- Unreported Judgment
SUPREME COURT OF QUEENSLAND
GDL Investments (Qld) Pty Ltd v Spotwire Pty Ltd  QSC 273
GDL INVESTMENTS (QLD) PTY LTD
SC No 3231 of 2003
29 August 2003
14 and 19 August 2003
1.The application is dismissed.
2.The applicant to pay the respondent’s costs of this application, including any reserved costs, to be assessed.
CONTEMPT, ATTACHMENT AND SEQUESTRATION – CIVIL CONTEMPT - where application for orders the applicant and its sole director be punished for contempt for failure to comply with an order made by consent on 26 May 2003 – where consent order provides applicant will provide respondent with details of overseas bank accounts and information related to a person known as “Nathan” - where sole director of applicant has sworn in two affidavits he has none of the specified details for Nathan or any overseas bank accounts– where inconsistencies between evidence of sole director and other evidence including emails sent by sole director – whether respondent has proved each element of alleged contempt beyond reasonable doubt
Clifford v Middleton  VR 737, cited
Commissioner of Water Resources v Federated Engine Drivers Association  2 Qd R 385, cited
Consolidated Press Ltd v McRae (1954-55) 93 CLR 325, cited
Hafele Pty Ltd v Maggbury Pty Ltd  QCA 397, cited
Witham v Holloway (1995) 183 CLR 525, cited
G A Thompson SC, with C Wilson, for the applicant
C E K Hampson QC for the respondent
Sciacca Lawyers for the applicant
Nyst Lawyers for the respondent
- McMURDO J: This is an application by Spotwire Pty Ltd (“Spotwire”) for orders that GDL Investments (Qld) Pty Ltd (“GDL”) and its sole director, Mr G S Lasrado, be punished for contempt for failing to comply with an order made by Byrne J on 26 May 2003.
- That order was made by consent in proceedings brought by GDL to set aside a statutory demand served upon it by Spotwire. GDL was ordered to provide to Spotwire certain documents and information, which Spotwire, by this application, alleges that GDL failed to provide.
- The application to set aside the statutory demand has been overtaken by this contempt application, and it stands adjourned to a date to be fixed. On this application, however, it is necessary to examine the dealings between the parties which led to Spotwire’s statutory demand. To some extent those dealings are revealed by the affidavits of Mr Lasrado and Spotwire’s Mr Atherton, neither of whom was cross examined. Mr Atherton was not required for cross examination. Mr Lasrado’s affidavits, although filed by the respondents, were tendered in Spotwire’s case as exhibits to an affidavit by Spotwire’s solicitor. The result was that the applicant had to challenge Mr Lasrado’s affidavits, in critical respects, by their alleged inconsistency with other evidence, and in particular evidence of e-mail transmissions by Mr Lasrado to Mr Atherton.
- Mr Atherton describes Mr Lasrado as an acquaintance of approximately eight years and as having “a number of business interests in the internet industry, within which I am associated”. He describes Spotwire’s business as the selling of “memberships to adult only websites on the internet”. Mr Lasrado, through one or more companies controlled by him, conducts a like business which he describes as “the entertainment industry and the internet industry”. Mr Lasrado agrees that he has known Mr Atherton for some years and that “from time to time I have spoken with John (Mr Atherton) regarding issues and problems that arise”. It is common ground that in late January 2003 they discussed the difficulty of procuring payment by their customers’ credit cards. Mr Atherton described the problem in this way:
“Internet businesses, like Spotwire operate in the following way:
(a)A customer who wishes to purchase a membership to an association’s website must enter their credit card details on the spaces provided on the website.
(b)In a typical credit card transaction, a merchant accepts a credit card from a customer for the provision of goods or services.
(c)The merchant then electronically presents the card transaction data to an “acquirer,” usually a bank but sometimes a third party processing firm, for verification data to the association (e.g. Visa or MasterCard) which in turn contacts the issuer (e.g. MBNA) to check the cardholder’s credit line.
(d)The issuer then indicates to the association that it authorises or denies the transaction.
(e)The association relays the message to the merchant’s acquirer, who then relays the message to the credit card terminal at the merchant’s point of sale.
(f)If the transaction is authorised, the merchant will thereafter submit a request for payment to the acquirer, which relays the request, via the association, to the issuer.
(g)The issuer pays the acquirer.
(h)The acquirer in turn pays the merchant, retaining a small percentage of the purchase price as a fee for its services, which fee it then shares with the issuer.
