Sent and Primelife Corporation Ltd v John Fairfax Publication Pty Ltd and Hills [2002] VSC 429

Sent and Primelife Corporation Ltd v John Fairfax Publication Pty Ltd and Hills [2002] VSC 429 - VSC 2002 case summary — Zoe

[6]

"Specifically, Eduard Christiaan Sent, to give him his full name, has been charged (though not convicted) on three occasions with serious criminal offences including fraud... His next grand venture also involved tax minimisation - this time using boats instead of planes. He built scallop-dredges which he sold to syndicates of high-income individuals such as doctors and lawyers and leased them back for fishing in Bass Strait. This was supposed to return $100,000 plus a year, on top of the juicy tax benefits derived from `revenue trips' just before the end of the financial year. The venture became such a runaway success that a massive flotilla of 60 $500,000 boats was launched in just 18 months, prompting the then Primary Industries Minister, Mr. John Kerin, to warn in Parliament that Mr. Sent's company, Allied Fisheries Limited, was `promoting the purchase by professional people of new scallop boats on the basis of exaggerated claims about the extent of our fisheries' resources'. But within two years that company had also capsized under massive debts, with Allied blaming everything from fleet breakdowns (the propeller fell off one boat) to poor catches during the El Nino weather effect. In 1984, the Tasmanian Supreme Court ordered the company wound-up. The following year, the Tasmanian Attorney General, Mr. Geoffrey Persall, announced that the NCA was investigating Allied's operations and had seized five tea chests of documents from its former premises at Beauty Point near Launceston. This eventually led to Mr. Sent's third appearance in Court on criminal charges. In its 1989 Annual Report, the NCA said that four people had been charged under the Commonwealth Crimes Act with conspiracy to defraud the Commonwealth over `an alleged tax avoidance scheme involving the formation of partnerships of investing members of the public for the purpose of purchasing and updating fishing vessels'. The NCA told the Herald that Mr. Sent and his partner, Mr. Forshaw, were two of those charged. In September 1989, a Magistrate found there was insufficient evidence to commit them for trial and the charges were dismissed."

[26]

