Plaintiffs v Defendants [2026] VSC 171 | Case summary

EQUITY - Fiduciary Duties - Duty to avoid conflict of duty and interest - Duty to avoid deriving an unauthorised profit from fiduciary position - Scope and content of fiduciary duties - First defendant was company secretary of second plaintiff - Second plaintiff was a special purpose vehicle undertaking a residential development - First defendant participated in a consortium which pursued the acquisition and development of a residential site across the road - Whether first defendant breached the 'no conflict' and 'no profit' rules in doing so - Having regard to scope of fiduciary duty no breach of fiduciary duty in pursuing and failing to disclose that competing opportunity - Links Golf v Tasmania Links Golf Tasmania Pty Ltd v Sattler and Anor [2012] FCA 634; (2012) 213 FCR 1, applied; Bell v Lever Bros Ltd [1931] UKHL 2; [1932] AC 161, applied.

Plaintiffs v Defendants [2026] VSC 171 | Case summary | Zoe

[60]

I have kept the need for 'actual persuasion' in the sense explained above, firmly in mind when resolving contested issues of fact.
Witness statements were prepared and relied on in this matter, save in respect of certain identified and contested conversations, the evidence of which was adduced viva voce.
In undertaking the process of fact finding in respect of events occurring principally between five and ten years ago, I have had regard to and applied the approach articulated by Leggatt J in Gestmin SGPS SA v Credit Suisse (UK) Limited:
1. An obvious difficulty which affects allegations and oral evidence based on recollection of events which occurred several years ago is the unreliability of human memory.
2. While everyone knows that memory is fallible, I do not believe that the legal system has sufficiently absorbed the lessons of a century of psychological research into the nature of memory and the unreliability of eyewitness testimony. One of the most important lessons of such research is that in everyday life we are not aware of the extent to which our own and other people's memories are unreliable and believe our memories to be more faithful than they are. Two common (and related) errors are to suppose: (1) that the stronger and more vivid is our feeling or experience of recollection, the more likely the recollection is to be accurate; and (2) that the more confident another person is in their recollection, the more likely their recollection is to be accurate.
3. Underlying both these errors is a faulty model of memory as a mental record which is fixed at the time of experience of an event and then fades (more or less slowly) over time. In fact, psychological research has demonstrated that memories are fluid and malleable, being constantly rewritten whenever they are retrieved. This is true even of so-called 'flashbulb' memories, that is memories of experiencing or learning of a particularly shocking or traumatic event. (The very description 'flashbulb' memory is in fact misleading, reflecting as it does the misconception that memory operates like a camera or other device that makes a fixed record of an experience.) External information can intrude into a witness's memory, as can his or her own thoughts and beliefs, and both can cause dramatic changes in recollection. Events can come to be recalled as memories which did not happen at all or which happened to someone else (referred to in the literature as a failure of source memory).
4. Memory is especially unreliable when it comes to recalling past beliefs. Our memories of past beliefs are revised to make them more consistent with our present beliefs. Studies have also shown that memory is particularly vulnerable to interference and alteration when a person is presented with new information or suggestions about an event in circumstances where his or her memory of it is already weak due to the passage of time.
5. The process of civil litigation itself subjects the memories of witnesses to powerful biases. The nature of litigation is such that witnesses often have a stake in a particular version of events. This is obvious where the witness is a party or has a tie of loyalty (such as an employment relationship) to a party to the proceedings. Other, more subtle influences include allegiances created by the process of preparing a witness statement and of coming to court to give evidence for one side in the dispute. A desire to assist, or at least not to prejudice, the party who has called the witness or that party's lawyers, as well as a natural desire to give a good impression in a public forum, can be significant motivating forces.
6. Considerable interference with memory is also introduced in civil litigation by the procedure of preparing for trial. A witness is asked to make a statement, often (as in the present case) when a long time has already elapsed since the relevant events. The statement is usually drafted for the witness by a lawyer who is inevitably conscious of the significance for the issues in the case of what the witness does nor does not say. The statement is made after the witness's memory has been "refreshed" by reading documents. The documents considered often include statements of case and other argumentative material as well as documents which the witness did not see at the time or which came into existence after the events which he or she is being asked to recall. The statement may go through several iterations before it is finalised. Then, usually months later, the witness will be asked to re-read his or her statement and review documents again before giving evidence in court. The effect of this process is to establish in the mind of the witness the matters recorded in his or her own statement and other written material, whether they be true or false, and to cause the witness's memory of events to be based increasingly on this material and later interpretations of it rather than on the original experience of the events.
7. It is not uncommon (and the present case was no exception) for witnesses to be asked in cross-examination if they understand the difference between recollection and reconstruction or whether their evidence is a genuine recollection or a reconstruction of events. Such questions are misguided in at least two ways. First, they erroneously presuppose that there is a clear distinction between recollection and reconstruction, when all remembering of distant events involves reconstructive processes. Second, such questions disregard the fact that such processes are largely unconscious and that the strength, vividness and apparent authenticity of memories is not a reliable measure of their truth.
8. In the light of these considerations, the best approach for a judge to adopt in the trial of a commercial case is, in my view, to place little if any reliance at all on witnesses' recollections of what was said in meetings and conversations, and to base factual findings on inferences drawn from the documentary evidence and known or probable facts. This does not mean that oral testimony serves no useful purpose - though its utility is often disproportionate to its length. But its value lies largely, as I see it, in the opportunity which cross-examination affords to subject the documentary record to critical scrutiny and to gauge the personality, motivations and working practices of a witness, rather than in testimony of what the witness recalls of particular conversations and events. Above all, it is important to avoid the fallacy of supposing that, because a witness has confidence in his or her recollection and is honest, evidence based on that recollection provides any reliable guide to the truth. [14]
The correctness of the approach articulated by Leggatt J is reinforced by the following observations of Lord Pearce in Onassis and Calogeropoulos v Vergottis:

[65]

Each of the witnesses presented as a person who endeavoured to tell the truth and separate their recollection from self-interested speculation. Consistently with the fact finding process I have identified, in specific instances, it has been necessary to prefer the evidence of one witness over another or reject certain evidence. In doing so, I have made the requisite assessment by reference to any documentary evidence, the clarity of the evidence given, the consistency of the witness's evidence with other lay evidence and the inherent probability of the contested accounts.
The plaintiffs called the following witnesses.
Stewart Gull, the founder and titular head of the Gull Group and the father of Alistair and Cameron. Mr Gull was, and is, a director of CCV and Hilltop Views at all material times.
Alistair Gull, who has worked within the Gull Group since initially joining as a labourer as a twenty year old in 1997. He was, and is, a director of CCV and Hilltop Views at all material times.
Cameron Gull owned and operated a hospitality business specialising in major events. He sold that business in or around 2015 and commenced working in the Gull Group business. Cameron was employed by Gull & Co Pty Ltd (Gull & Co) as a licensed estate agent. He was a director of Hilltop Views at all material times and became a director of CCV from 6 April 2020.
Leonie Müller, is a long time executive assistant employed by GRVS. Ms Müller worked across the entire Gull Group and worked predominantly for Stewart, whilst also performing work for Alistair and Mr Burke.
Sean O'Keefe, a town planner at Southern Cross Town Planning, was engaged as an expert witness to provide an opinion concerning, inter alia, the density of residential development likely to be permitted with respect to the Cobblers Lane Property and the associated likely future dwelling yield of that property.
Charles Shinkfield, a civil engineer and the manager of Planning & Development at Paroissien Grant & Associates Pty Ltd, was engaged as an expert witness to provide an opinion on the scope, cost and timing of civil works required for the residential development and subdivision of the Cobblers Lane Property.
Andrew Kinnaird, director of Urbis Valuations Pty Ltd, was engaged as an expert witness to provide an opinion, inter alia, as to the market value and gross realisation value of the Cobblers Lane Property on the assumption that it was developed and completed in accordance with a model plan, to which I will come in more detail.
Greg Meredith, the Senior Managing Director of Ankura Consulting Group LLC, was engaged as an expert witness to provide an opinion on the plaintiffs' alleged loss and the defendants' profits from the alleged breaches of fiduciary and statutory duties.
The defendants called the following witnesses.
Paul Burke, the first defendant. Mr Burke was, as I have said, a director of CCV and company secretary of Hilltop Views during the events that are the subject of this litigation. He is also a director and company secretary of Gracefield Equity, Cobbler Nominees and Forest Edge, the SPV defendants through which the properties were ultimately acquired for development.
Robert Dolan is the fourth defendant and, as a member of the Initial Consortium and Cobblers Consortium, is a director of Gracefield Equity, Cobbler Nominees and Forest Edge. Mr Dolan has known Mr Burke since they were 15 years old. They were reacquainted in 2009. For the past 30 years Mr Dolan has owned and operated a business supplying industrial automation products.
Michael Harris is the fifth defendant and, as a member of the Initial Consortium, is a director of Gracefield Equity and Forest Edge. Mr Harris is a small business owner and the brother in law of Mr Dolan.
Timothy Wright is the sixth defendant and, as a member of the Initial Consortium, is a director of Gracefield Equity and Forest Edge. Mr Wright is the owner and director of Wright Civil Engineering, a company specialising in land development engineering and project management. He has also invested in property since 2005, including projects involving land subdivision for residential purposes. Mr Wright was first introduced to Mr Burke after being invited to invest in a 20-acre property in Mount Clear, Ballarat.
Craig Lightfoot is the eighth defendant and, as a member of the Cobblers Consortium, is a director Cobbler Nominees. Mr Lightfoot has been a friend of Mr Burke's since they were young school boys at St Patrick's in Ballarat. He has worked in the medical imaging industry since around 1988 and, since 2017, has invested in and developed several commercial projects.
The defendants only called one expert witness - Ms Luana Kenny, valuer and managing director of M3 Property. Ms Kenny was engaged as an expert witness to provide an opinion on the market value of the Cobblers Lane Property and the gross realisation value of the Cobblers Lane Property on the assumption that it was developed and completed in accordance with the model plan, as set out in Mr Kinnaird's report.
Before leaving the topic of witnesses, I note that Mr Sculley the ninth defendant, did not give evidence. I will return to what, if any, ramifications flow from this later in my reasons.

[70]

Between 1995 and 2007, CCV was itself able to buy, and did buy, retirement village sites and developed and operated them. From 2008 onwards, following the acquisition of Meadow Gardens in 2007, CCV did not buy any further sites or retirement villages.
As I have stated, the first site acquired by the Gull Group for retirement villages was Rosebank, in Sebastopol, in 1990. Rosebank Retirement Village Pty Ltd was incorporated for the purpose of developing the proposed retirement village. The village was transferred to CCV on or about 22 August 2006, when a 30% interest in the villages was sold to ING Community Living Fund Limited (ING). At that time GRVS was incorporated as a vehicle to provide services to the Country Club Villages business.
In around 2006 and 2007, Stewart Gull was anticipating that ING would ultimately buy out the remaining 70% of the retirement village business. With that in mind, Stewart scaled up the retirement village business by investing in the development of existing sites and the acquisition of new sites. That included the purchase of Meadow Gardens.
However, the global financial crisis interceded. As a consequence, it became necessary to buy out ING's interest. Two sites were sold for cash. What Stewart Gull described as 'the two best villages in the portfolio', Noosa Domain and Bellarine Lakes were in development phases and became the subject of joint venture arrangements.
Those joint venture arrangements arose in the following way.
The Bellarine Lakes retirement village is on the Bellarine Highway, near Geelong. The land was purchased in 2003. Due to the unfavourable economic conditions during the global financial crisis, in order to fund the remainder of the project, it was necessary to look for alternatives to traditional bank finance. Mr Burke suggested to Stewart that Mr Mulcahy, the director of a local accounting firm, had a network of wealthy clients who could provide the necessary capital injection. The result was that Mr Mulcahy and his network of investors agreed to enter into a joint venture to complete the development of Bellarine Lakes. Mr Burke told Stewart that he had been offered a stake in the Mulcahy syndicate and Mr Gull said that was fine.
The special purpose joint venture company, Bellarine Lakes Pty Ltd, was incorporated on 19 October 2012 (Bellarine Lakes Joint Venture). The joint venturers were Bellarine G Pty Ltd (of which Stewart Gull was the sole director and shareholder) and Burke Mulcahy Bellarine Pty Ltd (the company representing the interests of the consortium put together by Mr Mulcahy). The joint venture interests as between the joint venturers, subject to any agreed variation, was 50% each.
The second joint venture is Noosa Domain, a retirement village located in Noosaville (Noosa Domain Joint Venture). The structure of the Noosa Domain Joint Venture is relevantly the same as the Bellarine Lakes Joint Venture. More specifically:

[72]

Stewart gave written evidence that these joint investments gave Mr Burke 'skin in the game' and that they would profit together. Stewart stated there was 'no way' he would have agreed to Mr Burke pursuing these opportunities without his involvement and while Mr Burke remained an officer and employee of the Gull Group.
CCV did not purchase any land following the acquisition of Meadow Gardens in Ballarat in 2007. Stewart gave evidence that CCV was not the acquiring entity for any of the residential land developments conducted by the Gull Group. Thus, as it transpired, the acquisition of Meadow Gardens in 2007 was the last land acquisition by CCV.
The Gull Group actively and consciously deployed SPVs to conduct the Gull Group's business.
Following the acquisition of Meadow Gardens in 2007, the Gull Group set up SPVs which owned the retirement villages on a single title. The SPVs also developed the land.
As Stewart stated in his written evidence in chief, SPVs were used to protect the other Gull Group entities from any potential liability or risk arising out of the development. Stewart also identified that it had advantages for the financial administration of each development.
Alistair gave evidence that if the Gull Group was successful in bidding for land, the Gull Group would often set up an SPV to effect the purchase. Alistair gave evidence that this practice was adopted for retirement living developments and land subdivisions. Funds for the purchase would, on Alistair's evidence, come from any entity within the Gull Group, such as by way of an inter-company loan.
Stewart gave evidence that once the Gull Group secured a property for purchase, Ms Müller would set up an SPV to enter the contract of sale. During the period 2015 to 2020, when a residential land development was undertaken, this was the practice followed on almost every occasion.
Thus, as properties were added to the Gull Group, so too were SPVs to own and develop the properties. The make-up of the Gull Group and its constituent entities were thus continually evolving. Stewart agreed that the Gull Group is not a corporate group in the sense of a single holding company of various subsidiaries, but rather a family group constituted by a collection of companies which were ultimately owned by Stewart, his wife, Alistair and Cameron.

[73]

Mr Burke's role within the Gull Group is significant because, as a survey of the authorities will make clear in due course, the content of fiduciary duties are moulded to the character of a particular relationship and, in most cases, the scope of the duty will be determined by reference to nature of the activities of the principal, including the principal's 'venture or undertaking' and the course of dealing between the parties.
More precisely, having regard to the time at which the alleged breaches are said to have occurred, it is important to identify the nature of Mr Burke's role and responsibilities within, and to, Hilltop Views in the period 2015-2019 and the nature of Mr Burke's roles and responsibilities with respect to CCV in 2019 and 2020. In so doing it is also necessary to identify the nature of the business undertaking of each of the plaintiffs.
Stewart Gull and Mr Burke met in or about 1988. In or about 1995, Mr Burke commenced working for the Gull Group in an accounting role. On 1 July 2006, Mr Burke's employment was transferred to GRVS. Mr Burke was employed by GRVS from 1 July 2006 to 30 December 2018. From 1 January 2019, until the termination of his employment on 2 November 2020, he was employed as the CEO and Managing Director of CCV. Mr Burke was not provided with a written employment contract when he was initially employed within the Gull Group. Mr Burke did not receive a written contract of employment until he was employed by CCV.
From about the mid-2000s, according to Stewart Gull, Mr Burke was primarily responsible for the management of the Gull Group's businesses and reported to Stewart. Mr Burke became Stewart's self-described 'right-hand man'. It is evident that Stewart placed a high degree of trust and confidence in Mr Burke. Mr Burke had access to all of the financial information of the Gull Group entities and Stewart's personal finances.
Stewart Gull gave written evidence that when Mr Burke was still employed in the Gull Group, the 'leadership' or executive team of the Gull Group comprised Stewart, Alistair, Cameron and Mr Burke. Stewart said that the organisation chart set out in Annexure A to these reasons accurately depicted Mr Burke as the CEO of 'Country Club Living'. In his words, Stewart performed 'the role as the owner of the business'. Stewart therefore remained involved in all major decisions in relation to CCV.
Mr Burke's office was next to Stewart's and near Alistair and Cameron's. In approximately 2017, the Gull Group relocated its office from 632 Sturt Street, Ballarat to Peel Street, Ballarat. Both at its former site in Sturt Street and at the Peel Street site, there was one building for staff who worked exclusively in the retirement village side of the business and predominantly operations staff, and another building for staff who worked in the property development business.
Stewart gave written evidence that when the Gull Group designed its new office at Peel Street, it was decided to have a window that would open between his office and Mr Burke's office so they could speak freely to one another without having to get up and move to the other person's office. According to Stewart, Mr Burke was heavily involved at a management level in all aspects of the business.
When the Gull Group was based in Sturt Street, the offices of Mr Burke, Alistair, Cameron and Stewart were located together in the property development side of the business, but they worked in the retirement business as well. In Peel Street, their offices were located in the same building as the retirement village team. The section of the office where Stewart sat with Mr Burke, Cameron, and Alistair represented what Stewart described as the core management section of the business, or 'the mind' of the business. Stewart gave evidence that if Mr Burke had only worked in the retirement village section of the business and had a less important position within the business, his office would have been in the CCV section of the buildings.
From about 2015 until 2018, Stewart explored a public listing of the retirement village parts of the business. More specifically, in late 2017 and throughout 2018, the Gull Group actively pursued the proposed public listing of its retirement village business. Mr Burke, together with the CFO, Mr Jock Selkirk, played a key role in this project. The target listing date was late 2018.
Stewart gave written evidence that for the public listing to occur, the organisational structure of the Gull Group needed to be such that the listed entity was structurally separated from the other parts of the Gull Group. A new entity, Country Club Limited (CCL) was chosen as the entity to be listed and which would perform the management function of the business. CCL was incorporated on 14 September 2018 and Mr Burke was appointed as a director.
The plan was for Mr Burke to be the CEO and Managing Director of the listed entity, with Mr Selkirk to be the CFO. Stewart gave evidence that for about 15 months a major part of Mr Burke's day to day role, along with Mr Selkirk, was working on the public listing and all that was required for it to be able to happen. Mr Burke's focus on the IPO therefore commenced in or about the final quarter of 2017. According to Stewart, during this period, Mr Burke continued to be heavily involved in all aspects of the Gull Group business, to assist wherever required.
Stewart gave written evidence that a final decision to abandon the plan to publicly list was made in or about December 2018, as market conditions were unfavourable at that time. However, Mr Burke's employment was transferred to CCV on 1 January 2019, in case the Gull Group decided to pursue a listing in the future. According to Stewart, at that time Mr Burke's role did not change and he continued to work across the whole group.
Pausing there, prior to the proposed IPO, it is common ground that Mr Burke worked across the broader Gull Group as an employee of GRVS. However, Mr Burke's case is that his role narrowed and became more focussed on the retirement village business being conducted by CCV from late 2017 to early 2018. Stewart described this as a 'fallacy'.[23]
Until what he described as the 'shift', Mr Burke accepted he was doing work across the entire Gull Group and across retirement village and non-retirement village developments. According to Mr Burke, the 'shift' occurred in late 2017 and involved a transition process of three to four months, and required working on the IPO and doing more work in the retirement village part of the business at Stewart's direction.
It was not in dispute that following the so called 'shift', Mr Burke performed work in respect of other companies within the Gull Group. Mr Burke's legal team characterised these tasks as 'ad hoc'. Such a characterisation was rejected by Stewart Gull who said that tasks in respect of other companies within the Gull Group 'were part of his duties and responsibilities as the most senior person within the group to do what's required within the group'.
Alistair accepted, in cross examination, that after the IPO was called off, Mr Burke became more focused on the retirement village side of the business. Alistair gave evidence that from early 2018:

[75]

Alistair's observations are also consistent with the objective fact that his employment by CCV (a retirement village business) commenced at the start of 2019.
Ms Müller disagreed with the suggestion that there was a shift in Mr Burke's role towards the retirement village side of the business in 2017-2018 and that his role thereafter in the residential side of the business was minimal or ad hoc. The basis for this disagreement was not elaborated on and the cross examination of Ms Müller revealed that the high point, in terms of detail, to substantiate Mr Burke's involvement in residential development was a 2020 email about a development that the Gull Group had sold three years earlier.
Ms Müller confirmed that Mr Burke's contribution to discussions regarding particular acquisitions concerned the accounting and financial side of those acquisitions. She gave evidence that the types of matters Mr Burke would advise on included the structural set up and operation of a business, tax issues, complicated contract review and tax inputs. I accept this aspect of Ms Müller's evidence. It is consistent with Mr Burke assisting, as and when required, on financial matters relevant to the broader Gull Group.
Mr Burke denied that he had a broader role within the Gull Group beyond CCV, once he became CEO of CCV. He accepted that he was asked, from time to time, to assist in other parts of the Gull Group business. According to Mr Burke, once at CCV, the ad hoc work that he did was more to do with historical residential development transactions where he had some expertise in the transactions that had occurred. He did not believe he was doing any work in terms of financial advice for any new developments.
The evidence supports a conclusion, which I draw, that on and from late 2017, Mr Burke's primary focus was the retirement village side of the business but that he worked and advised on the broader business of the Gull Group whenever requested to do so. More specifically, when required to do so, Mr Burke had an ad hoc role, assisting when requested in relation to accounting, financing and tax matters for a particular development, company or proposed acquisition. Thus, I accept Mr Burke's evidence that from early-to-mid 2018 the work he was doing for the broader Gull Group was generally ad hoc in nature - that is, as and when a particular need or request arose. I am fortified in this conclusion by the evidence of Alistair Gull, who accepted that the proposed IPO resulted in a significant shift in Mr Burke's role.
A conclusion that Mr Burke's role became more focussed on the retirement village business, as a matter of fact, is supported by the following matters.
First, his employer changed from GRVS to CCV on 1 January 2019.
Second, there was a demonstrable and clear break in Mr Burke being appointed as a director or secretary of SPVs conducting Gull Group business other than retirement village business on and from 19 January 2018 - that was the last date on which he was appointed as a director or officer of a residential development entity.[24] By way of contrast, there are 20 entities of which Mr Burke became a director on 14 September 2018. That step was taken to facilitate the listing of the retirement village business and to clean up the associated company structures.
Third, Ms Müller gave evidence that from early 2018, the residential land side of the business was being run by Alistair, Stewart and Cameron.
Fourth, there was paucity of documentary and detailed witness evidence suggesting a detailed or meaningful involvement on the part of Mr Burke in the residential development businesses of the Gull Group.
As the defendants rightly submit, if Mr Burke had worked across all aspects of the business for a two and a half year period, the plaintiffs ought to have been able to tender a substantial body of documentary material evidencing that broader role. The documentary evidence supporting the existence of a broader role upon Mr Burke's transition to CCV was very limited. It consisted of:

[80]

On 29 June 2015, Hilltop Views was incorporated with Stewart, Alistair and Cameron as the named directors and Mr Burke as the named company secretary. The shareholding in Hilltop Views was 25 ordinary shares owned legally and beneficially by each of Stewart, Alistair, Cameron and Shelley Anne Hindhaugh.
Hilltop Views was an SPV. It has only ever owned, subdivided and sold the lots on Hills Estate. It did not, and has not, ever purchased any other property. Cameron also gave evidence that Hilltop Views did not carry out any other developments because his sister, Ms Hindaugh, was also a shareholder in that in that entity. Thus, Hilltop Views has not purchased any property other than the Hills Estate property. It has not carried out any other developments and its only business activities have been subdividing and selling the residential lots at Hills Estate. The connection between Ms Hindaugh's shareholding and the absence of further developments by Hilltop Views was not explored further in the evidence.
On 29 June 2015, Hilltop Views entered into the contract of sale for the purchase of 9 Hilltop Road - otherwise known as Hills Estate. The contract was signed on behalf of the purchaser by 'Cameron Stewart Gull - Director - Hilltop Views Estate Pty Ltd'. Thus, the contract of sale was executed not only on the same day that Hilltop Views was incorporated but on the understanding that it had been incorporated at the time of execution. Consistently with Mr Burke being named as company secretary, Stewart gave evidence that Mr Burke knew that the purchase of Hills Estate had been made. The settlement date on the contract of sale for Hills Estate was 29 June 2016, or earlier by agreement.
Self-evidently, and as Cameron and Stewart confirmed, the decision to buy the Hills Estate land had been made before the incorporation of Hilltop Views. The opportunity to purchase Hills Estate had been communicated to Cameron in 2015 by Andrew Ferguson, an agent for the Ballarat Property Group. Cameron gave evidence that he discussed the opportunity with Alistair, Stewart and Mr Burke and that they agreed that it was worth further investigation. More specifically, Cameron also gave evidence that Mr Burke was consulted around the decision to purchase the Hills Estate land and gave specific input about financial matters. In written evidence, Mr Burke stated that he was not involved in the purchase of Hilltop Views or in any discussions relating to the decision to acquire it.
Neither Stewart nor Alistair had a specific recollection of Mr Burke being involved in the decision to purchase the property by Hilltop Views. There were no documents tendered at trial to suggest that Mr Burke had any involvement in the decision to purchase Hills Estate. Cameron accepted in cross examination that it was he and Alistair, in consultation with Stewart, who 'ran with' the opportunity to purchase Hills Estate.
As a result of the absence of documentary evidence to support the contention that Mr Burke was involved in the decision to purchase Hills Estate, the absence of any recollection by Stewart and Alistair and in light of Mr Burke's rejection of Cameron's account, I am not actually persuaded that Mr Burke was involved in the decision to acquire Hills Estate.
I will consider Mr Burke's role with Hilltop Views following the acquisition of Hills Estate, later in the chronological sequence of the case with respect to the Gracefield Road Property.

[87]

Some retirement villages were owned directly by CCV and some were owned by SPVs. By 2010, the practice of the Gull Group was to set up SPVs which owned the whole of the retirement villages on a single title. CCV derived no revenue from the SPVs conducting retirement village business. As Mr Burke described, 'Country Club Villages got paid fees from Bellarine and Noosa, but they were joint ventures, they did not get fees from the SPVs that related to Stewart'.
Thus, on the state of the evidence, CCV did not itself expand its operations and generate additional cash flow earning opportunities after 2007. CCV derived its revenues from the management of villages that it had acquired the land in respect of, and the sale of retirement village units, lease fees and deferred management fees. It also received fees from the Bellarine and Noosa joint ventures for services that had been agreed between the parties.
CCV never acquired and developed land specifically for residential purposes. CCV was not the holding company for any SPVs and there is no suggestion that CCV had any economic interest in purely residential development, or an entity which conducted residential developments. There is no suggestion in the organisation chart replicated in Annexure A of there being a residential development component of the CCV business.
Counsel agreed,[25] that it was common ground between the parties that CCV only acquired land which was intended, at least as to part, to have a retirement village component. Counsel also agreed that it was common ground that in the acquisition of land by CCV, there were, on occasions, separate uses to which that land was put, albeit that a purpose of the land was always for retirement village development. One example was the Melba Vale land which was initially intended to be entirely used for retirement village purposes. However, as there was a flight path going over the edge of the development, the affected land was used for a commercial purpose. Mr Burke accepted that things could arise in the retirement village business that might cause the land to be repurposed for a non-retirement village purpose and that such occurrences did arise. Stewart gave evidence, which I accept, that as no piece of land was ever perfect for retirement village development, part of the land acquired (or to be acquired) for retirement village purposes would need to be carved off for sale as commercial or residential blocks.
The evidence thus reveals that the actual responsibility and assumed duties of Mr Burke, as CEO and Managing Director of CCV, was to perform that role with respect to the retirement village part of the business and to assist other entities within the Gull Group on matters such as due diligence, accounting, feasibility, and financing as and when requested to do so. These duties did not require Mr Burke to refer specific residential development opportunities he had learned of to unspecified entities within the Gull Group, or Stewart, Cameron and Alistair Gull. Absent a specific request capable of enlivening a relevant duty to the affected entity, these duties did not preclude Mr Burke from competing on residential land developments with unspecified entities within the Gull Group or Stewart, Cameron and Alistair Gull.
Mr Burke accepted that whilst an employee of CCV, he was unable to be involved in retirement village investments outside of CCV, including retirement villages operated by SPVs or other entities within the Gull Group. Thus, Mr Burke also accepted, in cross examination, that if the Cobblers Lane Property was appropriate for a retirement village development he could not have been involved in the purchase of the site. Mr Burke rejected that he had any responsibility to bring potential retirement village acquisitions to the Gulls. Mr Burke gave evidence that potential acquisitions were managed by the Gulls. Alistair confirmed that it was not Mr Burke's role to do so.

[88]

Stewart gave evidence, which I accept, that the feasibility of any given project would be assessed at different stages and be the subject of constant evaluation to assess the impact of changing market conditions and construction costs. An initial feasibility would be informal. Ultimately, however, a detailed feasibility would be required to identify the anticipated rate of return and for the purpose of obtaining external bank financing.
To perform feasibility studies from in or about 2015 onwards, the Gull Group used a software program called EstateMaster. The unchallenged evidence of Ms Müller was that the software for this program was licenced to GRVS and CCV was granted an 'allowance' to use it. The evidence disclosed that the licence fee was $3,894 per annum and that CCV paid an internal fee to GRVS to account for its share of the use of EstateMaster. The annual internal fee as at April 2023 was $1,298.
Prior to EstateMaster, the Gull Group did not do formal feasibilities but provided information (such as estimated sales and engineering development costs) as needed to valuers. Valuation work was done in order to assist the Gull Group in obtaining bank finance for the relevant development. The information that was gathered would assist the valuer in providing the valuation required to support a bank finance application. Prior to EstateMaster, the process was therefore manual but was described by Mr Burke as 'not too onerous'. Mr Burke accepted, in cross examination, that he was already skilled in ascertaining feasibility outputs before EstateMaster was introduced, such as the likely profit a development would produce. EstateMaster presented a new way of working and what Mr Burke described as a more efficient tool. Consistent with this evidence, Mr Burke gave evidence that whilst a feasibility could be done on Microsoft Excel, using EstateMaster was easier and quicker. Mr Burke accepted that EstateMaster 'was a tool that allowed inputs of the knowledge that the Gull Group had' and that it was typically used by the valuer.
EstateMaster enables property developers to manage property development projects. Key features include the ability to:

[102]

The Written Contract of Employment thus draws an express distinction between Mr Burke's 'original commencement date' of 1 January 2019 and the date of the commencement of the Written Contract of Employment (21 January 2020) and explicitly notes that the commencement date in item 2 'will be honoured' for leave entitlement purposes. Such an assurance would be wholly unnecessary if the written contract was being provided in January 2019 at the same time that Mr Burke was in fact commencing work. Moreover, there would be no need to stipulate a date, in the future, for the commencement of the written terms of employment, in circumstances when Mr Burke was being employed from 1 January 2019.
The consequence is that, if the written terms in the 21 January 2020 contract apply, they only apply to the conduct of Mr Burke on and from 21 January 2020. That renders them irrelevant to the claim concerning the Cobblers Lane Property.
Mr Burke gave evidence that he never agreed to the terms of the Written Contract of Employment and was 'never paid in line' with its terms. Mr Burke gave evidence that both he and Mr Selkirk refused to sign the employment contracts. Mr Burke said that short and long term incentives for Mr Selkirk and himself had not been finalised and had been informally discussed with Stewart. Mr Burke gave evidence that he told Stewart that he and Mr Selkirk would not sign the agreement until they received legal advice.
Stewart Gull gave evidence rejecting that suggestion. Stewart Gull denied that Mr Burke ever refused to sign the contract. Stewart said that he had nothing to do with the employment contracts. Stewart denied that Mr Burke told him that he and Mr Selkirk would not sign the Written Contract of Employment until they had received legal advice.
Mr Burke did not get that legal advice. His evidence, which I accept, was 'it was pretty pressing times in that period from February 2020. We had a lot of distractions in the organisation at that time. It was a pretty challenging time. It wasn't a priority for - to be honest, no priority for Stewart or myself in that period'.
CCV relied upon Mr Burke's response to a number of variation letters to contend that Mr Burke accepted the terms of written contract provided to him in or about January 2020.
At 9:37am on 20 April 2020, a payroll officer at CCV emailed Mr Burke as follows:

[112]

The nature of the case being propounded by CCV was to the effect that the variation letters left Mr Burke's original Written Contract of Employment standing, subject to the alterations constituted by the written variations. I accept that the variation letters were altering rather than rescinding Mr Burke's earlier contractual arrangements. The critical question is what the terms of the earlier contract were and whether they included the terms included in the Written Contract of Employment.
I am not actually persuaded that Mr Burke agreed, by words or conduct, to the terms of the Written Contract of Employment provided to him in January 2020. That is so for the following reasons.
First, Mr Burke's evidence squarely raised that he and Mr Selkirk had rejected the written offer of employment in order to get legal advice and to finalise discussions about incentives. Mr Selkirk was the CFO of CCV. He was not called to give evidence to rebut Mr Burke's version of events and his absence was not explained. Drawing upon the principles in Blatch v Archer,[30] that 'all evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted'[31] and Jones v Dunkel[32] that when a party who is capable of testifying, fails to give evidence without explanation 'it may lead rationally to an inference that his evidence would not help his case'.[33] I infer that any evidence from Mr Selkirk would not have assisted CCV in discharging its onus.
Second, contrary to CCV's submission, the evidence of the acceptance of the variation letters did not demonstrate an acceptance or agreement to the written contract terms provided to Mr Burke in January 2020 and contained in the Written Contract of Employment. The variation letters were obviously varying the previous terms of his employment, but they did not illuminate or explain what the source and content of those prior terms were.
Third, contrary to CCV's submission, clause 2.3 of the Written Contract of Employment does not assist CCV. Having regard to the terms of clause 2.3, CCV submitted that:

[117]

The reference to Jamie in the email is a reference to Jamie Mulchay who was also involved in the Bellarine and Noosa Domain joint ventures.
Mr Burke described the title of the email as a joke by Mr Grist. This explanation appeared to be rehearsed and was self-serving. It could have been readily corroborated by calling Mr Grist, on whose behalf a witness statement was served. Mr Burke denied it was about land development at all and that it was the product of a joke between himself and Mr Grist. I reject this and infer that Mr Grist's evidence would not have assisted Mr Burke's case in this regard.
One of the items on the agenda was 'How do we reduce any conflict of interest for Burkey?'.
Mr Burke gave evidence that the reference to a conflict of interest was in the email because he had been talking to Mr Grist about the fact that he could not invest in retirement villages. Mr Burke gave evidence to the effect that Mr Grist was keen to continue investing in development projects and had been involved in the Bellarine and Noosa developments. I accept this evidence.
At the Zoom meeting with Mr Grist, Mr Dolan and Mr Sculley, Mr Burke said that he explained that he would not invest in retirement villages. He said that was 'the end of it in terms of the discussion' on that topic. Mr Burke did not recall any discussion regarding residential investment. Similarly, he gave evidence that there was no discussion about the difference between CCV and other parts of the Gull Group, or that Mr Burke was doing ad hoc work in residential development for other parts of the Gull Group. Mr Burke's evidence on these topics was not challenged.
Mr Dolan was cross examined about the email. Mr Dolan said he was surprised to see the conflict of interest bullet point. Mr Dolan said he was not particularly concerned by it and did not enquire about it further at the meeting or ask Mr Burke about it after the meeting. Mr Dolan said that the only conflict of interest that he had perceived Mr Burke may have was with respect to retirement villages. His evidence, which I accept was:

[122]

The variations between more precise formulations of the principle governing the liability to account are largely the result of the fact that what is conveniently regarded as the one "fundamental rule" embodies two themes. The first is that which appropriates for the benefit of the person to whom the fiduciary duty is owed any benefit or gain obtained or received by the fiduciary in circumstances where there existed a conflict of personal interest and fiduciary duty or a significant possibility of such conflict: the objective is to preclude the fiduciary from being swayed by considerations of personal interest. The second is that which requires the fiduciary to account for any benefit or gain obtained or received by reason of or by use of his fiduciary position or of opportunity or knowledge resulting from it: the objective is to preclude the fiduciary from actually misusing his position for his personal advantage...the two themes, while overlapping, are distinct. Neither theme fully comprehends the other and a formulation of the principle by reference to one only of them will be incomplete. Stated comprehensively in terms of the liability to account, the principle of equity is that a person who is under a fiduciary obligation must account to the person to whom the obligation is owed for any benefit or gain (i) which has been obtained or received in circumstances where a conflict or significant possibility of conflict existed between his fiduciary duty and his personal interest in the pursuit or possible receipt of such a benefit or gain or (ii) which was obtained or received by use or by reason of his fiduciary position or of opportunity or knowledge resulting from it. Any such benefit or gain is held by the fiduciary as constructive trustee: see Keith Henry & Co. Pty. Ltd. v. Stuart Walker & Co. Pty. Ltd. That constructive trust arises from the fact that a personal benefit or gain has been so obtained or received and it is immaterial that there was no absence of good faith or damage to the person to whom the fiduciary obligation was owed.[34]

[148]

It is, in my view, a striking feature of the authorities referred to above how rare have been the circumstances in which a court has been called on to deal with the pure case of a director's involvement in a competing business, without any additional or complicating factor. However, as a Judge sitting at first instance, I must accept that, in Australia, Bell v Lever Bros is good law to the extent that it stands for the proposition that merely by acting as a director of a competing company, or carrying on a competitive business on his or her own behalf, a company director will not be regarded as being in breach of his or her fiduciary obligations. I so conclude from the treatment of the subject in On the Street, Rosetex and SEA Food, limited though it was. Stated in its highest form, the proposition for which Bell v Lever Bros stands is, as put by McLure P in Streeter (at [69]) "a director is permitted to occupy board positions in competing companies". That is to say, merely by occupying such positions, the director will not be regarded as placing himself or herself in a position of conflict. But, it must be accepted, Lord Blanesburgh's words in Bell v Lever Bros extended also to the permissibility of a director conducting a business on his or her own account in competition with the company on the board of which he or she sat. That would, presumably, involve the performance of active, executive, functions in a competitive business, and would not be analogous to a situation in which the director held non-executive positions on the boards of two companies. But it would seem to be permitted, as for example was the involvement of a non-executive director in an executive role in a competing company in On the Street. As against this, my attention has been drawn to no decision of an Australian court in which Bell v Lever Bros has been rejected.