(i)It is not uncommon for customers to refuse to proceed with the transaction at any stage.
(j)When this occurs, the merchant facility does not process the subscription but sends a cancellation fee onto the association. These cancellation fees are commonly referred to as “charge backs”.
(k)Because of the level of charge backs Spotwire was receiving Spotwire was having difficulties with its merchant facilities.”
- There was no clarification of what Mr Atherton means by customers refusing to proceed with the transaction, but at least on one view, this is a reference to customers who revoke or attempt to revoke their credit card authorities. Whatever was the precise problem, Mr Atherton discussed it with Mr Lasrado. According to his affidavit:
“I informed Lasrado of the difficulty Spotwire was having with its merchant facilities. Lasrado had represented to me (on behalf of Spotwire) that Lasrado knew a gentleman by the name of ‘Nathan’, who was based overseas, who had the ability to process credit cards and had done so successfully on behalf of Lasrado in the past.”
Mr Lasrado’s evidence as to the problem and its discussion was as follows:
“Internet businesses have in recent times being (sic) experiencing difficulties in having credit card transactions processed principally because of new regulations imposed by VISA. Accordingly I offered my assistance to him to introduce him to my contacts to see if they would process credit card transactions for his business.
I had been processing my credit card transactions for my business entities using overseas contacts who then remit the money to me, at my direction, once processed. There is one overseas contact in particular by the name of ‘Nathan’ whose services I used for this purpose at that time.
Over the next few days I spoke with John (Mr Atherton) on the telephone on several occasions and an agreement was reached between John and I that I would request my contacts overseas to try and assist and facilitate the processing of his credit card transactions.
At this time Nathan, who resides overseas, rang me by telephone from Europe, and I enquired from him whether he would be interested in processing credit cards for John. He said he would be interested and for John to send him over a data base through me as a point of contact.
I told John of the above conversation and it was agreed between John and I that he would give me a data base of credit card details of subscribers to his internet businesses so that I may onforward it to my contact overseas, Nathan. I told John words to the effect that “once I have the data base I will forward that to Nathan for him to arrange through his bank and Visa International contacts to process and remit funds direct to your nominated account.”
- It is common ground that Mr Atherton provided Mr Lasrado with a data base of relevant details of customers, including their credit card details. According to Mr Atherton, this involved some 92,982 customers “to be billed at a specified price of USD 21.00”. So Mr Lasrado persuaded Mr Atherton that he had persons he could use as intermediaries in the processing of credit card transactions through whom, by some means or another, Spotwire could recover more than could be recovered through the usual channels. The evidence does not explain how Mr Lasrado’s “overseas contacts” could be more successful. Mr Lasrado’s e-mails in early February 2003 suggest that methods used by Mr Lasrado’s contact, whom he calls ‘Nathan’, were not entirely honest. If so, it then provides a basis for explaining why Nathan would wish to make so little known about himself to Mr Lasrado, and why Mr Lasrado then had so little to offer by way of information in compliance with the order of 26 May.
- Mr Lasrado told Mr Atherton that Nathan required an “up front” payment of US $250,000, which Spotwire paid, as directed by Mr Lasrado, to GDL’s account in Brisbane. That was paid in Australian dollars, calculated by an exchange rate specified in one of Mr Lasrado’s e-mails. Spotwire gave Mr Lasrado the details of a bank account into which Nathan was to deposit his collections. But having made that payment to GDL and having provided its data base to Mr Lasrado, Spotwire has received nothing in return. Not a dollar has been paid for any of its 92,982 customers, and nor has the US $250,000 been repaid. Mr Lasrado told Mr Atherton that Nathan was “processing the credit card transactions for (Spotwire)”, as Mr Lasrado had verified by use of “a software program to which Nathan gave me access to give to John”, from which he “saw a web page which detailed the amounts that Nathan had caused to be processed as authorised credit card transactions from John’s credit card data base as totalling an amount of US $1,361,519.95”. This seems to be the source of one of the amounts claimed in the statutory demand, i.e. it explains Spotwire’s claim that US $1,361,519.95 should be paid to it. The other claim by the statutory demand was the repayment of Spotwire’s US $250,000. Mr Lasrado has sworn that, in effect, GDL has passed on the US $250,000 and that it has not received anything from the suggested “processing” of Spotwire’s business. He says that the US $250,000 was passed on to Nathan, not by an actual payment but by another Lasrado company, E Billing Pty Ltd, giving credit to Nathan for that sum against amounts said to have been due from Nathan for credit card collections on its behalf.
