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CITE

Unreported Judgment

Sentinel Springwood Retail Pty Ltd v Tomlinson[2021] QDC 159Porter QC DCJ
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Sentinel Springwood Retail Pty Ltd v Tomlinson[2021] QDC 159

DISTRICT COURT OF QUEENSLAND

CITATION:	Sentinel Springwood Retail Pty Ltd & Ors v Tomlinson & Ors [2021] QDC 159
PARTIES:	SENTINEL SPRINGWOOD RETAIL PTY LTD ACN 168 114 814 AS TRUSTEE FOR THE SENTINEL SPRINGWOOD RETAIL TRUST (First Plaintiff) AND BCC MACKAY INVESTMENT PTY LTD ACN 143 488 966 AS TRUSTEE FOR THE MACKAY RETAIL TRUST (Second Plaintiff) AND SENTINEL COUNTRYWIDE RETAIL LIMITED ACN 601 712 707 AS TRUSTEE FOR THE SENTINEL COUNTRYWIDE RETAIL TRUST (Fourth Plaintiff) AND SENTINEL REGIONAL OFFICE PTY LTD ACN 614 553 883 AS TRUSTEE FOR THE SENTINEL REGIONAL OFFICE TRUST (Fifth Plaintiff) AND SHIELD PROPERTY SERVICES PTY LTD ACN 149 144 016 (Eighth Plaintiff) v NEIL DANE TOMLINSON (First Defendant) AND ARETE PARK PTY LTD ACN 626 064 453 IN ITS OWN RIGHT AND IN ITS CAPACITY AS TRUSTEE OF THE ARETE PARK TRUST (Second Defendant) AND CLAIRE LOUISE TOMLINSON (Third Defendant) AND VERUS CONSTRUCTION PTY LTD ACN 619 673 737 (Fifth Defendant)
FILE NO:	2456/19
DIVISION:	Civil
PROCEEDING:	Trial
ORIGINATING COURT:	District Court at Brisbane
DELIVERED ON:	5 August 2021
DELIVERED AT:	Brisbane
HEARING DATE:	3, 4, 5 February, 19 March, 16 April 2021
JUDGE:	Porter QC DCJ
ORDER:	Judgment should be entered against the first and fifth defendants in favour of the fourth plaintiff for $41,838; Judgment should be entered against first defendant in favour of the fifth plaintiff for $40,613; The claims of the plaintiffs are otherwise dismissed; The counterclaims of the fifth defendant are dismissed; and The Court will hear the parties on interest and costs and any residual matters not covered by the above orders.
CATCHWORDS:	TORTS – MISCELLANEOUS TORTS – DECEIT – where plaintiffs claim damages in deceit against first defendant based on fabricated quotations which induced plaintiffs to enter into building contracts at inflated prices – where first defendant admits the conduct but asserts scope of works was varied to sustain inflated quotation of successful contractor – where first defendant asserts the conduct was engaged in to avoid breaches by his employer of the prohibitions in Queensland Building and Construction Commission Act 1991 (Qld), s. 42 – where first defendant asserts that no loss was suffered for those contracts where the damages claimed by the plaintiffs had been recovered already from the contractors involved – whether the plaintiffs can established a continuing loss based on the unilateral application of settlement sums obtained from the contractors to costs incurred in the proceedings against those contractors BREACH OF FIDUCIARY DUTY – PROSCRIPTIVE DUTY – where plaintiffs claim damages against first defendant for breaches of fiduciary duty – where first defendant obtained a secret benefit for himself and a third party – whether first defendant’s breaches were fraudulent BREACH OF FIDUCIARY DUTY – ACCESSORIAL LIABILITY – where plaintiffs allege that fifth defendant had actual knowledge of first defendant’s fraudulent breach of his fiduciary obligations to the plaintiff – whether fifth defendant assisted first defendant in breaching those obligations – where claim against fifth defendant for accessory liability was established TORTS – MISCELLANEOUS TORTS – CONSPIRING TO INJURE BY UNLAWFUL MEANS – GENERAL PRINCIPLES – where plaintiff alleged conspiracy to injure by unlawful means – where the means were unlawful because the conduct comprised a fraudulent breach of fiduciary duty in which fifth defendant was a knowing participant – where plaintiff established an agreement to engage in unlawful conduct which was carried into effect – whether a purpose to injure the plaintiff is established where the primary purpose of the conspiracy to obtain a financial benefit but the conspirators knew that that benefit inevitably had to come at the expense of the plaintiff
LEGISLATION:	Corporations Act 2001 (Cth), s. 471B(a) Criminal Code 1899 (Qld), s. 408C Queensland Building and Construction Commission Act 1991 (Qld), s. 42 Uniform Civil Procedure Rules 1999 (Qld), Rule 687
CASES:	Barnes v Addy (1874) LR 9 Ch App 244 Briginshaw v Briginshaw (1938) 60 CLR 336 Colbeam Palmer Ltd v Stock Affiliates Pty Ltd (1968) 122 CLR 25 Coad v Wellness Pursuit Pty Ltd (2009) 71 ACSR Derry v Peek (1889) LR 14 App Cas 337 Fatimi Pty Ltd v Bryant [2004] NSWCA 140 Harstedt Pty Ltd v Tomanek (2018) 55 VR 158 IMF (Australia) Ltd v Meadow Springs Fairway Resort Ltd (2009) 69 ACSR 507 Lee v Abedian [2017] 1 Qd R 549 Magill v Magill (2006) 231 ALR 277 McKellar v Container Terminal Management Services Ltd (1999) 165 ALR 409 Metal Manufacturers Limited v GMJ Electrical Projects Pty Ltd & Ors [2019] QDC 62 Richardson v Aileen Pty Ltd [2007] VSC 104 Shirlaw v Taylor (1991) 102 ALR 551 Warman International Ltd v Dwyer (1995) 182 CLR 544
COUNSEL:	C. Johnstone for the Plaintiff M. Baroni for the Fifth Defendant
SOLICITORS:	Russells for the Plaintiff N. Tomlinson, the First Defendant, appeared in person Valorum Law Group for the Fifth Defendant

