust Account such funds to be held in trust while an agreement and securities in respect of the investment were prepared.

Particulars

The invitation was oral and occurred in a conversation between Giorgio and Braham at a restaurant in South Yarra in which Giorgio said to Braham words to the effect that he wished to offer Braham the opportunity to invest $500,000 in the re-development of the Kush café in South Yarra, and Braham said words to the effect that he was interested in making such an investment.

The request was partly oral and partly implied. Insofar as it was oral, Giorgio then said words to the effect stated in paragraph 8(b). Insofar as the request was implied, it arose from the course of conduct between the parties, in that Braham Investments had previously invested with Sovereign in:

(a) an investment in the form of a loan secured by a first ranking mortgage and first ranking charges through the Aged Care Property Fund in the sum of $2,600,000; and

(b) an investment in the form of secured notes in the Tarneit Land Fund in the sum of $1,900,000 (CB1012).

The invitation and request is also to be inferred from the document at CB448.

For the purposes of each of those investments, Braham Investments was requested to, and did, first deposit the amounts to be invested in the Wantrup Trust Account while agreements and securities were prepared, and such amounts were not released to Sovereign until entry into an agreement and the provision of securities to the satisfaction of Braham Investments.

For the Aged Care Property Fund investment, see (CB79, 80, 84, 88, 89, 90, 92 and 935).

For the Tarneit Land Fund investment, see (CB244, 245, 255-256, 258, 259-260, 264, 265, 276, 280, 285-303, 304, 306-311, 312-314, 316, 333, 337, 339340, 341, 342 and 344-420).

...

1. The proposed investment by Braham Investments in the Kush Café development (proposed Kush investment) was conditional upon the preparation of and entry into an agreement and the provision of security for the proposed Kush investment to the satisfaction of Braham Investments.

Particulars

Braham Investments refers to and repeats paragraph 8 above including the particulars thereto, and refers to the fact that Braham Investments' solicitors and Sovereign's solicitors (respectively) were engaged in correspondence with each other from 5 December 2011 about the form of draft agreements and securities as particularised under paragraph 12 below. As to the negotiations, see (CB468, 469, 470, 472, 475, and 481-583).

1. By reason of the matters pleaded in paragraphs 8(b), 9, 9A and 10 above:
   1. Wantrup held the sum of $500,000 on trust for Braham Investments to be applied or disbursed only at the direction of Braham Investments, alternatively until and unless an agreement was entered into by, and security was provided to, Braham Investments in respect of the proposed Kush investment to the satisfaction of Braham Investments;
   2. further, or in the alternative to sub-paragraph (a) above, the sum of $500,000 was trust money within the meaning of the definition of that expression in section 3.3.2. of the Legal Profession Act 2004 (LPA) being money entrusted to Wantrup in the course of or in connection with the provision of legal services by Wantrup; and

Particulars

Braham Investments entrusted the money to Wantrup by depositing it in the Wantrup Trust Account.

1. further, by reason of the matters referred to in subparagraph (a) and (b) above, Wantrup held the sum of $500,000 in the Wantrup Trust Account on behalf of Braham Investments within the meaning of section 3.3.14 of the LPA, to hold it exclusively for Braham Investments and only to disburse it in accordance with a direction given by Braham Investments.

1. Further, Wantrup knew or ought to have known that at and from the time of his receipt of the cheque for $500,000 from or on behalf of Braham Investments and his deposit of the cheque into the Wantrup Trust Account that the sum of $500,000 was:

1. monies belonging to Braham Investments; 2. deposited into the Wantrup Trust Account to be held on trust by Wantrup for Braham Investments, alternatively, held on behalf of Braham Investments within the meaning of section 3.3.14 of the LPA and was only to disburse those monies at the direction of Braham Investments;

1. to be applied by Wantrup on behalf of Braham Investments or released to Sovereign or EOS only at the direction of Braham Investments, alternatively for the purpose of the proposed Kush Investment upon completion of the preparation of and entry into an agreement and securities in respect of the proposed Kush investment.

Particulars

The fact that Wantrup knew or ought to have known of the matters referred to is to be inferred from:

1. the matters referred to and particularised in paragraph 11 above;
2. the deposit of the sum of $500,000 into the Wantrup Trust Account rather than it being paid to Sovereign or Eos;

1. his knowledge of and prior involvement in the transactions between Braham Investments and Sovereign and/or EOS referred to in the particulars to paragraph 8 and, in particular:
   1. in respect of the investment in the form of a loan secured by a first ranking mortgage and first ranking charges through the Aged Care Property Fund in the sum of $2,600,000:
      1. advice by Demian Walton, of B2B Lawyers the solicitor for Braham Investments given by e-mail dated 25 November 2010 that his client wished to proceed "subject to agreement as to the form and finer detail of the legal documents" together with a request by Walton for the security documents (CB77);
      2. advice by Braham to Wantrup by e-mail dated 6 December 2010 that Andrew Ludekens, an associate of Giorgio and Wantrup, had requested that Braham place funds in Wantrup's trust account to demonstrate his commitment subject to final legal details (CB84);
      3. an acknowledgment by Wantrup by e-mail dated 6 December 2010 to Braham that stated "[m]oneys into my trust account to be held there at your direction (CB88, 90);

The e-mails referred to above are in the possession of the solicitors for the Plaintiff and may be inspected by prior arrangement.

1. in respect of the investment in the form of secured notes in the Tarneit Land Fund in the sum of $1,900,000:
   1. in or about August 2011, Braham Investments had made an initial investment of $1,900,000 into the Tarneit Land Fund on the basis of a Deed Poll executed by Sovereign dated 23 August 2011 (Loan Note Deed) constituting secured loan and notes further secured by a mortgage of land no. AJ182620Y dated 19 August 2011 given by Sandhurst Trustees Ltd in favour of, among others, Braham Investments, as the Custodian of the Sovereign Tarneit Land Fund (Sandhurst) (CB364);
   2. Braham Investments had provided the funds for the initial investment by depositing them in the Wantrup Trust Account;
   3. both by his solicitors and directly, Braham had expressly instructed Wantrup that the amounts deposited into the Wantrup Trust Account for the purpose of the initial investment were not to be released from the Wantrup Trust Account to Sovereign for the purposes of the Tarneit Land Fund until completion of and entry into the relevant security documents, as follows;
      1. e-mail dated 3 July 2011 from Braham to Wantrup (CB280);
      2. e-mail dated 8 July 2011 from Walton to Wantrup (CB312, 316);
      3. e-mail dated 11 August 2011 from Braham to Wantrup (CB339);
      4. e-mail dated 23 August 2011 from Walton to Wantrup (CB362).

The e-mails referred to above are in the possession of the solicitors for the Plaintiff and may be inspected by prior arrangement.

1. the fact that from prior to the making of the deposit on 8 December 2011 Wantrup and/or his office was in correspondence with B2B Lawyers, the solicitors for Braham Investments, in relation to the preparation of an agreement and securities in respect of the proposed Kush Investment. Between 5 December 2011 and 9 December 2011, that correspondence included the following:
   1. On 5 December 2011 (CB469), Wantrup sent an email to Demian Walton, a Partner of B2B Lawyers, with the subject title 'Simon Braham - Kush Restaurant loan to Krema Pty Ltd' which stated: 'Dear Demian. I have prepared a loan agreement which is with Nikolas and his co directors for review. As it requires guarantees by the directors and in order to save costs and time, perhaps you might send me your standard guarantee and I will hope to adopt it. Charles'.
   2. On 5 December 2011 (CB470), Walton sent an email to Wantrup in which he stated: 'If you send me the loan agreement, we will prepare the guarantee and debenture charge'.
   3. On 7 December 2011 at 4:32pm (CB472), Wantrup sent an email to Walton copied to Braham with the subject heading 'Simon Braham - Kush Restaurant loan to Krema Pty Ltd' which stated then: 'Dear Demian. Attached is a document I have in mind. It's a convertible note Deed. I'm also attaching Nikolas' original Term Sheet so that you can see where I'm coming from. Charles'.
   4. On 9 December 2011, at 8:40am (CB481), Wantrup sent an email to Walton with the subject heading 'Simon Braham - Kush Restaurant loan to Krema Pty Ltd' which stated: 'Dear Demian. I'm under pressure to discuss these documents with you. Can we talk this morning. I would like to be able to sign off today if at all possible. Please call me. Charles."
2. Further, between 9 December 2011 and 12 December 2011, the correspondence included the following passing between Wantrup and his office and Anthony Calvi, Special Counsel of B2B Lawyers:
   1. On 9 December 2011 at 1.58pm (CB485), Calvi sent Wantrup an email which stated: 'As expressed in the earlier conversation with Demian, we are preparing the debenture, personal guarantees and amending the deed poll to allow a debenture'. In that email, Calvi also requested from Wantrup certain documents relating to Krema Pty Ltd and the conduct of the Kush Café business.
   2. On 9 December 2011 at 2:47pm (CB487), Patrick Toscano, an employee of Wantrup & Associates provided a response to the requests made by Calvi.
   3. At 4:19pm on 9 December 2011 (CB557), Calvi advised Toscano that a more complete list of documents would be required before B2B could advise Braham.
   4. On Friday 9 December 2011 at 4:28pm (CB571), an e-mail chain between Toscano and Calvi including in particular an email from Calvi to Toscano which reiterated a request for evidence of the right to run the business, a response from Toscano to Calvi providing information in that regard, and a further response from Calvi on 12 December 2011 at 4:06pm copied to Wantrup stating that B2B Lawyers would still need to view the heads of agreement so as to establish the right to run the business.

A hard copy of each of the e-mails referred to above is in the possession of the solicitors for the Plaintiff and may be inspected by prior arrangement.

...

1. Further or alternatively, by reason of the matters alleged in paragraphs 11 and 12 above, Wantrup owed to Braham Investments fiduciary duties in respect of the sum of $500,000 deposited into the Wantrup Trust Account for the purpose of the proposed Kush Investment to:

1. act prudently in the best interests of Braham Investments in dealing with the sum of $500,000; 2. observe the terms upon which the sum of $500,000 was entrusted to him and/or held by him in the Wantrup Trust Account on behalf of Braham Investments; and

1. disburse the sum or any part of it only in accordance with a direction given by Braham Investments.[192]

164 Braham's evidence in chief in relation to the first payment was as follows:

When was the first time that money was discussed in connection with the proposed investment?---November 2011, and I'd indicated I was interested in investing four to five hundred thousand dollars, subject to terms.

When did you have - - -?---And security.

- - - that discussion?---Early November 2011.

And where?---At a café in South Yarra.

Named?---Cosi.

With whom did you have that discussion?---Nickolas Giorgio.

Doing the best you can recall, tell His Honour how that conversation unfolded?---He asked me if I was interested in investing. I said I was. I said I would put money into Charles Wantrup's trust account, like I had in the previous investments. I wrote a cheque on 15 November. I told him not to bank it until I had - - -

Just slow down. People are taking a note. I asked you to describe that conversation where the proposed investment was mentioned?---Yes.

And you have raced ahead, but I want you to focus on that conversation. Doing the best you recall, tell His Honour who said what and in what order?---I said I was interested in investing, I was prepared to put money into the Wantrup trust account pending documentation. I provided the cheque on 15 November. I requested the cheque not be banked until - - -

DR HANAK: Your Honour, the witness seems to be moving from the conversation to another topic.

HIS HONOUR: It is important, so we all understand, that it is this conversation you're talking about, Mr Braham, not other things that might be your thoughts, et cetera, that you confine yourself to dealing with the evidence by saying, 'I said to Mr Giorgio; Mr Giorgio said to me' so we're clear about precisely what is confined to the conversation and we're clear about who said what. Start again, dealing with your conversation with Mr Giorgio and describing who is speaking at each point?---He invited me to invest. I said I would put money into Charles Wantrup's trust account pending documentation. I asked him not to bank the cheque until I had the funds cleared and the money would not be disbursed until the documentation was complete.

Was that part of the conversation or is that something that you're speaking of as what you - - -?---That was the conversation, and Mr Giorgio agreed.

MR HEATH: What did Mr Giorgio say?---He said, 'Agreed'.

When did you provide the cheque you mentioned a moment ago?---I provided the cheque on 15 November.

And where did you provide that cheque?---At a café in South Yarra.

Do you remember where?---No, I don't remember where. We went to several different cafés at different times.

What was said at that meeting where you handed - - -?---Not to bank the cheque until I had the funds cleared and not to release the funds until the documentation was complete.

Do you remember the timing of that meeting? What date did you hand the cheque over?---15 November 2011.

Was anything else said at that meeting bearing on that proposed investment?---No, Your Honour.[193]

....

Mr Braham, what was the next relevant event in terms of this proposed Kush investment. You handed the cheque over.

What happened next in terms of your dealings with Mr Giorgio and/or Mr Wantrup?---I'd asked for documents to be forwarded to my solicitor, Demian Walton.[194]

....

MR HEATH: I'm sorry, I didn't catch that?---At the end of November I received an email from Mr Wantrup wondering when the funds would be available for him to bank the cheque.

And do you recall what you told him in response?---I told him in response that I was still waiting to have funds cleared in the bank account and I would let him know.

HIS HONOUR: Was this an email or was this telephone call?---An email, Your Honour.

MR HEATH: Did you have any discussions with anyone at or around that time about the funds and whether they could be applied or used?---The only discussion was the funds would remain in the trust account.

With whom did you have that discussion?---Nickolas Giorgio.[195]

Giorgio's evidence in chief - the first payment

165 Giorgio is a public accountant and registered tax agent. He was also a Director of Sovereign from about March 2010 until April 2013, when that company went into administration. Giorgio was also a director of Eos. Eos acted as a treasury for Sovereign, and amongst other things paid bills on behalf of Sovereign.[196]

166 Giorgio's evidence was that Sovereign acted as a funds' manager in respect of two registered investment schemes. One scheme was the Sovereign Tarneit Land Fund and the other investment schedule was known as the Sovereign Aged Care Property Fund.[197]

167 In respect of investments made in relation to the schemes which were managed by Sovereign, all funds were paid into Wantrup & Associates Trust Account. Wantrup & Associates acted for Sovereign. Further, most disbursements of funds were disbursed through Wantrup & Associates.[198]

168 At October 2010 Sovereign MF did not have a bank account. Wantrup Trust Account made payments for it on occasions.[199]

169 Giorgio's evidence was that on about 2 November 2011 he met with Braham at a café at South Yarra, probably Cosi Café, in Toorak Road. At that time, in a meeting at which Braham and Giorgio alone were present, Giorgio outlined Sovereign's plans in relation to the Kush Café restaurant in South Yarra.

170 In that conversation Braham asks Giorgio what sort of capital Sovereign was looking to raise in relation to the development of the Kush Café and Giorgio responded that money up to around the $1 million would be required. In that same conversation Braham indicated that he would be interested in receiving further information about the Kush project.[200]

171 Thereafter, in about mid-November 2011, Giorgio met again with Braham at either the Cosi Café, or another café in South Yarra known as 'Thirty Eight Chairs', but at that meeting, which was probably on either 12 or 13 November 2011 attended by only Giorgio and Braham, Braham told Giorgio that he was interested in being involved in the Kush Café development project and he wanted to pledge some funds towards financing the development, mentioning a figure to Giorgio of around $400,000.[201]

172 Giorgio's evidence was that he and Braham discussed documenting the investment.

173 The only discussion in relation to security was how the form of security would take shape.[202] Giorgio's evidence was in relation to the security documentation in respect of an investment that Mr Braham might make in relation to the Kush project, that to obviate the problems which occurred with security documentation in the past, namely delays in finalising such documentation, Giorgio proposed to Braham that, in relation to the proposed Kush investment which they were discussing, the funds advanced by him would be disbursed and the documentation would be finalised at some point later on. At this meeting Braham said that he was agreeable to such an arrangement.[203]

174 On 14 November 2011 Giorgio gave evidence that he again met with Braham alone at the Cosi Café. Giorgio's evidence was that at this meeting Braham provided him with a cheque in the sum of $500,000 dated 15 November 2011 (cheque drawn on Braham Investments Trust). Giorgio stated that at the time he received the cheque the terms of what had been agreed between he and Braham had not changed including the term of the arrangement that the funds provided by Braham could be disbursed once his cheque was cleared.[204]

175 In late November 2011 Giorgio stated that he had conversations with Braham about the pending settlement in relation to the Kush Café which included the transfer of the lease in relation to the premises at which the Kush business was being operated.[205] Giorgio's evidence was that he discussed delays to the settlement of the Kush transaction with Braham.[206]

176 At the time he made the first payment, Braham was aware that cleared funds were required by Giorgio immediately. There were also numerous requests for cleared funds, including on 22 November 2011;[207] on 23 November 2011;[208] and on November 2011.[209]

177 Braham's cheque was deposited and dishonoured on 30 November 2011. It was dishonoured again on 2 December 2011. Braham was aware that that had occurred.[210]

178 Giorgio requested another cheque, and that was provided on 5 December 2011 however that cheque was also dishonoured.[211] Braham ultimately provided the funds on 8 December 2011.[212]

179 This conduct in the lead-up to the making of the 8 December 2011 payment made it abundantly clear that Giorgio required cleared funds for Sovereign immediately or almost immediately. There is no evidence that Braham ever said during this time that the money he was providing should sit in trust until the agreement and security documents were completed.