"7 Mr Jeffrey Sher QC has also appeared on behalf of the Defendants in proceeding no. 6972/01 commenced by the Plaintiffs for pre-trial discovery, and in proceedings no. 2018/00 and 6896/00 in respect of an application by the Defendants to dissolve injunctions granted in favour of Primelife Corporation Ltd against Mr Zlatko Andrejic and Ms Lilliana Curkovic. 8 I am informed by Ted Sent, and verily believe, that: (a) Brian Forshaw and he had been directors of Allied Fisheries Pty Ltd, which had run a scallop fishing business. Allied Fisheries Pty Ltd was wound up in about 1984. (b) In the mid to late 1980s, the NCA conducted an investigation in relation to his and others involvement in Allied Fisheries Pty Ltd. (c) Jonathan Mott, a solicitor, formerly of Gadens Ridgeway, and now of Deacons, was acting for him and Brian Forshaw in their personal capacities in relation to their involvement with Allied Fisheries Pty Ltd. All of their documents in respect of Allied Fisheries were handed to him. (d) In or about February 1989, he was charged with conspiracy to defraud the Commonwealth in respect of an alleged tax avoidance scheme in relation to Allied Fisheries Pty Ltd. The file in this regard was destroyed some years after the charges against him were dismissed in or about September 1989. (e) Sometime in the late 1980s as a result of the ongoing NCA investigation, he was advised by his solicitor, Jonathan Mott, to seek the advice of Queen's Counsel. He cannot remember now whether at this time charges had been laid or it was simply clear that charges were likely to be laid against him in relation to the Allied Fisheries venture. (f) The decision to retain Jeffrey Sher QC was made on the recommendation of his then solicitor Jonathan Mott and his friend and business colleague, Brian Forshaw. His recollection is that Brian Forshaw, on Jeffrey Sher QC's name being mentioned, said something to the effect that he knew Sher. His recollection was that Brian Forshaw said he had known Sher since school days and he assumed that this meant that they had been to the same school, however he now knows that this may not have been the case. (g) Jonathan Mott prepared a brief for Jeffrey Sher QC and he recalls that at that time Jonathan Mott told him that he had put into the brief such of the documents that would explain the matter to Jeffrey Sher QC. (h) A conference was held in Jeffrey Sher QC's chambers. Present at the conference were him, Jeffrey Sher QC, Brian Forshaw, and Jonathan Mott. He knows that Jeffrey Sher QC must have read the papers in the brief because he asked him a series of questions and although he cannot remember the specific questions, he recalls thinking that they demonstrated a detailed knowledge of the brief. (i) The conference lasted approximately 2 hours and again, although he cannot recall specifically what was said, he remembers that he detailed his involvement with Allied Fisheries from its inception up until that point in time. (j) The concept of Allied Fisheries was the construction and establishment of a major fishing fleet to operate from Australian shores and to export the catch to Japan, France and the United States of America. The operation was to be by way of syndication where individual persons could purchase a share in a boat which would have been constructed and leased back to the Allied Fisheries operation on the basis of a guaranteed minimum return. (k) During the course of his conference with Jeffrey Sher QC, he recalls that he discussed with him and told him about the commercial structural arrangements in relation to Allied Fisheries, the involvement of outside syndicate promoters and his negotiations with the Commonwealth Government and the Tasmanian Government in relation to Allied Fisheries. In the context of all of these topics, he informed Jeffrey Sher QC in great detail of his involvement at each level of the business and in respect of each of these matters. (l) At the conclusion of the conference, Jeffrey Sher QC did not provide a written opinion and declined to further act for him in relation to Allied Fisheries, due to its time-consuming nature and due to his other activities at the time, which he explained generally to him, Brian Forshaw and Jonathan Mott at the conference. (m) As a result, he is concerned that his confidence and trust reposed in his former Counsel, Jeff Sher QC, be maintained. (n) Further, as a result of Jeffrey Sher QC's participation in the aforesaid conference, he was privy to confidential and privileged instructions and information concerning Allied Fisheries Pty Ltd, his involvement in the same and the pending charges and/or charges referred to above in relation thereto and his personal characteristics and instructions in relation thereto. (o) he is extremely concerned, having regard to the nature of this proceeding, that matters discussed with Jeffrey Sher QC at the conference referred to above, will be directly or indirectly of assistance to Jeffrey Sher QC particularly in his cross-examination of him as a Plaintiff in the trial and therefore of assistance to the Defendants. 9 On or about 11 October 2001, my firm sent a facsimile to Freehills, the solicitors for the Defendants, in which the Plaintiffs alleged that Jeffrey Sher QC would have a conflict in continuing to act for the Defendants. Now produced and shown to me marked `LAW 3' is a copy of that facsimile. 10 On or about 11 October 2001, I spoke to Guy Gaudion, a senior associate employed by Freehills, who informed me that Jeffrey Sher QC was not appearing at the directions hearing on 12 October 2001. 11 On or about 12 October 2001, I spoke to Ken Adams, a partner of Freehills, who informed me that he was still obtaining instructions regarding Jeffrey Sher QC's continued retainer for the Defendants. 12 On or about 12 October 2001, Freehills sent a facsimile to my firm by way of response, a true copy of which is now produced and shown to me and marked `LAW 4'. 13 On or about 26 October 2001, Freehills sent my firm a further facsimile seeking further information about the allegations of conflict of interest. Now produced and shown to me marked `LAW 5' is a true copy of that facsimile. 14 On or about 19 June 2002, my firm sent a facsimile to Freehill. Now produced and shown to me marked `LAW 6' is a copy of that facsimile."

[29]

