Berry & Anor v CCL Secure Pty Ltd [2019] HCATrans 204 (18 October 2019)

Last Updated: 22 October 2019

[2019] HCATrans 204

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Sydney No S189 of 2019

B e t w e e n -

BENOY BERRY

First Applicant

GLOBAL SECURE CURRENCY LIMITED (COMPANY NUMBER 05127761)

Second Applicant

and

CCL SECURE PTY LTD ACN 072 353 452

Respondent

Application for special leave to appeal

BELL J
GAGELER J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 18 OCTOBER 2019, AT 9.31 AM

Copyright in the High Court of Australia
MR J.T. GLEESON, SC: May it please the Court, I appear with MR P.F. SANTUCCI for the applicants. (instructed by Marque Lawyers)

MR G.K.J. RICH, SC: May it please the Court, I appear with MS J.L. ROY for the respondent. (instructed by Arnold Bloch Leibler)

BELL J: Yes, thank you, Mr Rich. Yes.

MR GLEESON: Your Honours, our special leave questions as proposed are on page 224. Could I say something about them at the outset? The first question raises this issue. It is accepted that we have a person who engaged in misleading and deceptive conduct, it is accepted there was reliance, and it is accepted that there was detriment in the sense that my clients surrendered their valuable rights under the contract; that much is agreed.

The issue that we then have is that the damages were claimed on what we call the revenue account. It would have been possible to value the contract, but that was not done. Instead the parties said, we will treat the lost commissions over the life of the contract as the damages, so that was an agreed approach. And we then said, applying ordinary tort or trade practices principles, put us back in the position we were in. We had a contract, and the first time in the actual world that you lawfully terminated our contract was many years later, 2018.

The question then was really a Malec v Hutton type question. There is a past hypothetical event being relied upon, put up by the respondent, which is, although we fraudulently got rid of your contract, we could have done it on one of two occasions by lawful means. As to the second occasion which was several years later, that is 2010, we now accept based on the fact findings of the Full Court that that qualifies in Malec v Hutton land.

So the question we are left with is, in 2008, at a time when there was a deliberate decision not to take lawful means to terminate our contract, can the respondent nevertheless set them up to say, your damages end because I would have taken such means? And the proposition of law we are contending for in paragraph 7, the second question, is not only is there an onus on the respondent, but what had to be established was that there was a lawful means independent of the misleading conduct which would have brought about the same damage. Now, your Honours, as to where we get independence from, we have referred in our submissions to the contract cases in the Mihalis Angelos line ‑ ‑ ‑

BELL J: Yes.

MR GLEESON: ‑ ‑ ‑ where we say in each case, innocent parties relying upon something independent. We have also looked again at the tort cases, and perhaps the best example is Chappel v Hart itself where – I will give your Honours the page if necessary – where Justice Gummow and Justice Kirby in the majority said if you are going to set up a defence that the harm would have come about by some other means so as to reduce the damages, they must be independent means. Now, that is the principle we contend for.

GAGELER J: Independent of what?

MR GLEESON: Independent of the wrong.

GAGELER J: The wrong being what?

MR GLEESON: The wrong here was this. The wrong was the misleading and fraudulent inducement of us to surrender our contractual rights – a wrong done as part of a fraudulent scheme upon the applicants. And so I just wanted to show your Honour on the facts, if I could, what the fraudulent scheme was.

GAGELER J: Right, so fraud is critical to the argument you wish to present?

MR GLEESON: It is. The claim is under the Trade Practices Act, so it is a statutory compensation claim, but the fraud is critical to the argument.

GAGELER J: How do you link that to the statutory question?

MR GLEESON: Because when one is asking what is the damage caused by the misleading conduct, we have established the prima facie damage, which is the loss of commissions for 10 years. And when it is then said, no, that loss could have come about by another means, and therefore it is not suffered by, we then have to ask whether that other means is, as I say, independent of the conduct which has attracted the statute. So, your Honours, what I wanted to show your Honours if I could, on the facts ‑ ‑ ‑

BELL J: Just before you do, Mr Gleeson, when you mention the loss of commission for 10 years, as I understood it, the area now of contention is the Full Court’s selection of the date mid‑2008, as opposed to the date mid‑2010.