180 From these circumstances, including as detailed below, I infer in relation to the discussions between Giorgio and Braham in November and December 2011 about the need for payment, that Braham knew the cleared funds were required straightaway in the circumstances. I accept that Braham made no attempt to communicate any requirement that the money he was providing be held until he authorised its release or until execution of satisfactory investment agreement and security documentation, and Braham intended that the money he was to provide would be immediately paid out to Wantrup's account to Sovereign or Eos. This intent is also consistent with Braham's earlier enquiry which was not challenged during Giorgio's cross-examination, namely that in relation to the $100,000 for Kush, discussed in August, Braham had asked whether he should make out the $100,000 cheque to Eos.[213]

181 Furthermore, if as Braham contends his intent was that his money would sit in Wantrup & Associates Trust Account until the documentation required was satisfactorily completed, upon being somewhat pressured for cleared funds by Giorgio, were Braham's version of these matters accurate, it is to be expected he would have made this point to Giorgio that given the basis on which Braham was providing his money there was no urgency. No such evidence was before the Court.

182 Giorgio's evidence was that on 29 November 2011, on behalf of Sovereign, he requested Wantrup to deposit Braham's cheque for $500,000[214] and that he directed the funds which had been deposited in the Wantrup & Associates Trust Account to Eos.[215]

183 Further, Giorgio gave evidence that Braham's cheque for $500,000 was initially dishonoured and required several re-presentations before it was honoured. Giorgio gave evidence that he contacted Braham in relation to it being necessary to re-present his cheque, and requested that he attend to the cheque which bounced and requested he do so as soon as he could, stating to Braham that settlement was imminent and that they would like to have clear funds in order to be ready.[216] Giorgio's evidence was that he had discussed with Braham prior to 8 December 2011 that the moneys Braham was providing would be set aside primarily for settlement but some of those funds would be used for operating costs and legal fees.[217]

184 Giorgio's evidence was that from the outset of their discussions about Braham's initial investment in Kush, Giorgio told Braham that the funds Braham provided were going to be disbursed to pay legal fees and the settlement of the Kush transaction which in November 2011 was expected to be imminent. Giorgio stated on several occasions in his evidence that Braham expressed no surprise in response to Giorgio's outline of what was planned.[218]

Wantrup's evidence in chief - the first payment

185 Wantrup's evidence was that he commenced to act for Sovereign in about 2010[219] and received his instructions usually from Giorgio.

186 Wantrup gave evidence about the 2010-2011 transactions referred to by the plaintiff in its 'course of conduct' allegations, including referring to communications from Braham in relation to those earlier transactions, in which Braham had made it clear that the investment funds he was providing in those earlier instances were to be released only upon his satisfaction with security documentation.[220]

187 Wantrup gave evidence that his firm received a cheque from Braham Investments Trust in the sum of $500,000[221] on approximately 15 November 2011, however, Wantrup could not say precisely by what means that cheque had been delivered to his office.[222]

188 On 29 November 2011 Wantrup received an email from Giorgio referring to the funds received from Braham and informing Wantrup that those funds were to be held by Eos in respect of legal fees. The same communication dated 29 November 2011 stated 'Mr Wantrup can you bank Simon's cheque and transfer the cleared funds to EJC in preparation for settlement'.[223]

189 Wantrup's evidence was 'EJC' referred to Eos.[224]

190 On about 1 December 2011 Sovereign directed Wantrup & Associates to pay from the trust moneys received by Wantrup & Associates the sum of $500,000 to Eos and that direction was signed by Giorgio.[225]

191 Wantrup's evidence was that Braham's initial cheque for $500,000 in November 2011 was dishonoured, then in due course re-presented, and the transfer of those funds in the sum of $500,000 did not take place until 8 December 2011[226] with those moneys being transferred out of Wantrup & Associates Trust Account on 9 December 2011.

192 Wantrup's evidence was that prior to 9 December 2011 neither he nor his firm received any instructions from Braham, or anyone acting on his behalf, in relation to the basis on which Wantrup & Associates were holding the funds provided by Braham.[227]

193 Wantrup's evidence was that the receipts in relation to the receipt of the sum of $500,000 from Braham in November 2011 were prepared by Ms Naumovski, a person who ultimately left Wantrup's employ in about 2012. Wantrup's evidence was that he gave no instructions in relation to the preparation of the receipt ultimately issued in respect of Braham's $500,000 cheque and that the receipts that were prepared by Ms Naumovski were 'completely wrong'. As a result Wantrup had to take steps to correct Wantrup & Associates' trust ledger.[228]

Braham's evidence - inconsistent, unreliable and unpersuasive

194 I do not accept that the November 2011 conversation was as Braham stated in his evidence. I find Braham's evidence in relation to that conversation most unconvincing for the following reasons:

(a) Braham's evidence of what was said by him and by Giorgio in their conversation at a café known as 'Cosi' in early November 2011 changed on a number of occasions as recounted by Braham and was inconsistent as identified below.

With whom did you have that discussion?---Nickolas Giorgio.

Doing the best you can recall, tell His Honour how that conversation unfolded?---He asked me if I was interested in investing. I said I was. I said I would put money into Charles Wantrup's trust account, like I had in the previous investments. I wrote a cheque on 15 November. I told him not to bank it until I had - - -

Just slow down. People are taking a note. I asked you to describe that conversation where the proposed investment was mentioned?---Yes.

And you have raced ahead, but I want you to focus on that conversation. Doing the best you recall, tell His Honour who said what and in what order?---I said I was interested in investing, I was prepared to put money into the Wantrup Trust Account pending documentation. I provided the cheque on 15 November. I requested the cheque not be banked until - - -.[229]

He invited me to invest. I said I would put money into Charles Wantrup's trust account pending documentation. I asked him not to bank the cheque until I had the funds cleared and the money would not be disbursed until the documentation was complete.

Was that part of the conversation or is that something that you're speaking of as what you - - -?---That was the conversation, and Mr Giorgio agreed.

What did Mr Giorgio say?---He said, 'Agreed'.[230]

When did you provide the cheque you mentioned a moment ago?---I provided the cheque on 15 November.

And where did you provide that cheque?---At a café in South Yarra.

Do you remember where?---No, I don't remember where. We went to several different cafés at different times.

What was said at that meeting where you handed - - -?---Not to bank the cheque until I had the funds cleared and not to release the funds until the documentation was complete.[231]

195 Braham, in his Affidavit affirmed 17 April 2013[232] at [47], put forward a materially different version of the same conversation including because he did not assert that Giorgio agreed to any part of the arrangement with Braham:

In November 2011, Giorgio approached me to invest in a proposed re-development of Kush café in Chapel Street, South Yarra, being conducted by Sovereign. I told Giorgio I was interested in investing $500,000. Giorgio asked me to demonstrate that interest by depositing $500,000 in Wantrup's trust account, such funds to be held in trust while an agreement and securities were prepared. I provided such funds from Braham Investments on 8 December 2011, after a cheque I provided on 6 December 201 was dishonoured. This was consistent with past practice in that Braham Investments had deposited $1,900,000 in Wantrup's trust Account pending the finalising of the issue of Notes referred to above.[233]

196 Under cross-examination in respect of the above Affidavit Braham stated:

You made no reference in this Affidavit to statements that you made to him?---It was an agreement that we had, is what I said, I think, Your Honour.

Mr Braham, you made no reference in this Affidavit, in paragraph 47, to statements that you made to Mr Giorgio. Do you agree?---No, I think we make reference to an agreement.

I beg your pardon?---It is an agreement that Mr Giorgio and myself had that funds would go into the trust account awaiting agreement.

Are you suggesting that what you're referring to in the sentence beginning with, 'Giorgio asked me to demonstrate' is not a conversation, but an agreement?---It is both, Your Honour.

Mr Braham, unless I'm very much mistaken, I suggest that what you're intending to convey in this Affidavit was a statement that Giorgio made to you and that's why you begin the sentence with, 'Giorgio asked me', would you agree?---The first half is Giorgio asking me. The second is an agreement that funds will be held in trust whilst an agreement and securities were prepared, Your Honour.[234]

197 Braham's said Affidavit, although clearly seeking to address matters of significance to the plaintiff's case in relation to the November conversation, did not reflect the contents of the conversation between Braham and Giorgio which was said to have been exchanged in Braham's evidence in chief at T76 and T77.

198 I consider the substance of the Braham Affidavit of 17 April 2013, at [47], and Braham's attempts in his evidence in chief to establish the basis upon which the first payment was made, to be materially inconsistent. I do not accept Braham's attempted explanation as to why his Affidavit of 17 April 2013 was not consistent with his evidence in chief at T76 and T77, namely, that although his Affidavit purports to convey the substance of a conversation he had with Giorgio, for example 'Giorgio asked me', the Affidavit , Braham sought to explain, was dealing with a hybrid of what was said and what was agreed, as he sought to explain it at T156.21-31-T157.1-8.

199 Braham's versions of the November 2011 conversation were also inconsistent with the instructions which he gave both in relation to several iterations of the pleading of his case and his Outline of Evidence.

200 The allegations pleaded in the plaintiff's Statement of Claim at [8(a)] and [8(b)] relate to the November 2011 conversation. In his evidence at trial Braham both sought to multiply the number of conversations in which the pleaded allegation was made (T159.23-31) and he also attempted to explain why the particulars to [8(b)] of the plaintiff's Statement of Claim did not accord with his evidence in chief in relation to the single pleaded November 2011 conversation, by asserting that the particulars of conversation at [8(b)] are referring to 'an agreement between me and Giorgio'.[235]

201 Braham also gave the following evidence in relation to this important conversation in November 2011:

I'm suggesting to you, having looked at the particulars, Mr Braham, that at this time you referred to one conversation between yourself and Mr Giorgio at a restaurant in South Yarra; do you agree with that?---We had several conversations, as we know. At the time I probably I don't know what I was thinking at the time. Maybe I thought it was only one, but there were certainly several.

So it is possible at this time you thought it was only one; now you think it's several. Is that your evidence?---I don't know how to answer that.

I beg your pardon?---I'm not sure how to answer that. Clearly we had several conversations about it at different meetings.[236]

202 As I consider to be reflected in the above paragraph of Braham's evidence, and in particular in the last preceding paragraph, in my view, Braham demonstrated his confusion and uncertainty about the communications upon which he was seeking to rely in relation to the November 2011 meeting with Mr Giorgio.

203 In my view, Braham's evidence highlighted above also reflected his approach to his evidence, namely that rather than provide his frank and accurate recollection of what was said, he was endeavouring to provide answers in cross-examination which would best support his case. In my view this was made clear in the context by Braham's attempt to protect his position by seeking to rely on several conversations to support his pleaded case whereas the pleaded case quite clearly, and over a number of iterations of pleading from the plaintiff, relies on only one relevant conversation in November 2011 at [8(a)] and [8(b)] of the third further Amended Statement of Claim.

204 I also consider that Braham in his evidence, particularly when being cross-examined, attempted to convey vagaries to provide wriggle room, for example by saying 'we had several conversations, as you know. At the time I probably - I don't know what I was thinking at the time. Maybe I thought it was only one, but there were certainly several ... I don't know how to answer that ... I'm not sure how to answer that. Clearly we had several conversations about it at different meetings.'[237]

205 The Outline of Evidence proffered for Braham dated 27 July 2015, at [21], refers to a relevant meeting in November 2011 between Braham and Giorgio at a single meeting.[238]

206 When cross-examined Braham stated that the Outline of Evidence which had been produced was consistent with his instructions and his recollection of events.[239] However, contradicting himself, Braham conceded that the Outline of Evidence at [21] makes reference to only one meeting at a restaurant in November 2011.[240]

207 Braham in his evidence also sought, in my view evasively and ineffectively, to suggest that his outline of evidence was in reality referring to several meetings in November 2011.[241]

208 In my view Braham's evidence in relation to his Outline of Evidence was, for the reasons I have cited and explained, less than frank and accurate in chief, and under cross-examination his evidence in my view demonstrated that Braham responded to questioning in a way which he believed would afford him wriggle room and would better support the plaintiff's case.

209 A comparison of Braham's Outline of Evidence at [21] and his sworn evidence by Affidavit of 17 April 2013, at [47], with his abovementioned evidence at trial, in my view demonstrates Braham's willingness to modify his version of events and to afford himself wriggle room and to give his evidence in a way which he considered would best advance his case rather than in an accurate and complete manner.[242]

210 Further, whereas it is clear that Braham's Affidavit of 17 April 2013 at [47] deposes to what Giorgio said to Braham in the November 2011 conversation and both the plaintiff's iterations of pleading at [8(a)] and [8(b)] and Braham's Outline of Evidence dated 17 July 2013 [21] allege and detail what Braham said to Giorgio in the same November 2011 conversation, Braham refused to acknowledge this important difference and when cross-examined about this aspect of his evidence suggested, in a way which I consider was evasive, that he did not understand the straight forward questions which had been put to him by counsel for Wantrup in respect of that inconsistency.[243] In that same cross-examination Braham also sought to explain that inconsistency by asserting that in his Affidavit at [47] he was intending to address 'an agreement' rather than detailing what had been said in a conversation.[244] I do not accept this attempted explanation of inconsistencies by Braham. Further, I consider that this attempted explanation was one of many instances on which Braham gave whatever evidence he considered would best suit his case, or would avoid him having to make an admission or concession in his evidence.

211 Further, there was no evidence to the effect that Braham instructed his solicitor, Mr Walton, in or after November 2011 that the funds which Braham provided after the November 2011 conversation should remain in Wantrup's trust account pending Braham's further instructions.

212 Giorgio met with Braham in January 2012 at which time Braham was aware that the $500,000 Braham had provided in 2011 had been utilised and therefore had been transferred out of the Wantrup Trust Account and yet Braham took no issue with that money being paid out of the Wantrup Trust Account and utilised. This is even though on the evidence Braham did not instruct the release of that large sum of money and no related agreement or security documents has been executed.

213 The objective facts, including those referred to below, in my view give rise to a clear and strong inference that the terms alleged by Braham in relation to the November 2011 conversation about his investment not being utilised, and being kept in the Wantrup Trust Account until his instruction to release them and execution of an agreement and securities (see T157.6-8), are contrary to the true events which occurred.

214 Giorgio's evidence was that between about December 2011 through to January 2012 he met with Braham about once a week. They discussed the Kush transaction.

215 Giorgio also gave evidence of meeting with Braham on 19 January 2012 and discussing matters relating to the Kush investment, including Giorgio informing Braham that the moneys that he had provided were going to be disbursed to pay some legal fees and that some of the moneys would be set aside for an imminent investment.[245] Giorgio's evidence was that Braham was not surprised, and Braham stated that that was 'not a problem', when Giorgio outlined how the moneys provided by Braham were going to be utilised.[246]

216 Further, Giorgio's evidence under cross-examination confirmed that Braham had been informed by the partial utilisation of the $500,000 that Braham had provided in late 2011.[247]

217 I am also satisfied that Braham was aware by the end of February 2012, that Braham's first payment had been withdrawn from the Wantrup Trust Account.[248] In my view the documents at CB601-2 confirm that the first payment had been withdrawn from the moneys provided by the plaintiff in December 2011 which had been placed in the Wantrup Trust Account.

218 In my view, it is also notable that at the request of Anthony Lamanna (Braham's accountant and Director of ALM Williams Partners Pty Ltd), Braham was asked to review the Wantrup Ledgers which had been provided to Braham's accountant, and via his accountant to Braham, by February 2012. I am satisfied that those Wantrup Ledgers were considered and understood by Braham.[249]

219 Additionally the plaintiff's own solicitor, Walton, was provided with access to the Wantrup trust ledgers, and Walton did not query the withdrawal of the sum of $500,000 from the Wantrup trust moneys in about the period 21 February 2012 to 22 March 2012.[250]

220 In my view the reliability and credibility of Braham's evidence was also eroded by the suggestion that he had something of a clear recollection about meetings upon which he relied yet he was not able to recall meeting and discussing relevant matters with Giorgio in late October and early November 2011. I am persuaded that Braham's recall of the meetings which did occur was poor.[251]

221 Likewise I am also unpersuaded that there was any agreement, arrangement or understanding between the plaintiff and the third defendant in relation to the moneys provided by Braham remaining in the Wantrup Trust Account.