- The first of Mr Lasrado’s affidavits was filed with GDL’s application to set aside the statutory demand which was made returnable on 26 May. On that day, Spotwire proposed orders for the adjournment of the hearing and for the provision of documents and information which Spotwire thought would advance its case. The relevant orders which were then made by consent were in these terms:
“2.By Consent, the Applicant provide to the Respondent:
(a)copies of all bank account statements for GDL Investments (Qld) Pty Ltd and Gregory Shiraz Lasrado, including Australian and overseas bank accounts, for the period 14 January 2003 to 26 May 2003;
(b)contact details, full name, country of residence and address of the “Nathan” referred to in Mr Lasrado’s affidavit sworn 9 April 2003 which the Applicant has in its knowledge or possession;
(c)details of any bank account into which the Applicant has transferred/deposited funds in favour of “Nathan” which the Applicant has in its knowledge or possession; and
(d)copies of any correspondence passing between the Applicant and Nathan in relation to the US$250,000.00 paid by the Respondent to the Applicant which the Applicant has in its possession;
on or before 4 June 2003.”
Spotwire’s case is that GDL has not complied with the order in respect of each of (a) to (d).
- As to (a) I am satisfied that copies of all bank account statements for GDL and Mr Lasrado for the relevant period, so far as Australian bank accounts are concerned, have now been provided, although they were not all provided by the required date of 4 June. An affidavit from GDL’s solicitor, Mr Sciacca, explains the delay as due to inadvertence. I accept that explanation. Now that Spotwire has those bank statements, it does not suggest that GDL and Lasrado had some reason for withholding those statements which were not produced by the required date. Although GDL thereby breached the order, the extent and circumstances of the breach are not so serious as to warrant punishment for contempt, if there has been no other breach of the order. There is a further issue as to whether GDL or Mr Lasrado had an overseas account, which is discussed below.
- As to paragraph (b), the only information which has been provided since the order is that Nathan resides in the Netherlands. Mr Lasrado says that he has no “contact details”, other than an e-mail address from which he has received, for example, what he says is an e-mail from “Nathaniel” dated 3 February 2003. He swears that he does not know Nathan’s surname, that his many telephone discussions always resulted from a call by Nathan and that he has no telephone number for him, and that he has no other information to facilitate communication with him.
- As to (c), he swears that “the Applicant (GDL) has not transferred/deposited funds in favour of Nathan”, and that “I have never had any bank account details for Nathan”, and as to (d), that there is no correspondence which has passed between GDL and Nathan.
- Spotwire’s case is that Mr Lasrado’s evidence is to be rejected, having regard to inconsistencies between it and other evidence, in particular e-mails from Mr Lasrado to Mr Atherton in early February, as well as the improbability that Mr Lasrado would know so little of a person to whom large amounts of money were being entrusted.
- According to his e-mail of 3 February 2003, Mr Lasrado had recently engaged Nathan to collect credit card payments by his own customers. He claimed that he had been required to pay his own deposit before Nathan went to work for him, but to his relief, he had started to receive the benefits of Nathan’s services by the transfer of substantial sums into what Mr Lasrado there described as “my UK account”. Mr Lasrado said:
“… I gave them some money for the chargeback’s first and they said they would do this payment on the Tuesday or earlier, for what has cleared.
Just logged on to my UK account and they have deposited some funds already in there. So it is all systems go. Bloody hell I am happy now. Was a bit on tender edge for a while as I had advanced funds to cover my chargeback’s as they would not do it till I had done that.
Anyway now I trust him as the amount he has sent me is quite substantial. Not the whole 500 odd k but what has cleared, as it is paid daily or I think 24hrs after it is processed and cleared in his bank he pays me. Although as I understood it I was not going to get paid till this week sometime, but just before he told me to check my account as I had given him the advance on the chargeback’s. I still have some more to go through and I don’t think he is even half way through yours. He is also billing them a small charge to reduce chargeback’s etc. That’s why I had to give him the 100k up front so as to make sure he is covered on my behalf, as he does not keep a hold back to cover himself. If my chargeback’s suddenly go through the roof he will want more. That is what I was worried about. My money with him. But now I feel 100% better, after talking to him for the past 30 mins and also by checking my account. …”
- Later that morning Mr Lasrado sent a further e-mail to Mr Atherton as follows:
This is confidential as it has my figures in there as well. Finally i have got off the phone. He has Given me the figures and i put them into a word doc for you of what has gone through and what has been declined.