Although nowhere so stated in terms, the principle with which the authorities are consistent is that carrying on business - including doing so by working as an executive director of a company - in competition with the company of which he or she is a non-executive director will not necessarily be regarded as involving a conflict of interest or duty. It cannot be assumed, as a matter of fact, that a situation of this kind will inescapably involve "a real or substantial possibility of a conflict between [the director's] personal interests and those of the persons whom he [or she] is bound to protect" (Hospital Products at 103 per Mason J). So understood, the principle is a very high-level one that could be used only as the broadest of starting points for the resolution of issues arising in a particular case.

Notwithstanding the heavily qualified nature of the legal principle on which LGT relies, to the extent that the defendants' case is to be understood as involving the proposition that Lord Blanesburgh's dictum in Bell v Lever Bros opens up as legitimate any and all kinds of competitive business to the director of a company, that proposition must be rejected. The question whether, in the light of the nature of the competitive business, the director's role in it and other relevant circumstances, the director's conduct would give rise to the sensible possibility of conflict, is not foreclosed by the dictum. At most, the dictum means that the mere fact of being the director of a company will not preclude the director from engaging in a competing business on his or her own account. But it leaves open any issues of actual conflict, or of conflict reasonably perceived to be within the range of sensible possibilities, arising on the facts of a particular case.

[166]

However, in order to attract equitable intervention, the information must be "confidential in quality" and of a "confidential nature": Coco v A N Clark (Engineers) Ltd at 47; Commonwealth v John Fairfax & Sons Ltd at 51; O'Brien v Komesaroff [1982] HCA 33; (1982) 150 CLR 310 at 326. Further, trade secrets may devolve by operation of law, as upon bankruptcy (Re Keene [1922] 2 Ch 475) and by testamentary provision (Morison v Moat [1851] EngR 790; (1851) 9 Hare 241 at 241, 265; [1851] EngR 790; 68 ER 492 at 493, 502). It should be noted that Re Keene (supra) the secret formulae had never been committed to writing. A secret process employed in a business may be held in trust in connection with a trust of the business (Scott on Trusts (4th ed, 1987), s82.5) and may be the subject of an equitable charge given to a creditor (Struthers v Hospital Products Ltd (unreported, Supreme Court, NSW, Kearney J, 25 February 1984)). And, in some circumstances, the obligation to observe an obligation of confidence may be extended to a third party: Malone v Metropolitan Police Commissioner [1979] Ch 344 at 361; Wheatley v Bell [1982] 2 NSWLR 544.

In National Provincial Bank Ltd v Ainsworth [1965] UKHL 1; [1965] AC 1175 at 1247-1248, Lord Wilberforce said that before a right or interest can be admitted into the category of property, it must be definable, identifiable by third parties, have some degree of permanence or stability, and be capable in its nature of assumption by third parties. This dictum has been applied in Australian decisions, for example, R v Toohey; Ex parte Meneling Station Pty Ltd (supra) at 342-343; Sonenco (No 77) Pty Ltd v Silvia (1989) 89 ALR 437 at 445, 457. The degree of protection afforded by equitable doctrines and remedies to what equity considers confidential information makes it appropriate to describe it as having a proprietary character. This is not because property is the basis upon which that protection is given, but because of the effect of that protection: cf Commissioner of Taxation (Cth) v United Aircraft Corp [1943] HCA 50; (1943) 68 CLR 525 at 548**, per Williams J;** Boardman v Phipps, at 127-129

To reach that conclusion is not to engage in the circularity of reasoning to which Windeyer J referred in Colbeam Palmer Ltd v Stock Affiliates Pty Limited [1968] HCA 50; (1968) 122 CLR 25 at 34, namely, by saying that equity intervenes in a particular class of case by injunction or other remedy, and by concluding that the reason for the remedy lies in the protection of an equitable proprietary interest. Here, the source of the equity is that indicated by Deane J in the Moorgate Tobacco Case, and is not based in property, but the effect of the protection given by the legal system is as I have described.

[170]

In my view, Professor Austin correctly identified some of the negative impacts that would flow from equity accepting that information can constitute trust property in this context. I acknowledge that what is written below is borrowed from his analysis, although the responsibility for its adaptation is mine. First, once it is accepted that not all information can be trust property, as Farah now conclusively decides, there is no identified criterion for drawing the line between the information which is and the information which is not property. It might be accepted that confidential information constituting a trade secret may be enough, but that is not this case, anymore than it was in Farah. Second, the extension of "trust property" to information does not lend itself to analysis by equity's rules of priority concerning volunteers, bona fide purchasers and legal versus equitable titles, or tracing. It makes the central focus of first limb Barnes v Addy liability the personal liability or remedial constructive trust liability of the stranger to account for the receipt of and any benefit gained through the use of the "trust property", as opposed to the maintenance of the title to or restoration of the traced proceeds of the "trust property". Third, if information is treated as trust property, that may distort the scope of the fiduciary obligation itself, although it must be recognised that there are many situations where a disclosure of information in breach of confidence will be treated as, or as analogous to, a breach of fiduciary duty. Fourth, if information is "trust property" that may be traced into its product, the stranger's gain, the result may be that the beneficiary can recover an unfairly enlarged gain, unless allowance is made for expenditure, skill and effort.

I would add two further considerations. In my view, it is important in asking the question as to the scope of "trust property" not to forget where first limb Barnes v Addy liability comes from and what the purpose of that liability is, in the sense of the interest it is designed to protect. Barnes v Addy was not about the liability of a person for the acquisition of property due to the dealings of another person who had an inconsistent fiduciary obligation. It was not even about the liability of a stranger to a trust in respect of the receipt of trust property with notice of the trustee's breach of trust. So, in referring to receipt by a stranger to a trust of "trust property", Lord Selborne did not have in contemplation the present sort of discussion about information or business opportunity as trust property. In fact, at the very beginning of his reasons, his Lordship said:

[180]

Assistance could also take the form of making representations or causing a company to commit the primary breach. In Compaq Computer v Merry, it was alleged that the directors of a company which owed fiduciary duties under an agency agreement had "knowingly caused, procured, permitted or assisted" the company to breach its fiduciary obligations and had participated in its contravention of s 52 of the Trade Practices Act. The alleged assistance took the form, broadly, of falsely representing that the company would comply with the terms of the agency agreement and causing the company to breach the terms. While Finkelstein J did not consider that accessorial liability was established, he appeared to accept that the alleged activities could amount to assistance in the relevant sense.

It seems self-evident that assistance should "make a difference" and forward or advance the primary breach or misconduct in some way. Mere passive acquiescence in the breach would not, in the ordinary case, suffice to establish liability on the ground of assistance. Further, it appears clear that assistance must take the form of some activity or conduct over and above mere knowledge of the fiduciary's breaches.

Lord Nicholls in Royal Brunei Airlines Sdn Bhd v Tan stated that "honesty and its counterpart dishonesty are mostly concerned with advertent conduct". Similarly, in Nightingale Finance Ltd v Scott, Carnwath J held that "for a third party to become liable as a 'knowing assistant' he must be an active participant in the breach of trust".

Consistent with that approach, the courts have eschewed the imposition of liability for mere passive acquiescence in the primary breach. In Brinks Ltd v Abu-Saleh (No. 3), Rimer J held that a wife who accompanied her husband on trips to Switzerland where he laundered misappropriated funds was not liable for knowing assistance, indicating that something more than passive acquiescence was required, despite the fact that her presence may have lent an appearance of legitimacy to the trips.

It has been recognised that the Court's reluctance to impose liability in the absence of a positive act is defensible, given the many difficulties posed by the hypothetical question of what steps an honest person would have been required to take in given circumstances.

It would seem that the assistance must also have some causal significance, which is more than minimal 'for if there is no causative effect and therefore no assistance given ... the requirements of conscience [do not] require any remedy at all.' [119]

[198]

Whether a benefit can be said to be obtained "as a result of" knowing participation in a breach of fiduciary duty by another contrary to the principles of equity is a question of causation or contribution that depends on "a precise examination of the particular facts" of the case, rather than upon attempts to refine the expression "as a result of", as if that phrase has some determinate operation of its own that may be discerned and applied independently of the equitable principle of which it is part. The equitable disgorgement principle with which we are concerned is a "prophylactic rather than a restitutionary principle". It is sufficient to show that the profit would not have been made but for dishonest wrongdoing. Further, whatever may be the position for wrongdoing that is not marked by dishonesty, a defendant cannot avoid liability to disgorge profits dishonestly made by showing that those profits might have been made honestly. This is not an approach to causation that is unique to dishonesty in equity. A defendant who is liable to compensate for deceit cannot avoid that liability by showing that the loss would have been suffered even without the deceit; and it is sufficient that the deceit was an inducement to engage in the conduct that occasioned the loss even if there were other inducements. And in taking an account of profits for dishonest infringement of intellectual property rights, courts do not reduce the profit by reference to opportunity cost, that is, the revenue that would have been received by a lawful alternative. As Lord Radcliffe said in the context of disgorgement of profits for a breach of fiduciary duty involving non-disclosure, "it is neither here nor there to speculate whether, if he had done his duty, he would not have been left in possession of the same amount of profit". For these reasons, the deterrent effect of an order for disgorgement of profits should not be diminished by acceding to Foresters' attempt to confine the scope of the causal enquiry implicit in the expression "as a result of". [143]

[232]

The degree of care and diligence that s 180(1) requires is assessed objectively by reference to the two elements identified in paragraph (a) and paragraph (b) of s 180(1): the corporation's circumstances; and the office and responsibilities within the corporation that the director had.[169] The corporation's circumstances includes all relevant commercial and other circumstances, including: the type of company; its constitution's provisions; the size and nature of its business; and the composition of its board.[170] In a specific case the circumstances may also include any breach or potential breach of the Act or other law by the corporation.[171]
The reference to 'responsibilities' in s 180(1)(b) is not to be understood as limited only to the usual responsibilities of someone in that particular office but extends to all of the responsibilities that the relevant person in fact had, regardless of how or why the person came to have those responsibilities.[172]
Reflecting its partial origins in equity, s 180(1) does not require it to be established that the conduct caused loss, however the acts or omissions of a director relied on to allege a breach of the duty must involve a foreseeable risk of harm to the company.[173] Whether a director has, in a specific case, exercised the requisite degree of care and diligence can only be answered by balancing the foreseeable risk of harm against the potential benefits that could reasonably have been expected to accrue to the company from the conduct in question.[174]
The obligation imposed by s 180(1) relates to all powers and duties of a director or officer, regardless of the source. The relevant source may be equity, common law, the Act, other legislation, or the company constitution. In order to determine whether the standard has been met, 'it is desirable to identify the power or duty with precision'.[175]
However, and importantly for present purposes, the impugned conduct must be conduct undertaken in the exercise of a power or the discharge of a duty - conduct undertaken outside the scope of powers or beyond the discharge of their duties will not fall to be sanctioned under s 180.[176] The involvement of an officer in a transaction where there is a potential conflict between personal interest and their duty to the company, means that the duty of care and diligence 'falls to be exercised in a context requiring special vigilance, calling for scrupulous concern on the part of those officers who become aware of that transaction to ensure that any necessary corporate approvals are obtained and safeguards put in place'.[177]

[241]

The learned authors of Ford, Austin & Ramsay's Principles of Corporations Law identify the following summary of principles applicable to s 181(1)(a):[187]
1. The duty will apply to a decision that is made by a director or to conduct of a director (where that decision or conduct involves the exercise of powers or the discharge of duties).
2. To satisfy the requirements of the section, the director must identify what they believe to be the best interests of the company in relation to the decision to be made or the conduct they propose to take. The director must honestly believe that the interests or proposed conduct they have identified is in the best interests of the company. If the director does not have this honest belief, then there is a contravention of s 181(1)(a). The court is entitled to consider the director's evidence and also the surrounding circumstances as part of deciding whether the director held this honest belief. One circumstance where the director will not hold this honest belief is where the court decides that the director did not undertake the required process of identifying the best interests of the company in relation to the decision that was made or the conduct that was taken.
3. Even if the court finds that the director held the required honest belief, the court is able to find there is a contravention of s 181(1)(a) if the court decides that the decision made by the director or the conduct taken by the director was a decision or conduct that no reasonable director, acting in the best interests of the company, would make or take ... [T]he court does not itself decide what are the best interests of the company ... rather the court employs the standard of the reasonable director ...
4. Even if the court finds that the director held the required honest belief, the court is able to find there is a contravention of s 181(1)(a) if the court decides that the decision made by the director or the conduct taken by the director was a decision or conduct that no reasonable director, acting in the best interests of the company, would make or take ... [T]he court does not itself decide what are the best interests of the company ... rather the court employs the standard of the reasonable director ...
5. For there to be a contravention of s 181(1)(a), the director must have knowledge of the facts that make the decision or conduct not in the best interests of the company.
6. It is not necessary to prove that the director acted dishonestly in order to find the director contravened s 181(1)(a) ...
The relevant test for impropriety for s 181(1)(b) (which is applicable also to ss 182 and 183) was identified by Basten JA in Sunnya as that set out by the majority of the High Court in R v Byrnes:[188]

[295]

From 2001 to 2014, Mr Harris, his wife and his business partner had owned and operated a seven acre flower farm at 224 Daylesford Road in Brown Hill (the Flower Farm).
In June 2014, the business partnership at the Flower Farm was coming to an end and in order to maximise returns, Mr Harris and his business partner decided to obtain a planning permit and subdivide the land. Mr Wright assisted Mr Harris in obtaining planning approval.
The neighbours to the south of the Flower Farm were Peter and Gail Kiel, who owned the Gracefield Road Property. Mr Harris became 'quite good acquaintances' with the Kiels and the Hesseys (who themselves owned the land to the east of the Flower Farm).
In around April or May 2015, Mr Harris had a conversation with the Kiels, who told him that they were planning to sell the Gracefield Road Property. At this time, the Gracefield Road Property was not on the market for sale. Mr Harris gave unchallenged evidence that as a consequence of the Flower Farm bordering the Gracefield Road Property, he was well aware of the development opportunity that existed and the type of return that could be made if the Gracefield Road Property was subdivided.
Following his conversation with the Kiels, Mr Harris called Mr Dolan to tell him about the opportunity to acquire the Gracefield Road Property. Mr Dolan described Mr Harris as being 'excited about the opportunity' and gave evidence that Mr Harris told him that he had some information on the sewerage connection that would be going through the Flower Farm and be accessible to the Gracefield Road Property.
Mr Dolan drove past the Gracefield Road Property and walked the property with Mr Harris to understand its contours and any other issues that might arise in its development. At an initial meeting of the two men, Mr Dolan prepared a rough one page budget of the likely costs of the project and possible development scenarios.
In or around August 2015, Mr Harris and Mr Dolan met to discuss purchasing the Gracefield Road Property. By this time, Mr Dolan had realised that the required financial commitment would be 'big' and would be in the vicinity of $1.5 million to $2 million. Mr Harris and Mr Dolan discussed bringing in additional investors. Mr Harris suggested involving Mr Wright as he had helped him with the potential subdivision of the Flower Farm. Mr Dolan suggested to Mr Harris that they consider involving Mr Burke. Mr Dolan gave unchallenged evidence that the reason he suggested that Mr Burke become involved was 'because he had introduced me to the retirement villages opportunity in Noosa and Bellarine earlier and I felt like I owed him an investment opportunity'. At this time, Mr Harris had not been introduced to Mr Burke. Mr Harris knew that Mr Burke was a good friend of Mr Dolan's and that Mr Burke had introduced Mr Dolan to an investment in retirement villages with Stewart Gull (i.e. Noosa Domain and Bellarine Lakes).
Mr Burke gave evidence that at or around this time, Mr Dolan asked Mr Burke what he thought the Gracefield Road Property was worth. By email dated 19 August 2015, Mr Dolan asked Mr Burke the following:

[301]

Mr Harris gave evidence that he based the calculations in his email on the figures he had been quoted to develop the Flower Farm.
Mr Harris gave unchallenged evidence that around 24 August 2015, he had a discussion with the Kiels over the fence of their neighbouring properties. Mr Harris offered the Kiels $1.5 million with a 12 or 24 month settlement period to purchase the Gracefield Road Property. According to Mr Harris, an offer of a 24 month settlement period was therefore made to the Kiels before it was listed for sale. It is not clear whether the offer made 'over the fence' was made by Mr Harris personally or on behalf of the Initial Consortium. The evidence supports a conclusion that Mr Harris made the offer independently. There is no suggestion on the evidence that Mr Burke or Mr Dolan knew that this offer had been made. Furthermore it is a bigger offer and on better terms than the first offer subsequently made by Mr Dolan on behalf of the Initial Consortium.
According to Mr Harris the Kiels told him, after consideration, that they would try and get more for the Gracefield Road Property and had therefore decided to list it with a local real estate agent, Don Hanlon of PRD Ballarat.
On 28 August 2015, Mr Dolan, Mr Harris and Mr Burke met for a coffee at L'Espresso coffee shop to discuss the opportunity to purchase the Gracefield Road Property.
In or about October 2015, an expression of interest campaign was commenced for the Gracefield Road Property and a 'For Sale' board was erected. On 13 October 2015, Mr Hanlon emailed Alistair Gull explaining that the Gracefield Road Property was being sold by an expression of interest campaign. Mr Hanlon's email made it clear that he thought Alistair might 'like to be made aware of this opportunity'.
Alistair gave written evidence that at the time he received Mr Hanlon's email, the planning and development of Hills Estate was still at a relatively early stage. Hilltop Views did not have a planning permit, nor a clear idea of the development costs and pricing was yet to be determined. Alistair gave evidence that nonetheless, the Gull Group were interested in other opportunities in the area.
On 22 October 2015, Alistair responded to Mr Hanlon inquiring 'how much are they chasing?.' Mr Hanlon did not disclose the answer to that question, instead replying:

[303]