222 I am also unpersuaded that it was ever represented or agreed by any relevant party or actor that once provided, Braham's money would sit in the Wantrup Trust Account until Braham instructed the release of those funds, and satisfactory agreement and security documentations had been executed.

223 Braham's evidence that the money which he was providing was to remain in the Wantrup Trust Account until Braham's instruction it be disbursed and the plaintiff entered into an agreement and securities in relation to such moneys,[252] is inconsistent with the body of evidence that Braham understood that Giorgio required the funds being sought by him immediately, and that Braham did not take issue with that requirement.[253] Braham's case in this regard is also inconsistent with his conduct at times when he became aware that his funds had been disbursed without such matters being attended to.

224 I also consider that Braham's credit is eroded and the likelihood of the Wantrup version of events significantly supported by the initial entries in the Braham Investment Trust accounts, which recorded the first payment as 'a loan'.[254] The Braham documents at CB616 to CB619 (inclusive), were created on 21 July, but in a year which those documents do not disclose.

225 However, I am satisfied that the Braham documents at CB616-CB619 were created some time after June 2013, because at CB618 the date 30 June 2013 appears, and I am also satisfied that these accounts were probably created after these proceeding were issued on 21 July 2013.

226 I note that the original payment transaction records Sovereign ('Sov') as a relevant party.[255] CB617 then shows this transaction as reversed on 30 June 2012 (transaction 313).

227 The significance of these Braham Investment Trust amounts, prepared by Braham's accountants, who were authorised to do so by Braham,[256] is that I consider the entry to which I have referred amounts to an admission that those accounts acknowledge and record the initial $500,000 first payment to be a loan to Sovereign. Braham did not explain how these accounts and entries conveyed a different position and Braham's accountant, Lamanna, was not called by the plaintiff.[257]

228 Further, I reject Braham's assertions that he did not understand the structure and role of the various companies of which he was a Director. In each case the companies mentioned by Braham, namely Braham Investments Pty Ltd, Braham Properties Pty Ltd, Simon Braham Pty Ltd and Braham Investment Trust, appear to be companies which have been in existence for some time and to be companies in the nature of corporate vehicles to facilitate Braham's personal investments, property portfolio, medical practice administration and superannuation interests.

229 Braham's evidence in relation to these companies included that Braham could not remember whether he was the sole director of Braham Properties Pty Ltd; his evidence was that he could not answer that question because 'I don't really understand all that'.[258] Nor could Braham recall whether in addition to himself there were any other directors of Braham Investments Pty Ltd.[259] Braham could not say whether Braham Properties Pty Ltd was a trustee company and professed not to understand the question put to him as to whether Braham Properties Pty Ltd, of which he is a director, is a trustee company of the trust.[260]

230 Braham's evidence was also that he was not sure what was meant by the question 'Did it (Braham Properties Pty Ltd) execute a trust deed at any point in time ...'. Braham also stated that he could not answer questions about whether Braham Properties had received communications which suggested that it was acting as a trustee of a trust; Braham asserted that he could not answer such a question because he did not understand it and did not understand what a trustee of a trust means.[261]

231 In my view the evidence of Braham, who was by 2011 a successful specialist medical practitioner of at least a decade's standing and who had acted as a director of several companies which he controlled for many years, that he did not understand the structure and the role of all of the companies conducting, in effect, his business and his affairs and in respect of which he was a director, in the case of at least Braham Properties Pty Ltd, Braham Investments Pty Ltd and Simon Braham Pty Ltd, the sole director, is incredible, unacceptable and untruthful.

232 I consider given Braham's direct personal association with the above mentioned companies and the nature of his formal role as Director of those companies, which Braham held and ostensibly discharged, that he well understood the structure and operation of his companies and the evidence which he gave to the contrary was untruthful.

233 Similarly, I do not accept that Braham did not understand and was not attentive to the Trust Ledgers sent to him under cover of an email from Wantrup's Accounts Supervisor, Ms Naumovski, dated 17 February 2012 (12:09pm).[262]

234 Ms Naumovski's email of 17 February 2012 pointed out a specific account balance debit to Braham's account and specifically asked him to contact her if he had any further queries. That email was also copied to Braham's accountant, Anthony Lamanna, at ALM Williams Partners Pty Ltd.

235 The ledgers, which I am satisfied were attached to Ms Naumovski's email of 17 February 2012, were again communicated to Braham at 1.35pm on 17 February 2012 by his accountant Anthony Lamanna who, in an email which he designated to be of 'High Importance',[263] confirmed that Ms Naumovski's email of 17 February 2012 had been received with Trust Ledgers attached, and that that email highlighted to Ms Naumovski and to Braham that in relation to the Sovereign MF account, Mr Lamanna required details of withdrawals made from that fund in the 2011/12 year in respect of the sums of $800,000 and a further sum of $500,000 withdrawn respectively on 17 August 2011 and 9 December 2011. Those Wantrup & Associate ledgers[264] also highlight the sum of - $51.44 debited as a result of a dishonoured cheque provided by Braham.

236 That Wantrup & Associate 'Trust Ledger', in respect of Braham and the Sovereign MF matter reflected the following:

237 In his evidence, Braham attempted to disengage with Ms Naumovski's email of 17 February 2012. Braham's evidence was that he did not recall that email and did not remember reading it.[265] In my view Braham's evidence attempted to convey that what was important to him in relation to the email was that his accountant, Lamanna got the information he wanted. Braham's evidence was that he did not think that he paid much attention to the email of 12 February 2012 and the attached Trust Ledgers.[266]

238 Although Braham agreed that to him the sum of $500,000 was a large amount of money, when he was asked whether he was shocked to see that the ledgers[267] were in debit rather than reflecting a credit balance of hundreds of thousands of dollars, Braham's response was that he certainly would not have understood what the ledger meant. Braham's evidence was that he did not understand that the money that he had placed in the Wantrup account had been taken out; Braham asserted that he did not understand the ledger.[268]

239 When Counsel for Wantrup put to Braham that it was likely that he would have understood the Wantrup ledger had he looked at it in February 2012, Braham responded 'I get really confused by debit and credit, so I would have - I would have relied on my accountant to read these documents, not me'.[269]

240 Further, when Counsel for Wantrup questioned Braham about what the above extract from the Wantrup ledger conveys in relation to the entry '-$51.44'[270] and put to Braham that the entry reflects that there was a negative balance in respect of 'Sovereign MF' account, Braham answered 'To be honest with you, I didn't understand the difference'.[271]

241 I reject Braham's evidence in relation to the documents at CB600 to CB604 and related matters. I do not accept that Braham did not look at the entries in the Wantrup & Associates trust ledger which had been provided to him on 12 February 2012 and I reject Braham's evidence that he would not have understood the Wantrup Trust Ledger if he had looked at it.[272]

242 I reject this evidence as inherently unlikely and incredible because Braham had not only been specifically referred to and provided with copies of the Wantrup & Associates Trust Ledger referring to the Sovereign Managed Fund, but also because Braham well knew that he had deposited $1.5 million into that account over the eight-month period preceding mid-February 2012.

243 Furthermore, Ms Naumovski's communication to Braham of 17 February 2012 specifically raised the need for Braham to regularise the trust ledger balance by paying the sum of $51.44, and in my view the most passing perusal of the relevant ledger itself clearly identified that it was in the overall deficient by '-$51.44'. Further, in my view it is highly probable Braham's specific attention would have been drawn to that debit entry.

244 Additionally the Trust Ledger, which is set out above, both reflected in very simple terms moneys received from Braham between 4 July 2011 and moneys debited to the trust ledger up to 9 December 2011, and that Ledger also recorded two instances on which Braham's cheques in the sum of $500,000 had been dishonoured.

245 Furthermore, the balance of the Wantrup & Associates trust ledger relating to the Sovereign managed fund and the withdrawals from that fund in the sums of $800,000 and $500,000 on 17 August 2011 and 9 December 2011 respectively, were again communicated to Braham under cover of an email from his accountant of 17 February 2012 (1.35pm) which his accountant had marked 'Importance: High'.

246 Given the circumstances which I have highlighted above, I consider it to be near inconceivable, and therefore extremely unlikely, that Braham would not have looked at the communications he received on 17 February 2012, in particular the Wantrup & Associates Trust Ledger dealing with the large sums of money which he had provided to Wantrup & Associates in the preceding period of approximately eight months. I also consider it to be near inconceivable and therefore extremely unlikely that Braham would not have carefully read, and upon reading, fully understood the straight forward information in relation to the Wantrup & Associates Trust Ledger attached to the email of 17 February 2012 from Ms Naumovski which is set out above.

247 I am for these reasons well satisfied that Braham received and understood the communications from Ms Naumovski of 17 February 2012 and the communication from his accountant of the same date which also expressly mentioned two large withdrawals of money in late 2011 from the 'Sovereign MF' account. I am also well satisfied that Braham considered and understood the Wantrup & Associates Trust Ledger extract attached to Ms Naumovski's email.

248 In that regard I am therefore satisfied that on 12 February 2012 Braham was well aware that the moneys he had provided to Wantrup in the sum of $800,000 in September 2011 and $500,000 in December 2011 had been withdrawn from Wantrup & Associates' account in November and December 2011 respectively.

249 As a result of these findings I also consider that Braham's evidence on these matters was untruthful and contrived to avoid admitting that by February 2012, he was well aware, amongst other things conveyed by the Wantrup Ledger, that the $500,000 he had provided in December 2011 had been disbursed to Sovereign.

250 Braham's evidence in this regard was, I consider, also contrived to try to avoid having to explain why, if his money had been disbursed to Sovereign as reflected in the Ledgers provided to him in February 2012, he was not protesting that such a transfer had been made without his authorisation and without related agreement and security documents being executed.

251 Additionally, the plaintiff itself submits that there was some inconsistency and imprecision in the language with which Braham described important discussions and the plaintiff also submits in relation to its own case that that case does not hinge on Braham's evidence, but rather turns on the intention of the plaintiff as manifested at the relevant time by the documents and objective circumstances which the plaintiff submits provide the best evidence of that intention.[273]

252 In relation to the plaintiff's submissions, I note that I have made findings regarding the inadequacies of Braham's evidence including as to its lack of veracity, and in relation to inconsistencies and imprecision with his evidence. I reject therefore that, even in general terms, Braham's evidence supported the plaintiff's case, although I accept that it was intended to do so.

253 I accept however the plaintiff's submission that its case does not hinge on Braham's evidence for the reasons I have outlined. The true intention of the plaintiff and the true nature of the three transactions in issue is most reliably and persuasively established by the objective circumstances including Braham's conduct and key communications and documents at about the time of the series of transactions in issue, and those facts and circumstances as established by Giorgio's evidence and Wantrup's evidence, which I accept and which are consistent with what I have concluded can reasonably be inferred from Braham's conduct, which was itself inconsistent with the plaintiff's fundamental case.

254 Further, I do not accept the plaintiff's submissions that no adverse inference should be drawn against Braham's credit in relation to the Trust Ledgers that he received from Ms Naumovski in February 2012,[274] or in relation to the plaintiff's financial statements, as a result of the time of day they were received by Braham, because of the pressures of Braham's work, and as a result of Braham's lack of financial acumen regarding accounting and trusts and his reliance on his accountant or because Braham lacked knowledge concerning matters of accounting and trusts and relied heavily on his accountant to deal with his financial affairs. I am far from persuaded as to any of these maters which the plaintiff argued in an attempt to explain Braham's conduct, which was in many respects, incredible and inconsistent with the plaintiff's case.

255 In addition to the reasons I have outlined as to why I consider the receipt of the trust ledgers from Ms Naumovski and the financial statements of the plaintiff to be of great significance, I am unpersuaded by the plaintiff's submissions in this regard because I consider that Braham's high level of education and long involvement as a Director of the numerous companies which existed and operated to support and facilitate his practise as a medical specialist and his investments, render it highly improbable that he was not able to readily and speedily understand the content and impact of the Trust Ledgers and the financial statements referred to above. I am also of the view based on Braham's own communications, that he was capable of well understanding the communications and financial documents in issue.[275]

256 Furthermore, I do not accept that Braham only had a very limited time in which to absorb and understand certain financial documents because he received those communications at about the middle of the day on 17 February 2012. Braham did not attempt to explain why he was not able to further consider those documents later in the day or in the evening of 17 February 2012.

257 Finally, I add that in my view, the findings I have made in relation to the quality of Braham's evidence above also afflict all of Braham's evidence in relation to the three payments which, in substance Braham has claimed followed the first payment on very much the same basis and with the same intent.

258 The plaintiff's pleaded case in relation to the second payment has as its base the following allegations:

1. In about August 2012, Giorgio, on behalf of Sovereign:
   1. invited Braham Investments to invest $100,000 in the Tarneit Land Fund (the proposed further Tarneit investment); and
   2. requested that Braham Investments, to demonstrate its interest in the proposed further Tarneit investment, deposit $100,000 into the Wantrup Trust Account such funds to be held in trust while an agreement and securities were prepared.

Particulars

The invitation was oral and occurred in a conversation between Giorgio and Braham at a restaurant in South Yarra. Giorgio said to Braham words to the effect that Sovereign needed an additional $100,000 to complete the project at Tarneit, in order that secured noteholders, including Braham Investments, may recover their investment in the Tarneit Land Fund. Braham said words to the effect that he was interested in making such an investment.

The request was partly oral and partly implied. Insofar as it was oral, Giorgio then said words to the effect stated in paragraph 15(b). Insofar as the request was implied, it arose from the course of conduct between the parties particularised under paragraph 8.

1. Pursuant to Giorgio's request in paragraph 15(b), on or about 22 August 2012, Braham Investments deposited the sum of $100,000 into the Wantrup Trust Account.

Particulars

Braham gave Giorgio a cheque in the amount of $100,000 payable to the Wantrup Trust Account at a restaurant in South Yarra on or shortly before 22 August 2012 [CB 620].[276]

Braham's evidence in chief - the second payment

259 Braham's evidence in chief[277] in relation to the Second Payment was as follows:

Are you able to identify any particular meetings in that year?---I met Mr Giorgio probably weekly, as I said, at cafés in South Yarra. It would have been brought up - I don't have a specific memory of every time it was brought up. When it was discussed, all that was said was, 'We're still waiting for documents, it has been a slow process, the money is in trust'.

Did Mr Wantrup attend any of those meetings?---Not when Mr Giorgio was present.

Did you have any separate meetings with Mr Wantrup in respect of which Kush was raised and discussed?---Yes, Your Honour.

Are you able to say when those meetings occurred?---In July 2012 we had a very lengthy session in Mr McCormack's chambers. It was really to do with witness statements and evidence in the Gunns litigation. We spent about six hours together in that session and at one time I expressed my frustration to Charles Wantrup that this was taking too long, that my funds had been in his trust account for a very long time and did he know what was happening with the documents in Kush.

And in response, what, if anything, did he say to you?---He referred me to Mr Giorgio.

I beg your pardon? What did he say exactly? Do you recall?---He said I'd have to speak to Mr Giorgio.

HIS HONOUR: Meaning you'd have to speak to him?---Correct, Your Honour.

MR HEATH: At that meeting, or any prior meeting at which Kush was discussed, did anyone disclose to you that your money had been paid out of Mr Wantrup's trust account?---No, Your Honour. [278]

...

Do you recall in general terms Mr Giorgio raising with you the provision of $100,000 and its payment into Mr Wantrup's trust account?---Yes, I do.

Would you tell His Honour about that conversation?---That conversation occurred over more than one meeting, Your Honour. The gist of the conversation was that Sovereign required more funds to complete the development at Tarneit. This was important because I had 1.9 million already invested in Tarneit. And he proposed an investment which was going to be secured on the title. The terms of the investment were a 15 per cent per annum return and half of the bonuses at settlement of the individual lots. The security, as I said, was going to be the title. I said at that stage I could probably provide $100,000. That money was to go into the Wantrup trust account and it wasn't to go out until documents were produced and finer legal agreement achieved.

Was there a discussion concerning the investment of a larger sum?---My recollection is that came a little later.

I want you to look at the second last text message on that page, 954. Just before we do, do you recall what Mr Giorgio said, if anything, in response to your comments as just outlined?---There was two issues running at the time. There was that further investment in Tarneit and there was what was going on at Kush. He agreed with me about the further investment in Tarneit.

What did he say, do you remember?---'Sure, Simon, certainly'.