Summary6

Factual background9

The plaintiffs9

Mr Tomlinson10

Introduction to the pleaded projects12

The Bodel projects12

Bodel12

Townsville Property: The F45 Fitout Works (January 2018)13

Uncontentious facts13

Disputed facts15

Springwood Property: Lifeline Make Good Works (January 2018)16

Disputed facts17

Mackay Property: ‘The Hub’ Fitout Works (February 2018)18

Uncontentious facts18

Disputed facts18

Creek Street Property Tenancy Works (February 2018)19

Uncontentious facts19

Disputed facts20

Springwood Property Air Conditioning Works (March 2018)21

Uncontentious facts21

Disputed facts21

Observations about the Bodel projects22

The Growth Australia projects22

Uncontentious facts22

Disputed facts28

Mr Tomlinson and Growth Australia31

Verus and the Dubbo Works34

Genesis of the Dubbo Works34

Uncontentious facts34

The drawings34

The Original Quote from Verus35

The first Revised Quote from Verus38

Mr Tomlinson’s dealings with Sentinel39

Events post-contract39

Disputed issues41

Mr Tomlinson43

Introductory comments on the claims against Mr Tomlinson43

Deceit43

Breach of fiduciary duty45

Conspiracy and breach of contract46

Mr Tomlinson as a witness46

The QBCC Licensing issue48

Relevance48

Mr Tomlinson’s version48

Analysis of Mr Tomlinson’s version50

Expression of concerns about licensing to Sentinel officers?50

Mr Tomlinson’s QBCC “risk strategy”51

Mr Tomlinson’s “market price” calculations52

Place of QBCC issue in Mr Tomlinson’s conduct53

Findings on the Bodel projects54

The F45 Fitout Works54

The Lifeline Make Good Works55

The Hub Fitout Works56

Creek Street Property Tenancy Works57

Springwood Property Air Conditioning Works57

Breach of fiduciary duty and the Bodel projects57

Findings on the Growth Australia Projects58

Findings on the dubbo project60

Mr Tomlinson’s evidence60

Mr Johnson’s evidence65

The claims to be resolved71

The plaintiffs’ case on Mr Johnson’s dealings with Mr Tomlinson71

Conclusion77

Deceit and fiduciary duty: Mr Tomlinson79

Verus’ accessory liability for breach of fiduciary duty79

Tort of conspiracy81

Relevant principles81

Analysis84

Remedies87

Growth Australia Projects87

The Bodel Projects90

The Dubbo Works94

The counterclaims95

The alleged compromise95

The claims by Shield96

Winding up97

conclusion98

Summary

[1]
The Sentinel group of companies (the Sentinel Group) carries on the business of building, owning, and operating commercial premises in Queensland, NSW and the Northern Territory. Each of the plaintiffs is part of the Sentinel Group.
[2]
The first, second, fourth and fifth plaintiffs are corporate trustees of several trusts by which each of those plaintiffs owns and operates commercial properties in various locations in Queensland, NSW and the Northern Territory as trustee (the Sentinel plaintiffs). The eighth plaintiff (Shield) provides services to the Sentinel Group for the ongoing maintenance and management of the properties owned by the companies in the Group.
[3]
On about 31 October 2017, Shield employed the first defendant (Mr Tomlinson) as its senior project manager. Mr Tomlinson was the senior employee of Shield, responsible, inter alia, for obtaining quotations for building work commissioned by particular Sentinel Group companies, negotiating agreements for such work and overseeing the completion of works pursuant to such agreements. Where capital expenditure over $5000 was contemplated, the Sentinel Group’s financial management practices required Shield to obtain three quotes for the work and submit those together with a recommendation as to which contractor to retain. Mr Tomlinson’s duties at Shield included managing that process. He did so with no supervision, consistent with his senior position with Shield.
[4]
Mr Tomlinson was dismissed on 15 June 2018, some eight months after he commenced work with Shield. It is uncontentious that prior to his dismissal, Mr Tomlinson had fabricated two, and sometimes three, quotations and submitted those to the relevant Sentinel plaintiff as if they were genuine quotations intending that that plaintiff would adopt the lowest fabricated quotation. He ensured that the quote given by his preferred builder was the lowest and would be accepted. These proceedings involve eight contracts for work done for various of the Sentinel plaintiffs where Mr Tomlinson gave effect to that practice:
1. (a)
  Five contracts were entered into with Bodel Projects Pty Ltd (Bodel);
2. (b)
  Two contracts were entered into with Growth Australia Pty Ltd (Growth Australia); and
3. (c)
  One contract was entered into with Verus Construction Pty Ltd (Verus).
[5]
The relevant Sentinel plaintiff and Shield primarily initially alleged^[1] in each case that the provision of the fabricated quotations gave rise to the tort of deceit and a fraudulent breach of fiduciary duty by Mr Tomlinson. They also initially alleged that in each case:
1. (a)
  Mr Tomlinson and Bodel, Growth Australia and Verus respectively had committed the tort of conspiracy to injure by unlawful means by conspiring to inflate the price of the work under each contract to their mutual benefit; and/or
2. (b)
  Each of Bodel, Growth Australia and Verus was an accessory to a fraudulent breach of fiduciary duty by Mr Tomlinson by, in effect, participating in, and giving effect to, that conspiracy.
[6]
Each Sentinel plaintiff alleged that, but for Mr Tomlinson’s conduct, it would not have entered into any of the building contracts, and claimed as damages the difference between the inflated price submitted by Mr Tomlinson and the price which would have been paid for the work without Mr Tomlinson’s conduct (usually the lowest unaltered and genuine quote given for the work). That measure of loss ultimately was the same for each of the causes of action seeking a compensatory remedy advanced by the plaintiffs against each of the defendants. That is, the same loss was claimed in conspiracy and knowing assistance against the builders, and in conspiracy, breach of fiduciary duty and deceit against Mr Tomlinson.
[7]
Prior to trial, settlements were reached with Bodel and Growth Australia, and the conspiracy claims and the accessory claims against those parties were not pressed at trial. The amounts paid by way of settlement were sufficient to meet the damages claimed for the causes of action advanced in respect of those specific contracts. However, the plaintiffs have apportioned those payments between the amount of the damages claimed in each case and the costs of the proceedings relevant to those claims up to the date of settlement. Accordingly, they allege they still have a loss arising out of entry into those contracts and maintain their claims against Mr Tomlinson for deceit and/or breach of fiduciary duty for the balance.
[8]
No settlement was reached with Verus, and the conspiracy and accessory claims are maintained in relation to the Verus contract. The damages claimed for the Verus contract are the difference between the initial quotation given by Verus and the price ultimately included in the contract, and further relief is sought arising out Verus’ counterclaims based on the Verus contract.
[9]
Mr Tomlinson admits that on at least two occasions, he received a personal benefit from builders who had been successful on contracts arising from the scheme by which he deceived Shield and the Sentinel plaintiffs:
1. (a)
  He admits Growth Australia paid for about $40,000 worth of work comprised in the construction of stables at his home. Sentinel Countrywide also seeks to recover the amount of this payment, which it characterises as a secret profit; and
2. (b)
  He admits receiving a payment of $22,000 via the second defendant (Arete Park), a company controlled by Mr Tomlinson’s wife, Claire Tomlinson (the third defendant), made by Verus. Arete Park has already repaid that sum to the relevant Sentinel plaintiff, and the proceedings against Arete Park and Mrs Tomlinson have also been resolved. Mr Tomlinson maintains that those funds were not procured by him dishonestly, but rather in respect of work required to be done as part of the work under the contract with Verus.
[10]
Further, Mr Tomlinson defends the several claims against him on the following grounds:
1. (a)
  First, he claims that the successful quotation in each case represented the “true” cost of the work under each contract. He alleges that each change made by him to genuine quotations was explicable by a change in scope of work from the initial scope quoted on and/or by the need to ensure that the builder did not under-price the work;
2. (b)
  Second, he explains his conduct in increasing the genuine quotes and fabricating competing quotations as being carried out to prevent Shield from committing an offence under s. 42(1) Queensland Building and Construction Commission Act 1991 (Qld) (QBCC Act). He contends that the work which Shield was retained to do by each Sentinel plaintiff was building work because it comprised, in broad terms, project management services which are building work services under the QBCC Act and required a relevant licence. He rightly states that Shield did not have a building licence for project management services during his employment. He relies on these propositions to contend that his actions were never to defraud or deceive the Sentinel plaintiffs or Shield, but to represent him as doing his best to carry out his role consistent with the law; and
3. (c)
  Third, he contends that the payments received by way of settlement from the builders other than Verus provide full indemnity for the loss asserted by the plaintiffs in respect of those claims.
[11]
As already noted, Verus is the only builder/defendant which has not settled the claim against it. Verus carried out certain work on a ramp servicing a loading bay for a supermarket in a shopping centre owned by the fourth plaintiff (Sentinel Countrywide) in Dubbo (the Dubbo Works). Verus does not dispute the plaintiffs’ contentions that Mr Tomlinson inflated a Verus quotation for that work from $140,000 to some $155,000, nor that he fabricated other quotes for the Dubbo Works and submitted them to Sentinel Countrywide. Verus also admits that its initial quote was for some $76,000 provided on 15 May but increased on 16 May to $140,000, and that it paid some $22,000 to Arete Park. However, it defends the claims against it on the bases that:
1. (a)
  The first increase in the quotation (from some $76,000 to some $140,000) was based on a telephone conversation in which Mr Tomlinson outlined additional work and onerous contract conditions that Mr Johnson of Verus had not considered in the first quote; and
2. (b)
  The payment made to Arete Park was made by Mr Johnson in the bona fide belief that it was payment for work required to be carried out as part of the Dubbo Works on certain expansion joints.
[12]
Based on these matters, Verus contends that it is not responsible for any wrongdoing by Mr Tomlinson, and in fact is entitled to the balance of the contract price for the Dubbo Works and to recover some scaffolding.
[13]
For the reasons set out below, I have concluded that:
1. (a)
  The Sentinel plaintiffs have made out their claims in deceit (subject to proof of damage) and breach of fiduciary duty against Mr Tomlinson in respect of each project;
2. (b)
  The Sentinel plaintiffs have failed to establish that, at the time of trial, they had any damage arising from the Bodel and Growth Australia projects, though Sentinel Regional is entitled to recover the value of the secret profit obtained by Mr Tomlinson from Growth Australia; and
3. (c)
  Sentinel Countrywide has made out its claims in deceit, conspiracy and breach of fiduciary duty against Mr Tomlinson in respect of the Dubbo Works, and its claim against Verus for conspiracy and accessory liability for Mr Tomlinson’s breach of fiduciary duty.
[14]
Accordingly, there shall be judgment:
1. (a)
  In favour of Sentinel Regional against Mr Tomlinson by way of account in the amount of $40,613; and
2. (b)
  In favour of Sentinel Countrywide against Mr Tomlinson and Verus for damages for $41,838.
[15]
The remaining claims and counterclaims are dismissed.