Alistair understood Mr Hanlon's reference to 'your current development' to be a reference to the Hills Estate. Alistair gave evidence that he was fairly circumspect about Mr Hanlon's response. Alistair stated that Mr Hanlon was not an agent that he had dealt with before, he had not seen any evidence to support Mr Hanlon's development projections and he did not like that Mr Hanlon did not tell him the price being sought by the vendors. The planning permit for the two lot subdivision attached to Mr Hanlon's email also appeared to Alistair to be missing a number of pages.
Alistair Gull did not respond to Mr Hanlon's email of 22 October 2015. He said that he was very uncomfortable about the prospect of telling Mr Hanlon what he thought the property was worth, particularly given the Gull Group had other live developments in the area at that time and property development is a very competitive business.
I pause to observe that at the time Alistair received Mr Hanlon's email, the Gull Group in fact had the benefit of a preliminary development cost estimate for Hills Estate, prepared by Coughlan Civil Pty Ltd. Moreover, Alistair did not ask Mr Hanlon for any evidence to support his development projections. Nor did Alistair ask Mr Hanlon for the missing pages of the planning permit. Nor did Alistair explain how he would have overcome his reticence to express a view on value in order to make an actual bid on the Gracefield Road Property.
Mr Dolan gave evidence that he led the negotiations to acquire the Gracefield Road Property on behalf of the Initial Consortium. In early December 2015, Mr Dolan contacted Mr Hanlon on behalf of the Initial Consortium. According to Mr Dolan, Mr Hanlon told him that expressions of interest would close on 11 December 2015. At that time, Mr Dolan decided not to express an interest, as it was thought better to negotiate once the expressions of interest had closed.
On 11 December 2015, Mr Harris sent Mr Dolan an email updating him on the outcome of a meeting Mr Harris had attended with a planner, James Iles:

[310]

By his email, Alistair was quite clearly communicating a rejection of Mr Hanlon's invitation to treat and encouraging the Kiel's to accept an offer at $1.5m. Alistair gave evidence that his reference to being 'committed in Brown Hill' was a reference to the fact that the Hills Estate and Apple Tree Estate (another development being undertaken in Brown Hill by the Gull Group) were in their early stages of development. As Stewart said, the Gull Group was 'never not fairly committed in Brown Hill'.
Alistair gave evidence that if he had known a 24-month settlement was a possibility when Mr Hanlon approached him about the Gracefield Road Property, he would have been much more interested and would have wanted to buy the Gracefield Road Property. According to Alistair, a longer settlement would have allowed the Gull Group more time to complete the planning and construction phases of Apple Tree Estate and the Hills Estate, before they would have had to settle on the Gracefield Road Property. He gave evidence that this would have had the 'big advantage' that the proceeds of sale from the other two estates could be used to fund the purchase and development costs on the Gracefield Road Property.
Alistair also said there were two advantages for a 24 month settlement on the Gracefield Road Property. First, the potential increase in sales prices; and, second, advantages that might arise with respect to holding costs. Given those perceived advantages, he did not offer a satisfactory explanation for failing to ask Mr Hanlon about the availability of an extended settlement period.
In cross examination, Alistair accepted that Mr Hanlon was not expressing that a 12 month settlement was a condition of the sale. Alistair, being an experienced residential developer, could have easily and readily enquired as to whether a longer term settlement was available. As he conceded in cross examination, if he was interested in the Gracefield Road Property with a 24 month settlement, he could have readily said so.
I reject Alistair's evidence that 'if I had known a 24 month settlement was a possibility when Mr Hanlon approached me about the property, I would have been much more interested and would have wanted to buy the property'. As an experienced residential land developer, Alistair would have readily known of his ability to enquire about longer settlement terms. The contemporaneous evidence confirms that Alistair rejected Mr Hanlon's entreaties because of the commitments of the Gull Group in Brown Hill. Alistair's evidence concerning what he would have done had he known of the 24 month settlement terms was infused with self-interested hindsight for the purpose of improving Hilltop Views prospects at trial.
Stewart gave evidence that if the settlement terms had included a 24 month settlement term and a $1.5m price, he would have happily purchased the Gracefield Road Property in March 2016. I reject this evidence. The Gull family, including and especially, Stewart and Alistair, were sophisticated and experienced investors in residential properties. If they had been seriously interested in purchasing the Gracefield Road Property on longer settlement terms in late 2015 and early 2016, then they would have made the simple enquiry as to whether a longer settlement was available. The fact that they did not make any such enquiry bespeaks a lack of interest in the property at that time, having regard to their other commitments in Brown Hill.
I pause to note that Alistair gave unchallenged evidence that he discussed the opportunity to purchase the Gracefield Road Property with Mr Burke and Stewart at the time of Mr Hanlon's December 2015 enquiry. Alistair gave evidence that he and Mr Burke discussed the slope of the land and the associated development costs because it was more expensive to develop steeper land. Alistair stated that he could not recall whether he expressed any interest in acquiring the Gracefield Road Property in these discussions. It was not put to Mr Burke that as a consequence of these discussions Mr Burke was aware of any interest on the part of the Gull Group, or more specifically Hilltop Views, in the Gracefield Road Property. In any event, having regard to Alistair's communications to Mr Hanlon at that time, it is extremely unlikely that Alistair expressed such an interest.
On 18 December 2015, Mr Hanlon emailed Mr Dolan certain additional requested information including the section 32 certificate, a plan of subdivision the Kiels had caused to be drawn and engineering costings for a potential subdivision.
Mr Dolan gave evidence that the negotiations proceeded on the basis that there were two alternative options to purchase the Gracefield Road Property: one option had a 12 month settlement period; and, the other had a 24 month settlement period.
On 24 December 2015, Mr Dolan emailed Mr Hanlon the following offer:

[321]

Shortly thereafter, Mr Dolan advised PRD Ballarat that the Dolan Family Trust or nominee would be the named purchaser on the contract of sale for the Gracefield Road Property.
On 17 February 2016, Paul Burke sent the Hills Estate DF Assessment to Cameron (copying in Alistair and Stewart). The assessment was prepared in EstateMaster and it had been prepared by Mr Burke. Ms Müller was not preparing DF assessments at this time and Mr Burke was the only other person with access to the DF component of EstateMaster. Ms Müller's uncontradicted evidence was that the assessment recorded that the study was prepared by and for 'PB' - i.e., Paul Burke.
Mr Burke gave evidence that it was a feasibility assessment prepared with inputs from the Gulls. The covering email sets out that it was based on certain information, including data provided by Chris Coughlan. It included expected sales rates that Mr Burke conceded was confidential information that one would not want a competitive developer to know. Mr Burke accepted that the valuation of the property, the development margin and internal rate of return (IRR) was confidential, albeit that he said the assumed development margin and IRR would not be of any value to a competitor.
The purpose of the DF Assessment was to get a valuation, and then use that valuation for the purposes of obtaining bank finance. Mr Burke accepted that the process was directed at getting the best value possible to maximise the amount of bank finance made available and minimise the capital contributions required by the Gull Group.
Under Mr Burke's supervision and at his request, Ms Müller prepared a DM EstateMaster file for Hills Estate in around 2016 to allow the tracking of development cash flows, variations and costs to complete. Mr Burke provided Ms Müller with data inputs for the DM assessment and reviewed it for her once she had completed it. Ms Müller, with the assistance of Mr Burke and at his request, had built the templates for the 'Project Cash Profits' and 'Costs to Complete' reports in EstateMaster specifically to be used by the Gull Group. Ms Müller's unchallenged evidence was that the Gulls or Mr Burke would often ask her to find out how much it would cost to complete certain aspects of projects, so the 'Costs to Complete' report template was created.
On 19 February 2016, Mr Dolan informed the members of the Initial Consortium that terms had been agreed for the purchase of the Gracefield Road Property. The email stated in full:

[327]

On 29 July 2016, Mr Wright met with Alistair and Cameron to discuss work opportunities with the Gull Group, including at Hills Estate. The meeting occurred at the offices of the Gull Group, which at that time were situated at 632 Sturt Street, Ballarat.
The meeting lasted for approximately half an hour. Mr Wright gave evidence that Cameron and Alistair proceeded to give him a briefing on their current land development projects. Alistair and Cameron wanted Mr Wright to take over a number of projects that had previously been worked on by Chris Coughlan, including Hills Estate.
According to Mr Wright, he was told that Mr Coughlan had been involved in a land subdivision at 224 Daylesford Road (i.e., the Flower Farm) as a developer and investor and because of that conflict of interest, was no longer to be used by the Gull Group. According to Mr Wright, he explained to them that he was doing land subdivision as well - as an investor directly opposite their project at the Hills Estate - that is, at the Gracefield Road Property. According to Mr Wright, he made it very clear to Alistair and Cameron that he and Mr Burke were involved in that site as developers and investors. Following being told, Alistair and Cameron went quiet and Mr Wright stated 'I hope I haven't said anything wrong', to which Alistair responded 'No, that's okay, that's all right, we'll send you through some details later today, Cameron has to chase them up from Chris [Coughlan], and then can you please proceed to provide us with a fee proposal'.
Alistair's evidence of the meeting confirmed that he and Cameron felt that there had been issues with a conflict of interest and lack of performance with Mr Coughlan, and that the meeting was to discuss Mr Wright doing work 'moving forward'. Alistair gave evidence that work on the Hills Estate was discussed and in that context Mr Wright said to Cameron and Alistair that he was 'involved' in the land across the road with Mr Burke. Alistair gave evidence that he assumed Mr Burke was involved as an investor. .Alistair said that he was shocked given 'what we were trying to do' and that 'someone inside our business' was doing it. According to Cameron, Mr Wright confirmed that he was working on a project over the road from Hills Estate with Mr Burke. Cameron said that Alistair and himself were in shock, and Mr Wright then said, 'I hope I haven't said the wrong thing'. According to Cameron, neither Alistair or himself said anything, as they were in shock at that point.
Cameron gave evidence that he was in 'utter shock and disbelief' that Mr Burke had purchased the Gracefield Road Property - opposite Hills Estate - without discussion and having been intimately involved in the negotiations and having done detailed work on the Hills Estate.
Shortly after the meeting, on the same day, at 5:02pm Cameron sent Mr Wright an email as follows:

[329]

Cameron gave evidence that after the discussion with Mr Wright, the Gull Group proceeded to engage Mr Wright to take over the projects that had been worked on by Mr Coughlan. Cameron and Alistair gave evidence that Mr Wright did a lot of work for the Gull Group from 2015 to 2020.
Mr Wright gave candid and clear evidence that he understood that if he did not want to follow the same relationship breakdown with the Gulls which Mr Coughlan had experienced, then he needed to be 'up front' and explain his interest as an investor, and Mr Burke's interest as an investor, and let them make a decision whether to continue to employ him. Mr Wright understood the concern with Mr Coughlan to be one of conflict of interest. Mr Wright gave clear evidence that he explained to Alistair and Cameron that he was involved in the subdivision of the Gracefield Road Property as an investor.
I accept Mr Wright's evidence for the following reasons.
First, Mr Wright gave unchallenged evidence that as at July 2016 he was already quite busy without Gull Group work. He had no strong incentive to mislead the Gulls. I accept that he was determined to commence his relationship with full disclosure as to the nature of his interest in the Gracefield Road Property.
Second, initial versions of both Cameron and Alistair's witness statements positively asserted that Mr Wright had told them that he and Mr Burke were investors. When confronted with these prior inconsistent statements, it was evident that they were re-constructing in their viva voce evidence so as to limit any inference that may be drawn from the fact that they engaged Mr Wright on Gull Group projects, including Hills Estate, following that conversation.
Third, Stewart's witness statement initially recorded that Alistair told him that Mr Wright had 'invested' in the Gracefield Road Property and was 'part of the purchasing syndicate'. Stewart sought to resile from this evidence 'on reflection' when adopting his witness statement, instead stating that he was told that Mr Wright was 'involved as engineer'. However, when confronted with the inconsistency with his previous statement, his explanation was unsatisfactory and infused with hindsight bias.
Fourth, Mr Wright's evidence is consistent with Mr Harris' written evidence in paragraph 28 of his witness statement. That evidence was not the subject of challenge during Mr Harris' cross examination - in fact, much of the cross examination proceeded on the assumed truthfulness of the following evidence by Mr Harris:

[331]

Fifth, Alistair and Cameron were, on all accounts, in shock. Their shock was generated by the involvement of Mr Burke in a project across the road. Their immediate focus was to communicate that fact to their father. Having regard to their state of mind, and the revelations regarding Mr Burke's conduct, it is less likely that they would accurately recall whether Mr Wright communicated that he was 'involved' or an 'investor'.
Cameron gave evidence that on 29 July 2016, following the meeting with Mr Wright, he met with his brother Alistair. Cameron stated that they were both in shock. He gave evidence that they called Mr Burke into the boardroom, and that in that meeting Mr Burke revealed that he had purchased a share in the Gracefield Road Property and that he was a silent partner. According to Cameron, Mr Burke said that he had a right to invest in his own projects. Alistair gave written evidence which corroborated Cameron's account. Cameron and Alistair were not cross examined or challenged on this evidence. Mr Burke's evidence was entirely silent on the existence and content of such a meeting. I accept the evidence of Cameron and Alistair as to the fact of the meeting occurring and the content of what was said by Mr Burke.
Following the meeting with Mr Burke, Cameron and Alistair called Stewart who was holidaying in Fiji. Stewart was having dinner when he received the call. According to Alistair, he told his father that Mr Burke had bought the land across the road from Hilltop Estate.
Stewart gave written evidence that on or about 29 July 2016, he received a phone call from Alistair and Cameron while he was on holiday in Fiji. He stated that he was having dinner at the time. Stewart stated that Alistair said to him words to the effect that Mr Burke was involved in a purchase of the land across the road from the Hills Estate and that Tim Wright was also involved as the engineer for the project.
During the conversation with their father, Alistair told Stewart that Cameron had questioned Mr Burke about the matter and that Mr Burke appeared very emotional. Stewart considered that the matter was too serious to deal with other the telephone and told Alistair that he would speak to Mr Burke when he got back from Fiji. Stewart gave evidence that both Alistair and Cameron said to Stewart words to the effect that Mr Burke's involvement in the development across the road was 'completely unacceptable'.
It is apparent that emotions were running high. Alistair and Cameron were shocked by Mr Burke's investment in a development across the road from Hills Estate. They had made clear to Stewart that it was completely unacceptable. Mr Burke himself, was also described as being emotional.
It was in that context that Stewart returned to Australia.
After returning to Australia, Stewart called Mr Burke into a meeting in the boardroom of the Gull Group in early August 2016. The only attendees at the meeting were Stewart and Mr Burke.
Certain parts of the accounts of Mr Burke and Stewart as to what was said in the meeting differ. For the reasons I have set out below, in respect of the discrepancies between them, I have largely preferred the evidence of Mr Burke.
The context surrounding this discussion is important. As I have described, emotions were running high. By the time of that August meeting, Mr Burke was aware that the engineer, Mr Coughlan, had lost work because the Gulls were unhappy with the existence of a conflict in respect of his work.
Both Stewart and Mr Burke gave evidence to the effect that Stewart asked Mr Burke 'what the hell is going on at Gracefield Road, Brown Hill'. Mr Burke described Stewart as being 'pretty agitated' and that Mr Burke was 'taken aback' because Stewart was unhappy. Mr Burke also stated that Stewart was 'a pretty strong character' and 'difficult'. In Mr Burke's words, one had 'to try and settle him'.
According to Stewart, Mr Burke responded to his query about what was going on by stating that Michael Harris had purchased the property and that Mr Burke himself had been offered a small minority interest in the property. Stewart gave evidence to this effect viva voce in his evidence in chief. In cross examination, he reiterated that Mr Burke said to him that Michael Harris was a friend of Peter Kiel, the owner of the land and that 'he'd purchased the land and offered [Burke] a small minority interest in it'. According to Stewart, that was the extent of Mr Burke's disclosure. According to Stewart, Mr Burke made no further disclosures at this time as to his involvement in the Gracefield Road Property.
I pause to make two observations. First, on Stewart's account, Mr Burke is relaying an obviously and unnecessarily untrue account to his boss whom he is trying to 'settle'. By August 2016, it was well known to Mr Burke that Mr Harris was not the purchaser of the property. As the 19 February 2016 email made clear, the purchaser, on behalf of the syndicate was the Dolan Family Trust or nominee. There was no apparent reason for Mr Burke to mislead Stewart about the identity of the purchaser. It was not put to Mr Burke that he had a motive or rationale for hiding Mr Dolan's involvement. That discrepancy undermines an acceptance of Stewart's evidence almost ten years after the relevant conversation. Second, on Stewart's account, he did not make any request for further or additional detail. For a savvy businessman of Stewart's calibre who is agitated about a senior employee participating in a competing development across the road, it beggars belief that he did not make an enquiry as to Mr Burke's or Mr Wright's specific quantitative interest in the Gracefield Road Property. Stewart was unable to give a satisfactory explanation for his failure to do so. I consider that the most likely reason for Stewart failing to do so, was that he had been explicitly told by Mr Burke what the relevant interests were.
Mr Burke gave evidence that he responded to Mr Gull's enquiry about investing in the Gracefield Road Property with words to the effect that 'he had invested in property before'. According to Mr Burke, Stewart was still agitated and said 'Paul, but it's across the road'. I accept that the primary focus of Stewart's agitation was the fact that the Gracefield Road Property was across the road and in direct competition with Hills Estate. In cross examination, Stewart explained the reason for his displeasure as follows:

[335]