Were there other discussions about Kush?---Yes, there were other discussions about Kush. I was expressing my frustration that nothing had happened at Kush and the settlement hadn't occurred. He kept telling me it was imminent. I said my funds had been in the trust account for eight months by now and he indicated to me that I would get a bonus - he called it 'interest'.

Did he talk about the nature or extent of that interest or bonus?---It was going to be $100,000. I didn't really understand exactly the mechanics of how that was going to work. [279]

...

What sort of issues were discussed at that particular meeting, if you recall?---Mr Giorgio and myself were involved in a range of issues. The relevant ones for us today are Tarneit and Kush.

And do you recall what discussion, if any, occurred in respect of Kush at that time?---Again, settlement was imminent, documents will be coming, and I expressed my frustration at the length of time it was all taking.

And what did Mr Giorgio say, if anything, in response to you expressing your frustration?---He just talked about the plans and how good it was going to be and this manager that was working in 38 Chairs helping him.

Helping him?---With the design or whatever he was going to do with this café to make it successful.

The other topic for discussion was the Tarneit Land Fund. Would you tell His Honour, please, what you said to each other in that regard?---I detailed that before, Your Honour, but he requested - he explained to me that to complete the project, the Tarneit Land Fund needed more money. That would help realise my $1.9 million investment. He proposed terms, which were 15 per cent per annum and half of the bonuses at settlement of each individual lot. Security was going to be on the title. I agreed to put $100,000 into Charles Wantrup's trust account and it wasn't to be released from Charles Wantrup's trust account until the documents were complete.

What did Mr Giorgio say in response?---He agreed.

Was there any discussion there, or in the next few days, about permission to release the funds the subject of that cheque handed over at that meeting?---No, Your Honour.[280]

Giorgio's evidence in chief - the second payment

260 Giorgio's evidence was that in about June or July 2012 he contacted Braham by telephone, communicating to him that Sovereign required further funds in relation to the Kush project.[281] Giorgio's evidence was in substance that on or about 15 or 16 August 2012 he met with Braham alone at Cosi. At that meeting Braham produced a statement which showed Giorgio that his current financial position was such that he could only pledge a further $100,000 to the Kush project.[282]

261 Giorgio's evidence was that he and Braham discussed that the $100,000 he was planning to advance would be used for legal fees in relation to the Kush project, and access to that $100,000 would be on the same basis as the earlier advance of $500,000 had been accessed. In the conversation about this second provision of money by Braham in relation to the Kush project, Giorgio's evidence was that Braham asked during the meeting at Cosi on 15 or 16 November 2012 whether he should provide his cheque for the further moneys to Eos, and Giorgio stated to him that he should make it out to Wantrup & Associates.[283] Additionally, he stated to Braham that 'we should just keep protocol and let's just follow suit in protecting your position'.[284]

Wantrup's evidence in chief - the second payment

262 Wantrup's evidence was that on about 22 August 2012 Wantrup & Associates received Braham Investments Trust's cheque in the sum of $100,000, dated 21 August 2012.

263 Wantrup was unable to recall who brought the Braham Investments trust cheque dated 21 August 2012 to Wantrup & Associates offices. Wantrup's evidence was that the trust account receipt dated 22 August 2012 was probably prepared by a new book-keeper at Wantrup & Associates, Ms Mirjana Blazevski. Wantrup's evidence was that he had no knowledge of the preparation of the Wantrup trust account receipt dated 22 August 2012 relating to the sum of $100,000.

264 Wantrup's evidence was that Wantrup & Associates received a direction to pay, dated 22 August 2012, from Giorgio directing that the trust money received by Wantrup & Associates in the sum of $100,000 be paid to the nominated account of Krema Pty Ltd.

265 Wantrup's evidence was that he did not receive any instruction from Giorgio about the basis upon which those funds were being paid to Krema Pty Ltd, nor did he receive any instructions or requests in relation to those funds from Braham.

266 In my view Braham's evidence in relation to the second payment materially diverged from the case the plaintiff has pleaded at [15B] of its Third further Amended Statement of Claim. The plaintiff's pleading relies on only one relevant conversation. However, in his evidence extracted above, Braham referred to a number of meetings with Giorgio which Braham now says are relevant, and at which the conversations he now relies upon took place.

267 Furthermore, and more significantly, in his evidence in chief in relation to the second payment, Braham stated that he and Giorgio agreed on the terms Braham had put to Giorgio about providing the sum of $100,000.[285]

268 At no point in these proceedings has the plaintiff alleged any form of agreement reached in relation to the second payment nor has the plaintiff or Braham, described such an agreement in any outline of evidence, and neither did Braham describe the circumstances relating to the second payment in his Affidavit sworn on 17 April 2013,[286] in the way he did in his evidence at trial.

269 In my view the above inconsistencies in the plaintiff's case and the material divergence between Braham's evidence at trial in 2016 and his sworn Affidavit of 17 April 2013 and his earlier pleading, now inconsistent with his sworn evidence, is more damning of the accuracy, veracity and persuasiveness of Braham's evidence and his case because his inconsistent Affidavit of 17 April 2013 was sworn relatively shortly after the discussion between Braham and Giorgio relied on in relation to the second payment.

270 In addition to the plaintiff's inconsistent earlier pleading and Affidavit which did not allege any agreement between Giorgio and Braham in relation to the second payment, the plaintiff, in my view, also inconsistently alleges that Giorgio requested the sum of $600,000 from Braham in August 2012.[287]

271 In my view Braham's evidence at trial as to an agreement being reached with Giorgio in relation to matters concerning the second payment was in the nature of recent invention by Braham. I have come to that view for a number of reasons, including the following: because of the change and evolution in Braham's evidence on this point, compared with his earlier instructions on the basis of which his earlier pleadings and his outline of evidence were produced; and because of Braham's conduct, which I have identified, which was inconsistent with the case the plaintiff puts in relation to the three payments. For these reasons my overarching conclusion is that Braham's evidence is unreliable and inconsistent in many specific respects and that those defects infect the whole of his evidence. Similarly, my overarching conclusion is that Braham's evidence has been untruthful and contrived to assist his case, and in areas of any conflict with the evidence of Giorgio or Wantrup, is not to be preferred.

272 Further, I accept Wantrup's submission that Braham's evidence at trial about agreements relating to the second payment with Giorgio in August 2012 is highly likely to be a recent invention on the part of Braham, because his pleaded case is based on 'a request' made in the setting of earlier dealings. Therefore, had Braham informed his legal representatives of the 'agreement' which he now says was reached with Giorgio, that agreement would have been reflected in the plaintiff's case by way of amended pleadings to that effect and that important new allegation would have been referred to in Braham's Outline of Evidence.

273 Further, in relation to the second payment the evidence establishes that Braham was being pressed by Giorgio to provide the second payment of $100,000 promptly.[288] However, the evidence is that Braham took no issue with that requested timing and agreed to meet Giorgio on the day after Giorgio's text message on 20 August 2012,[289] and further, Braham provided the requested cheque to Giorgio that next day.

274 In my view these circumstances contradict Braham's case that his intention was that the money which he had provided would be held and remain in Wantrup & Associates Trust Account and would not be released until execution of satisfactory agreement and security documentation, or on his specific instruction.

275 I am also of the view that none of the contemporaneous documents associated with any of the three payments, including the second payment, support Braham's assertion that the money which he provided was to remain held in trust by Wantrup.

276 Nor is there any evidence to the effect that Braham contemporaneously instructed Walton, his lawyer, in relation to his intent that the moneys that he was providing for Sovereign were to remain in trust until the occurrence of certain specified events.

277 Braham's evidence in relation to the second and third payment being moneys intended to sit in trust to await the completion of associated agreement and security documentation, and his instruction releasing those moneys, is most improbable, and I accept, as the third defendant submits, also illogical.

278 In my view it is most unlikely, given that the first payment of $500,000 had, on Braham's case, long been sitting in Wantrup & Associates Trust Account before approaches were made to him in relation to the second and third payments that Braham would not have reacted to urgent requests by Giorgio for additional cleared funds. If things had been as Braham suggests, in response to Giorgio's request for further large sums of money, it is highly likely Braham would have said in substance, 'why do you need more - what about the $500,000 I already have sitting in Wantrup's Trust Account?'. I also note that Giorgio told Braham that the Kush investment had stalled.[290]

279 In such circumstances, if Braham truly believed that the $500,000 that he had provided in 2011 remained in the Wantrup & Associates Trust Account, Braham would, in my view, most probably have referred to that large amount of money which he believed was sitting in the Wantrup & Associates Trust Account and responded to any pressing by Giorgio to provide a further $100,000 by citing the past payment and existing available sum of $500,000, and asking why there was a pressing need for a further $100,000.

280 In this regard, Braham in his evidence sought to suggest that the $100,000 requested by Giorgio in August 2012 '... was for further Tarneit investment ...'.[291] However, in my view it is clear from the contemporaneous text messages exchanged between Giorgio and Braham that the $100,000 sought in August 2012 was required for a 'settlement'.[292]

281 The evidence also establishes in my view that the only project in relation to which settlement was imminent in August 2012 was the Kush project.[293]

282 Giorgio's evidence was that the further $100,000 discussed with Braham in mid-August 2012 was 'for Kush, to cover further legal fees'.[294]

283 I accept Giorgio's evidence in this regard and reject Braham's attempt to characterise the $100,000 payment which he made in August 2012 as made in relation to a further Tarneit land fund investment.

284 Finally, I add that in my view the finding I have made in relation to the quality of Braham's evidence above also afflicts all of Braham's evidence in relation to the three payments which, in substance Braham has claimed followed on very much the same basis and with the same intent.

285 The plaintiff's pleaded case in relation to the third payment has as its base the following allegations:[295]

16A. In about September 2012, Giorgio, on behalf of Sovereign:

1. invited Braham Investments to invest an additional $500,000 in respect of the proposed further Tarneit investment; and
2. requested that Braham Investments, to demonstrate its interest in investing such additional amount in the proposed further Tarneit investment, deposit $500,000 into the Wantrup Trust Account such funds to be held in trust while an agreement and securities were prepared.

Particulars

The invitation was partly oral and partly in writing. Insofar as it was oral it occurred in a conversation between Giorgio and Braham at a restaurant in South Yarra. Giorgio said to Braham words to the effect that Sovereign now needed $500,000, in addition to the $100,000 already deposited by Braham Investments into the Wantrup Trust Account, to complete the project at Tarneit in order that secured noteholders, including Braham Investments, may recover their investment in the Tarneit Land Fund. Braham said words to the effect that he was interested investing the additional $500,000. Insofar as the invitation was in writing, it was contained in the Giorgio 17 September Email and in an email from Giorgio to Braham of 18 September 2012 at 12.43 pm. Copies of the emails are in the possession of Braham Investments' solicitors and may be inspected by appointment.

The request was partly oral and partly implied. Insofar as it was oral, Giorgio then said words to the effect stated in paragraph 16A(b). Insofar as the request was implied, it arose from the course of conduct between the parties particularised under paragraph 8.

16B. Following Giorgio's request in paragraph 16A(b),:

(a) a meeting was convened between Giorgio, Wantrup and Braham to be held on 21 September 2012 at the Hyatt Hotel;

(b) prior to the 21 September meeting, Braham requested that Wantrup provide at that meeting completed documentation so that Braham could arrange for Walton to review it;

(c) at the 21 September meeting, Braham gave Wantrup a cheque in favour of the Wantrup Trust Account in the sum of $500,000 (first cheque) drawn upon the bank account of Braham Investments [CB 653, 959] and directed Wantrup that:

1. the first cheque should not be deposited until Braham had placed funds in the Braham Investments bank account; and
2. Wantrup was not to disburse the funds until Walton had advised Braham in relation to the proposed investment and the security for the proposed investment was in place (the 21 September direction)

(d) Wantrup sought to bank the first cheque immediately and it was dishonoured;

(e) on 26 September 2012, Braham arranged a bank cheque in the sum of $500,000 (second cheque) [CB 671] at the St Vincent's branch of the Commonwealth Bank of Australia. A female employee of Wantrup collected the bank cheque from Braham at the Victorian Eye and Ear Hospital on that day.

286 As with the first payment and the second payment the plaintiff also alleges that this payment was conditional upon the preparation and execution of an investment agreement and security terms, and that the subject money was trust money held by Wantrup on trust for Braham Investments Pty Ltd, including within the meaning of s 3.3.14 of the LPA.

287 Further, the plaintiff alleges that as with the first and the second payments all payments, including the third payment, were known by Wantrup to only be applied at the plaintiff's direction, alternatively and for the purpose of the investment pleaded by the plaintiff to be the subject of each payment and upon completion and execution of an investment agreement and security terms.

288 For the reasons I have separately explained elsewhere, I reject the plaintiff's allegation referred to in the last two preceding paragraphs.

Braham's evidence in chief - the third payment

289 Braham's evidence in chief[296] in relation to the third payment was as follows:

I'd like you, please, to now focus on the next payment which you made in September. Do you recall making a payment to Mr Wantrup in September?---Yes, Your Honour.

In what amount was that payment?---$500,000, Your Honour. [297]

....

What were those discussions and with whom did you have them?---With Nickolas Giorgio, the discussions were with, followed up from that meeting we referred to in August 2012. The discussion was that I would invest a further 500,000 into Tarneit to help complete the project, subject to ...

MR HEATH: Do your best, Mr Braham. Don't look at that document. What I want you to do is do your best to recall, let His Honour know and again consider the idea of 'he said/I said' and if you don't recall, then let His Honour know, please - if you don't recall precisely?---Of course, I don't recall precisely. This is a long time ago, but what he said was, 'Tarneit requires further funds to complete the investment'. I said, 'I will try to raise these funds'. He said, 'Can you provide a cheque to put into Wantrup's trust account?' I said, 'I'll try to raise the funds. Give me some time to do that. The money would be to go into Wantrup's trust account. The terms of the investment were as previously discussed and the money was not to come out until final legal agreements', is what I said.

HIS HONOUR: You said that, did you?---Yes.

MR HEATH: Did you get a response?---He agreed. It had been a pattern that we'd been following for years by now. [298]

....

Can you recall generally -I don't want to take you to the documents, they speak for themselves- but can you recall generally making those follow-ups before the next meeting at the Hyatt hotel?---I certainly can, Your Honour. I sent texts to Mr Giorgio on many occasions asking for the documents to be provided before the 21 September Hyatt meeting.[299]

...

Yes, and you'll see there's a reference to a meeting. I want you to tell His Honour about that meeting if you could, please?---That meeting occurred on 21 September around 3 o'clock at the Hyatt hotel in the city. That meeting was very important because we needed to -I wanted the documents before this meeting so that we could further progress these two proposed investments. The meeting was with Charles Wantrup, Nickolas Giorgio and myself.

Do you recall when the meeting commenced and who was there at the commencement of the meeting?---Mr Charles Wantrup was slightly late. Mr Giorgio and myself were there at or before 3 o'clock.

Was there a discussion about Kush at that meeting?---Yes, there was.

What was discussed?---The discussion was we needed to get the documents prepared. We talked about this bonus.

HIS HONOUR: Just get back to the format of describing who is talking, if you wouldn't mind, Mr Braham.

MR HEATH: Just think as though His Honour is there and watching the conversation unfold in respect of that topic. 'You said/he said' - if you adopt that approach, that would be helpful?---It is a complex meeting some time ago, Your Honour, but what I said is, 'I need these documents. I'd been asking for them, in Kush's sake, for nine months'. Mr Giorgio and Mr Wantrup said the documents were imminent, settlement would be soon. I asked about this bonus. I said that the moneys have been in Wantrup's trust account now for a very long time. They indicated that I would get what they called at the time an interest of $100,000 so the total Kush investment would be worth 600,000. Mr Giorgio asked if I had the cheque for the further Tarneit investment. I said, 'Yes'. Your Honour, we discussed the further Tarneit investment. I said, 'I have the cheque. The funds will not be available until early next week. It is to be banked into Charles Wantrup's trust account and the funds were not to be released prior to final legal agreements'.

What did anyone say in response to that, if anything?---Both Mr Giorgio and Wantrup agreed.

What did they say, do you recall?---'Thank you'.

How long did the - let me go back a step. I withdraw that. I want you to look at the bottom of 1058 in volume 3?---The imessages.

Yes. The message to you, if you just look at that?---That is a few days prior to the meeting.

Just look above it. 1058, the last message?---Is that the top one?

The bottom message at the bottom of the page, 'Simon, cheque for 500K', do you see that one?---Yes, Your Honour.

And there was a request there. Did you comply with that request when preparing the cheque that you handed over?---Yes, I did. I dated the cheque 24 September 2012, Your Honour.