They have nearly finished my stuff, about another 10000 cards to go. With your stuff they are not even half way through I think.
Now the problem is Jon, he has asked me for payment to cover his chargebacks before he pays out any money. With me he wanted 150k US I talked him down to about 100k and gave that to him. And the other 50k I will give him when I get my next payment. This is just the way he does it to cover his arse.
For you he wants 300k US. I have talked him to 250k. As yours is such a large amount. He is honest and will pay you the money he has proven that by paying me the money. I may be able to get him to 200k but I don’t like my chances as I have been on the phone for bloody ages.
But this is what I will do as i have confidence in him. I don’t have the 250k here right now. As he deposited nearly 400k so far for me in my UK account, and there is more to come. I will get a bank wire down for those funds but that will take about 3-5 days before I bring it through HK and then to here. It is allot of money i know, but this is the only way he is going to do it. I will assure that you will get your funds. Hows that. As this guy has stuck by his word so far and I don’t see any reason why he wont from now on. He has processed over a million bucks of yours so far. He is earning a heap. As he is doing this for a few people I believe.
After 2–3 months he basically burns the merchant from what he says and we get as much as we can in that time. After the merchant is fucked over he will then give our deposits back.
I think he wants the money as he is paying someone off and he wants us to cover his out of pocket expenses + some insurance that we are not fucking him. I know that i am not so i don’t mind. With your stuff it is going through allot better than I thought. Plus with the extra clean cards this is gong to make a big diff.
…… has done it in a way where he has hit them for a small charge first and then a larger one of diff amounts. The word doc that i typed out will show that, as that is how he explained to me and I took notes on every figure that he gave me.
There is also a screen shot of our accounts. They are both together. Your account is Jath, and mine is Glas.
The good thing is that this cannot be linked to us what so ever.
talk to you in a sec
- According to Mr Lasrado’s April affidavit, he received an e-mail from Nathan which was dated “Sunday, February 03 2003” in relation to the proposed payment of US $250,000 for the processing of Spotwire’s business. In a later affidavit, Mr Lasrado says that after he printed that e-mail and provided it to his solicitors, he deleted the e-mail from his computer as part of a “routine cleanup” and notwithstanding the assistance of “computer technicians”, he has been unable to locate anything relevant from his computer in order to comply with the order. The purported e-mail from Nathan was in these terms:
When the 250 000 is delivered to you tell me so i start the process. We will auth the cards database till this time. I send you stats fig of how much we auth now of tje database separate. We will deduct from your payment of your database this amount of 250 000. your friends send you for his account costs for us. If enough in your processed account to do this for his costs and your costs as well which was 120 000. This saves any bank transfer. I avoid link to me that is why I call you only.
We get many bad cards in the database your friend give to you. It casing many troubles for my banker account and bank. IF goes to bad we can not do. All will be reversed if go over high %. So send me some clean database cards and new ones. This balance out the bad ones. I take long time to get this ready for you please do not break this account with sending old database. Otherwise no one make money as bank not pay on my whole account and then i start again. But give me also bad name here at home. Visa in europe is very strict so make sure everything ok.
I call you tonight to see if funds come, if this ok we process. Meantime i send you few stats copy of card that is already auth but not billed yet. I bill when you say money arrived.
We make good money from you and your friends if all work. Then i do more for you after but make sure you get good current data from your current adult business. I offer many people to do this for. I have many account but sometime it not work, but we try again with more bank. I do not do business in australia normally as it is so far away and my english not so good, always here in europe for phone sex i process. But you say you have friend with plenty business so i want to help this way we all make money. If not work it still cost as i pay bankers but we try again soon. This many cards there is risk as i tell you. This why i ask for more money so i pay my workers. Goes on size of account. I charge you discount as you ask me. I separate all cost and payout for you and your friend and other friend. Easy account then. Go now, i call you later.
- Early on Wednesday, 5 February 2003, Mr Lasrado sent another e-mail to Mr Atherton which included the following:
“Have not hear from you since i sent you what nathan sent me. First time he has ever mailed me. Seems as though he is not happy that we questioned him etc.
What do you want to do from here. As i paid him my 50k today as you said you did not need the funds as you were not going to send it or the extra transactions for him to lower the overall chargebacks that will come through.