MR GLEESON: Yes, exactly. I only mention that because we accept the 2010, consistent with our principle, the Full Court was able to identify a matter independent of the misleading conduct; that was a separate policy decision to get rid of all agents.

BELL J: Yes.

MR GLEESON: So, your Honours, if I could show you perhaps three facts that are critical. If you could start at page 42 of the book, at paragraph 114. This is where Mr Chapman came up with the fraudulent scheme and you will see in paragraph 2 of his memorandum to Mr Ellery that he represented to Mr Ellery that Dr Berry had “health issues”, which meant he could not perform, and the critical thing is the next bit:

We should therefore have a succession plan –

and the succession plan is to appoint two agents, SPT and Marketing. So that is the first fact we would go to. Secondly, if your Honours could to page 49 in paragraph 137, this shows that as of November 2017, Dr Berry was fulfilling the agency quite adequately. And in particular you will see in the question and answer about line 40, that his separate dispute with the government in the arbitration was accepted by Mr Chapman as not impeding his agency.

BELL J: Yes.

MR GLEESON: Now, I mention that because that, as the case went through to the Full Court, in the end was the only matter that could possibly have been an independent reason to get rid of him and the findings of the trial judge, undisturbed, were that was not in fact a reason. If your Honours could then go to page 57 at paragraph 164, Mr Chapman repeats the ill health line and lie to Mr Ellery, and you see in 165 that Mr Brown agrees with Mr Chapman.

Now, the real reason that Chapman wanted us gone can be seen, if your Honours go over to the Full Court’s findings at page 185. These are very important paragraphs, 124 to 126. What we get from 124 was that the reason Chapman wanted to put in the company SPT, which he controlled, was so he could use it to pay bribes – and that is part of the reason he went to gaol. And then at 126, paragraph (c), this is the Full Court accepting the trial judge. The finding was:

the termination of the Agency Agreement occurred not because Dr Berry was suffering from ill health, but because the removal of Dr Berry and GSC was necessary to make way for SPT –

BELL J: Yes.

MR GLEESON: So Chapman’s plan was, I get rid of Berry to get my company in, and perhaps another company, and I earn private moneys. Now, the critical other finding that survived in the Full Court is back at page 183, which is paragraph 110, and that is the central finding that Mr Chapman was not prepared to take lawful means to get rid of Dr Berry, because it wanted to keep him on board as an agent. So what that shows is, in terms of the key architect, Mr Chapman, he deliberately chose fraud rather than lawful means, and yet the defence now was, but we should be allowed to act as if we had taken lawful means.

Now, where does that leave the rest of the facts, your Honours? Only this – that the one witness they called who tried to argue for independent lawful means was Mr Brown. His evidence you can see at page 94 at the top – that is Brown ‑ and he put forward a series of reasons which would be ‑ if they were true, they might be independent reasons to want to get rid of Mr Berry.

BELL J: His evidence was rejected, was it not?

MR GLEESON: His evidence was completely rejected ‑ that is paragraphs 314 to 319 ‑ and that rejection survived the Full Court.

BELL J: Yes.

MR GLEESON: So where we are actually left in the end is the finding that we are commending is the trial judge at page 99, paragraph 319. The reason they tricked us into signing the letter was they were not prepared to use lawful means to terminate. His Honour then refers to a number of cases, clearly by analogy, and really paragraph 321, Lord Kenyon is really the essence of the approach he is taking, and that leads him to 322.

Now, contra that, in the Full Court, these things occur: your Honours will see, perhaps important to note, at page 202 ‑ and this seems to be the argument that ultimately was accepted at paragraph 193, their submission was, our proposition we would have remained for years:

was not supported by the evidence. It was also incongruous with the notion that Securency had been plotting and laying the groundwork to remove Dr Berry and replace him with other agents –

So they are saying, in trying to ascertain this hypothetical, you can actually take into account the wrongful conduct, namely the plan to remove us by deception, and you will see the same thing at paragraph 204 ‑ this is their case in a bit more detail ‑ they identify three matters as the reasons why they would have exercised lawful means. The first, they:

wished to terminate the Agency Agreement (in particular having regard to its attempts to do so) –

So that is in particular having regard to the wrong. The second is the matter they failed on, that he could not fulfil his obligations because of his arbitration. And the third, that in fact appointed other agents. That is the appointment of the agents in order to secure the fraudulent scheme of Mr Chapman.