Factual background

The plaintiffs

[16]
Each of the Sentinel plaintiffs is the registered proprietor of commercial property in Queensland and NSW. Each operates as trustee of a distinct trust. Each of the Sentinel plaintiffs belongs to the Sentinel Group. The Sentinel plaintiffs do not have their own staff and are managed by a central administration which supports all companies in the Sentinel Group. The principal witness for the plaintiffs was Ms Jones, chief executive officer of the Sentinel Group, who gave evidence on behalf of all the plaintiffs. Her father, Mr Warren Ebert, is also a senior officer of the Sentinel Group. He gave brief evidence on the issue of QBCC licensing.^[2]
[17]
Shield is also a part of the Sentinel Group. It is a service entity for other companies in the group, including the Sentinel plaintiffs. It provides accounting, and property and project management services to other companies in the group. Amongst the services provided by Shield were building services. Shield effectively acted as agent for the other plaintiffs in obtaining quotations for building work required by the other plaintiffs and managing the subsequent works on their behalf. The kinds of building work required were consistent with the role of the other plaintiffs as owners and operators of commercial premises: maintenance and repair works, fitout and make good works, and the like.
[18]
Shield provided those services pursuant to consultancy agreements with the other Sentinel companies. Ordinarily, consultancy agreements are in writing,^[3] but on occasion, they are not. There is no written consultancy agreement with the fourth plaintiff (Sentinel Countrywide) in respect of the contract the subject of these proceedings.^[4] However, Ms Jones gave evidence that the relationship between Shield and Sentinel Countrywide was conducted on the basis of the terms of the consultancy agreements with other Sentinel companies and there was no challenge to this at trial. The only term of the consultancy agreements which was relevant in this proceeding was that, by those agreements, Shield agreed to indemnify each other Sentinel plaintiff for liabilities of that plaintiff arising out of any negligence, fraud or dishonesty in relation to the services provided by Shield. That liability is relied upon as providing the basis for Shield’s claims in respect of each of the pleaded contracts.