Did anyone explain to you why it had to be done that way?---It suited me, anyway, because I had to have the funds available.

HIS HONOUR: That wasn't the question, Mr Braham. Did anyone explain to you why it should be done that way?---No, Your Honour.

MR HEATH: If you just go on and explain why it did suit you. You're jumping ahead, but I do want to ask you that question, too. Why did it suit you?---I had to get the funds cleared into that account and I'd already indicated that that wouldn't happen until early the next week anyway.

When did you indicate that, do you recall?---I'd have to check the record.

At the meeting or before the meeting?---Before the meeting.

To whom did you give that indication?---Nickolas Giorgio.

Did either Mr Giorgio or Mr Wantrup say to you what would happen to the money when placed into the trust account?---What Mr Giorgio said was the money was going to be used to fund the completion of the Tarneit Land Fund.

Was there a discussion with you about permission to take that money and send it off once it had cleared to Mr Wantrup's trust account?---No, Your Honour.

I want you to let His Honour know, doing the best you can, how long the meeting ran for?---An hour and a half, Your Honour. [300]

...

Did you have a conversation with that person?---No, Your Honour.

On that day, did you have a conversation with Mr Giorgio or Mr Wantrup in which you authorised the payment of those moneys to Sovereign, or anyone else, without finalising the loan agreement and security documents?---Certainly not, Your Honour.

In the week or two leading up to you handing over that cheque, did you have a conversation with either one of those men about the fact that the moneys, when received and cleared, could go to EOS Janus - that is the company that sent you the $55,000 invoice a couple of years earlier?---Certainly not, Your Honour.

Did anyone mention EOS Janus receiving your funds?---No, Your Honour.

Mr Braham, after that cheque was handed over, did anyone tell you that the moneys had been paid out?---No, Your Honour.

Did anyone tell you about the purpose for which the moneys would be used?---Yes. As we said before, completion of the Tarneit land sub-development.

After September 26, did you have any discussions with Mr Wantrup or Mr Giorgio regarding Kush?---Yes, Your Honour.

Was it a regular topic at meetings, or how often?---At this stage I think it was mainly by email because it was between the lawyers, Demian Walton and Charles Wantrup, drawing up the final details of the agreement.

Were any final documents ever presented to you in respect of Kush?---No, Your Honour.

Were the documents, having passed between the lawyers involved, was there any final document passed on to you for execution in respect of the further Tarneit investment?---No, Your Honour. [301]

Giorgio's evidence in chief - the third payment

290 Giorgio gave evidence that on or about 16 September 2012 he met again with Braham alone at a restaurant known as 'Third Eight Chairs' in South Yarra. At this meeting there was no discussion about the Kush project however the Sovereign Tarneit land fund investment was discussed including that Sovereign was looking for funding to cover some compliance costs in relation to that project.[302]

291 Giorgio's evidence was that in this discussion he identified to Braham the way in which any further investment he made would be utilised, namely for compliance costs in relation to Council's requirements, to enable the issue of titles in relation to the development.[303] Giorgio's evidence was that Braham was agreeable to what was being proposed but was not able to indicate how much further money he could contribute to Sovereign. In the same conversation Giorgio discussed with Braham that the quicker compliance costs could be met, the quicker the titles in relation to the development could be issued.[304]

Wantrup's evidence in chief - the third payment

292 Wantrup gave evidence that on 21 September 2012 he received a Braham Investments Trust's cheque in the sum of $500,000 at a meeting which occurred at the Hyatt Hotel in Melbourne.[305]

293 Wantrup said the following in relation to the Hyatt Hotel meeting on 21 September 2012:

I arrived at the Hyatt Hotel. Nickolas and Mr Braham were sitting there. We started talking about overseas tax structures for Mr Braham. I couldn't really understand how an overseas tax structure would assist him, so I was fairly non-committal. I was handed a cheque for $500,000. I don't remember whether that was before the conversation or within the conversation.

Was anybody else present at this meeting?---Not at that point.

When I received the cheque, I was told that the Commonwealth Bank was coming to collect a cheque. I rang my office. I spoke to a secretary of mine at the time and asked her to bring a chequebook to me. She came with the chequebook. I completed the cheque. The Commonwealth Bank guy arrived and stood there expectantly. I put the cheque in an envelope and it was given to him.

Was Dr Braham present?---At all times.

Do you remember the name of the person from the Commonwealth Bank?---Dean. I don't remember his second name. He was introduced.

HIS HONOUR: For how long was that person present?---A very short time, Your Honour. Basically he acted like a courier rather than a senior manager of the Commonwealth Bank.

DR HANAK: Was there any discussions at this meeting about when Mr Braham's cheque could be presented?---Absolutely, yes. It was made clear that there weren't funds in the account at that time and they'd be there on the following Monday, and the Commonwealth Bank person was told not to bank the cheque.

This Hyatt Hotel meeting, what was the date of the meeting, do you recall?---The 21st.

294 Wantrup's evidence was that the deposit of the Braham Investments Trust's cheque dated 24 September 2012 in the sum of $500,000 was not into the Wantrup & Associates Trust Account because of the previous experiences which Wantrup had had with Braham's cheques bouncing and to avoid any future problem in relation to cheques being deposited in the firm's trust account and subsequently not being honoured.[306]

295 The Braham Investments Trust;s cheque of 24 September 2012 was therefore deposited in the Wantrup General Account.[307]

296 The receipt issued for Wantrup & Associates in relation to the sum of $500,000 received on 24 September 2012 recorded 'Memo for account Sovereign MF Limited. To pay EJC $400,000, Barrister's fees (John Denton, Bowen Lawyers and Rubenstein) and outstanding invoices'.[308]

297 On 17 September 2012, Giorgio, Managing Director of Sovereign, sent an email to Braham which was also copied to Wantrup in the following terms:

As discussed with the imminent settlement of Kush I have asked Charles to attend to the following documents although some of these are partly complete:

1. Convertible Loan and Note agreement

2. Shareholders Agreement

The total provided by you for the Kush matter is $600,000.00 which avails you to a 46% equitable share given the sale price remains at 1.3mill. However this sale price figure may change (be reduced) prior to settlement.

In the matter regarding Sovereign Tarniet Land Fund and the request for further funding it was agreed that you would provide an immediate amount of $500,000.00 on the following terms:

1. Interest to be at 15% p.a. to mature on or before 30th November 2012
2. 50% share of house commissions received by Eos Janus Holdings Pty Ltd on 48 lots in stages 5 and 6
3. Secured by current first mortgage held together with debenture charge over SMF already held.

Charles will attend to point number 2 above by way of a separate agreement however he will need to issue a new note for point 1.[309]

298 It is most significant in my view that this 17 September 2012 communication from Giorgio to Braham referred to both the $600,000 which by mid-September 2012 had been provided by Braham in relation to the Kush project, and also recorded the request which was communicated by then from Sovereign to Braham to provide a further $500,000 for the Sovereign Tarneit Land Fund.

299 That communication referred to discussions with Braham about the imminent settlement of the Kush lease and noted the still yet to be finalised agreement and security documentation in relation to that investment, which Braham indicated in his evidence he had sought since about mid-November 2011, and which Braham has both pleaded and stated in evidence was required before the money he had provided to Wantrup was applied or released. This clearly had not occurred by mid-September 2012 and the evidence is clear; Braham had not insisted on any such documentation before paying $500,000 to Wantrup by the third payment of December 2012 and $100,000 by the second payment of 2012.

300 Further, as I have detailed, seven months earlier Ms Naumovski, in Lamanna's communications to Braham of 12 February 2012, had attached the Wantrup Trust Account ledgers thereby expressly advising and alerting Braham to the transfer out of the Wantrup & Associates accounts of the $500,000 Braham had provided to Giorgio in early December 2011.

301 Giorgio's evidence was that even as late as mid-September 2012 Braham raised no disagreement, complaint or enquiry about the $600,000 which he had by then provided for the Kush project,[310] the $500,000 which Braham had been notified in mid-February 2012 had been disbursed to Sovereign, nor did Braham complain about the fact that the associated agreement and security documentation had not been finalised in relation to his investments.[311]

MR HEATH: Mr Giorgio, on 18 September, emails passed between you and Mr Braham about the provision and receipt of the very legal documents to which Mr Braham had referred in that meeting?---I'm sorry, there were?

You had email discussions or communications with Mr Braham - 629 and 630 of the court book - on 18 September concerning the provision of documents? I shouldn't be too much longer, Your Honour.

HIS HONOUR: Thank you, Mr Heath.

WITNESS: Which book?

MR HEATH: Volume 1, 629, 630. If you look at 630 first, do you see the first paragraph after the salutation at the bottom of 630?---Yes.

He was asking about the documents; correct?---Correct.

And he'd referred expressly to the documents at the meeting with you on 16 September 2012?---In relation to that meeting, there was a mention of documents, but it wasn't a sore point. I mean, the documents were up to the legal parties to deal with and there's already enough historical issues there in relation to the procrastination of legal parties, so - - -[312]

303 Further, Braham's email of 18 September 2012[313] to Giorgio headed 'Subject: RE Kush and Other matters', took no issue with the conversation outlined in the email from Giorgio's conversation of 17 September 2012 or Giorgio's email of 18 September 2012. [314]

304 In my view the contemporaneous communications involving Braham, and the associated contemporaneous documents, reflect and confirm the fact that although, as I have found, by at least mid-February 2012 Braham was aware that the money he had provided to Wantrup for the Kush Café investment in December 2011 had been released by Wantrup to Sovereign, Braham took no issue with that utilisation of the $500,000 he had provided to Wantrup in December 2011 nor did Braham object or complain that those funds had been transferred to Sovereign before he had entered into the loan agreement and security documentation which he, Braham, claims in his case he required before funds which he provided were released or applied.

305 Furthermore, neither did Braham object or complain that the December 2011 funds had been disbursed without his or the plaintiff's direction.

306 I also consider the above facts and circumstances to be most telling against the arrangements and understandings which Braham asserts in relation to the three payments which Braham alleges were all subject to substantially the same overall intent and general arrangement.

307 For this additional reason and because, as I have elsewhere explained, I accept Giorgio and Wantrup's accounts of the conversations, arrangements and intent of the three payments, I reject the plaintiff's and Braham's case in this regard and accept Wantrup's case, including Giorgio's supportive evidence on these matters.

308 Further, I consider Wantrup's case is further supported, and Braham's case is further discredited, by Giorgio's and Wantrup's evidence in relation to the further meeting on 21 September 2012 which occurred at the Hyatt Hotel in Melbourne.

309 This meeting was attended by Wantrup as well as Braham and Giorgio. An additional person, Mr Dean O'Neill, attended to receive a cheque which was expected to be provided by Wantrup.[315] Wantrup provided the cheque to Mr O'Neill and Braham provided a cheque in the same amount to Wantrup. Wantrup's cheque was post-dated to allow for Braham's cheque to clear.[316]

310 Giorgio's evidence was that in relation to the cheque for $500,000 provided at the Hyatt meeting on 21 September 2012, on 24 September 2012[317] he signed a further direction on behalf of Sovereign authorising $500,000 to come out of the Wantrup & Associate's Trust account in relation to the Sovereign MF Limited investment, and he also directed those moneys to be transferred to: in part Eos ($400,000); in part to a consultant ($75,000); and in part to barrister's fees ($25,0000).

311 Giorgio's evidence was that at the 26 September 2012 meeting with Braham, Giorgio asked Braham whether it was 'okay' to disburse the Tarneit funds,[318] and at that meeting the funds in the form of the cheque provided by Braham were in effect disbursed before Braham's eyes by the provision of a cheque for $500,000 (which Braham's counter cheque of $500,000 was to cover) to Mr O'Neill of the Bank.[319]

312 I accept the facts in relation to the Hyatt Hotel as summarised in the third defendant's oral submissions:

Mr Wantrup's evidence was to the following effect: 1. Mr O'Neill from the Commonwealth Bank attended the meeting. 2. Mr Wantrup was given Mr Braham's cheque and was asked to provide a cheque to the Commonwealth Bank. 3. Mr Wantrup arranged to obtain his chequebook and provided the cheque to Mr O'Neill in front of Mr Braham. 4. Mr O'Neill was told not to bank the cheque because there were not funds in Mr Wantrup's account. 5. That discussion took place at the same time as the discussion concerning the banking of Mr Braham's cheque. 6. The discussion occurred in front of Mr Braham - transcript 264, line 28 to 265, line 28 and 363, line 21 to 364. That general evidence was supported by what Mr Giorgio said about the Hyatt meeting.

Mr Wantrup's evidence about the Hyatt meeting was also supported by the contemporaneous documents, which establish that he wrote out the cheque to EOS at the Hyatt Hotel - court book 2036; he instructed his secretary, later that day, to record the details of the payment of the cheque and the place where the payment was made, transcript 266, 21-27 and court book 2036. The cheque was handed to Mr O'Neill on 21 September - court book 2033, which is an email from Mr O'Neill that says, 'I have received notice the cheque you handed me on Friday has been returned'. It confirms the cheque was given to him on the very day that we allege that occurred. There is no suggestion of any other meeting with Mr O'Neill on 21 September at which that could have occurred. There is no suggestion that Mr Braham left the meeting early.

In that situation, Your Honour, it would have been obvious to those present and observing those facts, including Mr Braham, that one cheque was being banked against the other.[320]

313 In relation to the third payment I consider that Braham's evidence is again inconsistent, unsatisfactory and unpersuasive.

314 At trial Braham's evidence did not establish the first of the plaintiff's pleaded conversations in paragraph [16A(b)] of the Third Further Amended Statement of Claim, relating to the alleged request by Giorgio.

315 Braham's evidence was, as with his evidence at trial concerning the second payment, that there had been an 'agreement' reached between he and Giorgio in relation to the basis upon which Braham would provide the third payment.[321] Braham's evidence in chief was that Wantrup expressly agreed to hold the money represented by the third payment on trust.[322]

316 As with my conclusion in relation to the second payment, I consider that Braham's evidence in relation to his asserted 'agreement' with Giorgio both at the first of the alleged meetings in August 2012, and at the Hyatt Hotel meeting at which Braham now alleges he reached agreement with both Giorgio and Wantrup, to be recent inventions by Braham as to the suggested agreed basis upon which Wantrup would hold the third payment in trust.

317 In my view, it is most telling against the accuracy and credibility of Braham's evidence in relation to the third payment and in particular Braham's new assertion that an agreement was reached with Giorgio at that meeting, that no mention is made of such an agreement in Braham's Affidavit sworn 17 April 2013, even though at the date Braham swore that Affidavit the events he was deposing to had occurred relatively recently, whereas at the time he gave his materially different evidence at trial in relation to these aspects, the conversations he was purporting to recall had occurred over three years ago. Similarly, neither Braham's Amended Statement of Claim produced in August 2013 or his Outline Witness Statement mention that agreement.

318 Furthermore, in those earlier statements of his case Braham does not mention a Hyatt meeting nor any positive agreement reached with Giorgio or Wantrup. Accordingly, Braham's Outline Witness Statement covers materially different facts in relation to the discussions between Giorgio and Braham, and as to the Hyatt Hotel meeting between Giorgio, Braham and Wantrup in relation to the basis upon which the third payment would be held by Wantrup.

319 I consider that these matters also greatly discredit Braham, detrimentally affect his overall credit, and render his evidence about the conversations he had with Giorgio and Braham concerning the basis of receipt and Wantrup & Associates holding the three payments, most unreliable.

320 Furthermore, as I have earlier concluded in relation to the second payment, it is in my view most improbable, illogical and inconsistent for Braham to put forward a case to the effect that he intended and had arranged for, the third payment of $500,000 to sit in the Wantrup Trust Account until satisfactory finalisation of agreement and security documentation, and his instruction that those moneys be released to Sovereign.

321 As with the second payment there was a degree of urgency communicated by Giorgio in relation to the third payment. Giorgio was again requiring that Braham provide cleared funds and to do so very promptly.[323]

322 Consistently with what I consider to be the true situation, Giorgio's request for Braham to provide $500,000 on 20 September 2012 was responded to by Braham providing a cheque for that money the next day, on 21 September 2012.

323 Although Braham initially provided a cheque on 21 September 2012 it bounced. Ultimately Braham provided speedy transfer of necessary funds and a replacement cheque on 26 September 2012.[324]

324 These facts are inconsistent with Braham's suggestion that he was expecting his funds to sit in Wantrup's Trust Account until related contracts were agreed and he provided an instruction for the release of funds.