Your Honours, there is one final fact I should mention on the agents. If I could ask you to go back to page 61 at paragraph 178. This is the second agent, JHM, and you can see that Mr Ellery only agreed to sign JHM on the basis that Dr Berry had signed the release letter, being the fraudulent letter. So that shows us that ‑ coming back to your Honour Justice Gageler’s question ‑ here we have the fraud, the inducement of us to sign the letter, being at the very heart of the appointment of the other agent. So they had a choice at the time. They could have used lawful means if they wanted to get JHM in. They chose not to, because they did not want to suffer disadvantage, yet now they say they can rely upon that.

GAGELER J: Mr Gleeson, really critical here is the finding at page 99, at 319, that Securency:

was not prepared at the time to use its contractual right to terminate.

MR GLEESON: Yes.

GAGELER J: You say that is the fact.

MR GLEESON: That is the fact.

GAGELER J: Is this not a fact case?

MR GLEESON: And that finding has not been overturned in the Full Court.

BELL J: Indeed, the Full Court ‑ ‑ ‑

MR GLEESON: Embraces it.

BELL J: ‑ ‑ ‑ embraced it, to the extent that it did not accept the argument that Securency advanced, that it would have terminated in accordance with the agreement, had Dr Berry declined to sign the termination letter. So it, as it were, projected out the date on the counterfactual to the date corresponding with termination at the end of the two‑year term.

As I understand it, much of your complaint is the absence of any explanation for the basis for the Full Court’s ultimate determination on the counterfactual, that termination would have been effected at the end of the two‑year period, other than based on the reasoning in 227 that Dr Berry had failed to establish that they would not exercise their rights because of the Full Court’s acceptance that it was clear that Securency sought to make arrangements with other agents.

MR GLEESON: So your Honour is correct, 226 and 227 are the heart of it.

BELL J: Yes.

MR GLEESON: But what is actually happening here, if we are correct in law, the Court should have given itself an instruction ‑ when we are doing this counterfactual, we can only be looking for matters which are independent of the fraud and the breach of the Trade Practices Act. Therefore, if that is our correct starting point, you cannot find in these paragraphs any attempt to do that. You see perhaps at the beginning of 224 in that first sentence, it is clear they wanted to get rid of Dr Berry.

BELL J: Yes.

MR GLEESON: Now, immediately that begs the question, who wanted to get rid of Dr Berry? There are only three possibilities. If it is Mr Chapman, he wanted to get rid of Dr Berry for his fraudulent, private scheme, but was not prepared to use lawful means to do so, so that is him.

If it is Mr Brown, he gave evidence that he had independent reasons, and he was disbelieved. If it is Mr Ellery, he did not give evidence, and all we know about him is that he was told a lie, which was it was for ill health. So that way in which the court has set it up has immediately, we would say, contravened the independence constraint and you see that in 227 in the middle.

GAGELER J: Well, you just say it is contrary to the evidence, Mr Gleeson.

MR GLEESON: Well, we had evidence and we had findings. We have had them overturned firstly because the Full Court has said, all these cases you are talking about, about fraud, are legally irrelevant. We say that was a wrong turning because in those cases, consistent with the law’s approach to both misleading conduct and fraud, the law will take, in short, a robust approach against the wrongdoer, seeking to set up hypotheticals or matters of which factual proof is difficult. Now, that is just well‑established territory.

BELL J: Yes.

MR GLEESON: So that happens at the start. But when one gets to 227, and the court says at line 50:

although the misleading conduct of Securency made that limited involvement possible –

In the factual, we agree with that, that is what happened:

absent the misleading conduct, the factors that motivated the replacement . . . would have been brought to an end.

One begs to us, what possible factor? And it is not Brown, because they tell us at paragraph 230 that the conclusion is not based on Mr Brown. Now, what it is based on, what legal principle has led to the upsetting of the trial judge’s approach is obscure at best from these paragraphs, your Honour. Could I just show you one other area where there is a problem with it, in paragraph 230. This is, we do not rely on Brown, but for completeness, Brown is neutral. Do your Honours see at lines 40 to 45:

As to the factor that a unilateral termination would have converted Dr Berry into a person who would be likely to impede Securency’s interests rather than advance them, in our view, this is a neutral consideration since the wrongful termination would also have had that effect.