- Mr Lasrado’s April affidavit exhibited further e-mails of 5 February, between Mr Lasrado, Sonia Lasrado and Mr Atherton relating to Spotwire’s payment to GDL. Mr Lasrado’s e-mail discussed an appropriate rate of exchange where Spotwire was paying GDL in Australian dollars:
“Thanks heaps Jon, shitty about taking losses but you can write them off anyway, can’t you. the rate I got from the banks treasury dept if I was to change 250k US today at this time would be .5808 I also rang NAB as well and they gave me .5773 and then if you look at the standard rate on the boards it is .5932 big diff. But if I was to do it today with the CBA it would be .5773, and that works out best of me. So can we use that rate. I think that comes to $433050, what do you get. 1mk. The problem is we transferred US dollars from overseas accounts. I also though I would see what would it be if I used my AU account overseas to do it and Singapore quoted me .5602, the international traders really fuck with you don’t they. I am glad I had the US dollars and did not have to use AU dollars. They must really make big money on the currencies. How do you get what would be the exact rate the dollar is worth. because if you ring 10 different places you will get 10 different answers. Who is right:-)
anyway tell me what you think.”
- According to these e-mails, his dealings with Nathan had involved both payments to Nathan, and payments from him. He represented that he had paid $100,000 to Nathan for his services for his own business “upfront” i.e. before seeing anything from Nathan. He represented that funds representing proceeds of credit card transactions from his own business had been “deposited” to “my UK account”. It was submitted for the respondents that this could have been a reference not to a bank account but to the balance owing between Mr Lasrado (or his relevant entity) and Nathan. I am unable to accept that submission. Whilst parts of Mr Lasrado’s e-mails require some decoding, this statement is clear enough. Unambiguously, it asserts that funds have been deposited to an account in the UK. From the e-mails it would be expected that Mr Lasrado was able to provide more information than he now claims. It is difficult to see that a payment of his own $100,000 could have been effected without knowledge of some ‘contact details’.
- However, the e-mails must be considered with Mr Lasrado’s affidavits. According to the April affidavit, Spotwire’s US $250,000 was not passed on by GDL to Nathan by giving credit for this amount against what was to be deposited by Nathan in favour of Mr Lasrado’s business. In the April affidavit he put the matter in this way:
“17. I arranged for Nathan to take US$250,000.00 from my money, which he already held overseas, and was to be remitted to me for my previously concluded and processed credit card transactions.”
In an affidavit sworn on 3 July, Mr Lasrado says that his own business with Nathan was through his company E Billing Pty Ltd, and that it was from “monies which were to become due to (that company) that the US$250,000 was to be taken by Nathan so as to give effect to the payment on John’s behalf.”. Mr Lasrado points out that this is supported by what he represents to be the e-mail from Nathan of 3 February.
- The Lasrado affidavits do not deal with the subject of payments to Nathan for Mr Lasrado’s own business. But as to what amounts (if any) Mr Lasrado’s business received, that same affidavit sworn 3 July, upon one view, suggests that like Spotwire, Mr Lasrado has received nothing from Nathan. In paragraph 4 Mr Lasrado says:
“At paragraph 27 of my earlier affidavit I stated that I have suffered a loss in the order of US$500,000.00. By that statement I meant that another of my companies had sustained a loss approximating that sum as, after the events the subject of the present dispute (particularly the matters referred to at paragraphs 22 and 23 of my earlier affidavit) Nathan refused to process any further payments on behalf of other companies associated with me or to remit about US$500,000.00 I expected as the proceeds of transactions Nathan had processed for me to that point in time. It was from those monies which were to become due to E Billing Pty Ltd A.C.N. 087 264 980 (one of my companies) that the US$250,000.00 was to be taken by Nathan so as to give effect to the payment on John’s behalf.”
This is difficult to reconcile with Mr Lasrado’s first affidavit which was in these terms:
“9.I had been processing my credit card transactions for my business entities using overseas contacts who then remit the money to me, at my direction, once processed. There is one overseas contact in particular by the name of “Nathan” whose services I used for this purpose at that time.”
As I read this paragraph, it suggests that Nathan was one of these “contacts” who had both processed credit card transactions for his entities and remitted money. In this contempt application, the respondents read an affidavit sworn by their solicitor, Mr Sciacca. He was cross examined, in the course of which he said that Mr Lasrado had instructed him that none of his companies had received any payments from or through Nathan.