Mr Tomlinson

[19]
Mr Tomlinson has had a career in the construction industry. He completed a trade qualification, then completed tertiary study in construction management. From at least 2002, he worked in construction and project management. His CV, prepared in about October 2017, states that he held at that time an Open Builders Supervisor Licence issued by the QBCC. Although he appears to have been born and lived in the UK, he worked in Queensland from at least 2013, working in all aspects of construction management.^[5] In the course of his career in Queensland, he had worked with Mr Russell, Mr Gilmour, Mr Taylor and Mr Williams of Growth Australia, and Mr Johnson of Verus. He was also a work colleague of Mr McIntyre of Bodel.
[20]
Mr Tomlinson commenced working for Shield in late October 2017. He was appointed on a full-time basis as senior project manager. He was the senior officer of that company, responsible for its construction management activities. He was responsible for overseeing construction projects undertaken by the Sentinel companies and project management for such projects. Part of that role also required him to obtain quotations from builders for work to be carried out, to assess those quotations and to make recommendations to the Sentinel company intending to carry out the work as to which quotation to accept.
[21]
Importantly for this case, when seeking approval for capital expenditure to carry out building work by one of the Sentinel companies, Mr Tomlinson was required, as part of his duties as senior project manager, to submit a “Capex Request Form” to the relevant Sentinel company. If anticipating expenditure over $5000, Mr Tomlinson was required by the Sentinel Group policy to obtain and include, with the Capex Request Form, at least three quotes for the work. He was also required to make a recommendation as to which builder should be selected.
[22]
Mr Tomlinson occupied a position of considerable autonomy and influence. He was the senior construction manager within the Sentinel Group, and there does not appear to have been any day to day supervision of his work or his recommendations. His position allowed him to influence the affairs of Shield and the Sentinel companies in relation to large capital expenditure decisions and to act with considerable discretion in doing so. His position with Shield gave rise to a relationship of special trust and confidence with both his employer and the Sentinel plaintiffs he was advising through Shield.
[23]
It is not every employee whose position attracts fiduciary obligations.However, the circumstances articulated in paragraphs [20] to [22] compel the conclusion that Mr Tomlinson was in a fiduciary relationship with his employer and each of the Sentinel plaintiffs for whom he was acting from time to time in seeking quotations and recommending preferred builders.^[6] Mr Tomlinson did not contend otherwise.
[24]
Mr Tomlinson owed the well-known proscriptive duties^[7] which bind fiduciaries, being that he owed a duty:
1. (a)
  Not to obtain for himself or any third party a benefit from his employment without the fully informed consent of the relevant plaintiffs; and
2. (b)
  Not to put himself in a position of conflict between his own interests or those of a third party with whom he was dealing, and his duty to the Sentinel plaintiffs and Shield.
[25]
Mr Tomlinson also owed express and implied duties to Shield as an employee. Clause 2.2 of his employment contract imposed duties on Mr Tomlinson to:^[8]
1. (a)
  Serve Shield Property faithfully and diligently exercising all due care and skill;
2. (b)
  Act at all times in Shield Property’s best interests;
3. (c)
  Refrain from acting, or being seen to act, in conflict with Shield Property’s best interests;
4. (d)
  Use his best endeavours to protect and promote Shield Property’s reputation;
5. (e)
  Use his best abilities and knowledge to perform the duties assigned from time to time;
6. (f)
  At all times, display a thorough and professional manner, upholding and maintaining Shield Property’s reputation, goodwill and its customer relationships; and
7. (g)
  Display the highest ethical and professional standards of service delivery and confidentiality towards Shield Property and its clients.
[26]
Of course, these duties were owed only to Shield, not the Sentinel plaintiffs.

Introduction to the pleaded projects

[27]
As I have explained, these proceedings are concerned with eight projects which resulted in contracts with three builders: Bodel, Growth Australia and Verus. In each case, Mr Tomlinson purported to obtain three quotations and recommended the identified builder to be selected. In each case, Mr Tomlinson put forward three quotations, including the quotation given by the successful contractor, as he was required to do. In each case, he admits one or more of the quotations were fabricated or inflated in a way which made the quotation of the successful builder the lowest quotation. The obvious purpose, and his clear intention of doing so in each case, was to secure approval for the successful contractor to carry out the work at the price specified for that contractor in the submission prepared by Mr Tomlinson.
[28]
The effect of Mr Tomlinson’s admissions in each case is that he put fabricated quotations to the relevant Sentinel plaintiff, intending to induce, and actually inducing, that plaintiff to enter into the quotation given by the successful builder for a contract price which was not the result of a competitive tender process. These admitted facts give rise to a compelling case that Mr Tomlinson is liable to the relevant plaintiffs for deceit. Further, the admitted facts in relation to the settled claims provide a context against which Mr Tomlinson’s explanations for his conduct can be considered. It is therefore convenient to start by setting out the admitted factual context for each contract challenged in these proceedings and to identify the issues which are in dispute in that regard.
[29]
The Verus claim will be considered last, given that it is the only one where there remains a dispute with the builder involved in the project. All the facts recited in this section of the judgment are admitted or were uncontentious at trial, unless I note to the contrary.

The Bodel projects

Bodel

[30]
Bodel was a construction company incorporated in January 2017. Mr McIntyre was an employee of Bodel or a related company at the relevant time and was the seventh defendant in the proceedings. The plaintiffs advanced five claims against Bodel and Mr McIntyre arising out of five completed contracts for building work carried out between November 2017 and February 2018. The plaintiffs claimed a total of some $89,000 in damages or equitable compensation from Bodel and Mr McIntyre plus costs. This sum reflected the difference between the contract sum in each case which was put forward by Mr Tomlinson to the relevant plaintiff in his Capex Request Form, and the lowest genuine quotation obtained for the work by Mr Tomlinson. The relevant plaintiff’s claims were settled against each of Bodel and Mr McIntyre. Bodel settled the claims against it for $97,000 and Mr McIntyre settled the claims against him for $18,000. It is useful to present the Bodel claims in chronological order, rather than the order in the pleading. Chronological order assists in understanding Mr Tomlinson’s conduct.

Townsville Property: The F45 Fitout Works (January 2018)^[9]