That is directly contrary to their previous finding that the wrongful termination course was taken in order not to have that very outcome occur. So is it merely fact? Well, yes, a different approach has been taken to fact, a radically different approach. Is there a principle involved here? The question is, are we correct that the independence constraint is the appropriate principle? If it is, it has not been observed on these reasons, and there was no basis to overturn the primary judge.

BELL J: When you talk of the independence constraint, that seems somewhat different to the matter that you raise in your reply by reference to the Full Court’s decision in Pitcher v Neville’s Bus.

MR GLEESON: Yes.

BELL J: As I see it, in the way the matter was argued before the Full Court, it was common ground that the correct approach to the assessment of damages is that stated at paragraph 166, namely:

to determine how much worse off the respondents are than they would have been had they not relied on the alleged misrepresentation –

That seems to have been common ground. Am I right?

MR GLEESON: Yes. Yes.

BELL J: As I took it from your reply, you suggest that there is a tension between the analysis that we find at paragraph 227 in the Full Court’s reasoning, and the approach adopted by the Full Court at paragraph ‑ I think it is 116 ‑ and following in Pitcher.

MR GLEESON: Yes, your Honour, we do.

BELL J: Now, that is not something that involves this principle of the independence constraint?

MR GLEESON: No. We rely upon both, and if I could just elaborate on the Pitcher point. The Pitcher approach would say you are the wrongdoer. You have placed them in the position in the actual world which we know everything about. You are now coming to Court and saying, hypothetically, we could have brought about this detriment by a different means. You have created this evidentiary difficulty. You have created this area of conjecture and speculation by your wrongful conduct. How will the Court respond to your attempts now to say, but I could have done it lawfully all along?

And Pitcher Partners would say, firstly, there will be an onus on you, and the onus is not reflected in the Full Court. There will be an onus on you on this point. And, secondly, your proof will be considered rigorously, and there will be a robust approach taken to it, and any presumption which is available to be drawn against you can be drawn against you. In effect, that supports Justice Rares who says at paragraph 319, you chose not to take it, why would the court do anything other than act upon what you did at the time?

So the two points, as it were, feed together and it is very similar to what Justice Brennan and the majority said in the Mihalis Angelos, where the Commonwealth came along and said, we wrongfully terminated the air surveillance contract, but we had a lawful means which was to go through the secretary show cause process.

GAGELER J: Amann Aviation, I think you mean.

BELL J: Yes, Amann.

MR GLEESON: Amann Aviation, yes – we had lawful means, we did not take it, but we should be put in the position we are in. Now, each of the majority judges rejected that and allowed for no discount on that ground. And Justice Brennan put it most clearly, that there will be an onus on you and he looked at the facts, and it is actually very similar to our case. He said, at the time you chose not to go through the secretary process because of the adverse consequence you feared – namely delay ‑ and you would lose the rival person. Why would the Court now turn around and give you the benefit of that approach?

So, your Honours, we would submit that those two propositions together, but particularly Pitcher Partners, we would commend that as a judgment of the Chief Justice and the Full Court. And it has come at the legal issues that Justice Rares was seeking to come at in, we submit, a powerful fashion.

BELL J: Thank you, Mr Gleeson. Yes, Mr Rich.

MR RICH: Thank you, your Honour. Your Honours, with respect, a critical issue in the determination of this application is the answer to his Honour Justice Gageler’s question a moment ago ‑ independent of what? The respondent’s liability for damages in this case rests upon one representation made at one meeting in February 2008. The representation, your Honours will see, is at page 157 of the application book in paragraph 26(1) of the Full Court’s reasons. It is the Renewal Representation, that if Dr Berry agreed to terminate:

the existing terms would continue and a new agreement would be made –

That misrepresentation caused Dr Berry to sign the termination letter which your Honours have seen – it is extracted in paragraph 16 on page 154.

Now, in assessing what loss the applicant suffered by the one representation that was pleaded and found to have been made ultimately at the Full Court level, in assessing what loss was suffered by that representation which Dr Berry was entitled to compensation for under section 82, the established principle required the Full Court to determine how much worse off the applicants were than they would have been had they not relied on that representation. That is what their Honours did, in our respectful submission, in paragraphs 166 and following of their reasons, commencing at page 195.

GAGELER J: I think the gist of what is put against you, stripping away all the legalese ‑ ‑ ‑

MR RICH: Yes.