"3. I was on leave in early October 2001, and upon my return on or about 11 October 2001, I was instructed by Mr Sent that he had just found out that Mr Sher QC had signed the Defendants' defence and that Mr Sher QC had a conflict of interest in acting for the Defendants as he had previously given advice to him in connection with Allied Fisheries. 4. On or about 11 October 2001 my firm sent a facsimile to Freehills in which Mr Sent's concerns regarding the Defendants' retainer of Mr Sher were raised. That facsimile is exhibit "LAW 3" to my Affidavit affirmed 3 September 2002. 5. On or about 12 October 2001, the Honourable Justice Bongiorno made orders for the Plaintiffs to file and serve their further and better particulars and reply by on or about 8 November 2001, and for the parties list of discoverable documents to be completed by on or about 6 December 2001. 6. On or about 26 October 2001 Freehills sent a facsimile to my firm requesting further information concerning Jeffrey Sher QC's previous retainer by Mr Sent. That facsimile is exhibit "LAW 5" to my Affidavit affirmed 3 September 2002. 7. In or about late October 2001 and early November 2001, I was unable to obtain instructions from Mr Sent due to an illness he was then suffering. 8. In or about mid November 2001, I received advice from Counsel concerning the matters about which I ought to obtain instructions from Mr Sent in relation to Mr Sher's retainer, and instructions were sought by my firm from Mr Sent. However at that time, the Plaintiffs were running behind in complying with the Court's orders made 12 October 2001, and the Plaintiffs focused on completing their pleadings and discovery. 9. On or about 22 November 2001, the Plaintiffs filed their Further and Better Particulars of its claim and its Reply, both dated 22 November 2001. 10. Due to a number of factors including issues of privilege, relevance and attempts to locate documents going back a considerable period of time, the Plaintiffs were unable to complete discovery prior to me going on leave on or about 21 December 2001. I returned from leave on or about 15 January 2002. 11. The Defendants' Affidavit of documents was filed and served on or about 30 January 2002. 12. In or about early March 2002, instructions were again sought from Mr Sent in relation to the retainer of Mr Sher QC. 13. The Plaintiffs' Affidavit of documents was eventually filed and served on or about 14 March 2002. 14. On or about 14 March 2002, although I was not able to actually speak to Mr Sent, I received instructions from him via a third person in relation to Mr Sher's retainer. I indicated to that person that further instructions would be required from Mr Sent in relation to some outstanding issues before a summons seeking orders to restrain the Defendants from engaging Mr Sher could be issued. 15. On or about 15 March 2002, there was a directions hearing in this matter in which Senior Counsel for the Plaintiffs informed the Court that the Defendants' retainer of Mr Sher was still a live issue. Now produced and shown to me marked "LAW1" is a copy of the transcript of the hearing before the Honourable Justice Bongiorno on 15 March 2002. 16. During March and April 2002 I was involved in the capacity as solicitor and save for a few days, also in the capacity of Counsel, for a matter which was heard intermittently over 14 sitting days, and which involved approximately 2 weeks of preparation, including collating and reviewing documents for privilege in relation to a notice to produce. During those months, I also had a 9 day vacation. 17. In or about March 2002 I was informed by Sandi Porter, the deputy CEO of Primelife Corporation Ltd and believe that Mr Sent would be overseas for a 6 week period commencing from on or about the beginning of April 2002 until about 14 May 2002 and because he would be sailing in the Indian Ocean, although he could be contacted in an emergency by satellite phone, it would be difficult to obtain detailed instructions from him. I did not speak to him during that period. 18. After Mr Sent's return from overseas in or about mid-May 2002, I obtained instructions from him in relation to the outstanding issues in respect of Mr Sher's retainer, as a result of which on or about 19 June 2002, my firm sent a facsimile to Freehills. That facsimile is exhibit "LAW 6" to my Affidavit affirmed 3 September 2002."

[32]