Mr Burke gave evidence that he spoke to Stewart about the fact that settlement of the Gracefield Road Property would only occur in a couple of years and it was most likely the lots would not be sold for 2.5 to 3 years. Mr Burke accepted in cross examination that he said words to the effect that the Gracefield Road Property had been purchased on terms with a long settlement so that it would not compete against Hilltop Views. Mr Burke accepted that he said those words to settle Stewart down as Mr Burke had not expected Stewart to be so agitated. In his evidence, Mr Dolan said he did not recall Mr Burke ever saying to him that the settlement needed to occur over 24 months to avoid competition with Hills Estate. There is no satisfactory evidence upon which I can conclude that a 24 month settlement was chosen by Mr Burke or the Initial Consortium in an attempt to avoid competition with Hills Estate.
Mr Burke also accepted in his evidence that at this time (mid 2016) there was a possibility of the interests of Hilltop Views being in conflict with the interests of the Initial Consortium in the development of the Gracefield Property.
According to Mr Burke, Stewart asked him who was involved. I accept this evidence. According to Mr Burke he told Stewart that Robert Dolan had invited him to join the opportunity and that Robert Dolan's brother-in-law, Michael Harris, was involved. According to Mr Burke, Stewart then asked him 'how much have you got', to which Mr Burke responded that he, Mr Dolan and Mr Harris had 30% each and Mr Wright had 10%.
Stewart rejected Mr Burke's account that he was told the land was being developed by Mr Burke, with Mr Harris, Mr Dolan and Mr Wright. Stewart responded that if 'I knew any of those who was involved with it, [Burke] would have been terminated on the spot'. I do not accept this evidence. Stewart was unable to articulate a clear or cogent reason for the statement of position he expressed in the witness box. In re‑examination, he appeared to suggest the reason was that he had been unhappy with the fact that the Noosa and Bellarine syndicates had been represented to him as being pulled together by Jamie Mulcahy, when he had learned over time it was a syndicate that had been pulled together by Paul Burke and Jamie Mulcahy. However, that does not make sense when the joint venture partner companies at both developments have Mr Burke's name in the title. Furthermore, Stewart's evidence makes little rational sense when it is recognised that Stewart: was aware, on his own evidence, that Robert Dolan was a fellow member of the consortium put together by Mr Burke and Mr Mulcahy to invest in the Bellarine Lakes and Noosa Domain retirement villages; gave evidence that it was Mr Harris, on his account, that had invited Mr Burke to participate in the Gracefield Road Property; and, Stewart was already, as I have found, aware of Mr Wright's involvement in the project.
For the reasons I have expressed, I accept Mr Burke's evidence over Stewart's evidence in respect of the August 2016 board room meeting and conclude that Mr Burke did communicate to Stewart the identity of, and relative proportions held by, the investors in the Gracefield Road Property. For completeness, I note that there was no evidence as to what, if anything, Stewart relayed to Alistair and Cameron following that meeting. I also note that it was not part of the defendants case that the content of what Mr Burke said to Stewart in August 2016 gave rise to, and relevantly made good, any defence of fully informed consent.
Returning then to the chronological sequence of the events insofar as they concern the Gracefield Road Property. Mr Harris gave written evidence that on 28 December 2016, himself, Mr Burke, Mr Wright and Mr Dolan entered into the Gracefield Partnership Agreement through their respective corporate trustees on behalf of their family trusts.
Stewart gave written evidence that between 2017 and 2018, the Gull Group redeveloped the Hills Estate which included subdividing the land into 29 lots. In around July 2017, 21 lots in Stage 1 of the Hills Estate went on sale. Stewart gave evidence that the success of Stage 1 determined the timing of release of Stage 2 blocks.[241]
On 31 July 2017, Mr Harris sent an email to Mr Dolan enclosing proposed pricing for the Gracefield Road Property lots. Mr Harris prepared the pricing based on sales data from a sub-division called Blacksmith Estate and in respect of the sale of lots at the Flower Farm.
On 28 August 2017, Mr Harris emailed Mr Dolan, Mr Wright and Mr Burke. The relevant part of the email concerned whether to agree to erect a fence on a boundary shared with the Gracefield Road Property in order to remove an impediment to obtaining planning approval. Mr Harris stated:[242]

[356]

Mr Burke, by this email, clearly stated that he had populated the Stage 1 price list for the Gracefield Road Property with prices based on the Hills Estate development.
The pricing document attached to Mr Burke's 21 February 2019 email was the Gracefield Road Property Data.
The pleading alleged that the Gracefield Road Property Data incorporated Hills Estate Confidential Information. The Hills Estate Confidential Information was defined as sales and pricing information relating to Hills Estate.
Before descending into the detail of the Gracefield Road Property Data, three matters of context should be identified.
First, the first contract of sale for the sale of a lot at Hills Estate was executed on 14 November 2017. Alistair accepted, in cross examination, that advertising of the Hills Estate lots commenced shortly before 14 November 2017 and that advertising would have included the location of the lots within the estate, the lot size and the sale pricing. According to Alistair, the advertising would have been on realestate.com.au and in the Ballarat Courier newspaper. Brochures were also distributed and the lots were advertised on the Gull & Co website.
Stewart was taken to a sales brochure for Hills Estate dated 16 January 2018 in cross examination. He gave evidence that a Hills Estate sales brochure with sales prices as at 16 January 2018 would not have been the first brochure of this kind. Stewart gave evidence that there would have been earlier brochures distributed as part of the sales program. Those brochures identified the lot size and pricing for each lot, together with which lots had been sold and which remained available. Stewart gave evidence that the sales brochures were updated regularly to ensure that up to date information was being provided to the market.
Ms Müller gave evidence that the price and size of each lot was public as of 22 July 2017, when an advertising campaign was commenced in the Ballarat Courier. Alistair agreed that advertised sale price and size of the Hills Estate lots were publicly available as at 21 February 2019.
Second, it is necessary to set out the dates of entry into the contracts of sale by purchasers of the Hills Estate lots and the settlement dates of those contracts:

[367]

Whilst the Late 2018 Brochure stated at the bottom of the page 'ALL PRICES ARE CURRENT AS OF THE 16/01/2018 AND ARE THE SUBJECT TO CHANGE BY THE VENDOR AT ANY TIME', I have concluded that the entry at the bottom of the page was in error and reflected a failure to update the text at the bottom of the page from an earlier sales brochure. I have drawn this conclusion because the uncontradicted evidence was that a contract of sale had been executed for only one of the lots (Lot 4) by 16 January 2018, whereas the brochure records a far greater number of lots had been sold. The available evidence suggests, and I conclude, that the sales brochure was published between 29 November 2018 (when the contract of sale for lot 9 was executed), and 19 December 2018 (when the contract of sale for lot 29 was executed).
The area of each lot number and original pricing for each lot was obviously not confidential information. It was clearly identified on advertising material produced by Hilltop Views from in or about mid 2017 onwards and regularly updated thereafter.
As the lot size of the Hills Estate lots was publicly known, it is necessary to evaluate the extent to which the current prices of those lots was confidential.
The sale status and current pricing of lots which were currently for sale was, obviously, not confidential. The fact the lots were on sale and the prices at which they were on sale was the subject of public advertising through regularly updated sales channels.
The sale status of lots which had settled and the price at which the lot had settled was also not confidential. The fact that a lot had been sold was regularly recorded in the updated sales information being produced by Gull & Co. The price at which that transaction had occurred was then released shortly thereafter. Ms Müller gave evidence that as part of Gull & Co's real estate licence, Gull & Co was obliged to disclose sales prices to CoreLogic after settlements were effected, but that this data could take up to two months after a property settlement to find its way to the CoreLogic system. According to Ms Müller, reporting sales data to CoreLogic allowed valuers to obtain relevant sales data to perform their valuations. Alistair gave evidence that the sale price was usually updated and publicly available within a month and that the sale price of most of the completed lots should have been publicly available by 21 February 2019.
The sale status and current pricing of a small proportion of the lots at Hills Estate was, however, confidential information. Specifically, whether a lot was the subject of a hold or a conditional or unconditional sale was not externally known and nor was the currently applicable pricing for that lot. Ms Müller explained that the current price in the 'Gull - Current' worksheet (and therefore Sheet 1 worksheet) for lots that are unconditional, conditional or on hold is not publicly available information. Thus, to the extent that the summary data points in the Gull-Current worksheet used current prices attributable to unconditional, conditional or 'on hold' lots, it meant that the summary could not be entirely replicated using publicly available information.
It is therefore necessary to identify the specific lots in respect of which the sale status and pricing were confidential.
Of the 29 lots the subject of the Hills Estate and described on 'Sheet 1' and the 'Gull-Current' worksheet, one lot was on hold (Lot 24), two lots were the subject of conditional sales (lots 19 and 30) and two lots were the subject of unconditional sales (lots 18 and 29).
Having accepted Mr Burke's evidence as to the use of the Gracefield Road Property Data, I conclude that the following matters within the Gracefield Road Property Data were confidential and potentially of some use to Mr Burke and the Initial Consortium:

[376]

Mr Burke accepted his statement 'Gully is selling his lots at around $10 k more' was based upon the price list that he had sent around the previous day. In cross examination, Mr Burke observed that the prices at which Gull was selling was publicly available, although he had obtained the information from the Gull & Co spreadsheet.
Lots 1 to 6 and 43 to 47 constituted the entirety of Stage 1 development of the Gracefield Road Property. The proposal at that stage was therefore to sell lots 1 to 6 for $169,000 and Lots 43 to 47 for $176,000.
The reference to 'lots 7-11' in Mr Dolan's email was not explored in the evidence. I consider that it was intended to be a reference to lots 43 to 47. I am of that view because Mr Harris' email (to which Mr Dolan was replying) referred to lots 43 to 47 and Mr Burke's response ten minutes later refers to '$176,000 for the 640m2 [lots]' which only makes sense if that is a reference to lots 43 to 47 (which are that size) rather than lots 7 to 11 (which are not).
Mr Burke gave evidence that the pricing decision was based on a number of factors. Mr Burke stated that the Hills Estate prices were important and relevant, but that it was only one factor in the decision making on price because a critical factor was the rate of sales. He gave evidence that the valuation assumed two sales per month - from which I infer there was a need to set prices at a level capable of achieving that assumption. Mr Burke also gave evidence that sales needed to be calibrated to try and keep contractors on site so that if Stage 1 was sold down, contractors could be kept on site to fund Stage 2. I accept Mr Burke's evidence in that regard.
The proposal to price lots 1 to 6 at $169,000 appears to directly correlate to the average pricing of the similar sized lots at Hills Estate. That is because in the 'Gull - Current' worksheet the approximate range attributable to lots of between 550 square metres and 600 square metres was originally $287.64 per square metre and recorded as 'currently' being $291.77. The 'Gull-Current' worksheet revealed that there were 13 Hills Estate lots in this size category (lots 1-4, 19 and 23-30) and that on average their original sale price was $166,385 and that their current price on average was $168,885 - i.e. very close to $169,000. However, of the 13 Hills Estate lots in the 550 to 600 square metre category, lots 1 to 4, 23, 26 and 28 had settled and lots 25 and 27 were for sale. Lots 19 and 30 were conditional sales and lot 24 was on hold Relevantly, the sale prices recorded as being current in the 'Gull-Current' worksheet for each of lots 19, 24, 25 and 27 matched the publicly available information that I have found was published by brochures in late 2018. The sales price recorded for lot 30 was $179,000, being $1,000 less than the advertised price in late 2018. The current confidential pricing information for the conditional lots (19 and 30) and the held lot (lot 24), would therefore have had no effect on any pricing decision - an almost identical current price for Hills Estate lots in the same size bracket could have been calculated using publicly available information.
Turning then to lots 43 to 47, Mr Burke gave evidence that the advice that he gave to the effect that 'Gully' (i.e. Stewart Gull) was selling his lots at around $10,000 more was based upon the pricing information that had been provided to Messrs Dolan, Wright and Harris. He sought to downplay its significance by saying that the information was publicly available. He said that use of the Gracefield Property Data just saved him time.
Mr Burke was not cross examined on what specific component or part of the pricing information was in fact used. In that context, it was not put to him that the specific information he relied upon and used for the pricing recommendation for lots 43 to 47 was not publicly available.
Mr Burke and Mr Dolan were also not examined on whether the reference to 'is selling' in Mr Burke's email was a reference to the east facing lots then on the market or all of the east facing lots that had been sold or were for sale by Hilltop Views.
Having regard to the way in which the evidence was adduced, it is not possible to determine whether or not the figure of $176,000 for lots 43 to 47 was arrived at or calculated using figures which were only available publicly available or a combination of public and confidential information. It is possible that only publicly available information was used for the purpose of pricing those lots. Absent cross examination on the precise way in which the pricing information was used, the issue cannot be taken any further.
This can be demonstrated in the following way. Hills Estate's east facing lots of 680 square metres in size then being sold (lots 10-15) were being advertised for between $190,000 and $205,000. Those prices were all publicly available in the Late 2018 Brochure, because none of them had been sold, even conditionally. Those prices were set at an overall average of $293.38 per square metre and when that figure is applied to the smaller land size of the Gracefield Road Property lots 43 to 47 (640 square metres), the resultant price is $187,764 - approximately $11,000 more in relative terms than the proposed sale price for those lots of $176,000.
Another way in which Mr Burke may have used the information, albeit not explored in cross examination, was to use the sales information from all of the Hills Estate's east facing lots and not just those that were being sold at the time. As Mr Wright explained, the east facing lots were 8, 9, 10, 11, 12, 13, 14, 15 and 23 to 30. The current average price of those lots was $291.87 per square metre, which extrapolates to a value of $186,794.80 for a 640 square metre lot (or approximately $10,000 more than the price proposed by Mr Dolan and Mr Burke). If that was the way in which the information was used, only the current prices of lots 24 (on hold), 29 (unconditional) and 30 (conditional) could be treated as being confidential and an almost identical answer would have been arrived in any event if only publicly available information was used. That is so because the current prices were the same as the publicly available prices for lots 24 and 29 and only $1,000 less than the publicly available price for lot 30.
In his evidence Mr Burke stated that any difference between the privately sourced information and what could be compiled by reference to public sources would be 'marginal'. Mr Burke was not challenged on that conclusion. That was for good reason. The difference between the current pricing on a per square metre basis using the information available to Hilltop Views and reflected on the 'Gull-Current' pricing sheet and information solely in the public domain was, as he said, marginal.
Mr Dolan gave evidence that he had a 'basic' or 'quick' look through a number of the pages of the Gracefield Road Property Data. Mr Dolan said that it did not occur to him at the time that this was a detailed amount of information for Mr Burke to hold. Mr Dolan said that he did not stop to think about where Mr Burke had obtained that information from or that it was more information than one might find out in the public domain. Mr Dolan said he did not think about how Mr Burke knew the difference between the original price and current price. Mr Dolan said that he did not stop at the time to think about how Mr Burke could possibly know that someone might have called the agent and put a hold on a lot. Mr Dolan accepted that if he had stopped to think about it he would have recognised that 'Mr Burke was leaking like a sieve from Gull & Co'.
Mr Dolan said that he relied on the Gull-Current pricing page and 'Gull-Remaining'[248] pages. Mr Dolan gave the following evidence:

[386]

Third, Mr Dolan's email of 26 February 2019, supports a clear inference that the figures discussed with Mr Burke and from the 'Gulls development' at Hills Estate had played a part in assisting the Initial Consortium to propose a price between the $169,000 and $176,000 values arrived at following evaluation of the Gracefield Pricing Property Data and the $155,000 and $160,000 values initially proposed by Hocking Stuart.
However, the fact that pricing at the Gracefield Road Property was set by reference to current pricing of the Hills Estate lots is, in and of itself, of little consequence. There is no cogent evidence to support a conclusion that as at February 2019 it was any part of Mr Burke's duties to set prices at Hills Estate. The important question is what confidential information was actually used. The evidence does not establish with any specificity anything more than the fact that a very small amount of confidential pricing information from a small number of lots was used to calibrate the price proposals to Hocking Stuart for lots 1 to 6 and may have been used for lots 43 to 47. Moreover, having regard to the almost complete identicality between the small number of prices that were confidential and the publicly available pricing for those lots, any use of the small number of confidential prices would have been of de minimis effect.
For completeness, I note that there was no specific evidence or cross examination to suggest that the Gracefield Property Data was used for the purposes of setting Stage 2 or Stage 3 pricing at Gracefield Road.
Mr Burke gave evidence that his fellow members of the Initial Consortium, were, at this time, collectively deciding on pricing based on the various sources of information that they had available to them. He accepted that the pricing information from Hills Estate was part of this assessment. Mr Burke gave evidence that he regretted using the Gracefield Road Property Data and apologised for doing that. Mr Burke said he didn't get anything out of it. Mr Burke said it saved him time. Having regard to my findings as to the content of the Gracefield Road Property Data, the manner of its use and the almost complete similarity between the publicly available and confidential pricing, I accept this evidence.
On 21 August 2019, Gracefield Equity became the registered proprietor of the subdivided Gracefield Road Property. Stage 1 of the Gracefield Road Property sales was launched in March 2019. 19 lots were sold by April 2020. The Gracefield Road Property was sub-divided into 47 lots. The defendants submitted that, and the evidence confirmed, all of the lots have been sold, and the $3,351,151 profit has been distributed to the family trusts for each of Messrs Burke, Dolan, Harris and Wright in accordance with their respective proportional interests.

[390]

The scope of Mr Burke's duties to Hilltop Views must be framed by reference to the nature of Hilltop Views' business operations and his role within the company. Hilltop Views was a special purpose vehicle set up by the Gull Group specifically for the purpose of purchasing the Hills Estate. As I have observed, it has not purchased any further property or carried out any other developments.
Mr Burke was not employed by Hilltop Views. He is not alleged to have owed Hilltop Views any duties as an employee. His role within the company was company secretary. The nature of his specific role as company secretary was not explored in any detail in the evidence, although the evidence revealed that he had acted as company secretary for over 20 Gull Group companies by the start of 2015.
Whilst a company secretary has authority to enter into contracts for the purposes of a company's administration, the secretary has no authority to participate in the management of the company's affairs, absent board authorisation.[251] A company secretary is unable to summon a general meeting purely by virtue of their appointment.[252] A company secretary may convene a meeting on the authority of a resolution of directors sitting as a board.[253] It is customary for the company secretary to have responsibility for making the necessary arrangements for the meeting to occur.[254] The company secretary also oversees the compliance of proxies lodged,[255] meeting procedure including minutes,[256] and secretarial functions arising post meeting.[257]
The evidence therefore does not allow me to conclude that the scope and responsibility of Mr Burke as company secretary was therefore anything other than a narrow one, focussed on the administration of the company. That is not, however, the end of the matter. It is necessary, consistently with the principles identified above, to consider the course of dealings between Mr Burke and Hilltop Views.
On the evidence, I find that Mr Burke's role with respect to Hilltop Views was limited to acting as company secretary, preparing the Hills Estate DF Assessment in February 2016, receiving a cash flow analysis from a valuer on 18 March 2016 and supervising the preparation of a DM assessment for Hills Estate by Ms Müller in 2016. Mr Burke's role with respect to Hills Estate was thus confined to tasks of a secretarial and financial nature. In respect of his financial roles, they appear confined to assisting in the post-acquisition feasibility assessment for the purposes of obtaining finance and liaising with the valuer. As Cameron stated, it was himself and Alistair in consultation with their father who 'ran with' the development of Hills Estate. There is no clear documentary evidence to suggest that Mr Burke was actively involved in the sales or development strategy for Hills Estate, including the pricing of the Stage 1 and Stage 2 lots. I also note, for completeness, that there was no evidence adduced to suggest that Mr Burke's role was deliberately reduced following his July and August 2016 meetings with the Gulls and the disclosure of his involvement at the Gracefield Road Property.
As I have also stated already:

[394]

The pursuit of the Gracefield Road Opportunity by Mr Burke as a member of the Initial Consortium was neither a breach of the conflict rule, nor the profit rule. That is so for the following reasons.
First, the opportunity to conduct the development at the Gracefield Road Property did not come to Mr Burke by reason of his role at Hilltop Views. It was not an opportunity obtained by reason of his fiduciary position. Mr Burke was offered the opportunity to invest by Mr Dolan, following the earlier identification of the opportunity to Mr Dolan by Mr Harris.
Second, Mr Burke was not under a positive duty to pursue the Gracefield Road Opportunity on behalf of Hilltop Views. That is clear from his limited role as secretary and in providing assistance in the financial and administrative work of the Hills Estate development, in the way I have described above. I am fortified in this conclusion by Alistair's evidence that it was not Mr Burke's role to bring development opportunities to the Gulls.
Third, following Lever Bros and Links Golf, Mr Burke was able to participate in a business undertaking which competed with Hills Estate. The act of deciding to invest and participate in the development of the Gracefield Road Property would only have given rise to a conflict if it conflicted with the performance of Mr Burke's duties or performance as company secretary of Hilltop Views. That is, the conflict must arise in the exercise or non-exercise of powers qua fiduciary in the service of the company. As Jessup J explained in Links Golf, 'it is only in respect of those decisions which involve the exercise of powers or functions in the service of the company (including the omission to do so where a duty exists) that the director can be held to account as fiduciary.'[258] Thus, whilst a fiduciary cannot conduct his or her personal affairs in a way which possibly conflicts with his or her fiduciary duty, the evaluation of whether or not the conduct is or may be in conflict must be done by paying careful attention to the subject matter over which the fiduciary obligation does in fact extend.
In reply closing submissions, the plaintiffs stated that they did not 'cavil with the general proposition that merely being a director of a competing company, or carrying on a competitive business, will not automatically be a breach of the fiduciary conflicts rule.'. The plaintiffs emphasised that the 'essential qualification' to the ability of a fiduciary to compete was that the in earning the profit from the competing venture, the fiduciary was prohibited from using the property of the company or confidential information which had come to him in his capacity as a fiduciary. That qualification is apt and appropriate, but does not mean the pursuit of the Gracefield Road Opportunity was a breach of fiduciary duty. The Initial Consortium had made the decision to buy and had signed a contract of sale by 1 March 2016, well before:

[396]

The participation of Mr Burke in a consortium which acquired the Gracefield Road Property in 2016 and developed it thereafter, in circumstances which gave rise to a real possibility that the development and sale of lots on that property would compete with Hills Estate, was not in and of itself a breach of fiduciary duty. Pursuit of the acquisition and development of the Gracefield Road Property was outside Mr Burke's fiduciary duty to Hilltop Views. Put another way, the opportunity to develop the Gracefield Road Property did not belong to Hilltop Views in equity. This was demonstrated in closing addresses. Having accepted that the Lever Bros doctrine permitted Mr Burke to compete with Hills Estate, senior counsel for the plaintiffs was unable to clearly articulate how, if at all, Mr Burke had breached his fiduciary duty to Hilltop Views up to September 2017.
If however, contrary to my findings, a breach of fiduciary duty did occur in the pursuit and acquisition of the Gracefield Road Property in 2015 and 2016, any such claim is barred by the application of s 1317K of the Act by analogy. The case as pleaded and run demonstrated an almost complete overlap between the way in which the pursuit of the opportunity to acquire the Gracefield Road Property was treated as being a breach of Mr Burke's fiduciary duties and the way it was alleged he had breached his statutory duties.[259] As the proceeding was only commenced on 21 December 2022, any claim based on conduct prior to 21 December 2016 is barred by the application of s 1317K by analogy.
I am also satisfied the doctrine of laches would preclude action in respect of the pursuit and acquisition of the Gracefield Road Opportunity insofar as it is based on the events of 2015 and 2016. As I have found, by August 2016, the Gulls knew that Mr Burke and Mr Wright were investors at Gracefield Road. I have also found that Mr Burke told Stewart of the percentage investment of each by the investors in Gracefield Road.
In these circumstances, the question is whether, by reason of Hilltop Views' own acquiescence when aware of these facts, or of prejudice brought about by the passage of time, it would be inequitable to require Mr Burke to account to Hilltop Views for the profits realised by him as a result of his investment in Gracefield Road.
By August 2016, Hilltop Views was armed with the facts necessary to articulate the case it now makes to the effect that Mr Burke breached the 'no conflict' and 'no profit' rule by pursuing and acquiring the Gracefield Road Property with the Initial Consortium. Hilltop Views only issued the proceedings in late 2022. In the intervening period the Initial Consortium sub-divided and sold the Gracefield Road Property and took out finance for that purpose. Armed with the requisite facts to make its claims based on the pursuit of the Gracefield Opportunity, Hilltop Views instead allowed the Initial Consortium to establish and exploit the subdivision of the land at Gracefield Road. It would now be inequitable for them to be required to account to Hilltop Views in respect of any breach in pursuing and acquiring the Gracefield Road Property in 2016.
However, that is not the end of the matter. Equity is also concerned with the misuse of information and the property of the principal to whom the fiduciary obligation is owed.[260]
The first alleged misuse was that Mr Burke accessed and used the EstateMaster software for the purpose of preparing the Pleaded Gracefield Feasibility Assessment (i.e. the Gracefield DM Assessment) in October 2017. It is plain that Mr Burke used his access to EstateMaster to prepare the Gracefield DM Assessment.
The difficulty for Hilltop Views case is that the case as pleaded and run was that EstateMaster belonged to CCV. To take two examples:

[400]

The use of EstateMaster was therefore not a breach of Mr Burke's fiduciary obligations with respect to the property of Hilltop Views. The misuse of EstateMaster was a breach of fiduciary duty qua CCV. There was no breach of the profit rule qua Hilltop Views. Mr Burke was using CCV company property for an unauthorised personal use. However, CCV did not make any claim with respect to Mr Burke's unauthorised use of EstateMaster with respect to Gracefield Road. Nor was there a breach of the conflict rule in using the EstateMaster software. As Jessup J observed in Links Golf, one 'cannot throw the mantle of conflict over every decision its director makes'.[263] The duties or interests which are said to conflict or present a real possibility of conflict must be identified.[264]
As stated already, the 'duty' in the conflict formula refers to the function or responsibility the fiduciary has assumed or undertaken to perform for, or on behalf of, his or her beneficiary.[265] The relevant function or responsibility is question of fact. The term 'interest' in the conflict formula denotes the 'presence of some personal concern of possible pecuniary value in a decision taken, or a transaction effected, within the scope of a fiduciary's duties'.[266] In accessing and using EstateMaster, a product owned by GRVS and licensed to CCV, Mr Burke was not exercising a power or function in the service of Hilltop Views or omitting to take a step where a relevant duty existed. The correctness of this conclusion can be demonstrated in another way. If it is permissible, as Hilltop Views accepts, for Mr Burke to compete in a residential development without using Hilltop Views' confidential information or property, then it is not within the purview of any legitimate complaint by Hilltop Views to object on the basis of fiduciary obligation, to the use of the property of another entity to further that competitive purpose.
The proscriptive 'theme' relevantly applicable to Mr Burke's conduct was the 'profit' rule. However, as I have found he was not seeking to profit from the property of Hilltop Views.
In any event, if I am wrong and the misuse of EstateMaster is actionable by Hilltop Views, there was no evidence that confidential information was used or accessed. There was no evidence that the DM assessment was used by Mr Burke or the Initial Consortium in any way or gave them any particular advantage. Moreover, there was no causal connection established between the profit gained from the development of the Gracefield Road Property and the use of EstateMaster to prepare the Gracefield DM assessment. The profit rule is concerned with the benefit or gain for which the errant fiduciary will be required to account. A breach of fiduciary duty must cause or sufficiently contribute to that benefit or gain.[267] As a matter of causation, there was no attempt to prove that the use of EstateMaster for the purposes of generating the Gracefield DM assessment was causative of any ultimate benefit or advantage.
It was also contended that Mr Burke misused his fiduciary position by using EstateMaster for the purposes of preparing the Gracefield DF Assessment in or about December 2017 and distributing it to Mr Evans thereafter.
Following the completion of evidence and the close of the evidence, the defendants raised, in closing submission, that the document included in the court book and tendered in evidence as a 'Gracefield Feasibility Assessment' (i.e. the Gracefield DF Assessment) provided by Mr Burke to Mr Evans in .emdf form on 22 December 2017 and in Excel format on 12 January 2018 was in fact, the wrong document. By agreement, the native form of what was submitted to be the correct document was tendered in evidence. No cross examination was conducted in respect of the replacement document. The replacement document was also different to the Pleaded Gracefield Feasibility Assessment, which as I have observed was a 'DM Assessment' and not a 'DF Assessment'.
The Gracefield DF Assessment was not the subject of any pleaded allegation.
I invited the parties to make a submission about the comparison, if any, between the Hills Estate DF Assessment and the Gracefield DF Assessment. The parties both made short written submissions on that topic.
Before descending into some of the detail of those submissions, it is necessary to record the following matters.
First, there was no pleaded claim against the defendants that confidential information or commercially sensitive information from the Hills Estate DF Assessment had been incorporated, improperly or otherwise, into the Gracefield DF Assessment or the Gracefield DM Assessment.
Second, there was no pleaded claim against the defendants that the use by Mr Burke of the Hills Estate DF Assessment for the purposes of the Gracefield DM Assessment or the Gracefield DF Assessment constituted a breach of fiduciary, statutory or contractual duty.
Third, consistently with the above observations, no attempt was made to adduce evidence as to the commercial sensitivity or confidentiality of any of the items in the Hills Estate DF Assessment which were alleged, after closing submissions, to be replicated or mirrored in the Gracefield DF Assessment. Nor was any attempt made to cross examine Mr Burke on those matters.
As a consequence, it is not open to me to evaluate, on a proper analysis of the pleaded case or as a matter of procedural fairness, whether or not the use of the Hills Estate DF Assessment by Mr Burke, in whatever form for the purposes of preparing the Gracefield DF Assessment, constituted a breach of fiduciary or statutory duty.
The defendants submitted I should draw the conclusion that only the template for the Hills Estate DF Assessment was used by Mr Burke in preparing the Gracefield DF Assessment. I am unable to draw such a conclusion because the lay evidence did not support it. No witness, particularly Mr Burke, gave that evidence. Moreover, there are a number of identical features of the Hills Estate DF Assessment and the Gracefield DF Assessment which may or may not reflect the conscious copying of information on the one hand, or the incorporation of the information in the underlying template, on the other. A bare comparison of documents cannot resolve that comparison. By way of example:

[406]

In reply written and oral closing submissions, the plaintiffs did not directly or properly grapple with this submission.
I accept the defendants' submission. Acting on their submission that it is open to make a finding regarding the use of the Gracefield DF Assessment, I proceed to find that the preparation of the Gracefield DF Assessment involved the misuse of the EstateMaster software. However, as with the use of EstateMaster for the purposes of preparing the DM Assessment and for the same reasons, I consider that this was a claim actionable by CCV.
In any event, if I am wrong about the misuse of EstateMaster being actionable by Hilltop Views, there was no evidence that confidential information was used or accessed. Mr Burke's conduct amounted to use of a licensed software application, well after entry into the contract of sale to acquire the Gracefield Road Property by the Initial Consortium. More importantly, as I have found earlier, there is no firm basis upon which it can be concluded that the Gracefield DF Assessment caused or significantly contributed to the production of the valuation report and the subsequent receipt of finance.
In the circumstances, if contrary to my principal conclusion, Mr Burke's use of EstateMaster was an actionable breach of fiduciary duty qua Hilltop Views and caused accountable profits, I consider that the use of equity as against Mr Burke to deliver an account of the entirety of the profits made by him in respect of the Gracefield Road Property by reference to such a limited misuse and in circumstances where the opportunity had already been validly and lawfully taken, would be to convert equity into an instrument of injustice,[269] and deliver an inappropriate windfall to Hilltop Views.
The account of profits sought against Mr Burke in respect of the Gracefield Road Property was $1,005,345. The calculation of those profits was based on the allocation of the beneficial interest of each partner (30% in the case of Mr Burke) to the totality of the realised profit of $3,351,151. The financial statements of the Gracefield Partnership disclose that distributions were made to the Burke Family Trust.
Mr Meredith assumed that interests held by the Burke Family Trust are for the benefit of Mr Burke. That is, that the interests held by a family trust within the partnership are held for the benefit of the defendant with the corresponding name.
The defendants submit that such an assumption is unsound. I disagree.
The financial statements record that the relevant partners include the 'Burke Family Trust'. The distributions recorded in the financial statements are made to family trusts corresponding with the names of the four shareholders and in the proportions of those shareholders. The accounts and company records support a clear inference that the profits made by Mr Burke as a consequence of any breach of fiduciary duty were distributed at his direction to the Burke Family Trust. The distribution of monies at Mr Burke's direction to his family trust does not mean he did not 'make' the relevant profit. In Vyse v Foster (No 1),[270] in a passage endorsed by Mason J in Hospital Products,[271] James LJ stated:

[408]

I am fortified in this conclusion by the failure of Mr Burke to contend otherwise in his written or oral evidence. The initial report of Mr Meredith was filed on 13 May 2025 and the amended report of Mr Meredith was filed on 23 September 2025. Mr Burke's witness statement was ultimately dated 5 October 2025. I infer, having regard to the failure to adduce evidence challenging the natural inference from the company records and accounts, and taking into account the evidence of Mr Meredith, that Mr Burke is unable to adduce any evidence to assist him in this regard.[273]
Thus, if contrary to my conclusions above, an account of profits is properly recoverable against Mr Burke for a breach of fiduciary duty, the measure of that account is $1,005,345. As I have said, recovery of such an amount, having regard to the nature of a breach by the misuse of EstateMaster would be unjust and deliver a windfall to Hilltop Views.
Having regard to my principal conclusion that the misuse of EstateMaster did not constitute breaches of fiduciary duty owed to Hilltop Views I decline to express a view on whether relief ought to be granted under s 1318 of the Act. As Jessup J noted in Links Golf,[274] addressing such a question is inappropriate in circumstances where it would only arise if I was wrong on the breach of duty issue and then 'it would be the nature and context of the error, and the correct conclusion then hypothetically reached, that would provide the context for the finding of honesty, or otherwise, under s 1318'.
Turning then to the Gracefield Road Property Data, Mr Burke's fiduciary position was misused by accessing and using the Gracefield Road Property Data for the purpose of setting prices at Gracefield Road. Mr Burke had access to and knowledge of confidential current pricing data for the Hills Estate development by reason of his fiduciary position with respect to Hilltop Views.
As I have found, the confidential pricing data used by Mr Burke was limited in scope. It concerned the pricing of five lots and generated a de minimis advantage for the Initial Consortium. The confidential prices of the five lots were almost identical to the publicly available information. As a matter of causation, the use of the confidential information had no tangible benefit or effect on the prices set by the Initial Consortium for Stage 1. In any event, even if it had been of some benefit or advantage, the plaintiffs made no attempt to quantify or establish the benefit or gain derived from the misuse of confidential information. That approach was made clear by senior counsel for the plaintiffs in opening:

[416]

As I have found, Mr Burke was permitted by the scope and content of his fiduciary duties to Hilltop Views to pursue the opportunity to acquire and develop the Gracefield Road Property with the Initial Consortium. A necessary corollary of that conclusion is that the pursuit by the Initial Consortium of the Gracefield Road Opportunity did not transgress ordinary standards of behaviour. There was no dishonest and fraudulent design in that regard.
Moving on to the misuse of EstateMaster.
I have found that there is no actionable claim by Hilltop Views for breach of fiduciary duty arising from the use of EstateMaster. That is obviously fatal to any claims of 'knowing assistance' in respect of the alleged misuse of the EstateMaster software. If I am wrong, it is important to recognise that there was no evidence or suggestion that any of the human actors alleged to be accessorily liable took any step to assist in Mr Burke's misuse of the EstateMaster software. With the exception of Gracefield Equity, there was no evidence or suggestion that any of the alleged accessories were aware of Mr Burke's intention to use EstateMaster or that they took any step, including by silence or inaction, to facilitate, encourage or offer prior acquiescence to its use.[277] They were, at its highest, passive recipients of the Gracefield DM and DF Assessments. The plaintiffs have therefore failed to establish 'assistance', let alone 'knowing assistance' on the part of Mr Dolan, Mr Harris and Mr Wright with respect to the alleged misuse of EstateMaster.
On the evidence, Gracefield Equity made $16,007 in profits. The conduct and knowledge of Mr Burke is attributable to Gracefield Equity. If a breach of fiduciary duty was to be found (contrary to my conclusion) with respect to the use of EstateMaster, then Gracefield Equity, in acting through Mr Burke for its intended advantage, has assisted in his breach of fiduciary duty. I am satisfied that any misuse of EstateMaster is capable of being characterised as outside the ordinary standards of human behaviour. However, for the same reasons as I have expressed with respect to Mr Burke:

[418]

Mr Dolan was, together with Gracefield Equity, a knowing participant in the misuse of the confidential pricing data contained within the Gracefield Road Property Data. The data contained prices for 'conditional', 'unconditional' and held lots that Mr Dolan, ought readily have recognised was not publicly available information. Mr Dolan accepted that if he had stopped to think about it he would have recognised that 'Mr Burke was leaking like a sieve'. Mr Dolan had clear constructive knowledge within categories (ii)-(iv) of the Baden taxonomy,[278] that Mr Burke was circulating and using a small amount confidential pricing from within Hills Estate. Moreover, he assisted Mr Burke, in using that information to arrive at pricing for Lots 1 to 6 at the Gracefield Road Property. The use of the confidential pricing information by Mr Burke transgressed the ordinary standards of human behaviour. A reasonable person in his position would have appreciated that he was accessing confidential, non-public information. The knowledge and conduct of Mr Burke and Mr Dolan is attributable to Gracefield Equity would and render it liable as a knowing participant in the misuse of the confidential pricing data.
However, as I have found, the misuse of the confidential pricing information was limited in extent and of de minimis effect. There was no evidence capable of establishing that Mr Dolan's assistance in the limited misuse of confidential information caused any relevant gain or benefit. Applying Ancient Order, this is fatal to any claim of 'knowing assistance' against Mr Dolan and Gracefield Equity. Even if the problems of causation and quantification to which I have already adverted could be overcome, an account of the profits made by Mr Dolan from the acquisition and development of the Gracefield Property would be wholly disproportionate having regard to the form and extent of his wrongdoing.[279]
Finally, the evidence does not sustain a conclusion that Mr Wright and Mr Harris knowingly assisted Mr Burke's misuse of the confidential pricing data. There was insufficient evidence adduced to warrant a conclusion that Mr Wright and Mr Harris ought reasonably have concluded, by reference to their access to and review of the pricing data, that Mr Burke was misusing confidential information. Moreover, unlike Mr Dolan, they did not provide any active assistance in using that limited confidential pricing information to set prices for the Gracefield Road Property lots.