GAGELER J: ‑ ‑ ‑ is that the Full Court does not explain who, on behalf of Securency, would have made the decision to terminate the contract lawfully, and why.

MR RICH: Yes, your Honour. But the desire of the respondent to terminate, and who would have made that decision, or whose desire it was in and of itself is not a contravention of section 52. The applicant’s right to compensation is governed by section 82, and relevantly limited to the loss or damage he suffered as a result of conduct in contravention of section 52.

GAGELER J: So we get to the counterfactual.

MR RICH: But the conduct we are compensating him for is the representation, not the desire or the reasons why Mr Chapman might have done what he has done. Your Honours have heard this morning reference to a private, fraudulent scheme on the part of Mr Chapman. This private, fraudulent scheme was nowhere pleaded, is not something that was charged against us as a source of our liability. The source of our liability is the representation. And so the difficulty with our learned friends’ independence point is that they want to bring into the wrong not just the representation, but all of the reasons and motivations and personalities that led somebody to make that representation.

BELL J: Mr Rich, as I understood it, in the concluding part of Mr Gleeson’s submissions, rather more emphasis was placed on the suggested disconformity between the analysis that one finds ultimately at paragraph 227 here ‑ ‑ ‑

MR RICH: Yes.

BELL J: ‑ ‑ ‑ and the statements of principle in Pitcher v Neville’s Bus. When one looks, starting at perhaps application book 208, paragraph 224 and following, one sees that the approach of the Full Court was to accept that the damages flowing by reason of the misrepresentation were to be assessed on, it seems, the agreed basis of the revenue account, as Mr Gleeson puts it ‑ ‑ ‑

MR RICH: Yes.

BELL J: ‑ ‑ ‑ looking at the lost commissions on the counterfactual. And, indeed, the Full Court accepted part of Dr Berry’s analysis, to the extent of rejecting Securency’s argument, that it was open to terminate on 60 days’ notice, and if Dr Berry had not signed the termination agreement that is what the court should assume would have occurred. That was rejected.

MR RICH: Indeed.

BELL J: What we do not find is an explanation for how it was that the Full Court then landed on an acceptance, on the balance of probabilities, that Securency would have terminated conformably with the agreement at the conclusion of its two‑year term.

MR RICH: Yes. A couple of points about that, if we may. Firstly, the answer to the “would” question, that is, would Securency have terminated, and when, are factual – they are factual questions.

BELL J: Yes.

MR RICH: Secondly, so far as reliance is placed on Pitcher Partners, the particular part of the reasons which is relied upon appears in paragraph 227 on page 209 and I think it is the last sentence on that page:

Ultimately, without evidence of positive and substantive involvement of Dr Berry –

And it is said that, in effect, an onus was reversed and wrongly so.

BELL J: Yes.

MR RICH: Could we just say to your Honours that that issue – that is, what their Honours are there talking about is what Dr Berry in fact did or did not do post‑June 2008. Their Honours are not dealing with a hypothetical scenario. They are saying, what did Dr Berry do? And in this case, in a very important distinction with Pitcher Partners, Dr Berry gave evidence. He went into the witness box. There was no difficulty of proof. Your Honours will recall Pitcher Partners is a case where it was a hypothetical about what a third party, i.e. the State, would have done.

This was an historical fact about what Dr Berry did do, or did not do, post‑June‑2008. He got into the witness box and he could, if he was able to, have said, this is what I did. I played a substantive role in their business, and let me tell you how. He did not say that. And so it is not a Pitcher Partners scenario at all, in our submission. It is quite a different case.

Could we then come back to, your Honours, the statutory analysis. The crux of our learned friends’ independence point is that in answering the hypothetical, or the counterfactual question, would the now respondent have terminated? What our learned friends say is the Full Court should have actually ignored things that the respondent would have done had it not made the representation.

GAGELER J: What were they, and what was the evidentiary basis? Really I am just treating this for a moment as a fact case.

MR RICH: Yes, your Honour. Well, what were they was that your Honours know that – leave aside SPT for a moment, because SPT, as has been found, was a vehicle for Mr Chapman. But JHM was in fact appointed, and in fact acted as agent. And your Honours have been taken to the evidence that actually they – there was an agreement signed and countersigned for them to take a role as agent.