325 Finally I note that the plaintiff's alleged breach in connection with the third payment of $500,000 is that Wantrup deposited that cheque rather than an allegation of breach as a result of those moneys being disbursed. In this regard I accept that in the circumstances, which I have addressed in some detail above, it was obvious to Braham that the cheque that he was providing at the Hyatt Hotel was 'crossing' with the Wantrup cheque being provided to Mr O'Neill.

326 I consider it to have been obvious to Braham in those circumstances, and in the circumstances established in relation to the Hyatt Hotel meeting which are set out above, that, as Braham full well knew, the third payment would be deposited, and deposited immediately, and he was conversant with, and acceptant of, that occurring.

327 For the above reasons, including those referred to in the last two preceding paragraphs, I reject Braham's claim that there was any breach by Wantrup in relation to the third payment.

328 Furthermore, I reject the plaintiff's submission that Wantrup's evidence was vague and high level concerning the Hyatt meeting on 21 September 2012. Further, I reject the plaintiff's contention that Wantrup's evidence was bizarre and inherently implausible in placing Eos' banker in the role of a courier who waited patiently and quietly to receive a cheque.

329 The plaintiff's ultimate submission on this aspect is that even if Braham's evidence about the 21 September 2012 meeting is rejected, the evidence of Wantrup and Giorgio does not support a finding that the plaintiff intended to transfer beneficial ownership of the moneys concerned, once those moneys reached the Wantrup & Associates Trust Account. The plaintiff submits that such a conclusion is not open because the evidence gives rise to conflicting inferences and equal degrees of probability and therefore any choice between the inferences amounts to mere conjecture.

330 In Mutual Community General Insurance Pty Ltd,[325] the Court of Appeal stated, at [15] per Neave JA and Nettle JA:

The suggestion that his Honour intended to exclude consideration of competing possibilities which were not established as such as probabilities runs counter to his Honour's express recognition, immediately before the subject reference to 'the probable opportunity of others to do so', and apparent approval of, cases like Baltica, where the real possibility of other persons having caused a fire, assessed in light of the evidence as a whole, was held to have entitled the court not to be satisfied on the balance of probabilities that the plaintiff is responsible. That is made still clearer a little later in Tadgell JA's judgment by his Honour's invocation of the locus classicus of proof on the balance of probabilities in a circumstantial case:

In a civil case like this, where there is no direct evidence of a fact that a party bearing the onus of proof seeks to prove, 'it is not possible to attain entire satisfaction as to the true state of affairs: Girlock (Sales) Pty. Ltd. v Hurrell.[326] In such a case, however, the law does not require proof to the 'entire satisfaction' of the tribunal of fact. A definition of the sufficiency of circumstantial evidence in a civil case to support proof by inference from the directly proved facts was given by the High Court in the unreported case of Bradshaw v McEwans Pty. Ltd. (27 April 1951) in a passage since repeatedly adopted: e.g. Luxton v Vines;[327] Holloway v McFeeters;[328] Jones v Dunkel;[329] Girlock's case.[330] The relevant passage in Bradshaw's case is this:

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.[331] 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 ...[332]

331 I consider that on the evidence in this matter referred to above I am able, with sufficient confidence on the balance of probabilities, to decisively prefer the Wantrup and Giorgio accounts of what occurred in relation to the third payment transaction, and particularly so given my expressed views and conclusions in relation to the quality and acceptability of Braham's evidence.

332 Furthermore, in my view the exchange of cheques before Braham's own eyes at the Hyatt Hotel on 21 November 2012 provides a clear and strong indication that Braham was aware, and accepted, that the $500,000 that he was providing in relation to the Tarneit Investment was being immediately disbursed at the direction of Sovereign into that investment and that this was occurring in the absence of any direction from him or the plaintiff, and notwithstanding that investment agreement and security documentation had not been entered into.

The plaintiff's attack on Giorgio's credit is rejected

333 The plaintiff submits in relation to the respective credibility of Giorgio and Braham, that where there is an inconsistency between their evidence, the Court should prefer Braham's version of events and should reject Giorgio's evidence, because:

(a) Giorgio's evidence that in November 2011 Braham authorised or agreed to an immediate transfer of the moneys that he was providing without the finalisation of agreement and securities documentation is a recent intervention because it is not reflected in contemporaneous documents;

(b) Giorgio gave conflicting accounts of the discussions in which Braham is said to have authorised his money to be dealt with in the way described by Giorgio;

(c) Giorgio's version of events in relation to his conversation with Braham on about 12 November 2011 was not referred to in Wantrup's evidence, Defence or his outline of closing submissions.

334 In my view Giorgio's evidence is very much preferable to Braham's evidence about the communications between them in relation to the three payments in issue for the reasons which I have elsewhere outlined as to why I consider Braham's evidence to be unacceptable, unreliable, unpersuasive and in a number of important instances untruthful, as I have explained.

335 The plaintiff's submission concerning Giorgio's evidence being a recent intervention is, I consider, sufficiently displaced by the documents passing between the parties in January and February 2012[333] and in September 2012,[334] which flagged to Braham that the $500,000 that he had advanced in December 2011 had been transferred out of the Wantrup & Associates account and transferred to Sovereign, and the fact, which I accept, that Braham raised no issue or dispute and made absolutely no complaint or query in that regard.

336 For the same reasons, in my view there is no substance or force to the plaintiff's submission that Giorgio's account of the conversations with Braham in November 2011 are not referred to in Wantrup's evidence or in his Defence or outline of submissions. Giorgio's Outline of Evidence was produced on 11 March 2016, well after Wantrup's Outline of Evidence (8 October 2015). Furthermore, it was not put to Giorgio that his evidence of the November 2011 conversations with Braham are not reflected in Wantrup's pleading or outline of evidence.

337 Neither am I persuaded that Giorgio gave conflicting accounts about the discussions in which Giorgio says Braham authorised the utilisation of his funds.

338 For the reasons I have outlined I am persuaded that Giorgio's account of the critical communications between he and Braham about the three payments in issue is consistent and credible, and far preferable to the account of the events in question which was proffered by Braham.

339 I am not persuaded by the plaintiff's submission that Giorgio was an unreliable witness, or that I should discard or ascribe materially less weight to his evidence because he is said to have acknowledged his desire to punish and destroy Braham.

340 I recognise however, that it was established that from time to time Giorgio felt some animus for Braham. However, I am persuaded that Giorgio's evidence, particularly in cross-examination, establishes that any animus Giorgio had earlier felt towards Braham had dissipated by the time Giorgio gave evidence at the trial of these proceedings.[335] Accordingly I am also satisfied that Giorgio's past negative feelings for Braham did not affect his evidence at trial.

341 Further, my conclusions in this regard are bolstered by the objective factors which I have found most telling against the veracity and reliability of Braham's version of the critical events, and my findings concerning the acceptability and persuasiveness of Braham's evidence.

342 The plaintiff also submits that Giorgio's evidence is not to be accepted because he admitted in cross-examination that on an occasion Braham stated that he was prepared to put money into the trust account pending documentation[336] and that Giorgio invited Braham to do so.[337]

343 I do not ultimately consider this evidence from Giorgio to be of significance because although there is evidence Braham said at one point that he was prepared to put his money into the Wantrup Trust Account, pending documentation, I have found that the true nature of the transaction and Braham's intent was to utilise Wantrup's trust account simply as a clearing account for his provision of funds to Sovereign.

344 I have also found that the relevant funds provided by Braham were intended by him to be immediately available for deployment to Sovereign's purposes and I have found on the basis of Braham's own conduct that it is clear that he did not insist on the prior finalisation of related agreements and securities but rather he was content to accept that in due course security and investment agreement related documentation in respect of the money provided and subject investments would be finalised and provided to him.

345 The scenario which I accept is that Braham again and again, in late 2011 and 2012, accepted and acquiesced in the provision of his money occurring and that money being transferred out of Wantrup's Trust Account to Sovereign, even though the agreement and security documentation in relation to those transactions was not in place, and even though Braham had not instructed the release of such funds.

346 As I have earlier emphasised, it is most notable in this regard that Braham made no complaint that the finalisation of the security documentation was advised to him as still a work in progress on 12 September 2012,[338] some nine months approximately after he had provided the first tranche of $500,000 for the Kush project, and approximately seven months after he had been specifically advised that those moneys had been transferred out of the Wantrup Trust Account to Sovereign.[339]

347 Braham made no complaint and raised no objection or disputation about these matters even as late as the end of 2012.

348 In relation to the plaintiff's submission that Giorgio gave evidence which accorded with Braham's evidence in essence that Braham should just keep 'protocol and follow suit' in protecting his position,[340] I consider Giorgio's evidence in this respect vague, and most likely amounted to him telling Braham that rather than making out his cheque to Eos he should follow the usual course and make out his cheque to Wantrup & Associates.

349 I also note that the plaintiff in its final submissions described the 'protocol' as follows:

In other words, critically for our case, 'following suit' meant following the approach that had been adopted and implemented in 2010 in respect of the Glen Waverley investment, and also the approach which had been adopted and implemented in respect of the 2011 Tarneit Land Fund investment. The first one was for a total amount of $2.6 million; the second one was made up of two tranches and came to $1.675, although the note was issued in the sum of $1.9 million.[341]

I have elsewhere explained why I do not accept that the earlier conduct relied on by the plaintiff is of significance in relation to the subject three payments.

350 The plaintiff also seeks to derive support for its case from Giorgio's evidence that he reminded Braham of the late 2011 arrangement in relation to his earlier advance of $500,000, when he said that the $100,000 would be accessed in the same manner as the earlier $500,000 contribution.[342]

351 I do not, however, accept the plaintiff's submission that Giorgio's evidence as to these conversations provides any material support to Braham's version of events for the reasons I have earlier stated, and because for those same reasons, I am persuaded that Giorgio and Wantrup's evidence as to the true nature of the three payments decisively displaces the unacceptable and unconvincing suggested effect and inferences argued for by the plaintiff.

352 The plaintiff also characterises Giorgio's evidence as high level and lacking in substance as to the effect of Braham's authorisation or agreement to the transfer of beneficial ownership in the moneys which he, Braham, was to provide.

353 For reasons which I have explained I reject this criticism of Giorgio's evidence.

354 Further, I note that Giorgio made it clear that there was very limited discussion in September 2012 about what would happen with the cheque to be provided by Braham and the cheque to be provided by Wantrup, because there had been prior discussions which informed that aspect of this third payment in the series of transactions concerning advances by Braham to Sovereign.[343]

355 Further, I reject, for the reasons I have outlined, the plaintiff's submission that Giorgio's evidence, even if accepted, would not support a finding that the plaintiff intended to transfer beneficial ownership of the moneys Braham advanced, absent satisfactory documentation and securities being in place in the meantime.[344]

356 The plaintiff also submits that relevant contemporaneous documents support the conclusion that the proposed $100,000 in August 2012 investment did not relate to Kush.[345]

357 On this aspect I do not consider that the evidence sufficiently explains how it could be that the Wantrup email of 7 December 2011 (4:32pm)[346] to Walton and Braham can support the plaintiff's contention that the $100,000 'proposed investment did not relate to Kush'.

358 In its closing submissions the plaintiff submitted that:

There is a dispute on the evidence about in what Mr Braham or the plaintiff was proposing to invest. Contrary to Mr Giorgio's evidence, the relevant contemporaneous documents support the conclusion that the proposed investment was for Tarneit, not Kush - 472, 655, 691 and 794 - and when confronted with those documents, Mr Giorgio gave dissembling evidence - 472-476. He did accept, importantly, that he instructed Mr Wantrup to prepare the draft note showing a $500,000 investment in Kush - that is at 475 - and that figure was consistent with the amount that had been paid into the trust account in December 2011 - 476.12 - and such matters undermine Mr Giorgio's evidence that the proposed $100,000 investment related to Kush - see also 467.4-9.[347]

359 In my view the evidence does not explain in any satisfactory way how Wantrup's email to Giorgio of 25 September 2012 (09:09am) (CB 655) establishes, or intends to establish, that 'the proposed investment did not relate to Kush'.

MR HEATH: Can I get you to go back to 655, please. This is Mr Wantrup to you following up in respect of Krema discussions at the meeting on the Friday, that is Friday, 29 September 2012; correct?---This email relates to a meeting on 29 September?

Yes. See the email is dated Tuesday, 25 September, and it talks about 'On Friday I think you agreed'. That is a reference to the Grand Hyatt meeting, isn't it, from about 3 pm on 21 September 2012?--- Correct, but I think there was a lot of confusion in relation to the 100. The 100 was actually provided to Krema, not Tarneit.

But it says there, 'Amount was 500 and then on Friday I think you agreed to make it 600'?---Yeah. Look, I think there was some confusion there, so I really wouldn't place too much weight on this.

There wasn't any confusion, though, when Mr Wantrup came to preparing the proposed note agreement, was there?---Well, I'm not too sure. The convertible note in relation to Kush should include a $600,000 figure.[348]

...

MR HEATH: Volume 2, 691?---On 691 there are two emails.

Yes. Down the bottom you'll see the email from Mr Wantrup to Mr Walton, Wednesday, 26 September 2012?---Yes.

And do you see there it refers to Mr Wantrup attaching a note deed, company charge note and the original term sheet?---M'mm.

Do you see the sentence after that? The note investment is $500,000?---Yes.

The exit fee is built into the maturity redemption sum?---I'm not familiar as to how - I see that email. However, I cannot recall how the 600,000 was comprised in relation to Kush.

But 655, doesn't that help you remember? That was the day before the letter went out to Mr Walton on the other side of the proposed transaction?---No. Like I said, I remember a lot of things. I cannot recall how we were going to deal with the 600.

Can I just put this proposition to you: by that email at 655, Mr Wantrup was seeking your instructions, you being the provider of instructions on behalf of Krema; correct?---Yes.

And a day later, he was sending out the documents based upon what he'd written in that email to you on the day before; correct?---I understand that. I'm not disagreeing with you.

You gave the instructions to - - -?---Sorry?

You authorised, in effect, Mr Wantrup to send out the email down the bottom of p.691?---I'm not - like I said, I can't recall the thought process behind the way that this was structured.

Let me put this proposition to you before moving on: the amount of the proposed note investment in Krema was half a million dollars?---600.

Do you disagree with me saying half a million dollars?---Well, Dr Braham provided 500 and then 100, so how it was dealt with - I can't recall the thought process behind the way that Mr Wantrup wanted to - - -

And the reference to principal amount in the draft note deed, to which I have taken you a moment ago, that being half a million dollars, that sum was consistent with the amount that Mr Braham had paid into Mr Wantrup's trust account on 8 December 2011; correct?---Yes.[349]

361 Similarly, the email from Walton to Wantrup and Braham of 23 October 2012 (12.19pm) and the attached email from Wantrup of 19 October 2012 (6:04pm)[350] mentioning Krema Pty Ltd investment is far from conclusive in my view.

362 The document at CB794, which is relied on by the plaintiff, in my view does not advance the plaintiff's argument in any substantial way, notwithstanding it appears to relate to the Tarneit Land Fund investment.[351]

363 This is because, as submitted by Wantrup, the contemporaneous text messages exchanged between Giorgio and Braham on 20 August 2012 confirmed that the relevant money was required for a settlement.[352] Further, the evidence confirmed that Sovereign was involved in three projects namely the Glen Waverley retirement home, the Tarneit investment and the Kush Café.

364 As I have earlier observed as persuasive on this issue, the only project which was about to settle, or in respect of which there was a proposal to settle in August 2012, was the 'Kush' project. This is confirmed at CB627 and CB632, and this position is confirmed in the discussions that Braham gave evidence about that he had with Giorgio.[353]

365 I am on the above bases satisfied that, consistent with Braham's email of 18 September 2012 to Giorgio and Wantrup expressly referring to '... $100k due at settlement of Kush ...',[354] at the time Braham made the $100,000 second payment in late August 2012, he made the payment with the understanding that it was to go towards the Kush investment.

366 Accordingly, I do not consider there to be a cogent basis to impugn Giorgio's evidence in relation to the purpose for which the second payment of $100,000 was made. It was in my view made by Braham in relation to the Kush project.

367 Concomitantly, I find that there is insufficient evidence to establish that Braham intended the second payment to be used for the Tarneit investment and Tarneit investment alone.

368 Finally I note that none of the documents relied upon by the plaintiff, in my view establish that the second payment was for the Tarneit investment, each of the documents relied on by the plaintiff is imprecise and equivocal in that regard.

369 In my view the evidence establishes that Braham provided the funds in relation to the first, the second and the third payments expecting and intending that those funds would be utilised very promptly by Sovereign and expecting and intending that the finalisation of agreement and security related documents would occur at some stage after he made the subject advances but that immediate access and utilisation of the funds concerned, by Sovereign, would occur before that and would not require any instruction from him.