[425]

The first allegation, concerning the acquisition of the Gracefield Road Property, did not relevantly constitute a 'use' of Mr Burke's position as an officer of Hilltop Views. It was an opportunity that came to Mr Burke outside his role as an officer of that company. It follows that there was no breach of s 182 by participating in the acquisition of the Gracefield Road Property.
The second allegation, must first be evaluated by recognising the distinction between the Gracefield DM Assessment and the Gracefield DF Assessment. The Gracefield DM Assessment was prepared using EstateMaster in October 2017 and was the subject of a pleaded allegation. There was no cogent proof that the Gracefield DM Assessment was prepared using confidential information from Hilltop Views.
The Gracefield DF Assessment was prepared, again using EstateMaster, in late 2017 and was provided to Mr Evans. There was no plea that the preparation and dissemination of the Gracefield DF Assessment was a breach of fiduciary or statutory duty. The defendants were not properly on notice of any case that it contained confidential information from Hilltop Views. However, as I have recited, the defendants did submit that it was open to find that EstateMaster had been misused.
EstateMaster was a product purchased by GRVS and licensed to CCV. Mr Burke was able to access it as an employee of GRVS and a director of CCV. Mr Burke accessed and used EstateMaster for purposes extraneous to his role at Hilltop Views (namely preparation the Gracefield DM Assessment and Gracefield DF Assessment). I cannot be satisfied that Mr Burke has misused his position as an officer of Hilltop Views by accessing and using EstateMaster. His access to EstateMaster was not dependent on his position at Hilltop Views and there is no suggestion he was exercising any authority as an officer of Hilltop Views when doing so. Put simply, Mr Burke's ability to access and use EstateMaster was a consequence of his role as employee of GRVS and a director of CCV. Insofar as he was accessing EstateMaster, he was using his position within those organisations to do so. In any event, even if I am wrong, as a matter of causation, there was no attempt to prove that the use of EstateMaster for the purposes of generating the Gracefield DM Assessment 'resulted' in any benefit or advantage capable of giving rise to compensation under s 1317H of the Act. Furthermore, as I have already found, the evidence does not enable me to make a finding that the provision of the Gracefield DF Assessment played a significant or meaningful role in the preparation of Mr Evans' valuation report and the subsequent receipt of finance from Webster Dolilta. Causation for the purposes of s 1317H of the Act has not been established.
The accessing of the Gracefield Property Data was a breach of s 182 of the Act and Mr Burke's use of that information was a breach of s 183 of the Act. Mr Burke had access to the confidential pricing information as a consequence of his role as an officer of Hilltop Views. The use of his position to access that information for the purposes of setting prices at the Gracefield Road Property and subsequent use of that information was beyond the standards of conduct that is to be expected of an officer in his position and was clearly improper. Objectively considered, the purpose was to obtain timely and up-to-date information for the purposes of setting prices in competition to Hilltop Views. The Gracefield Road Property Data was therefore being accessed to gain an advantage for Mr Burke and the Initial Consortium.
It is therefore necessary to determine to evaluate what, if any, measure of compensation ought to flow from these contraventions.
As I have said, the evidence does not establish with any specificity anything more than the fact that a very small amount of confidential pricing information from a small number of lots was used to inform the price proposals for lots 1 to 6 and may have been used for lots 43 to 47. Moreover, having regard to the almost complete identicality between the small number of prices that were confidential and the publicly available pricing for those lots, any use of the small number of confidential prices would have been of de minimis effect. No evidence of any loss to Hills Estate was established. It will be recalled that senior counsel disavowed in such case in opening. Turning then to an assessment of any profits generated from the contravention, there is no basis upon it can be concluded that any profit or gain was derived as a result of the contraventions by Mr Burke. In fact, the available evidence demonstrates that, even if the wrongful act was removed, the prices charged for lots would have been the same.
I pause to record that the defendants took the position in closing addresses that compensation pursuant to s 1317H of the Act for any breach of the pleaded statutory obligations, was not available because the pleader had not sought a specific order under s 1317H. I reject that contention. The SFASOC clearly alleged contraventions of ss 180-183 of the Act. Damages and an account of profits were sought. Whilst no declarations of contravention were sought, the language of s 1317H makes it clear that compensation can be ordered in the absence of a declaration of contravention. The Statement of Relief filed by the plaintiffs made it plain that they sought a compensation order pursuant to s 1317H for damages or profits.

[426]

The Cobblers Lane Property is situated in the south-western outskirts of Ballarat in an area designated as an Urban Growth Zone. At the time of trial, the Cobblers Lane Property had not been developed.
Mr Lightfoot gave unchallenged written evidence that he first heard about the Cobblers Lane Property through his father in mid-to-late 2019. He recalled his father saying words to the effect that the owner of the property was Bill Clarke and that he might be looking to sell it. At the time, the Cobblers Lane Property was not on the market.
Mr Lightfoot also gave unchallenged evidence that some months after the conversations with his father, he had a conversation with Anthony Carmody, a local accountant. According to Mr Lightfoot, Mr Carmody said words to the effect that Bill Clarke had a block of land in Delacombe that he might be interested in selling. At the time, Mr Lightfoot made the connection that this was the same block of land that his father had mentioned to him.
The opportunity to purchase the Cobbers Lane Property also came to Mr Burke through Mr Carmody, in or around October 2019. At that time, Mr Carmody was an accountant with Findex. The was some evidence at trial which confirmed that Findex did accounting work for the Gulls at that time. For example, an email from Mr Carmody dated 9 October 2019 concerning the Stewart Gull Family Discretionary Trust was tendered in evidence.
Mr Burke gave evidence that Mr Carmody was his personal friend and accountant. Mr Burke stated that Mr Carmody called him and advised that the vendor of the Cobblers Lane Property was not interested in going to market and that if Mr Burke was prepared to pay the asking price, the vendor would sell. Mr Burke inspected the property with Mr Dolan. Thereafter, Mr Lightfoot and Mr Sculley were invited to invest by Mr Burke and Mr Dolan respectively.
On 17 December 2019, Mr Sculley emailed Mr Matthews, Mr Dolan, Mr Burke and Mr Lightfoot in relation to the contract terms for the Cobblers Lane Property. Mr Matthews, a solicitor, had reviewed the contract and vendor statement, and provided comments and queries in respect of the acquisition. Mr Sculley was responding, notably to the effect that:

[428]

Bill was a reference to Mr Clarke - the vendor. Mr Burke and Mr Dolan had met with Mr Clarke. Mr Clarke had received some interest in his block from other parties but according to Mr Burke those other parties ' kept moving and changing' and Mr Clarke was 'frustrated'. The Cobblers Lane Property was being sold off-market and without an agent. Mr Burke gave evidence that Mr Clarke wanted a price and a 'set time' for completion, and did not want to be 'mucked around'. Mr Burke described the commitment that he had made, as referred to in the email above, was to pay the price Mr Clarke had asked for and to settle on the terms that had been stipulated. Mr Burke was concerned about the buyers that were already interested. He acknowledged in cross examination that buying off-market was of benefit because the expense of commission was not incurred and the competition was reduced. He acknowledged this meant there was less chance of other people finding out about the sale, such as the Gulls. It was not put to Mr Burke that Mr Sculley was suggesting that the purchase was 'delicate' because Mr Burke had a conflict of interest or because Mr Burke and the Cobblers Consortium did not want the Gulls to find out about the Cobblers Lane Property.
On or about 19 December 2019, the individuals comprising the Cobblers Consortium entered into a contract of sale for the purchase of the Cobblers Lane Property. Mr Dolan negotiated the sale price with the vendor's agent. The four members of the Cobblers Consortium all contributed an equal amount to the purchase price via their respective superannuation funds. Cobblers Nominees Pty Ltd was incorporated on 28 January 2020 as an SPV to own the property.
On 26 March 2020, Cobbler Nominees became the registered proprietor of the Cobblers Lane Property. The Cobblers Lane Property is held by Cobbler Nominees Ltd on trust for the Cobbler Unit Trust. The units in the Cobbler Unit Trust are held in equal shares by: Paul Burke & Julie Thompson as trustee for Jamula Superannuation Fund; Robert Dolan & Lea-anne Dolan as trustee for Learob Personal Superannuation Fund; Lightfeet Pty Ltd as trustee for Lightley Superannuation Fund; and Wavebreak Futures Pty Ltd as trustee for Wavebreak Superannuation Fund.

[432]

Those criteria included the existence of a land footprint of 15 to 40 acres for the development of retirement villages and the placement of between 100 and 350 retirement village units. When presented with these criteria in cross examination, Stewart accepted that they were accurate as at the time of the prospectus.
Thus, the criteria for use as a retirement village site was a footprint substantially in excess of the 10 acre footprint of the Cobblers Lane Property.
Furthermore, Stewart gave written evidence that the Cobblers Lane Property was suitable for a 40 lot residential subdivision.
When it was put to Stewart that the Cobblers Lane Property is a 10 acre property and therefore inadequate for retirement village development purposes, he responded by suggesting that the site could take 100 units or 10 units per acre. I reject this evidence. It is wholly inconsistent with Stewart's written evidence that he considered that a '40 lot subdivision' would be feasible. It is also incompatible with expert evidence which suggested that, at best, a development of 62 to 71 residential lots could be accommodated. Mr O'Keefe noted the land use budget recorded the land as being suitable for 62 indicative dwellings. Mr Kinnaird opined that that a 71 lot residential development in accordance with a development plan prepared by Beveridge Williams and dated 2 December 2024 (the Model Plan) reflected the 'highest and best use development of the land'.[283]
Although the evidence of the acquisition and development of retirement villages by CCV is historic and pre-dates the criteria in the draft prospectus, the rejection of Stewart's evidence on this topic is also reinforced by the fact that the development of Meadow Gardens (5.6 hectares) and Hemsley Park (7.2 hectares) occurred on much larger parcels of land.
I accept the defendants' submission that the scope of Mr Burke's fiduciary duties owed to CCV in 2019 and 2020 related only to retirement village development and management and cannot be characterised as extending to residential developments generally. The subject matter to which the fiduciary obligations extended falls to be determined by the character or undertaking of the venture concerned. The evidence amply demonstrated that the character of the venture undertaken by CCV was the development and management of retirement villages.
I also note that there was no related party specified in the evidence to whom it was said that Mr Burke owed a fiduciary obligation because he performed ad hoc work for them pursuant his role as CEO of CCV.
Ultimately, given the absence of any practical possibility of the Cobblers Lane Property being developed by CCV for retirement village purposes, there was no possibility of a conflict, let alone a substantial possibility of conflict between Mr Burke's role as a fiduciary qua CCV and his involvement in the pursuit and development of the Cobblers Lane Property.
CCV further contended that 'in any event', Mr Burke's duties extended to taking both 'residential and retirement living opportunities to CCV for consideration.'[284] I have found that Mr Burke's duties as CEO and Managing Director of CCV did not extend to locating or referring residential living opportunities to CCV. As I have said, it was no part of CCV's business to buy and sell residential property, unless it was a by-product of the purchase of land for the purposes of retirement village development.
Ultimately, the evidence at trial was very clear that it was Alistair and Cameron whose roles were to identify and source development opportunities and that it was not part of Mr Burke's role. As Alistair said in cross examination:

[434]

CCV then submitted that the Cobblers Lane Property was acquired by Mr Burke 'by reason of him being an employee and director of CCV and not in his personal capacity'.[285] However, it is to be recalled that Mr Burke was told of the opportunity by his friend and accountant, Mr Carmody. Mr Burke was not challenged on this evidence and it was not suggested to Mr Burke that Mr Carmody was approaching him in his capacity as CEO of CCV, with an opportunity for CCV. In fact, the cross examiner did not explore at all what Mr Carmody had said to Mr Burke and the circumstances in which the telephone call had occurred. There is no suggestion on the evidence that Mr Carmody was approaching Mr Burke in a professional capacity as an accountant and by reason of Mr Burke's role at CCV.
Senior counsel for the plaintiffs submitted in closing addresses that Mr Carmody sat in both camps.[286] Accordingly, contrary to the written closing submissions of the plaintiffs, there was no basis for inferring that Mr Carmody, if called, would have given evidence adverse to the defendants' case.[287]
Ultimately, there is no cogent or persuasive proof from which one can draw the conclusion that the opportunity to acquire the Cobblers Lane Property came to Mr Burke in his capacity as a fiduciary.
The claims against Mr Burke for breach of fiduciary duties in respect of the Cobblers Lane Property must be dismissed. No separate factual basis was advanced by the plaintiffs for contending that s 180 or s 181 of the Act had been breached in the circumstances. It follows that those allegations must be dismissed for the same reasons and because the impugned conduct was not undertaken in the exercise of a power, or the discharge of a duty, to CCV.
Finally, the plaintiffs submit that by acquiring the Cobblers Lane Property for the benefit of himself, Mr Dolan, Mr Sculley, Mr Lightfoot and Cobbler Nominees and not disclosing this to CCV, Mr Burke breached clauses 4.6, 4.7, 6.2(b), 6.2(d), 6.2(h) and 6.2(k) of the terms of the Written Contract of Employment. However, this claim must fail because, as I have found, the Written Contract of Employment did not form part of Mr Burke's contract of employment and, in any event, those terms were only expressed to have operative effect from 21 January 2020, after the execution of the contract of sale in December 2019.

[438]

However, even if one was to characterise the failure to bring the Cobblers Lane Opportunity to the attention to CCV as a breach of fiduciary duty (which I do not), it is a breach of the strict standards applicable to a fiduciary, and not conduct which transgressed the ordinary standards of honest behaviour. It was not, therefore, dishonest and fraudulent in the requisite sense.
Fourth,[288] there was no evidence of any knowledge within the first four Baden categories on the part of the Messrs Lightfoot, Sculley and Dolan of a 'dishonest and fraudulent design' of the type contended for. Not only did this articulation of the 'dishonest and fraudulent design' require CCV to establish that Mr Burke was under a positive duty to refer the Cobblers Lane Opportunity to CCV, but advancing a claim in this way also required CCV to identify the evidentiary basis upon which it could be found that Messrs Lightfoot, Sculley and Dolan had the requisite Baden knowledge of the fact that Mr Burke had an obligation to bring residential development opportunities to the Gulls and that Mr Burke had failed to do so.
Fifth, even if one puts to one side the lack of Baden knowledge of the alleged dishonest and fraudulent design on the part of Messrs Lightfoot, Sculley and Dolan, there is no evidence that they 'assisted' in failing to disclose it to CCV.
Mr Sculley was not called to give evidence. Whilst I can readily infer that his evidence would not have assisted him or his fellow defendants, this does not permissibly translate into a finding that he had the requisite knowledge of any obligation to bring the Cobbler's Lane Opportunity to the attention of the Gulls and of Mr Burke's failure to do so. The plaintiffs' evidence did not give rise to any available inference arising from the evidence that Mr Sculley had, or ought to have had, knowledge of any kind of the alleged fact that Mr Burke was or may have been acting wrongfully in being involved in residential development.
Mr Lightfoot's evidence was that at the time he invested in the Cobblers Lane Property he knew that Mr Burke 'worked for Stewart in the retirement villages business, but [he] was not aware of what his title was or that he was an employee and director of ... CCV or any other entity associated with the Gulls'. He further stated:

[442]

By their written closing submissions, the plaintiffs submitted that equitable compensation in the sum of $3,171,397, alternatively $2,249,744, should be awarded for the loss of the Cobblers Lane Opportunity.[289] However, no such equitable compensation can be awarded even if Mr Burke had breached his fiduciary duties.
The evidence reveals that even if Mr Burke had referred the Cobblers Lane Opportunity to the Gulls, and even if they had determined to pursue it, CCV would not have been the corporate vehicle through which it was acquired.
First, by 2019, prior to the acquisition of the Cobblers Lane Property by the Cobblers Consortium, the Gull Group had developed three retirement villages in the Ballarat area. Meadow Gardens was the last development and was completed in 2013. The Gull Group had not purchased a retirement village in Ballarat since 2007 when the Meadow Gardens site was purchased. CCV's retirement living business was focusing on other regional areas. Stewart accepted that he told Mr Burke that he thought the Ballarat market for retirement villages was saturated. Stewart gave evidence that his view as to the saturation of the retirement village market in Ballarat was erroneous, but he was unable to identify when he changed his view with any precision and did not give evidence that he had communicated his change of view to Mr Burke. In circumstances where CCV and the broader Gull Group had not acquired land for the purposes of retirement village development in or around Ballarat since 2007, and in circumstances where Stewart's view that the market in Ballarat was saturated, CCV's criteria for retirement village investment at the time and the size of the Cobblers Lane Property, I find that the Cobblers Lane Property would not have been an acquisition and development target of CCV.
A further reason as to why I am not actually persuaded that CCV would have purchased and developed the Cobblers Lane Property is that Stewart's evidence was, at best, equivocal. Stewart was uncertain as to whether CCV would have purchased the Cobblers Lane Property, stating 'I don't know about that. It could've'.
Third, CCV had never invested in or conducted purely residential sub-divisions. The business it operated was the acquisition and development of retirement villages.
In any event, CCV has not properly proven the quantum of any claim for equitable compensation. The calculation of the quantum of the equitable compensation claim hinged not upon an assumption that the land would be developed for a retirement village, but in accordance with a very specific 71 lot residential subdivision in accordance with the Model Plan. Yet that assumption was not supported by any lay evidence called by the plaintiffs. Not one lay witness gave evidence which established any intention on the part of CCV (or any other entity) to develop the Cobblers Lane Property in accordance with the Model Plan. This was fatal to the claim for equitable compensation. As Spigelman CJ in ASIC v Rich,[290] stated:

[446]

The Wilson Street Property was a residential block of land at 809 Wilson Street, Ballarat East. There was no suggestion by any party that it was land suitable for anything other than residential development.
Mr Dolan gave written evidence that he was first introduced to the Wilson Street Property by Damian Caine in around October 2019. Mr Caine was the sales agent and he contacted Mr Dolan by telephone to see whether he was interested in the Wilson Street Property. Mr Dolan gave evidence that he had minimal interest in the Wilson Street Property at that point in time.
Cameron gave written evidence that in or about May 2020 he became interested in the Wilson Street Property. The Wilson Street Property was approximately four hectares and was being sold with a planning permit for a 28-lot subdivision. As it had a planning permit, Cameron stated that much of the 'heavy lifting' for a development had already been done. Cameron stated that he also viewed the price as attractive based on his experience and knowledge of similar sites in the area and its development potential.
By September 2020, Mr Wright had already had professional dealings in respect of the Wilson Street Property. Two years earlier, in November 2018, he had been requested by the then owners to provide them with a fee proposal to provide an engineering design for a subdivision of the Wilson Street Property. In around September 2020, another client contacted Mr Wright and asked him to undertake some due diligence on the Wilson Street Property. At this stage the Wilson Street Property was on the market for sale. That client told Mr Wright he had been unable to organise funding in time and would not proceed with making an offer. By that time, Mr Wright had received a feasibility assessment from St Quentin's Quantity Surveyors (St Quentin's) and had determined that the development of the Wilson Street Property was worthwhile. Consistent with evidence given by Cameron, Mr Wright gave evidence that the Wilson Street Property was being sold with a planning permit, which greatly improved the value of the site as the risk associated with obtaining a planning permit did not arise.
On 10 September 2020, Mr Wright rang Mr Harris to tell him about the potential investment opportunity at the Wilson Street Property. Shortly thereafter, at 2:52pm that day, Mr Wright sent Mr Dolan, Mr Burke and Mr Harris an email about the Wilson Street Property, noting:

[456]