Uncontentious facts

[31]
In about November 2017 (being just after Mr Tomlinson began working for Shield), Mr Tomlinson was responsible for obtaining quotes for the fitout of the so-called F45 tenancy at Woodlands Village Shopping Centre in Townsville on behalf of the owner, the fourth plaintiff, Sentinel Countrywide. The work seemingly involved fitting out a gym.
[32]
The invitation to tender is not pleaded, nor can I locate it in the exhibits. However, such an invitation was issued with sufficient information to permit the builders invited to tender to produce a quotation for the works. The following quotations were provided:
1. (a)
  On 28 November 2017, KRO Panels provided its quotation for $82,360, excluding GST (all figures in this judgment will be exclusive of GST unless otherwise noted);^[10]
2. (b)
  On 29 November 2017, Hurst Constructions Queensland Pty Ltd (Hurst Constructions) provided its quotation for $72,615, and expressly referred to the supplied documents which had been quoted on;^[11] and
3. (c)
  On 30 November 2017, Interior Fitouts Pty Ltd (Interior Fitouts) provided its quotation for $112,000 to 120,000.^[12]
[33]
Mr Tomlinson chased up at least Interior Fitouts for their quote on 27 November 2017.^[13] To that extent, he must have had some role in the first round of quotations.
[34]
The next three quotations were provided well after 30 November, and the Alliance Retail quotation mentioned below refers to the documents as provided by email on 30 November 2017. I infer that Mr Tomlinson, for whatever reason, sought further quotations. The evidence does not disclose whether the documents provided to the second group of tenderers differed from those given to the first group of tenderers. Mr Tomlinson’s defence alleges that there was a second tranche of tenders sought because the “initial quotes…did not incorporate the full scope of the work”.^[14]
[35]
The following further quotations were delivered:
1. (a)
  On 7 December 2017, Alliance Retail provided its quotation for $83,552, referring to documents which must have been supplied before the date of the quote, being 29 November 2017;^[15]
2. (b)
  On 10 January 2018,^[16] Verus provided a quotation for $83,505. That quotation refers in the text to a different project in this proceeding (The Hub Fitout Works, discussed below) and one might wonder, given Mr Tomlinson’s admitted practice of fabricating quotations, if this is a genuine quotation. Mr Johnson of Verus recalled quoting on this job, amongst others,^[17] though it appeared from Mr Tomlinson’s evidence that this quotation was altered or fabricated^[18] (however the covering email suggests the contrary). Mr Tomlinson’s admitted practice of fabricating documents makes it difficult to be sure in some cases what is authentic and what is not; and
3. (c)
  On 9 January 2018, Bodel (by Mr McIntyre) provided its quotation for $116,972.^[19]
[36]
Mr Tomlinson admits:
1. (a)
  That on or before 9 January 2018, he altered the Interior Fitouts quotation so as to increase it to $135,480,^[20] and he altered the Alliance Retail quotation so as to increase it to $131,872.34;^[21]
2. (b)
  That on 9 January 2018, he submitted a Capex Request Form^[22] for the works attaching the genuine Bodel quotation and the inflated quotations from Interior Fitouts and Alliance Retail;
3. (c)
  That by the Capex Request Form, he recommended the Bodel quotation be accepted by Sentinel Countrywide; and
4. (d)
  That in reliance on his recommendation, Sentinel Countrywide approved the Capex Request Form.
[37]
Although not expressly pleaded, it is not disputed that Sentinel Countrywide then entered into a contract for the works with Bodel on the terms of the Bodel quotation and that the works were carried out. In that regard, it is expressly pleaded and admitted that Sentinel Countrywide paid the amount of the Bodel quotation for the works.
[38]
The plaintiffs allege that Mr Tomlinson knew that Sentinel Countrywide would rely on his recommendation in the Capex Request Form and enter into a contract with Bodel. Mr Tomlinson does not admit that, but it is absolutely plain that he would have known those matters. That was the whole purpose of the Capex Request Form process. He accepted as much in evidence on many occasions and in relation to similar situations set out below.
[39]
There was no allegation (nor any evidence at trial) that Mr Tomlinson sought or received any personal benefit in relation to this project.

Disputed facts

[40]
The plaintiffs allege that:
1. (a)
  Mr Tomlinson had no proper basis to inflate the other quotations as he did;
2. (b)
  But for his conduct, Sentinel Countrywide would have paid no more than the amount of the lowest quote (given by Hurst Constructions) plus GST (being $79,876); and
3. (c)
  Accordingly, Sentinel Countrywide suffered a loss equal to the difference between the amount paid to Bodel and the amount which would have been paid to Hurst Constructions ($48,793.58).
[41]
Mr Tomlinson disputes these parts of the case in his defence.
[42]
As to the first issue, he denies he had no proper basis to inflate the other quotes because:
1. (a)
  The “initial quotes” did not incorporate the full scope of the work required;
2. (b)
  Mr Tomlinson altered the initial quote accurately to “indicate the work required”; and
3. (c)
  He could not “tender further quotes” due to the discovery of Shield’s lack of a valid builder’s licence.
[43]
Mr Tomlinson then pleads a non-admission to the allegation that Sentinel Countrywide could have had the work done by Hurst Constructions for the price quoted by that builder. Technically, therefore, there is no denial that Hurst Constructions could have done the work for the price it quoted (the lowest quote).
[44]
The points raised in paragraph [42] above are the enduring themes of Mr Tomlinson’s case: that is, that the scope of work either changed or was misunderstood by the builders whose quotes were increased (by him), and that a proper tender process was unlawful because it comprised project management services which could not be supplied without the relevant licence.

Springwood Property: Lifeline Make Good Works (January 2018)^[23]

[45]
In about November 2017 (again just after Mr Tomlinson began working for Shield), Mr Tomlinson was responsible for obtaining quotes for work on a Lifeline tenancy at a commercial property in Springwood on behalf of the owner, the first plaintiff (Sentinel Springwood).
[46]
The invitation to tender is not pleaded, nor can I locate it in the exhibits. However, such an invitation was plainly issued with sufficient information to permit the builders invited to tender a quotation for the works. It is evident from the 23 November Bodel quotation (see below) that Mr Tomlinson provided the tender documents to Bodel by email, and it is likely (and I infer) that Goodview Construction also received those documents from Mr Tomlinson. The following quotations were provided:
1. (a)
  On about 19 November 2017, Goodview Construction provided its quotation for $33,150; and
2. (b)
  On about 23 November 2017, Bodel provided its quotation for $29,437.^[24]
[47]
At some stage thereafter, but before 11 January 2018, Mr Tomlinson admits that he:
1. (a)
  Altered the Goodview Construction quotation to increase it to $48,565;^[25] and
2. (b)
  Altered the Bodel quotation to increase it to $39,437 (the increased Bodel quotation).
[48]
The plaintiffs also allege that before 11 January 2017, Mr Tomlinson altered a quotation provided by another company (J & P Construction quotation) in respect of a different project (Queensland Dance Centre tenancy) so as to make it appear to be a quote for the Lifeline Make Good Works for $41,280.
[49]
Strangely, Mr Tomlinson denies that allegation because he says that he altered the quote to reflect the actions of Mr Ebert in directing that Lifeline, not the Queensland Dance Centre, take the tenancy. It is correct that J & P Construction quoted on a completely different scope of work for the Dance Centre. There is no suggestion that J & P Construction had anything to do with the revised quotation, and the document does not look much like the authentic Dance Centre quotation. And Mr Tomlinson concedes that he altered the quotation. I cannot understand the relevance of the reason given for the denial. I find that no quotation was ever given by J & P Construction at the price and for the work contained in the J & P Construction quotation.
[50]
Mr Tomlinson also admits:
1. (a)
  That on 11 January 2018, he submitted a Capex Request Form^[26] for the works attaching the increased Bodel quotation and the two fabricated inflated quotations from J & P Construction and Goodview Construction;
2. (b)
  That by the Capex Request Form, he recommended the increased Bodel quotation for the Lifeline Make Good Works be accepted by Sentinel Springwood;
3. (c)
  That in reliance on his recommendation, Sentinel Springwood approved the Capex Request Form; and
4. (d)
  That he knew that Sentinel Springwood would rely on his recommendation.
[51]
Although not expressly pleaded, Mr Tomlinson did not dispute that Sentinel Springwood then entered into a contract for the works with Bodel on the terms of the increased Bodel quotation and that the works were carried out for that price. Consistent with that, it is expressly admitted that Sentinel Springwood paid the amount of the increased Bodel quotation for the works.