370 Further, contrary to the plaintiff's submission that 'the plaintiff remained the beneficial owner of the moneys (notwithstanding inaccuracies in Wantrup's trust account records)',[355] I find that the payment by Braham into Wantrup & Associates' trust account of the first, and second payments, and into a Wantrup & Associates account of the third payment, and the effect of Wantrup's trust account records in respect of those moneys, is not determinative of either the beneficial ownership of those funds or the true arrangement and intent.

371 Further, in my view it is of no ultimate consequence in this case that Wantrup did not expressly plead that the plaintiff authorised or agreed to Sovereign using the relevant funds freely once they reached the Wantrup & Associates Trust Account. It is for the plaintiff to discharge its burden to establish its pleaded causes of action. It is not incumbent on Wantrup to plead the detail of what he contended in fact occurred in this regard.

372 Further, I do not accept the plaintiff's contention that from a commercial perspective Wantrup's case is implausible and unlikely because the plaintiff would not have intended to make an unsecured loan to Sovereign, or any other party, and if the plaintiff had that intention there would be no necessity to pay the relevant moneys into the Wantrup & Associates' trust account.

373 Here, what might, uninformed by the facts and circumstances, appear somewhat implausible and unlikely yields to the facts and circumstances which the evidence establishes, and in particular the arrangements and dealings which I have found Braham intended and expected in relation to the moneys he advanced. Here, in my view, the evidence referred to demonstrates Braham's conduct in relation to the three payments was fast and loose and exhibited considerable and imprudent financial bravado on each occasion.

Earlier course of conduct relied on by the plaintiff

374 I also reject as non-probative the plaintiff's reliance upon previous negotiations in 2010 and 2011 during the course of which Wantrup received moneys from the plaintiff.[356]

375 I consider that the dealings in relation to the Aged Care Property Fund and the Tarneit Land Fund were discrete and distinguishable dealings between the plaintiff and Wantrup and Sovereign for the reasons I have earlier explained.

376 I consider that the 'course of conduct' sought to be relied on by the plaintiff in 2010 and part way through 2011, was constituted by dealings of a more defined and controlled nature in which Braham, and his solicitor Walton, were astute and careful to ensure that the arrangements in relation to such dealings were recorded and legally documented.[357]

377 In my view the approach exhibited by Braham in relation to the three transactions concerning the three payments in issue was quite distinct and different. In relation to the three payments, Braham was not astute or careful to record and legally document matters, but addressed those dealings with a fast and loose approach and with the impudent financial bravado to which I have referred.

378 Accordingly, for the above reasons I consider that the nature of earlier transactions in late 2010 and in 2011 relied upon, in part, by the plaintiff as giving rise to the plaintiff's money being received and held by Wantrup 'pursuant to an express trust for the purpose of funding the proposed loan',[358] was quite different to the nature of the three payment transactions in issue, as established in the evidence outlined by the third defendant in its closing submissions,[359] including the documents referred to above which reflect the caution Braham applied in relation to the earlier 2010 and 2011 'course of conduct' dealings.[360] Further, in contradistinction to the three transactions and payments in issue, Wantrup, in relation to the historic transactions which the plaintiff alleges established a 'course of conduct', acknowledged that he understood the plaintiff's money in respect of those earlier transactions was not to be released until he received instructions from the plaintiff to that effect.[361]

379 I also consider that Braham's conduct in relation to the earlier transactions demonstrates that he was able to confirm expressly when he wanted to impose a condition as to the use of the money, and he did so. Braham did so in earlier transactions by clear written communications. Braham also appears to have done so without referring such communications to his solicitor for advice.[362]

380 In stark contrast, Braham's conduct in relation to the first, second and third payments was very different. On the evidence as I consider it established, the true position in relation to the first, second and third payments, was that Braham did not stipulate, in any sustained or consistent way, for any constraint in relation to either the need for his instructions to release or disburse the money he had provided, or that such funds could not be released or disbursed before execution of suitable agreements and security documentation. On the contrary, Braham's conduct conveyed an intent and acceptance that the money provided by the three payments to Wantrup & Associates should be immediately utilised by Sovereign in relation to the investments concerned.

381 Further, I reject the plaintiff's assertion in relation to the three payments in issue that even if Braham accepted or acknowledged that Sovereign needed the money it required urgently, that acceptance or acknowledgement did not amount to an intention by the plaintiff to transfer beneficial ownership of the subject moneys to Sovereign, or another entity, immediately upon payment into Wantrup's trust account, without satisfactory legal documentation and security in place.

382 The plaintiff contends that Braham considered that there was urgency associated with both the payment of cleared funds into the Wantrup account and also the provision, consideration and completion of documents governing the proposed investment agreement and security documentation.[363]

383 The plaintiff contends that the contemporaneous documents demonstrate objectively that the plaintiff's intention was that the subject moneys were to be kept safe until applied for the purpose nominated, namely an investment based on finalised documents and securities rather than application on a broader basis.

384 However, I do not accept the plaintiff's submission referred to in the last three preceding paragraphs. On the facts as I have found them, Braham's conduct clearly evinces that he did not require the finalisation of the investment agreement and securities related documentation before the moneys which he provided were transferred from the Wantrup Trust Account and applied by Sovereign.

385 Therefore, in my view, there is no substance to the plaintiff's submission that it is less plausible that the plaintiff knowingly paid over a considerable sums unconditionally for the benefit of Sovereign on the basis of no written documentation in support of such investment where, on the plaintiff's assertion, settlement was not imminent. Ultimately, for the reasons I have addressed, I do not accept this submission by the plaintiff and consider it to be at stark odds with Braham's conduct, which I have highlighted and explained elsewhere.

386 Further, I have found that Braham, and the plaintiff which he controlled, were imprudent and very willing to accept the risks associated with allowing the utilisation of the sums of money which Braham provided in December 2011 and August and September 2012 even though related documentation and securities had not been finalised.

387 I do not accept as probative or persuasive the submissions made by the plaintiff that if the plaintiff agreed to give Sovereign or other entities immediate access to the moneys which it was providing it did not need to use the trust account as a 'clearing account' and the plaintiff could have paid the moneys it was providing direct to Eos.

388 I consider that it is neither anomalous nor supportive of the plaintiff's case that, in the circumstances, the plaintiff's funds were paid into the Wantrup & Associates Trust Account. This is because, as explained by Giorgio, Sovereign, for which the moneys were intended, did not have a bank account and it was considered more convenient to utilise the Wantrup Trust Account as a clearing account. Giorgio's evidence in that regard was as follows:

DR HANAK: Why was the direction to pay to EOS rather than Sovereign or Krema?---EOS Janus was acting as Sovereign's treasury and, as stated earlier, we conducted all of Sovereign's administrative expenses out of EOS Janus for quite some time, given that we were dealing with a significant number of Sovereign legacy issues and that we didn't really have a bank account in place until much later on.

HIS HONOUR: I see Sovereign didn't have a bank account, but EOS Janus had bank accounts in the normal way?---Yes, Your Honour.

DR HANAK: Why would investors' money not conveniently be able to be paid into the EOS Janus' accounts rather than the Wantrup Trust Account?---I guess from the outset, Your Honour, we began to use Wantrup's trust account from day one and we just continued it. In fact, there was no reason why we couldn't open a Sovereign bank account, but we were spending 80 hours a week on Sovereign business and we just tried to keep it simplistic at that stage, and given that most of our costs consisted of mainly legal fees, we just left it at that. [364]

389 I also consider that Wantrup was most unlikely to be considered by Braham to be his 'trusted advisor' as submitted by the plaintiff. I do not accept that Wantrup held himself out as such or that the Wantrup Trust Account was used in this context or way, as also submitted by the plaintiff.

390 I also reject the plaintiff's submission that Braham treated Wantrup as a trusted advisor. I accept the Wantrup submission that this is not supported by evidence from either Braham or Wantrup. Furthermore, Braham had his own solicitor, Walton, acting at all material times, including in relation to the Managed Investment Scheme matters.[365]

391 Accordingly I reject the plaintiff's submissions in relation to Wantrup's duties to his client Sovereign.[366] Wantrup was, at all material times, acting for Sovereign, and the plaintiff submits, probably Eos.[367]

392 The plaintiff also submits that Wantrup, in all the circumstances, was acting in a way which was unsafe and flawed, in that he treated Sovereign as the person on whose behalf he received and held moneys.[368]

393 The plaintiff submits that in the circumstances there was a presumption that Wantrup received the funds paid by the plaintiff for the plaintiff's benefit, and that Wantrup should have known as much, and further that Wantrup's evidence is incapable of displacing that presumption.[369]

394 On the basis of my above finding in relation to the basis upon which the three payments in issue were received and held by Wantrup, I also reject the plaintiff's submissions outlined in the two preceding paragraphs.

Plaintiff's second cause of action based on contraventions of the LPA

395 The plaintiff's second cause of action is one based on a private right of action in respect of contraventions of s 3.3.14 of the LPA.

396 The plaintiff expressly relies upon the evidence supporting its express trust related first cause of action to support this second cause of action.[370] The plaintiff both relies upon its arguments advanced in support of the application made by it to amend its pleadings to add such a claim and relies also upon the evidence it contends has been established in support of its claim based on the formation of an express trust in favour of the plaintiff in relation to each of the three payments in issue. In this way, the plaintiff seeks to support the second cause of action on the basis of the same evidence and assertions as it advanced on its express trust claims .[371]

397 Accordingly, the plaintiff's factual assertions including, critically, the factual assertions advanced in seeking to establish its express trust, founds its claims in relation to both the contravention, and a private cause of action, in respect of s 3.3.14 of the LPA.

398 In light of my above findings and conclusions as to the plaintiff's express trust claim, I do not consider it to be necessary to deal further with the plaintiff's asserted private cause of action based on s 3.3.14 of the LPA. That is, beyond noting the plaintiff seeks to support its statutory cause of action on the assumption that its factual case is made out in relation to its express trust case. For the reasons I have outlined above, the plaintiff has failed to persuade me that any express, or other form of trust is established in relation to the three payments.

399 For the reasons which I have addressed I have found and concluded that the first, the second, and the third payments were not 'trust money' when provided by Braham to Wantrup & Associates. Those payments were not in any way impressed with a trust when received and held by Wantrup & Associates in December 2011 and August and September 2012. Furthermore, because the third payment was not deposited into a general purpose trust account, that payment was not the subject of an obligation imposed upon Wantrup under s 3.3.14 of the LPA.

400 Accordingly, the three payments were not trust moneys and are therefore not within the scope or stipulations of ss 3.3.2 ('trust money'), 3.3.3(1) and (2) and 3.3.14(1) of the LPA.

401 Further, in my view, if contrary to my conclusion it was necessary for me to deal with the plaintiff's asserted private cause of action based on s 3.3.14(1) of the LPA, and such a private cause of action existed [which I have not decided] then, in any event in my view the three subject payments were not in the nature of 'trust money' by reason, or as a consequence, of s 3.3.3(3) of the LPA. This is because the money which Braham provided by the three payments in issue was, for the reasons I have outlined above:

(a) not intended by him to be held in trust by Wantrup & Associates;

(b) intended by Braham to be placed in Wantrup's Trust Account simply as a clearing account so as to enable Wantrup to disburse such money on Sovereign's instructions;

(c) not money entrusted to Wantrup in the course of or in connection with the provision of legal services by Wantrup & Associates; and

(d) held by Wantrup & Associates for investment purpose, to be so invested by Sovereign[372] via and at the direction of Sovereign, and were not established to have been money which fell within any of the exceptions in s 3.3.3(3)(a) and (b) of the LPA.

402 Further, and in my view, the third payment was not the subject of any obligation on the part of Wantrup under s 3.3.14(1) of the LPA including because that payment was not deposited into a general purpose trust account.

403 Even if I had concluded that Braham did intend the third payment to be deposited into the Wantrup & Associates Trust Account (which I have not), I have found that Braham's overarching intent was that the three payments would be deposited in and cleared through Wantrup & Associates Trust Account only because Wantrup & Associates' trust account provided the most convenient clearing account, and so as to facilitate those funds being disbursed to the Sovereign investments in which Braham was interested. In my view, as I have explained, s 3.3.14 of the LPA is of no application to any of the three payments and of no application to the third payment for these same reasons, and also because the third payment was not deposited into the Wantrup general trust account.

404 I reject the plaintiff's case and its claims in these proceedings for the following reasons.

405 In summary I find the following in relation to the key questions for determination posed by the plaintiff, and in relation to associated questions:

(a) Braham did not intend Wantrup to receive and hold in trust for the plaintiff or Braham the three payments Braham provided to Wantrup and Associates;

(b) Braham and the plaintiff intended to transfer beneficial ownership of the moneys provided by each of the three payments to Sovereign;

(c) at the time of each of the three payments, and the receipt of those payments by Wantrup, Sovereign was the beneficial owner of the funds thereby provided;

(d) Braham and the plaintiff provided each of the three payments in issue to Wantrup to be held on behalf of Sovereign, and to be disbursed in accordance with Sovereign's direction in respect of Braham's investments;

(e) Wantrup's client at all material times was Sovereign, and accordingly the 'default position'[373] in the factual setting of this proceeding is that the moneys the subject of the three payments was provided to Wantrup as agent for Sovereign and not in Wantrup's own right or as agent for the payer, or anyone else;

(f) in relation to the three payments in issue at no time did the plaintiff or Braham communicate an intention to create a trust in respect of those payments to Wantrup and at no time did Wantrup accept or agree to receiving and holding those payments as trustee for the plaintiff or Braham;

(g) the three payments were not the subject of an express trust, in respect of which Braham was the settlor and Wantrup was trustee;

(h) the three payments provided by Braham were not subject to any effective stipulation from Braham or constraint that those moneys could only be released at Braham's direction;

(i) the three payments provided by Braham were not subject to any stipulation or constraint that those moneys could only be released upon completion of and entry into an acceptable agreement and security in relation to those investments;

(j) the receipt by Wantrup of the three payments was not the receipt of trust moneys within the meaning, or as a consequence, of ss 3.3.2 or 3.3.14 of the LPA, and those moneys were therefore not moneys received or held by Wantrup as trust money within the meaning of s 3.3.14 of the LPA;

(k) as a result of my findings rejecting the plaintiff's case in support of an express trust, the plaintiff's second asserted private cause of action based on Wantrup's contravention of s 3.3.14 of the LPA, need not be decided;

(l) if contrary to my conclusion it were necessary to decide the existence of the plaintiff's asserted private cause of action based on breaches of s 3.3.14 of the LPA, and such a cause of action was found to exist (which I have not decided) the three payment would not be trust moneys by reason of the operation of s 3.3.3(3) of the LPA.

406 Given my above findings and conclusions to the effect that the plaintiff has not established the liability that it has sought to attach to Wantrup it is unnecessary for me to decide any questions of apportionment pursuant to Part IVAA of the Wrongs Act 1958 (Vic).

407 For the foregoing reasons I shall dismiss the plaintiff's proceeding and claims for relief.

408 I shall order that the plaintiff's proceeding and claims be dismissed and that there be judgment for Wantrup.

409 I shall hear Counsel, if necessary, as to the form of final orders, including any orders as to costs.

[1] Sovereign went into liquidation on 24 May 2013. Eos went into liquidation on 24 July 2014. On 7 October 2013, Sifris J granted leave to the plaintiff to proceed against Sovereign MF Ltd (in Liquidation) and the plaintiff gave an undertaking it will not seek to enforce any judgment which it may obtain against the first defendant without obtaining leave of the Court. On 19 June 2014 Sifris J's Orders, in Other Matters, recorded that the proceeding was stayed as against Eos Janus Capital Pty Ltd pursuant to s 440D of the Corporations Act 2001 (Cth).

[2] Some confusion and dispute exists as to whether the second payment related to Kush or the Tarneit Land Fund.

[4] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [7]-[8], [15], [16A].

[6] Plaintiff's Third Plaintiff's Further Amended Statement of Claim, 15 March 2016, [4(d)(ii)]; No pleaded response by third defendant.

[7] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [8].

[9] Third Defendant's Further Amended Defence, 15 March 2016, [8].

[12] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [15].

[16] See above, footnote [1].

[17] Plaintiff's Closing Submissions, 19 April 2016, [1].

[18] T554.26-T555.5-11, T5321.7 and T522.5.

[19] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [11]-[12], [18], [12A], [21A]-[22].

[20] Third Defendant's Further Amended Defence, 15 March 2016, [11]-[12], [18], [12A], [21A]-[22].

[23] Plaintiff's Opening Submissions, 10 March 2016, [10]; Third Defendant's Closing Submissions, 8 April 2016, [10]; Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253, 275 [59] and 286-90 [105]-[115]; Re Australian Elizabethan Theatre Trust [1991] FCA 344; (1991) 30 FCR 491, 502.