Your Honours were told, well, that was not to be, in effect, exchanged until after the meeting with Dr Berry. But your Honours would understand that people do not want to be responsible for paying two agents at the same time. So the question is, we have to sort out what we are doing with Dr Berry first, and then we deal with JHM.

But in answer to your Honour’s question, they wanted to engage JHM, and they did in fact engage JHM as the agent for a period after Dr Berry ceased to be their agent – and that is exactly what they – they would have done what, in fact, happened and there is nothing surprising in that conclusion.

GAGELER J: “They” being who?

MR RICH: “They” being my client.

GAGELER J: I understand your client ‑ ‑ ‑

MR RICH: Securency.

GAGELER J: ‑ ‑ ‑ but, I mean, what individuals?

MR RICH: Well, Mr Chapman and Mr – I am sorry, his name – Mr Brown, were the two principal people involved. They had to get the approval, as I recall it, of Mr Ellery but the two drivers were Mr Chapman and Mr Brown.

GAGELER J: Is it accepted, on your part, that Mr Brown would not have terminated, other than through the unlawful means adopted?

MR RICH: No.

GAGELER J: I meant Mr Chapman, I am not sure if I said Mr Brown – Mr Chapman.

MR RICH: Did your Honour mean Mr Chapman?

GAGELER J: I meant Mr Chapman.

MR RICH: No. The position, we say, Mr Chapman wanted to terminate the agency arrangement with Dr Berry. He chose to adopt an unlawful way of trying to achieve that and the Full Court said, as your Honour Justice Bell pointed out, well, having done that, we do not accept the idea that he would, on the same day, or within a couple of weeks, have done it lawfully. He obviously deliberately chose not to do it that way.

BELL J: He chose to do it not that way because it was not in his or Securency’s interests to have Dr Berry no longer seen as supportive of the venture in Nigeria.

MR RICH: Yes. And there was a meeting, which your Honours will have read about, in March of 2008, which the Full Court deals with in paragraph 230 that was attended by Dr Berry with the governor. But as the Full Court says at about point 40 on that page, page 210 in paragraph 230, that that meeting occurred still a few months before 30 June 2008. So that, in effect, had happened.

And then what the Full Court did, when they got to – if your Honours go back to paragraph 223 on page 208, is they said, well, let us look at the agency agreement and what we have is an arrangement which has an expiry date of 30 June 2008. That is a natural point in time where parties to the contract would actively consider, are we rolling over for another year, or are we exercising our option? And both parties had an option to terminate. And they said on the evidence, we are satisfied Securency wanted to replace Dr Berry. And at that point in time, before the agreement rolled over, we find they would have done so.

BELL J: The finding that Securency wanted to replace Dr Berry depended, did it not, on the engagement by Mr Chapman of JHT.

MR RICH: JHM, yes.

BELL J: JHM and the ST ‑ ‑ ‑

MR RICH: SPT, yes.

BELL J: Yes, and on matters such as the representation that Dr Berry was ill and therefore unable to carry out his duties?

MR RICH: That is the explanation, or one of the explanations that Mr Chapman gave to his superiors as to why this should happen. But, your Honours, again, the wrongful conduct under section 52 does not include Mr Chapman’s reasons, or what he said to his superiors, or anything. The difficulty with the proposition ‑ ‑ ‑

BELL J: I think, Mr Rich, the issue is ‑ ‑ ‑

MR RICH: Yes.

BELL J: ‑ ‑ ‑ what was the evidence of persons in Securency other than Mr Chapman that supported the conclusion that, on the balance, Securency would have chosen not to renew at the time appointed for consideration of the rollover?

MR RICH: I do not think there were any other witnesses who were called who said that that is what they would have done. Mr Brown was called, but as your Honours have seen, he was not believed. But the point that their Honours focused on is if you look at what actually occurred, that is that JHM was in fact appointed, they in fact acted as agent for a time after Mr Berry had left and did the job in Nigeria.

It was clear that Mr Chapman wanted to replace Dr Berry and we find that if he had not done it unlawfully in February, it would have happened in June. Dr Berry is not entitled to compensation under section 82 of the Act for Mr Chapman’s thoughts, or reasons for acting. He is only entitled for the consequences of the misrepresentation.