There is nothing in the email itself nor the attachment that readily or clearly suggests confidential information of CCV or the Gull Group was used in the preparation of the Wilson Street Feasibility Assessment. Whether by submission or cross-examination, the plaintiffs did not identify what, if any, confidential information was included in the Wilson Street Feasibility Assessment.
The Wilson Street Feasibility Assessment circulated by Mr Burke on 23 September 2020, was prepared using the EstateMaster software and then circulated to the Initial Consortium in Excel.
According to Mr Burke, the main advantage provided by the use of EstateMaster was its ability to 'deliver the interest figure, because of the timing of the cash flows' and that it was 'just a lot easier to do it using EstateMaster'. Mr Burke gave evidence that he used EstateMaster to create a cashflow summary for the Wilson Street Property, and the cashflow summary and forecast summary made it easier and quicker to determine the profit.
The evidence therefore establishes that EstateMaster was used to estimate the timing of the cash flows and overall profit of the Wilson Street Property more quickly and easily. Mr Burke accepted that he was not authorised to use any software for his private investments. He stated that he utilised Excel for his own private use from time to time and accepted that he treated EstateMaster as like using Excel. It was by reason of that access he was able to generate the initial feasibility which he then used for his Excel spreadsheet for the Wilson Street Property.
Mr Burke extracted the information from EstateMaster and converted it into an Excel spreadsheet and then added in his own Excel worksheets to perform calculations. Mr Burke gave evidence that he used EstateMaster to 'generate the outputs' from assumptions provided by him and then used the outputs to then do his own work on the financing. Mr Burke said that he used Excel to finalise the profit estimates.
Thus, in summary, Mr Burke converted the content generated from EstateMaster to Excel, and then used the content to do his calculations as to the overall profit estimates. The Excel attachment to Mr Burke's email dated 23 September 2020 was 132 pages long. The first few pages appeared, on the evidence, to contain Burke's own calculations and then several input and output pages were converted from EstateMaster into Excel format.
The first few pages of the Excel document, containing Mr Burke's workings, were entitled 'Profit and Risk Summary' and contained an assessment of the overall assumed revenues, costs, lending requirements and contributions for the project. The summary presented was as follows:

[459]

Prior to the introduction of EstateMaster in 2015, Mr Burke said that calculations were done as to whether a project was viable or not, 'mostly [on] [the] back of envelope.' Mr Burke stated that EstateMaster was quicker but that the same detailed calculation on Excel without any problem. This evidence was not challenged.
The assumed acquisition price in the Wilson Street Feasibility Assessment was $1.95m plus GST. According to the unchallenged evidence of Mr Harris, a decision to increase the offer to $1.95 million plus GST had already been made but the figure was put into a feasibility assessment. Mr Harris gave written evidence that by the time he received the Wilson Street Feasibility Assessment he had already decided to invest in the Wilson Street Property based on his own understanding of the potential value of the project and that he did not rely on the Wilson Street Feasibility Assessment to decide to invest in the Wilson Street Property. Mr Harris accepted that Mr Burke's Wilson Street Feasibility Assessment was a factor in increasing the offer. However, Mr Harris gave evidence that he had already determined that continuing to bid for the property already 'added up'.
From Mr Wright's perspective, Mr Dolan's questions of Mr Burke at this time on the assumption of a purchase at $1.95 million plus GST was a wasted exercise and would not make a difference. Mr Wright gave evidence that he thought the investment still stood up but was inviting other opinions because he was only investing a quarter of a share. Mr Wright said he had already made up his mind and that even if Mr Burke said the investment was a bad investment, Mr Wright would have continued.
Mr Dolan gave evidence that he looked at the Wilson Street Feasibility Assessment briefly. Mr Dolan recalled looking at the initial Excel pages containing Mr Burke's workings but not the pages containing the EstateMaster inputs and outputs. Mr Dolan gave evidence that he did not get that far into the document. Mr Dolan understood the outputs to be the estimated funding requirements, the $2.4m profit, the peak debt, the contribution requirements of $0.5m, and the $0.6m of profit within a year. Mr Dolan accepted in cross examination that Mr Burke's email was one of the pieces of information used to make a decision on whether to buy the Wilson Street Property. Mr Dolan confirmed in cross examination that he knew the Initial Consortium had to go back to the vendor with a better figure. Mr Dolan said that Mr Burke's answers to his questions were helpful in the context of formulating the revised offer but 'certainly not the critical piece in making the decision'.
Mr Burke accepted that his conclusion in the covering email '[o]f course there is potential for upside and downside, but that I think we should have a go at it' was the synthesis of his analysis, including by using EstateMaster.
The best way of understanding the effect of Mr Burke's work on Mr Harris' and Mr Dolan's state of mind was that it was confirmatory of their assessment on the value of pursuing the property.
On 9 October 2020, following discussions with Mr Wright, Mr Burke and Mr Harris, and two and a half weeks after receiving the Wilson Street Feasibility Assessment, Mr Dolan emailed an offer of $1.95m plus GST for the Wilson Street Property to Mr Caine. On the afternoon of 13 October 2020, Mr Dolan met with Mr Caine to discuss the Wilson Street Property and collected a copy of the contract of sale.
Cameron gave written evidence that the Wilson Street Property was advertised in the Ballarat Courier on or about 16 October 2020. Cameron stated that Stewart, Alistair and himself discussed the opportunity to buy Wilson Street Property on or shortly after that date and decided to examine it more fully. Cameron also did due diligence on the Wilson Street Property, including speaking with James Iles of iPlanning Services. Mr Iles told Cameron that he had provided some advice to Mr Dolan about the Wilson Street Property.
On 16 October 2020, Cameron told Mr Caine of his interest in the Wilson Street Property verbally and sent his email address to Mr Caine by text message. After speaking to Mr Caine, Cameron sent his father and brother an email, at 12:32pm, stating '2 mil - 27 lots - gross sales 8 mill'. According to Stewart - Cameron, Alistair and himself agreed it would be a good opportunity to develop as a residential subdivision. There was no suggestion in the evidence that Mr Burke knew of the fact that the Gull Group was interested in, or bidding on, the Wilson Street Property.
On 20 October 2020, Cameron made an offer to purchase the Wilson Street Property by telephone to Mr Caine, for the sum of $1.9 million. That same day, Mr Caine informed Cameron that he had received an offer for $1.95 million plus GST (unbeknownst to Cameron Gull, being the offer made by Mr Dolan on behalf of the Initial Consortium on 9 October 2020). Later that day, Cameron increased his offer to $2 million plus GST by telephone.
At 7:55pm on 20 October 2020, Mr Caine emailed Mr Dolan as follows:

[465]

Strictly speaking, the events following the acquisition of the Wilson Street Property do not bear probatively upon the resolution of the issues in dispute. However, for completeness I proceed to make the findings below.
On or about 26 October 2020, Mr Dolan went to Mr Caine's office and picked up a copy of the fully executed contract of sale. At the meeting with Mr Caine, Mr Caine told Mr Dolan that the Gulls had been the losing bidder. Mr Dolan gave evidence that prior to that conversation, he had no knowledge of the identity of any other bidders or that the Gulls had been interested in buying the property. Shortly thereafter, Mr Dolan called Mr Burke and relayed the conversation he had with Mr Caine. Mr Burke told Mr Dolan that he did not know that the Gulls were bidding on the Wilson Street Property. I accept Mr Burke and Mr Dolan's evidence. There was no suggestion at trial that either Mr Dolan or Mr Burke knew that the Gulls were bidding on the Wilson Street Property prior to 26 October 2020.
Mr Dolan said that he told Mr Burke of the fact the Gulls were the losing bidder because he thought Mr Burke should know, and not because there was some kind of a problem or conflict. Mr Dolan confirmed that it never once occurred to him that there might be some kind of problem that he was investing with an employee of a group that he had outbid on the Wilson Street Property.
Cameron followed up on his offer with Mr Caine by text message on 26 October 2020, and again on 27 October 2020, but did not receive a response. By this time, Alistair and Cameron had become suspicious that Mr Burke was involved. They based this suspicion on the fact that Mr Dolan was pursuing the opportunity (which they were aware of through Mr Iles), that Mr Dolan was friends with Mr Caine and that Mr Caine had stopped responding to messages. Prompted by this suspicion, on the evening of 27 October 2020, Alistair and Cameron attended the Gull Group office after hours and inspected Mr Burke's emails. They thereby discovered Mr Burke's involvement in the bidding for the Wilson Street Property and preparation of the Wilson Street Feasibility Assessment.
On the following morning, 28 October 2020, Cameron, Mr Selkirk and Stewart were waiting in the boardroom for Mr Burke to arrive. Stewart gave evidence that Mr Burke arrived late for work. Stewart was already in the boardroom with Cameron and Mr Selkirk.
Stewart asked Mr Selkirk to take notes of the meeting. A copy of Mr Selkirk's typed notes were tendered in evidence. Neither party adduced evidence as to when those notes were prepared and produced, whether Mr Selkirk was typing notes whilst in the meeting, or whether Mr Burke was given a copy or draft of the notes for his comment at a time shortly after the meeting. Mr Selkirk did not give evidence. As I cannot be sure of the extent to which the notes are contemporaneous, I have given the notes limited weight.
After inviting Mr Burke into the boardroom, Stewart gave evidence that the following exchange occurred with Mr Burke:

[472]

In written closings CCV focussed on the acquisition of the Wilson Street Property and the generation of the Wilson Street Feasibility using EstateMaster as grounding their claims as against Mr Burke.
Turning first to the acquisition of the Wilson Street Property, CCV submitted that the 'Wilson Street Property was acquired by Burke by reason of him being an employee and director of CCV and not in his personal capacity.'[294] Accordingly, CCV submitted that 'the acquisition of this property by reason of his position is a clear breach of the no profits rule.'[295]
There was no such breach of the profit rule by Mr Burke.
The evidence clearly discloses that the opportunity to purchase and conduct a development at the Wilson Street Property did not come to Mr Burke by reason of his fiduciary position or by knowledge resulting from his fiduciary position. The opportunity was, on its face, brought to Mr Burke by Mr Wright and as a member of the Initial Consortium that had by this time already acquired, developed and partially sold lots at the Gracefield Road Property. The opportunity originated with Mr Wright and it was Mr Wright who observed that the vendors were seeking to sell. As can be seen from the chronology in section F.1 above, Mr Dolan was initially introduced to the property by Mr Caine in October 2019 and then in effect reintroduced to it by Mr Wright in September 2020. Mr Dolan gave evidence that he did not have any discussions about the potential acquisition of the property in the intervening period.
CCV next submitted that Mr Burke's failure to bring the development opportunity to CCV for consideration and instead taking the opportunity for himself constituted a breach of the conflict rule. There was no such breach of the conflict rule by Mr Burke. As I have found, CCV's commercial undertaking and venture was the development and management of retirement villages. It was not in the business of acquiring residential land. Mr Burke was not under a positive obligation to pursue an opportunity for residential land development on behalf of CCV. The opportunity to conduct a development at the Wilson Street Property did not arise in the performance of Mr Burke's duties as a director or company secretary, and thereby a fiduciary of CCV.
Turning then to the generation of the Wilson Street Feasibility Assessment using EstateMaster, CCV submitted that this was a 'clear example of a fiduciary using CCV resources to acquire a benefit, as well as a clear conflict in misusing CCV's proprietary information for his own personal gain'. CCV submitted that the objective evidence revealed that the Wilson Street Feasibility Assessment was 'instrumental' in the decision of the Initial Consortium to pursue the Wilson Street Opportunity and gave the Initial Consortium the confidence to increase the previous bid by a 'significant amount'.
I accept the defendants' submission that the use of the EstateMaster software licensed to CCV did not give rise to a real or substantial possibility of a conflict of interest in circumstances where CCV was only involved in retirement village development and management and EstateMaster was used to prepare a draft feasibility assessment for a residential development.
The articulation of the alleged breach by CCV in its written closing reveals, in truth, a complaint about a breach of the profit rule.[296]
Mr Burke submitted that there was no such breach of the profit rule as the investment in the Wilson Street Property did not occur by reason of Mr Burke's use of the EstateMaster software. Mr Burke pointed to his written evidence to the effect that he did not rely on the Wilson Street Feasibility Assessment when deciding whether to invest in the Wilson Street Property and that he used the feasibility study to gain a more accurate assessment of potential profit.
Mr Burke was granted the ability to possess, use and control EstateMaster by reason of his role as a director, secretary and employee of CCV. CCV had permissions to use EstateMaster from GRVS and paid GRVS an internal fee for that privilege. Mr Burke had no right or permission to use EstateMaster as he pleased and for his own benefit.
Mr Burke's conduct in using EstateMaster to prepare the Wilson Street Feasibility Assessment for his own personal benefit and that of the Initial Consortium was impermissible. The critical question in the circumstances is whether there is an adequate or sufficient connection between the impermissible use of the EstateMaster software and the loss to CCV of the Wilson Street Property or profit gained by the Initial Consortium. As the authorities reveal, under Australian law, there is a sufficient connection if the loss or profit would not have occurred but for the breach of fiduciary duty.
In the present case, there is no loss occasioned to CCV. Stewart gave evidence that CCV would not have purchased the Wilson Street Property. Stewart gave evidence that had the Gull Group successfully bid on the Wilson Street Property, it would have set up an SPV to purchase it. Stewart was very clear that the Wilson Street Property would not have been developed for the purpose of retirement village living and it was suitable for residential as opposed to retirement village development. Cameron agreed that had the Gull Group been successful in acquiring the Wilson Street Property it would have been for the purpose of development as a residential property. Cameron accepted that CCV would not have acquired the property Cameron said that an existing SPV or a new SPV could have purchased the Wilson Street Property.
The focus of analysis must therefore be on the profit made on the Wilson Street Property by the Initial Consortium.
On the state of the evidence, I am not actually persuaded that the profit made on the Wilson Street Property by the Initial Consortium occurred 'by reason of' Mr Burke's misuse of the EstateMaster software or that the profit would not have been made but for the dishonest wrongdoing. Nor am I satisfied, applying the test articulated by Lord Briggs for the majority in Rukhadze,[297] that the profit derived by the Initial Consortium owed its existence to a significant extent to the application by Mr Burke of CCV's EstateMaster software.
That is for the following reasons.
There is no doubt that the Initial Consortium had decided to invest in the Wilson Street Property before Mr Burke prepared the Wilson Street Feasibility Assessment. Prior to the circulation of Mr Burke's email containing the analysis using EstateMaster, the Initial Consortium had already made an offer of $2 million inclusive of GST. Further, according to the unchallenged evidence of Mr Harris, a decision to increase the offer to $1.95 million plus GST had already been made prior to the preparation of the Wilson Street Feasibility Assessment.
The question therefore is whether there is a sufficient connection between the misuse of CCV software on or about 23 September 2020 and the ultimate acquisition of the Wilson Street Property for $70,000 more, at $2.02 million plus GST on 22 October 2020. Put differently, the relevant question is, would the offer of $70,000 more not have been made but for the misuse of the software.
I am not actually persuaded that there is a sufficient connection between the misuse and the successful acquisition of the Wilson Street Property. The evidence of each of the relevant witnesses does not permit a conclusion, to the relevant standard, that the acquisition of the Wilson Street Property at a sum of $2.02m plus GST would not have occurred but for the preparation of the Wilson Street Feasibility Assessment. Nor is it sufficient to conclude that the decision to bid at $2.02m plus GST owed its existence, to a significant extent, to the Wilson Street Feasibility Assessment.
That is because, in summary, the evidence reveals the following.

[479]

Mr Burke was under no duty to bring opportunities for residential development to CCV. CCV was a company which had developed and was managing retirement villages. It was not in the business of acquiring land for residential development. There was no realistic possibility of conflict between Mr Burke's role as a member of the Initial Consortium and his role as a director and officer of CCV. In any event and most fundamentally, Mr Burke was not exercising a power or discharging a duty to CCV when pursuing the acquisition of Wilson Street Property as a member of the Initial Consortium and using EstateMaster for the purposes of preparing the Wilson Street Feasibility Assessment.
CCV further submitted that because Mr Burke took the opportunity to develop the Wilson Street Property away from CCV with the consequence that he derived a financial advantage and caused a detriment to CCV, he used his position as an officer of CCV in contravention of s 182 of the Act. Such a claim is untenable. Mr Burke did not use his position as a director or employee of CCV to divert an opportunity away from CCV. The opportunity came to Mr Burke through Mr Carmody - his friend and accountant. It was not an opportunity that CCV was in the business of pursuing and the uncontested evidence is that it was not the entity that would have effectuated or benefited from any successful purchase by the Gull Group.
Finally, and most relevantly, CCV contended that by accessing EstateMaster and generating the Wilson Street Feasibility Assessment, Mr Burke misused his position and misused information obtained because he was a director and an employee of CCV. In this way, CCV submitted that Mr Burke contravened ss 182 and 183 of the Act.
Focussing first on s 182, Mr Burke used his position as a director and employee of CCV to access EstateMaster. His authority and ability to access EstateMaster derived from his employment as managing director of CCV. Using his position at CCV to access EstateMaster for the purpose of generating a feasibility assessment to assist in pursuing a residential development with a development consortium outside of his employment was improper. His conduct breached the norm of conduct expected of the managing director and senior employee of an organisation such as CCV. The purpose was clearly to gain an advantage, being the contribution of information generated by Estate Master, based on inputs provided by him, to assist in the overall evaluation of the feasibility of the development of the Wilson Street Property. In those circumstances, s 182 of the Act was breached.
Turning then to s 183, the pleaded case was that information contained in the Wilson Street Feasibility Assessment was improperly used by sending it to the Initial Consortium and by using it for the purpose of bidding on the Wilson Street Property.[300] As I have found, the information generated by EstateMaster was based on assumptions provided by Mr Burke. The outputs generated by EstateMaster were then used by Mr Burke for the purpose of performing his own calculations. The information produced by EstateMaster (i.e. the outputs) was information acquired by Mr Burke. It is then necessary to ask whether the information was acquired because he was a director or employee of CCV. In the present case, the requisite causal nexus between Mr Burke's role and his receipt of the information is satisfied. The natural meaning of the word 'acquired' includes 'to obtain'. The only way he was able to obtain, and thereby 'acquire', the information was because as an employee and director of CCV, he was able to access and use EstateMaster. His use of the information thereafter was improper for reasons I have already identified in the context of the contravention of s 182. As with the claim made pursuant to s 182, the purpose of using the information generated by EstateMaster was clearly to gain an advantage for the Initial Consortium. In the circumstances, I am satisfied that Mr Burke contravened s 183 of the Act.
Sections 182 and 183 of the Act are civil penalty provisions. As CCV would not have purchased or developed the Wilson Street Property it has suffered no compensable loss. The question arises however, having regard to the definition of damage in s 1317H, as to whether or not the profit derived by Mr Burke from the acquisition and development of the Wilson Street Property resulted from those contraventions of the Act. I have already determined that the EstateMaster outputs were a factor in Mr Burke and Mr Dolan's decision to ultimately bid $2.02m plus GST on the Wilson Street Property. However, as I have said, the Initial Consortium had already decided to bid at $1.95m plus GST and Mr Harris and Mr Wright had formed a concluded view that the investment was worthwhile. The successful bid on the Wilson Street Property occurred one month after the production of the Wilson Street Feasibility Assessment. The speed of production by EstateMaster therefore offered no obvious benefit to the Initial Consortium. Applying 'common sense' in these circumstances, I am not satisfied, that the requisite causal connection has been established. Employing a counterfactual assessment, I am not actually persuaded that but for the production of the Wilson Feasibility Assessment, the Initial Consortium would not have increased their position from $1.95m plus GST by the additional $70,000 plus GST necessary to secure the purchase.

Plaintiffs v Defendants

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Cases Cited (84)