[24] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [12]; Plaintiff's Closing Submissions, 19 April 2016, [21]-[22].

[25] Third Defendant's Reply Submissions, 21 April 2016, [16].

[26] Plaintiff's Further Amended Statement of Claim, 15 March 2016, Clause 8(b), Particulars 8(b)(a) and (b); 15(b) and 16A(b); Plaintiff's Opening Submissions, 10 March 2016, [11].

[27] Plaintiff's Closing Submissions, 19 April 2016, [2]-[4].

[28] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [12(c)] and [19(d)(b)].

[29] T313.30-T314.15; Plaintiff's Closing Submissions, 19 April 2016, [13]-[14].

[30] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [12(c)] (and Particulars C); T276.9-16; Plaintiff's Closing Submissions, 19 April 2016, [17].

[31] Plaintiff's Opening Submissions, 10 March 2016, [17].

[37] CB89-CB90; Plaintiff's Opening Submissions, 10 March 2016, [21]; Plaintiff's Closing Submissions, 19 April 2016 [13]-[16]; T313.30-T314.15.

[39] Plaintiff's Opening Submissions, 10 March 2016, [21]; CB92, CB94, CB123, CB154, CB184.

[42] The Braham email to the CBA dated 16 June 2011 also refers to payment of $62,877.77 into Wantrup's Trust Account. It appears that this sum was to cover barrister's fees in respect of the Gunns' litigation (see T31.8-11).

[45] Plaintiff's Opening Submissions, 10 March 2016, [23].

[51] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [24].

[54] T313.5-20; Plaintiff's Closing Submissions, 19 April 2016, [15].

[55] Third Defendant's Reply Submissions, 21 April 2016, [14].

[56] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [12].

[58] Plaintiff's Further Amended Statement of Claim, 15 March 2016, [14], [23], [29], [30], and [31]; see also [10], [17].

[59] Third Defendant's Closing Submissions, 8 April 2016, [20].

[62] Legal Services Commissioner v Brereton [2011] VSCA 241; (2011) 33 VR 126, 154 [106] ('Brereton'); Cf Plaintiff's Closing Submissions, 19 April 2016, [38]; CB670.

[63] Plaintiff's Closing Submissions, 19 April 2016, [19]; CB446, CB454, CB596, CB620, CB653, CB1053-1054, CB1058, CB1068, CB1073, CB1075, CB1094.

[64] Third Defendant's Reply Submissions, 21 April 2016, [15].

[65] Third Defendant's Closing Submissions, 8 April 2016, [21]; Legal Services Board v Gillespie-Jones [2013] HCA 35; (2013) 249 CLR 493, 525 [119].

[66] Third Defendant's Closing Submissions, 8 April 2016, [21].

[67] Third Defendant's Closing Submissions, 8 April 2016, [21].

[68] Ibid [22], [37]; CB617, CB619.

[71] Plaintiff's Closing Submissions, 19 April 2016, [24].

[72] Third Defendant's Reply Submissions, 21 April 2016, [17]; CB446.

[73] Plaintiff's Closing Submissions, 19 April 2016, [25].

[74] Third Defendant's Reply Submissions, 21 April 2016, [18].

[75] Plaintiff's Closing Submissions, 19 April 2016, [26]-[36].

[76] Third Defendant's Closing Submissions, 8 April 2016, [13]-[17], [26]-[33].

[77] [1988] FCA 419; (1988) 84 ALR 271.

[79] Plaintiff's Closing Submissions, 19 April 2016, [39].

[82] Plaintiff's Closing Submissions, 19 April 2016, [40].

[83] T93.4-6, T418.16-25. Plaintiff's Closing Submissions, 19 April 2016, [40].

[85] Third Defendant's Reply Submissions, 21 April 2016, [20].

[89] Plaintiff's Closing Submissions, 19 April 2016, [41]; see CB603-CB604.

[91] Plaintiff's Closing Submissions, 19 April 2016, [41]; T332, 334, 339.

[93] Third Defendant's Reply Submissions, 21 April 2016, [21].

[97] Third Defendant's Reply Submissions, 21 April 2016, [22].

[99] T248-9, T248.27-T249.3, T262 and T342.

[105] Plaintiff's Closing Submissions, 19 April 2016, [40].

[106] CB does not record the trust account receipt number, it does not specify from whom money is received or for who's benefit the funds are received and it does not clearly identify the ledger account to be credited.

[107] Wantrup explained the evidence of Ms Naumovski; _T_9.12-17 and T324.6-16; CB1348, CB1351, CB1355 and CB1339.

[110] Plaintiff's Closing Submissions, 19 April 2016, [39]-[41].

[114] Legal Services Board v Gillespie-Jones [2013] HCA 35; (2013) 249 CLR 493, 520 [100].

[115] Plaintiff's Closing Submissions, 19 April 2016, [43].

[116] Plaintiff's Opening Submissions, 10 March 2016, [6].

[117] [1937] HCA 18; (1937) 56 CLR 464.

[119] Explanatory Memorandum, Legal Profession Bill 2004, 1. See also Third Defendant's Closing Submissions, 8 April 2016, citing Legal Profession Act 2004 s 1.1.1; and Victoria, Parliamentary Debates, Legislative Assembly, 16 November 2004, 1541 (Rob Hulls, Attorney-General). The Explanatory Memorandum Legal Profession Bill 2004 refers to 'protecting the interests of consumers'.

[120] [1999] VSCA 100; (1999) 2 VR 461,

[123] Legal Services Board v Gillespie-Jones [2013] HCA 35; (2013) 249 CLR 493, 527 [126].

[125] Wik Peoples v Queensland (1996) 187 CLR 1, 95-6.

[126] Third Defendant's Closing Submissions, 8 April 2016, [5]-[8].

[131] Third Defendant's Closing Submissions, 8 April 2016, [4]. Wantrup notes at para [3] and _T_505.28-31 and T511.14.21 that the Court may take into account the gravity of the matters alleged; refer ss 3.3.14 and 3.3.21 of the LPA; Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336, 361; Morley v ASIC [2010] NSWCA 331; (2010) 274 ALR 205; 81 ACSR 285, 422 [745]-[746]; Evidence Act 2008, s 140(2)(c).

[132] _T_594.4-12. See also Third Defendant's oral submissions at _T_505.21-31; Plaintiff's oral submissions at _T_594.4-12.

[133] Plaintiff's Further Amended Statement of Claim, 15 March 2016.

[134] Evidence Act 2008 (Vic), s 140; Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336, 361.

[135] Legal Profession Act 2004, s 3.3.14.

[136] Sovereign went into liquidation on 24 May 2013. Eos went into liquidation on 24 July 2014. On 7 October 2013 Sifris J granted leave to the plaintiff to proceed against Sovereign MF Ltd (in Liquidation) and the plaintiff gave an undertaking it will not seek to enforce any judgment which it may obtain against the first defendant without obtaining leave of the Court. On 19 June 2014 Sifris J's Orders, in Other Matters, recorded that the proceeding was stayed as against Eos Janus Capital Pty Ltd pursuant to s 440D of the Corporations Act 2001 (Cth); and Plaintiff's Submissions, 10 March 2016, [1] and [63].

[137] T554.26-28; T555.2-5; T556.17-24; T557.1-T558.2; T564.6-8.

[138] Commissioner of State Revenue v Snowy Hydro Ltd [2012] VSCA 145 at 130 [83]; Re Australian Elizabethan Theatre Trust; Lord v Commonwealth Bank of Australia [1991] FCA 344; (1991) 30 FCR 491, 502; _T_521.4-23.

[139] [1934] HCA 1; (1934) 50 CLR 341.

[140] (1874) L.R. 18 Eq., at pp. 14,15.

[141] [1934] HCA 1; (1934) 50 CLR 341 at 369 (emphasis added).

[142] George v Webb [2011] NSWSC 1608 (20 December 2011) [203]-[210]. 219 and 252 ('George v Webb').

[143] Re Australian Elizabethan Theatre Trust [1991] FCA 344; (1991) 30 FCR 491, 502-503 ('Re Australian Elizabethan'); Re Wall; Ex parte Official receiver v Kemmis (1979) 25 ALR 615, 624-5.

[144] George v Webb, 203; Salvo v New Tel Ltd [2005] NSWCA 281 (25 August 2005) [33] ('Salvo v New Tel Ltd'); Walter v Corboy (1990) 19 NSWLR 382; Re Australian Elizabethan, 502-503.

[145] Salvo v New Tel Ltd, [33]; Re Australian Elizabethan, 502-503 (where subject matter of trust are contractual rights against settlor, conferred upon alleged trustee with the purpose being to benefit third parties, may be appropriate to look to mutual intention of settlor and trustee); Re Goldcorp Exchange Ltd; Kensington v Liggett [1995] 1 ACT 74, 100 (PC); See also, eg, Trident General Insurance Cot Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1987) 165 CLR 107, 149 (trust over contractual rights conferred by settlor upon the trustee for the benefit of a third party).

[146] Re Australian Elizabethan, 502; Salvo v New Tel Ltd, [33].

[147] Raulfs v Fishy Bite Pty Ltd [2012] NSWCA 135 (11 May 2012) [51].

[148] PW Young, Smith and Croft, On Equity (LawBook, 2009), [6.1020].

[149] Re Australian Elizabethan, 502-503.

[150] Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253, 286 [105].

[151] [1988] HCA 44; (1988) 165 CLR 107, 147.

[152] Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107, 121 and 148; Walker v Corboy (1990) 19 NSWLR 382, 384 - 385, 387- 389 and 396- 397 ('Walker'); Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253, 277 [65] and 263, 288 - 289, [109]-[112] ('Byrnes v Kendle').

[154] Twinsectra Ltd v Yardley [2002] UKHL 12; [2002] 2 AC 164, 185, [71].

[155] Byrnes [2011] HCA 26; (2011) 243 CLR 253 at 275 [59] and 290 [114]-[115].

[156] [2015] HCA 6; (2015) 255 CLR 62; see also 'When is an express trust constituted? Korda v Australian Executor Trustees', N Summerfield and N Hodge (2015) 26 JBFLP 126.

[157] [2011] HCA 26; (2011) 243 CLR 253, 288-290.

[158] [1999] FCA 27; (1999) 161 ALR 105; referred to in George v Webb, [213].

[159] [2009] NSWSC 733 (18 June 2009), [32].

[160] Raulfs v Fishy Bite Pty Ltd [2012] NSWCA 135; Commissioner of State Revenue v Snowy Hydro Ltd [2012] VSCA 145; Legal Services Board v Gillespie-Jones [2013] HCA 35; (2013) 249 CLR 493; Byrnes v Kendle [2011] HCA 26; (2011) 243 CLR 253; Peter Cox Investments Pty Ltd (in liq) v International Air Transport Association [1999] FCA 27; Re Elizabethan Theatre Trust [1991] FCA 344; (1991) 30 FCR 491.

[161] George v Webb, [204]-[207]; Salvo v New Tel Ltd, [33]; Barclays Bank Ltd v Quistclose Investment Ltd [1970] AC 567, 580B; Re Australian Elizabethan; Lord v Commonwealth Bank of Australia and Others [1991] FCA 344; (1991) 30 FCR 491, 502-503; Trident General Insurance Co Ltd v McNiece Bros Pty Ltd [1988] HCA 44; (1988) 165 CLR 107, 147 and 149.

[164] Plaintiff's Closing Submissions, 19 April 2016 [footnote 1]; Transcript, 588 -590, in particular T589.2-20 and T589.28-T590.5; George v Webb, [207]-[210].

[165] [2012] VSCA 145; (2012) 43 VR 109, 130 [83].

[166] George v Webb, [207]-[210].

[168] George v Webb, 203; Salvo v New Tel Ltd, [33]; Walter v Corboy (1990) 19 NSWLR 382; Re Australian Elizabethan, 502-503.

[171] [1970] AC 567; [1968] 3 All ER 651 ('Quitclose').

[172] [1968] 3 All ER 651, 654.

[173] [1978] HCA 45; (1978) 141 CLR 335.

[176] Re Australian Elizabethan, [502]; Twinsectra Ltd v Yardley [2002] UKHL 12; [2002] 2 AC 164, [89]; Salvo v New Tel Ltd, [37].

[180] Brereton, [27] (emphasis added).

[184] Plaintiff's Closing Submissions, 19 April 2016, [20].

[190] Australasian Conference Association Ltd v Mainline Constructions Pty Ltd (In liq) [1978] HCA 45; (1978) 141 CLR 335, 353 (Gibbs ACJ) describing the proposition in Quistclose 'where money is advanced by A to B, with the mutual intention that it should not become part of the assets of B, but should be used exclusively for a specific purpose, there will be implied (at least in the absence of an indication of a contrary intention) a stipulation that if the purpose fails the money will be repaid and the arrangement will give rise to a relationship of a fiduciary character, or trust'; see also Brereton, [95]-[98].

[192] Plaintiff's Further Amended Statement of Claim, 15 March 2016.

[195] T79-80; Braham's evidence in cross-examination is addressed elsewhere and in considerations.

[245] T397.13-31; T398, in particular T398.22-26.

[251] _T_144.27-30; T145.18-20; T147.5-7; T147.28-29 and T162.5-7.

[253] T160.27-T161.1-15; T161.30-T162.1; T164.11-31; T166.20-24.

[255] CB617 - transaction 1101 (8 December 2011) Wantrup's law $500,000.

[257] CB617 - transaction 1101 (8 December 2011) Wantrup's law $500,000.

[273] Plaintiff's Closing Submissions, 19 April 2016, [35].

[275] CB79; CB658; T 119.27-121.1; T151.28-29; T175.14 and 176.6-31.

[276] Plaintiff's Further Amended Statement of Claim, 15 March 2016.

[277] Braham's evidence in cross-examination is addressed elsewhere and in considerations.

[295] Third Plaintiff's Further Amended Statement of Claim, 15 March 2016.

[296] Braham's evidence in cross-examination is addressed elsewhere and in considerations.

[325] [2013] VSCA 144 (14 June 2013), (referred to in Plaintiff's Closing Submissions, 19 April 2016, footnote [19]).

[326] [1982] HCA 15; (1982) 149 CLR 155, 169 (Mason J).

[327] [1952] HCA 19; (1952) 85 CLR 352, 358.

[328] [1956] HCA 25; (1956) 94 CLR 470, 480-1.

[329] Jones v Dunkel (1959) 101 CLR 298, 304.

[331] [1911] AC 674, 687 (emphasis added).

[332] [1997] 1 VR 125, 141.

[335] T424.10-T425.12; T432.15-T433.27.

[344] Plaintiff's Closing Submissions, 19 April 2016, [34].

[345] Plaintiff's Closing Submissions, 19 April 2016, [33(c)]; T623.30-624.2.

[355] Plaintiff's Closing Submissions, 19 April 2016, [7] and [9], subject to the possible significance of any relevant admissions against interest which may be established by Wantrup's trust records.

[356] Plaintiff's Closing Submissions, 19 April 2016, [13].

[357] Reasons for Judgment, [35],[36]-[37], [40]-[41] and [43]-[44].

[358] Plaintiff's Closing Submissions, 19 April 2016, [13] and [17].

[359] Third Defendant's Submissions, 8 April 2016, [20].

[360] T132.18; Reasons for Judgment[36]-[37], [40]-[41] and [43]-[44].

[362] Reasons for Judgment, [36]-[37], [40]-[41] and [43]-[44].

[363] Plaintiff's Closing Submissions, 19 April 2016, [22]-[24].

[364] T395.5-24; T380.13-17; T386.26-28; T416.112-14; T420.12-14; CB464 and CB622.

[366] Plaintiff's Closing Submissions, 19 April 2016, [29].

[367] T17.20-22 per Heath 'It is likely that Wantrup was also acting for EOS at the time.' (In reference to November 2010).

[368] Plaintiff's Closing Submissions, 19 April 2016, [30]; T355.20.

[369] Plaintiff's Closing Submissions, 19 April 2016, [30].

[370] The plaintiff expressly concedes that the evidence upon which it relied in respect of its second cause of action based on contraventions of s 3.3.14 of the LPA is the same evidence which it identifies and relies upon in support of its primary cause of action based on the formation of an express trust in favour of the plaintiff; see Plaintiff's Closing Submissions, 19 April 2016, [2] and [3].

[371] Plaintiff's Closing Submissions, 19 April 2016, [3] and [43].

[372] Wantrup's evidence at T579.22-23, T277.16-22 and T277.26-27 is confined to his evidence and as to him not investing in moneys.

[373] Third Defendant's Reply Submissions, 21 April 2016, [3]; T528.5-10.