Now produced and shown to me and marked `JLS:1' is a true copy of this entry in my fee book for 9 November 1988. 7 In November 1988 I ordinarily charged $500 per hour for my time. That rate varied depending on the matter, but it was my usual charge out rate. My usual practice at all material times including November 1988 was to charge for preparation and reading time as well as for time spent in conference. 8 In respect of the entry set out in paragraph 6 above I say: (a) Given that my usual charge out rate is $500 I believe I was engaged in the matter relating to Messrs Sent and Forshaw for approximately 1 hour including preparation, reading and conferring. (b) I deny that I was engaged either for at least 2 hours (as is alleged in paragraph 5(d) of Russell Kennedy's letter dated 19 June 2002 - `Exhibit LAW6' to Warren's Affidavit) or approximately 2 hours as alleged in paragraph 8(i) of Warren's Affidavit. (c) Had I met Mr Sent for a period of approximately 2 hours I would recall it. As stated above, to the best of my recollection I have never met Mr Sent. 9 Mr Sent alleges, via Mr Warren's Affidavit, that I: (a) read the papers in the brief (a copy of which he does not produce); (b) asked a series of questions of Mr Sent, to which he presumably gave answers; (c) listened to Sent as he discussed and told me about: s the commercial structural arrangements in relation to Allied Fisheries; s the involvement of outside syndicate promoters; and s Mr Sent's negotiations with the Commonwealth Government and the Tasmanian Government in relation to Allied Fisheries. In paragraph 8(k) of Warren's Affidavit it is stated in relation to all of these topics Mr Sent informed me in great detail of his involvement at each level of the business and in respect of each of these matters. 10 To the best of my recollection I have never met Mr Sent. Further, I do not recall advising anyone in connection with Allied Fisheries. I have a faint recollection of acting in some matter in respect of which Mr Sent was involved. I cannot now name the matter. I certainly have no recollection of any privileged information. By reason of the fact that I charged for only 1 hour of my time, it is highly improbable that I read and analysed a detailed brief, and received detailed and confidential instructions in relation to a potential prosecution of Mr Sent for his involvement in Allied Fisheries. 11 Responding to other matters alleged by Mr Sent, via Warren's Affidavit or Mr Warren's letter marked as exhibit `LAW6', I state as follows: (a) In respect of paragraph 8(c) of Warren's Affidavit, I was briefed by Ridgeway Clements, not Gadens Ridgeway. The reference is to `JCM:JN', which is a reference to Jonathan Mott. (b) In paragraph 5(c) of the letter of 19 June 2002 Mr Warren records that he is instructed that I had been to school with Mr Forshaw and it was that initial connection that led to my retainer. In paragraph 8(f) of Warren's Affidavit, Mr Sent appears to withdraw the statement concerning my common education with Mr Forshaw. To the best of my recollection I have never been to the same school as Brian Forshaw. To the best of my recollection I have never met Brian Forshaw. I have met Brian Forshaw's brother, Phillip Forshaw. (c) In paragraph 5(d) of the letter dated 19 June 2002 Mr Warren sets out his instructions that I said words to the effect, `What a load of rubbish, how can two little Jewish boys get into a mess like this?'. I did not and do not know that Mr Sent was Jewish (if that is the case). Further, the comment is so out of character for me that I deny making it, even if it was found that I did meet with either Mr Sent or Mr Forshaw (of which I have no recollection). (d) I have no recollection of reading any papers in connection with Allied Fisheries, or acting in respect of Allied Fisheries. I am therefore unable to confirm that I was briefed with any documents as alleged in paragraphs 8(g) and (h) or Warren's Affidavit. In paragraph 8(1) it is alleged that I declined to act further for Mr Sent in relation to Allied Fisheries due to its time consuming nature and due to my other activities at the time, which I explained generally to Mr Forshaw and Mr Mott at the conference. This allegation is elaborated upon in paragraph 5(f) of exhibit `LAW6' where it is said that I explained generally my private interests to Messrs Mott, Sent and Forshaw as a basis for declining to act further. I did not know Messrs Sent or Forshaw and if it were to be held that I met with them or either of them, I consider it so improbable that I would have explained my private interests to them as to deny that any such discussion to that effect took place."

[34]

"3. Insofar as the article refers to me, it is incorrect when it states that I was charged by the National Crime Authority in relation to the "Allied Fisheries operation". In fact, I was never charged in respect of that matter. I have since received a retraction and apology from the Firstnamed Defendant. Now produced and shown to me and marked with the letters "BF-2" is a true copy of the said retraction and apology. 4. I have also been shown and have read a copy of an Affidavit by Leonard Warren in support of an application by Ted Sent to restrain the Defendants in the abovenamed proceeding from retaining Jeffrey Sher QC as their Senior Counsel. I have also been shown and have read a copy of an Affidavit sworn 13 September 2002 in opposition to the application by Jeffrey Sher QC. 5. Jeffrey Sher QC is incorrect in his recollection on at least two counts. First, I can say that I was certainly present in Jeffrey Sher QC's chambers in late 1988 at a conference organised by Jonathon Mott, solicitor, where Ted Sent, Jonathon Mott and myself were present together with Jeffrey Sher QC. I am unable now to recall the specifics of that conference but I can say emphatically that Ted Sent attended at Jeffrey Sher QC's chambers with myself and Jonathon Mott for the purposes of a conference and obtaining advice from Jeffrey Sher QC. 6. The second matter in respect of which Jeffrey Sher QC is incorrect in his recollection is that he says in paragraph 11(b) of his Affidavit that to the best of his recollection, he has never met myself. Whilst I certainly state that Jeffrey Sher QC and I are not friends. 7. I certainly recall that in the late-1980s, Ted Sent and I were concerned about the ongoing NCA investigation into Allied Fisheries and the fact that charges may be laid against us. I can also recall that legal advice was taken in relation to that matter as well as one other matter at or about that time, but I am unable to specifically recall the subject matter of the particular conference that I recall attending in Jeffrey Sher QC's chambers with Ted Sent. It is quite possible that it was about Allied Fisheries, but then as I was never charged over that matter, I do not find it surprising that I now no longer recall the precise subject matter of the particular conference."

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Cases Cited (8)