And the end result of our learned friends’ independence argument is, let us ignore the factual finding by the Full Court that this would have happened anyway, lawfully, and let us compensate Dr Berry for commissions that he would not actually have received if the misrepresentation had not been made.

GAGELER J: Well, that is the question. I mean, that is the consequence of answering the ultimate question one way or the other.

MR RICH: In our submission, it is actually the nub of our learned friends’ argument. In other words, they would say to your Honours, the wrong is not just the representation, but we have to impugn the reasons why that representation was made, and if we get rid of the reasons why that particular representation was made then we can say it would not have happened.

But if your Honours accept the proposition that he is only entitled to compensation for what happened as a result of the representation, the overt conduct, then that falls away. And what they end up doing is saying, well, even though they could and would have done this lawfully anyway, and
terminated the agreement in June 2008, I should be compensated until 2010 because actually they tried to get rid of me unlawfully. If your Honours please, I think that is all we wish to say.

BELL J: Yes, thank you, Mr Rich. Mr Gleeson.

MR GLEESON: Well, your Honours, it really comes down to this on the Pitcher Partners point. We submit it was an essential part of the appellate rehearing function to answer the question who, on behalf of Securency, would have chosen to do it lawfully but a few months after they chose to do it unlawfully. And what reasons were there why they would have chosen to do so, and have they discharged the necessary onus?

And what you have heard this morning is there really has not been an answer to those questions. I think the highest it has got is, Mr Chapman wanted to do it. Well, he is the man that, when he had the choice between lawful means and unlawful means, chose unlawful means so it is ‑ ‑ ‑

BELL J: The point that Mr Rich raises is, unlike Pitcher, there was not a difficulty here. Dr Berry, as I understand it, did not give evidence of things that he continued to ‑ ‑ ‑

MR GLEESON: That is not quite right. What happened was Dr Berry gave every piece of evidence he could of what was happening, including there were a whole series of text exchange and message where he is saying, have you met our friend, the governor, in London? What can I do? But where Mr Rich is wrong there, with respect, it is still ultimately a question in the hypothetical world which he has to establish: what would they have done in June differently to what they actually did in ‑ ‑ ‑

BELL J: Yes, yes.

MR GLEESON: Now, the foundation for that would be, in part, what are the objective facts of what Dr Berry was doing for them as of June? That would be a relevant fact. The bit they are missing is the person to come along and say, based upon what he was doing in June, we were now prepared to run the risk we were not prepared to run in February, which was the risk of alienating Nigeria.

Now, the only persons you have heard are Chapman – and you have been pointed to no evidence, even from the fraudster, to say, I would have done it lawfully a few months later. And the only other evidence you were referred to this morning was the fact they appointed JHM. And I have shown you, in February Ellery only did that on the basis that the fraud terminated Dr Berry. So, your Honours, on that point, we would submit that it is an appropriate case for leave.

BELL J: Yes.

GAGELER J: Mr Gleeson, the way you encapsulated your argument in reply, is that captured in your proposed notice of appeal? Perhaps I am suggesting it could be better captured in your notice of appeal.

MR GLEESON: If the Court were otherwise minded to grant leave, could we revisit question 2 to make more precise what I have sought to put this morning?

BELL J: As I understood it, Mr Gleeson, you had really focussed your argument on what has been described as the Pitcher point and the suggested tension between the two ‑ ‑ ‑

MR GLEESON: Yes.

BELL J: ‑ ‑ ‑ as distinct from the matters the subject of the special leave questions in 6 and 7.

MR GLEESON: Your Honour, I think that is correct, particularly because there has been an acceptance this morning that Mr Brown is not being resuscitated as a person who had independent means so it is really back to where I put it.

BELL J: Yes.

MR GLEESON: So we would seek that ability, if your Honours are minded.

BELL J: Yes. There will be a grant of special leave in this matter. Mr Gleeson, the grant is subject to the understanding that the grounds will be reframed in accordance with the way the matter has been argued today.

MR GLEESON: Thank you, your Honour.

BELL J: I invite the parties to obtain from the Registry the directions which have been slightly modified to take account of the Christmas break.

MR GLEESON: May it please the Court.

BELL J: What is the estimate?

MR GLEESON: One day, your Honour.

BELL J: Yes. Yes, thank you. The Court will now adjourn, in order that the videolink can be set up to Brisbane.

AT 10.13 AM THE MATTER WAS CONCLUDED