Disputed facts

[52]
The plaintiffs allege that:
1. (a)
  Mr Tomlinson had no proper basis to increase the Bodel quotation or fabricate the others; and
2. (b)
  But for his conduct, Sentinel Springwood would have paid no more than the amount of the original Bodel lowest quote (being $29,437), and accordingly, Sentinel Springwood suffered a loss equal to the difference between that amount and the amount of the inflated Bodel quotation (being $10,000).
[53]
Mr Tomlinson disputes these parts of the case in his defence.
[54]
As to the first issue, he denies he had no proper basis to inflate the other quotes because “the lack of valid licenses held by Sentinel Springwood, required the altering of the invoices to satisfy Sentinel Springwood’s internal processes.”^[27]
[55]
As to the second issue, Mr Tomlinson alleges that the work could not and would not have been done for the original Bodel quote because the revised quotation was “necessary to include the full scope of the work…omitted from the initial quote”.^[28] The omitted works alleged were night works and costs to obtain a certificate of occupancy.^[29]
[56]
These allegations articulate again, in a different way, the enduring twin themes in Mr Tomlinson’s case.

Mackay Property: ‘The Hub’ Fitout Works (February 2018)^[30]

Uncontentious facts

[57]
In about February 2018, Mr Tomlinson was responsible for obtaining quotations for the fitout of a dance studio in commercial premises in Mackay owned by the second plaintiff (BCC Mackay) called “The Hub”.
[58]
On 5 February 2018 at 12:49pm, Mr McIntyre of Bodel sent an email to Mr Tomlinson offering to undertake The Hub Fitout Works for $115,117.40.^[31] After receiving the quotation, Mr Tomlinson immediately created a document which purported to comprise a quotation from Bodel with an increased quotation to $126,560 (the increased Bodel quotation). He then sent that document by email to Mr McIntyre at 1:23pm.^[32] Fourteen minutes later, Mr McIntyre sent the increased quotation to Mr Tomlinson with a covering email saying “please see attached our offering”.^[33]
[59]
At about the same time as he sent the increased quotation, he fabricated two other competing quotations for The Hub Fitout Works purportedly from Verus ($135,455) and Alliance Retail ($133,662). Metadata from Mr Tomlinson’s computer confirms the timing of the creation of these documents.^[34]
[60]
On the same day, 5 February, Mr Tomlinson submitted a Capex Request Form for The Hub Fitout Works,^[35] attaching the increased Bodel quotation and the two fabricated quotations from Verus and Alliance Retail, and recommended that BCC Mackay accept the increased Bodel quotation and engage Bodel to do the works.
[61]
BCC Mackay then entered into a contract for the works with Bodel on the terms of the increased Bodel quotation, the works were carried out and it was admitted that BCC Mackay paid the contract sum.
[62]
On this occasion, Mr Tomlinson admits that he knew that BCC Mackay would rely on his recommendation in the Capex Request Form and contract with Bodel on the terms of the increased Bodel quotation.
[63]
There was no allegation (nor any evidence at trial) that Mr Tomlinson sought or received any personal benefit in relation to this project.

Disputed facts

[64]
The plaintiffs allege that:
1. (a)
  Mr Tomlinson had no proper basis to inflate the Bodel quotation or alter the Verus and Alliance Retail quotations;
2. (b)
  But for his conduct, BCC Mackay would have either engaged Verus or Alliance Retail to do the works at “a lower price” or engaged Bodel for the amount of the first quotation; and
3. (c)
  Accordingly, Sentinel Countrywide suffered a loss equal to the difference between the amount of the increased Bodel quotation and the original quotation ($11,442.60).
[65]
Mr Tomlinson disputes these parts of the case in his defence.
[66]
As to the first issue, he denies he had no proper basis to act as he did because:
1. (a)
  It was proper to do so because “it was done to allow compliance with Section 42 of the QBCC Act concerning building standards and Queensland Fire Services”;^[36] and
2. (b)
  The price from Bodel was justified as a Guaranteed Maximum Price contract.^[37]
[67]
Oddly, he then pleads a non-admission to the allegation that, but for his conduct, BCC Mackay could have carried out The Hub Fitout Works for the price of the original Bodel quotation.

Creek Street Property Tenancy Works (February 2018)^[38]

Uncontentious facts

[68]
In about February 2018, Mr Tomlinson was responsible for obtaining quotes to split a tenancy in a commercial property at 200 Creek Street, Brisbane (the Creek Street Works) owned by the fifth plaintiff (Sentinel Regional).
[69]
On 7 February 2018, Mr Tomlinson sent an email to Bodel summarising the scope of work for the Creek Street Works and referring to a link to a drop box.^[39] On 9 February 2018, Mr McIntyre of Bodel sent an email to Mr Tomlinson attaching a quote to carry out the Creek Street Works for $28,131.70.^[40] By 12 February 2018, Mr Tomlinson had:
1. (a)
  Increased the Bodel quotation by $10,000 to $38,131.70;
2. (b)
  Altered a quotation by Verus in relation to The Hub Fitout Works to make it appear as if it was a quote for the Creek Street Works for $43,010^[41] (this fabrication fails to make any effort to link it to the Creek Street Works, as it refers to The Hub Fitout Works. It would not have passed even minimal scrutiny); and
3. (c)
  Altered a quotation by Alliance Retail in relation to another project to make it appear as if it was a quote for the Creek Street Works for $43,552.^[42]
[70]
On the same day, 12 February 2018, Mr Tomlinson submitted a Capex Request Form for the Creek Street Works, attaching the increased Bodel quotation and the two fabricated quotations from Verus and Alliance Retail, and recommended that Sentinel Regional accept the increased Bodel quotation and engage Bodel to do the works.^[43]
[71]
Sentinel Regional then entered a contract for the works with Bodel on the terms of the increased Bodel quotation, the works were carried out and the contract sum paid. Mr Tomlinson admits that he knew that Sentinel Regional would rely on his recommendation.

