123 Accordingly, the plaintiffs say, they should be granted the primary relief sought by them.
124 Before dealing with questions of credit, I should briefly consider a few miscellaneous matters related to the cause of action.
125 First the cause of action is in promissory estoppel. Thus the plaintiffs should ordinarily satisfy the test laid down by Powell J in Kurt Keller Pty Ltd v B M W Australia Ltd [1984] 1 NSWLR 353, 371 that they "must be able to point to, either, a statement which constitutes, or, conduct from which a reasonable man would infer, a clear and unequivocal representation by the person having the particular legal power, or discretion, either, that, in the future, he would not exercise that power or discretion at all, or, that, for a time, the power would be suspended." See also Dewhurst v Edwards [1983] 1 NSWLR 34, 51-3; The Scaptrade [1983] QB 529.
126 Secondly, because the onus is on the plaintiffs to prove those representations and in the light of the fact that the documents all record a loan, this is not the sort of case where one considers that once money is proved to be paid, the onus is on the person claiming that the transaction was one of loan, to prove it, cf Jenkins v Wynen [1992] 1 Qd R 40.
127 Both sides agreed that were a promissory estoppel established, the court would give the minimum equity needed to salve the defendant's conscience.
128 Thirdly, insofar as it is said that any assurances by Rabbi Gutnick lulled Rabbi Feldman and his associates into a false sense of security which made them not consider other exist strategies, the bald facts in December 1994 were that the organisation was completely trapped in a situation where it owed a bank over 24 million dollars and had no means of paying anything. No exit strategy was available except the generosity of the Jewish community to bale the organisation out of its mess.
129 I might add here that, principally for this reason, I was not attracted by the submission that, should some promissory estoppel be made out, the minimum equity was to enforce the promise. In my view, all that would have been needed was a little time, during which some interest at least would have to be paid, for the plaintiffs to reconsider and implement alternative exit strategies. However, as matters have fallen out, it is unnecessary to take this thought further.
130 I now have to consider the questions of credit.
131 The case was an unusual one. Rabbi Feldman seemed to be attended by a large retinue of supporters. Rabbi Gutnick appeared not to be attended by many other people. The fact that the majority in the public gallery were Feldman supporters was confirmed when there was hissing when Rabbi Gutnick referred to Rabbi Feldman as "Mr Feldman".
132 It was also most noticeable from the evidence that there is a very strong community network existing between businessmen who are orthodox Jews. One of the community would be most ready to help another member of the community on the mere request of a friend even though it were to his own detriment.
133 I found it very hard to get my mind around the fact that Rabbi Feldman seemed to be equating everything that he did with the charitable work of the religious and educational establishments of which he has day by day control. He never seemed to be concerned that his personal claims had really nothing to do with the claims of the schools and synagogue. He seemed to be a very intelligent man, yet was unable to segregate these two different types of claims. Of course, it advantaged him to commix them as much as he could.
134 Further, I was concerned about the interest subsidy matter. Interest subsidy is paid by the State Government for genuine relief to schools who construct particular capital works. The arrangement between the parties which preserved the subsidy and the deliberate structure of the transaction that Rabbi Gutnick would donate all interest received other than that which was in reality being paid by the Government, does not sit well with ethics.
135 However, the fact that the transaction was deliberately structured to preserve the loans bearing subsidies and for other reasons beneficial to the parties, makes it less probable that the whole documented transaction was negated by "the oral agreement and religious covenant with God that we both had made" and "to our mutual religious covenant as to behaviour".
136 Finally, the fact that Rabbi Gutnick had to borrow the money to pay out the bank tells against the underlying transaction being a gift.
137 Indeed, if Rabbi Feldman's position was accepted literally, no Jewish person could ever lend money to a Jewish charity at interest or indeed seek back his or her capital if to do so might imperil the charity. On the other hand, those administering the charity would be able to do so without accountability on the basis that they could never be forced to pay debts owing to members of the Jewish community. Indeed Rabbi Gutnick made this point at T148 that if Rabbi Feldman was right, every Jewish person would be scared whenever they lent money to a Jewish charitable organisation.
138 On the other hand, I considered that Mr Scheinberg who gave evidence for the plaintiffs, but who could not be classed as a Feldman supporter, was the most acceptable of the witnesses, and he did provide a small degree of corroboration of the plaintiffs' story.
139 These preliminary observations do not absolve me from dealing head on with the question of credit, but they do assist in that resolution.
140 I have already set out the contentions of the respective sets of counsel as to how I should approach the issue of credit. Whilst, of course, both sets of submissions make pertinent observations, in my view the picture presented by defendant's counsel gives the best guidance.
141 I should add that a lot of Rabbi Feldman's evidence was, I thought, a reconstruction of what his subjective thoughts and feelings were and that he has melded in various minor utterances of Rabbi Gutnick to bring into his mind the present picture of representations having been made. Basically, Rabbi Feldman's situation is similar to the strereotypical Englishman of the 19th century, saying, "I know that that chap will not sell me up because we are a member of the same club and no one but a bounder would do it."
142 On the other hand, Rabbi Gutnick's evidence was less subjective. The major thrust of the cross examination went to the conduct of the Rabbi's representatives before the Tel Aviv tribunal. I was not that impressed with his answers that he at one time was prepared to go to rabbinical arbitration over Rabbi Feldman's claims for commission, but never in respect of the mortgage claims. However, generally I accepted his evidence.
143 Mr Pembroke SC provided me with a schedule headed "Gutnick preparedness to assert the improbable and deny the obvious". The heading might almost be used for some of Rabbi Feldman's evidence.
144 I have ready that schedule carefully. Most of the schedule refers to minor matters connected with the rabbinical court procedures in Tel Aviv. With the intervention of agents and foreign countries, one would always expect some breakdown in communication.
145 The matters directly related to the taking of security do not make me alter my view that Rabbi Gutnick's version of events is more likely to be correct.
146 I was not as confident with the evidence of Rabbi Feldman.
147 In my view, Rabbi Gutnick's version of the events is more likely to be correct than that of Rabbi Feldman.
148 I say this on a minor degree from the demeanour of the witnesses, however principally Rabbi Gutnick's account more accords with the documents, fits in better with the surrounding circumstances and does not suffer from the reconstruction inherent in Rabbi Feldman's evidence. Further, I broadly accept the criticisms of Rabbi Feldlman's evidence set out in defendant's counsels' submissions which I have recounted earlier in these reasons.
149 However, when one analyses his evidence a little more closely, it can be seen that the case can virtually be dealt with even on the basis of a version of that evidence.
150 Whilst the statements attributed to Rabbi Gutnick made in Rabbi Feldman's affidavit were clear, as they were analysed in cross examination and were modified in the submissions, the plaintiffs do not establish statements of the nature referred to by Powell J in Kurt Keller Pty Ltd v B M W Australia Ltd [1984] 1 NSWLR 353, 371 referred to earlier in these reasons.
151 Even if the plaintiffs had shown a sufficiently certain representation, giving a remedy virtually of granting specific performance of a promise to make a gift would, for the reasons already given go further than the minimum equity.
152 Finally, I might note that there may indeed be some religious principles which Rabbi Feldman can deploy in some rabbinical tribunal. However, whatever these are, do not concern this court as they do not constitute conduct from which, together with other relevant evidence, I can make a finding of equitable estoppel against the defendant exercising its clear rights under the documents.