- Accordingly, there is a conflict between Mr Lasrado’s affidavits and his e-mails, at least as I read his e-mail of 5 February and its reference to the payment of GDL’s $250,000 as a transfer “from our overseas accounts”. It is not unlikely that Mr Lasrado misrepresented that matter in his e-mail, and that his affidavit evidence is true at least as to that matter. There is also a conflict between the e-mails to the effect that he or his own entities had received some monies from Nathan, and what the respondents submit is the effect of Mr Lasrado’s affidavits, which is that Nathan has paid nothing. Quite possibly, Mr Lasrado misrepresented also that matter in his e-mails. However, the statements to the effect that Mr Lasrado had paid $100,000 “upfront” to Nathan were not contradicted or qualified by his affidavits. The absence of evidence from Mr Lasrado on this matter, having regard to its immediate relevance to the issues concerning his knowledge or otherwise of Nathan and his bank accounts, suggests that Mr Lasrado did pay or cause to be paid such amounts to Nathan, but against that, there is Mr Lasrado’s sworn statement that he has no ‘bank account details’ for him.
- The evidence suggests another possibility, which is that there is no Nathan, and this has all been a means whereby Mr Lasrado could have the use of a large amount of Spotwire’s money. It is not easy to accept that such substantial business could be conducted with someone of whom all which was known was a first name and an e-mail address. The suspicion that Nathan does not exist is heightened by Mr Lasrado’s inability to demonstrate Nathan’s existence other than by his say so and what Mr Lasrado has represented to be a print out of an e-mail, which can not be otherwise verified. If Nathan has been invented by Mr Lasrado, there may be a contempt, but it is not the contempt which is alleged. The contempt application, as originally filed, did not specify the alleged contempt. The amended application, filed 10 July, contained some particulars, which are consistent only with Nathan’s existence. The further particulars delivered on 31 July 2003 were equivocal: for the most part, they accept Nathan’s existence but in one respect it is alleged that he does not exist. The outline of submissions for Spotwire, handed up at the commencement of this hearing, argued (in the alternative) that there was no Nathan, in these terms:
“It is submitted that the applicant and its officer have failed to obey the consent order because, notwithstanding this consent to the order, it is impossible to do so, because documents referred to in Lasrado’s affidavit do not exist. That is, “Nathan” is fictitious and has been invented to disguise Lasrado’s conversion of US$250,000 belonging to the abovementioned respondent Spotwire Pty Ltd. Lasrado should purge the contempt by admitting his perjury or be appropriately punished for the contempt.”
- Rule 926 requires the application to specify the alleged contempt, and a respondent is entitled to have the precise acts or omissions clearly identified. A contempt upon the basis that Nathan did not exist would be alleged in terms quite different from those of the Amended Application. The respondents would be entitled to notice not only the allegation of Nathan’s non existence, but also of the acts constituting the contempt upon that factual premise. There is no such contempt alleged by this application, as Mr Hampson QC accepted in his address. Given GDL’s response to the order, Spotwire could have been expected to relist the application to set aside the statutory demand and to argue that there was no genuine dispute as to its claim for repayment of the $250,000, on the basis that Nathan is fictitious. Instead, Spotwire has made this contempt application. To prove the alleged contempt Spotwire must prove Nathan’s existence, which it has by Mr Lasrado’s admissions. I shall consider this application upon the basis that there is such a person as “‘Nathan’ referred to in Mr Lasrado’s affidavit sworn 9 April 2003”.
- The highly unusual circumstances are potentially explicable by some assessment of what Nathan was thought to be doing. Mr Lasrado’s e-mails provide some clues. In his second e-mail of 3 February 2003 he says “…good thing that this cannot be linked to us what so ever.”. He refers to Nathan as “paying someone off”. The reference to getting “as much as we can” in “2-3 months” suggests that whatever Nathan was doing, it was not a service he could continue to provide. The reference to the “extra clean cards” as enhancing the prospect of recovery across all of the accounts is disconcerting, as is Mr Lasrado’s statement that “(Nathan) has hit them for a small charge first and than a larger one of diff amounts.”. This is to be read with his earlier e-mail in which he referred to “adding in some extra current cards” and said:
“… also he mentioned all the error code 4’s which mean insufficient funds or something, he is going to run in about a weeks time at around 19.95 or something like that, he runs them at weird amounts eg, instead of 49.95 he will do 48.66.”