Disputed facts

[72]
The plaintiffs allege that:
1. (a)
  Mr Tomlinson had no proper basis to inflate the Bodel quotation or alter the Verus and Alliance Retail quotations;
2. (b)
  But for his conduct, Sentinel Regional would have either engaged Verus or Alliance Retail to do the works at “a lower price” or engaged Bodel for the amount of the first quotation; and
3. (c)
  Accordingly, Sentinel Regional suffered a loss equal to the difference between the amount of the increased Bodel quotation and the original quotation ($11,442.60).
[73]
As with previous projects, Mr Tomlinson disputes these parts of the case in his defence. As to the first issue, he denies he had no proper basis to act as he did because:
1. (a)
  It was proper to increase the Bodel quotation because the original quotation “did not contain the full scope of work and required altering to ensure accuracy”;^[44]
2. (b)
  It was proper to fabricate the other quotes because “the lack of valid licenses held by the plaintiff” (presumably Shield) meant that “‘fabricated’ invoices” had to be used to prevent “the plaintiffs breaching Section 42 of the QBCC Act”.^[45]
[74]
He also disputes that Sentinel Regional could have carried out the works for the original Bodel quotation price “because the initial quote did not account for the full scope of the work required”.^[46]

Springwood Property Air Conditioning Works (March 2018)^[47]

Uncontentious facts

[75]
In about mid-February 2018,^[48] Mr Tomlinson was responsible for obtaining quotes to install air conditioning in a Lifeline tenancy located in the Springwood Property owned by Sentinel Springwood (the AC Works). This work appears to be related to the Lifeline Make Good Works above.
[76]
On 28 February 2018, Bodel obtained a quote for the works from a separate AC contractor (E & S) and provided it to Mr Tomlinson. It quoted two prices for two separate alternatives to complete the works: $27,700 (for one large unit) and $24,400 (for three smaller units). There is no reason to question the authenticity of that quotation.^[49]
[77]
On 1 March 2018, Mr McIntyre of Bodel sent a quotation to carry out the AC Works for $31,855 and $27,600 respectively.^[50]
[78]
Also on 1 March 2018:
1. (a)
  Mr Tomlinson altered the E & S quotation to increase the amounts to $37,348 and $33,256 respectively;^[51]
2. (b)
  Mr Tomlinson altered the Bodel quote for the Queensland Dance Centre so as to make it appear to be a quotation from Bodel for the AC Works, and increased Bodel’s AC quote to $36,855 and 32,600.^[52]
[79]
On the same day, Mr Tomlinson submitted a Capex Request Form^[53] for the works attaching the increased Bodel quotation and the altered quotation from E & S, and recommended that Sentinel Springwood accept the Bodel quotation and engage Bodel to do the works.
[80]
Sentinel Springwood then entered into a contract for the works (at the higher optional price as recommended in the Capex Request Form) with Bodel on the terms of the increased Bodel quotation in reliance on the recommendation in the Capex Request Form, the works were carried out and the contract sum paid.

Disputed facts

[81]
The plaintiffs allege that:
1. (a)
  Mr Tomlinson had no proper basis to inflate the Bodel quotation or alter the E & S quotations;
2. (b)
  But for his conduct, Sentinel Springwood would have engaged E & S to do the works at the amount of their genuine quotation; and
3. (c)
  Accordingly, it suffered a loss equal to the difference between the amount of the increased Bodel quotation and the genuine E & S quotation ($9,155).
[82]
As with previous projects, Mr Tomlinson disputes these parts of the case in his defence. The only allegation made is that “the scope of work under the quote referred to, was insufficient for the completion of the Air Conditioning Works”.^[54] The defence does not identify which of the two quotes in paragraph 106 of the statement of claim it refers to. Both original quotes are referred to in that paragraph. It seems his allegation is that neither figure was based on the correct scope.

Observations about the Bodel projects

[83]
The Bodel projects are of interest because they cover the period from when Mr Tomlinson first commenced work with Shield. I observe the following.
[84]
First, almost from the start of Mr Tomlinson’s work, he was fabricating and altering quotations. The first time he did so, on the evidence before the Court, was 9 January 2018.
[85]
Second, he explains his conduct in part on the basis that it was to avoid a breach of s. 42(1) QBCC Act by going to tender (which he interpreted as seeking more than one quotation for a scope of work). Although it is hard to be certain of exactly what documents he fabricated or altered, it appears likely that he did not seek more than one quote himself. The F45 Fitout Works and the Lifeline Make Good Works are an exception, but most of the quotes appear to have been sought before Mr Tomlinson was in control of the tender process for Shield. He also seems to have been a little inconsistent in the first two projects, approaching Verus on at least one occasion. But from mid-January 2018, he did not seek more than one quote.
[86]
Third, he admits all the fabrications, alterations and increases of quotations alleged against him. He also effectively admits (as I find) that each time he used those documents to present the Bodel quote as the lowest quote of three (or two in the case of the Springwood AC Works) in a Capex Request Form, that the relevant plaintiff relied upon that recommendation, entered into a contract on those terms and completed it, and that he knew that would occur.
[87]
Fourth, his pleaded defences, relating to the change of scope and the need to behave as he did to ensure no breaches of s. 42 QBCC, were not particularised or explained at all, or if they were, only the barest explanations were given.

The Growth Australia projects

Uncontentious facts

[88]
There were two related projects involving Growth Australia. They are conveniently dealt with together, as both involved replacing cladding on commercial buildings owned by Sentinel Regional. One property was located at Argyle Street, Newcastle (Argyle Street) and the other at Woods Street, Darwin (called Jacana House). Mr Tomlinson admits he was responsible for obtaining quotes for this work in April 2018. Mr Tomlinson’s statement, tendered as his evidence in chief at trial (the Statement), states:
1. (a)
  The projects began life early in Mr Tomlinson’s tenure, in about December 2017;
2. (b)
  There were three buildings which required replacement of external cladding – Argyle Street, Jacana House and another property at 153 Campbell Street, which he called Citilink, also owned by Sentinel Regional;
3. (c)
  That it was decided to tender all three buildings in one package and that “the scopes [were] sent out to four separate cladding companies in December 2017”;^[55] and
4. (d)
  The only quote received was from Architectural Cladding Solutions Pty Ltd (ACLAD).
[89]
There is no reason to reject this evidence. However, the Statement is ambiguous as to when the ACLAD quotation was received. The supporting documents tendered by Mr Tomlinson show that preparation work by consultant engineers was not completed for Argyle Street and Jacana House until 28 February 2018. There is no evidence of any quotation being received from ACLAD until 9 April 2018.
[90]
The other matter relating to the period before April 2018 covered in Mr Tomlinson’s evidence is more contentious. Mr Tomlinson said that the cladding works required other subcontractors to complete some work, and that accordingly, a builder with an open licence was required. He stated that he initially had discussions with Mr Neil Wright of ACLAD in January 2018 and that Mr Wright told him that ACLAD did not hold a builder’s licence at that time.
[91]
Of these matters, it seems uncontentious that an open licence was required to complete the whole of the work, and that as at January 2018, ACLAD did not hold such a licence. However, whether Mr Tomlinson was told that in January 2018 by Mr Wright and in what terms, and whether he continued to believe that, are highly contentious. Those issues are central to his defence to the plaintiffs’ case on the Growth Australia projects. I will deal with that further when discussing the disputed aspects of this matter.
[92]
On 6 April 2018, Mr Tomlinson sent an email to Mr Wright, seeking a quotation from ACLAD for all three cladding projects with a short narrative of the scope in each case and a detailed document in a drop box link.
[93]
The 6 April 2018 email:
1. (a)
  Made no mention of any other contractor being engaged to do the overall works;
2. (b)
  Made no mention of Mr Tomlinson’s view that ACLAD could not do the whole of the works because it was unlicensed; and
3. (c)
  Invited Mr Wright to provide the pricing to him by 13 April 2018.
[94]
On 9 April 2018 at 1:02am, Mr Wright of ACLAD sent an email to Mr Tomlinson attaching:^[56]
1. (a)
  A quotation to carry out the Argyle Street cladding for $466,900;
2. (b)
  A quotation to carry out the Jacana House cladding for $521,700; and
3. (c)
  A quotation to carry out the Citilink cladding for $628,600.
[95]
The 9 April 2018 email from Mr Wright stated:^[57]