The statement as to the use of “clean cards” suggests that there are other cards which were something other than “clean”, in the sense that there was something irregular in obtaining payment upon them. The reference to these “weird amounts” suggests that cards were being processed for the purported amounts of transactions which were not amounts truly authorised by the card holder. All of this occurred in circumstances where the need for Nathan’s services arose because customers were “refusing to proceed with the transaction …”, and the traditional channels for clearing credit card transactions were denying payment. The e-mails give the impression that this was an attempt to obtain payment upon credit cards where no due authority had been given by the card holder, or if given, had been withdrawn. The point of this speculation as to Nathan’s activities is that the apparent nature of Nathan’s services provided a good reason for the business to be conducted with the secrecy described in Mr Lasrado’s affidavits.
- I am asked to find, beyond reasonable doubt, that Mr Lasrado has more information to provide in compliance with the order than he has sworn that he has. I am asked to reject his sworn statements where they are inconsistent with his e-mails and in circumstances where I have not had the advantage of seeing that evidence tested by cross examination. The applicant must prove each element of the alleged contempt at the level of proof beyond reasonable doubt: Witham v Holloway (1995) 183 CLR 525 at 534. The case must be proved with the “utmost strictness”: Clifford v Middleton  VR 737; as cited in Commissioner of Water Resources Federated v Engine Drivers Association  2 Qd R 385, at 392, and Hafele Pty Ltd v Maggbury Pty Ltd  QCA 397 at , and “uncertain inferences from inexact proofs will not support such a charge”: Consolidated Press Ltd v McRae (1954-55) 93 CLR 325, 333.
- Other than the e-mails, there is no evidence that Mr Lasrado or any of his companies has paid to Nathan, or received from him, any money. Mr Lasrado’s statements in the e-mails could be false. The case provides considerable room for speculation: for example, as to whether Mr Lasrado was intending to use Spotwire’s deposit as a payment for Nathan’s services to both of the present parties. Another possibility is that a Lasrado company did pay its deposit to Nathan in circumstances where all which was known was the number of the recipient’s bank account. The recipient could have been an intermediary. If, as is not unlikely, it was another Lasrado company and not GDL which made that payment, then there was no breach of paragraph (c) of the order. In that event, Mr Lasrado’s knowledge of that bank account could be attributed to GDL for the purposes of this order, but that information, without more, would not constitute a “contact detail” as I read that expression in paragraph (b) of the order. I interpret that term to mean information which enables some one to communicate with Nathan. Accordingly, it is possible that the e-mails as to Mr Lasrado’s own “upfront” payment were true but that there has been no breach of the order.
- Again, there is a real possibility that Mr Lasrado was misrepresenting matters in the e-mails when he said that he had started to receive payments through Nathan, and he said that he had passed on Spotwire’s deposit from the transfer of “US dollars from overseas accounts”. One possible reason for that deception is that already mentioned, which is that Spotwire’s money was to be used also for a Lasrado entity’s dealings with Nathan.
- Although much of Mr Lasrado’s sworn evidence seems unlikely, I am not persuaded that I must reject it. I am not persuaded that, beyond reasonable doubt, the respondents have information or documents within paragraphs (b), (c) or (d) of this order which they have not disclosed. The result is that no breach of paragraphs (b), (c) or (d) of the order is established.
- Returning to paragraph (a) of the order, the remaining issue is whether it is established that Mr Lasrado or GDL had an overseas bank account within the relevant period. The terms of the order strongly suggest that they had overseas accounts, but Mr Lasrado has sworn to the contrary. The e-mails certainly evidence some overseas account or accounts, but it is only an account of GDL or Mr Lasrado which is relevant. In the light of evidence of a number of Lasrado companies, reference to “my UK account” by Mr Lasrado is not an unambiguous reference to an account in his own name. The applicant has not established that either respondent had an overseas bank account. Accordingly, there is no demonstrated breach of paragraph (a) of the order, save in the inadvertent and now remedied breaches which I have discussed above.
- I therefore conclude that the present application which is that GDL Investments (Qld) Pty Ltd and Mr Lasrado be punished for contempt of court should be dismissed. The applicant should pay the respondents’ costs of this application, including any reserved costs, to be assessed.
- Published Case Name:
GDL Investments (Qld) Pty Ltd v Spotwire Pty Ltd
- Shortened Case Name:
GDL Investments (Qld) Pty Ltd v Spotwire Pty Ltd
 QSC 273
29 Aug 2003
No Litigation History