Good morning Neil,

Thank you giving Aclad the opportunity to assess you requirements for your buildings in Brisbane, Newcastle & Darwin.

Please find the submissions for each building attached as requested.

If you have any questions or you require further information, please feel free to call us on 07 3390 6299.

Neil, Aclad very much look forward to working with you and the team at Sentinel.

Have a great day & we look forward to a positive response shortly.

Kind Regards,

Neil Wright

[96]
The quotations were materially in the same form, varying only by reference to the particulars of each project. It is convenient to observe that each relevantly provided:
1. (a)
  The following relevant text:^[58]

Summary: To work with Neil Tomlinson of Sentinel Portfolio Management in achieving the complete removal of all P.E (Poly Ethylene) cladding, with minimal to no disruption of tenants in the [relevant building]. Alcad has in place an Open Builders License to be able to work directly with the property owners. (One contract only)

…

Payment Terms:

15% deposit/site establishment fee on placement of order
Progress claims submitted fortnightly & payable fortnightly
M2 over the quoted amount will be charged as a variation to the contract.

Neil, once Aclad receive a letter of intent, we will begin immediately to save delays by ordering the custom replacement material…

[underlining added]

(b)
It then included a detailed set of “Site Specific Allowances” which appear to cover the whole of the preparation and administration of the cladding works.^[59] That list included, expressly, project management and contract administration (noting Mr Tomlinson’s case that he believed from the start of his employment that such services cannot be provided unlicensed).

[97]
On 9 April 2018 at 5:13pm, Mr Tomlinson sent an email to Mr Tim Russell of Growth Australia attaching each of ACLAD’s quotations for the three cladding projects. That email stated:^[60]

Hey Tim

First quotes back for the cladding works, including all height access, pedestrian and traffic management sit at $1,617,200.00 + GST

What would you be looking at as a construction management fee for this?

There are also going to be around $5,000.00 of works at Jacana House to swap the lights in the awning for alternatives, apply rubber seals to the bottom edge of street facing ground floor tenancy entrances and replace the tenant directory in the lobby.

Regards

Neil Tomlinson

[98]
On 20 April 2018, Mr Gilmour sent Mr Tomlinson an email which provided:^[61]

Hi Neil,

Growth Australia are delighted to submit our tender for the cladding replacement works to the Citilink Building, Newcastle Site and Jacana House (including the minor works).

We have included a program of works that allows for site measures and logistics, lead times and build program, these have been advised as worst case scenario, so we hope we can improve on these once engaged. We have programmed the works to commence with the Citilink building first, followed by the Newcastle building and finishing with Jacana House, we are flexible with this, should we need to change this sequence, each site requires a maximum 12 week build period.

We can confirm our availability to meet in person to discuss our offer, and look forward to your further consideration.

Kind regards

Ian

[99]
The attached Growth Australia tender stated under the heading “Project Specific Overview”:^[62]

Dear Neil,

Growth Australia have great pleasure in submitting our lump sum price to manage the cladding removal and new installation of Alucobond Plus 4mm aluminium composite panels to the Citilink Building, Campbell Street, Sentinel Asset in Argyle Street Newcastle and Jacana House, Darwin.

Working closely with our preferred contractors we have programmed the sites to run sequentially commencing with the Citilink building, then Newcastle and finally Darwin, we have confirmed the same delivery team for all 3 projects ensuring consistency and competitive pricing based on the quantum of works.

If our tender is successful we would like to arrange a kick off meeting and commence our site measure, we will then require 3-4 weeks to work through the construction & access methodology. Once this has been signed off, we have confirmed a 12 week lead time for materials which will be ordered immediately from receiving a signed contract and have allowed a 12 week building program. Please note our price also includes for the minor internal works at Jacana House as requested.

Value of Growth works:

Total ex GST $2,036,640

Gst $203,664

Total Inc GST $2,240,304

We thank you for the opportunity to submit a price, and can confirm our availability to meet with you to discuss our offer in person.

Kind Regards

Ian Gilmour

Growth Commercial Director

[100]
The text under the heading “Site Specific Scope & Allowances” largely copied the equivalent details from the ACLAD quotations.^[63]
[101]
The Budget Summary breakdown demonstrates that the ACLAD quotation for Citilink was increased by a relatively small amount ($20,000), but the increase for the ACLAD quotations for Argyle Street and Jacana House was 30% and 50% respectively. There is no mention of ACLAD in the Growth Australia quotation.
[102]
On or about 27 April 2018, Mr Tomlinson again repeated his pattern of fabricating competing quotations and favouring the quote of the contractor he preferred. In this case, he did the following:
1. (a)
  He altered the ACLAD quotations as follows:
  1. He altered the quotation for the Argyle Street cladding to increase it from $466,900 to $616,900;
  2. He altered the quotation for the Jacana House cladding to increase it from $521,700 to $796,180; and
  3. He altered the quotation for the Citilink cladding to increase it from $628,600 to $662,750.^[64]
2. (b)
  He fabricated quotations for the cladding works from a contractor known as Glasstech by altering a genuine quotation given by Glasstech for another Sentinel project to fabricate:^[65]
  1. A Glasstech quotation for the Argyle Street cladding for $687,450;
  2. A Glasstech quotation for the Jacana House cladding for $765,200; and
  3. A Glasstech quotation for the Citilink cladding for $717,185.
[103]
Also on 27 April 2018, again following the familiar pattern, Mr Tomlinson prepared a Capex Request Form for each of the Argyle Street and Jacana House cladding projects, accompanied by the altered and fabricated quotations and the Growth Australia quotation, and submitted them to Sentinel Regional, recommending in each case the Growth Australia quotation and knowing that Sentinel Regional would rely on that recommendation.
[104]
The plaintiffs allege that Mr Tomlinson had no proper basis to alter or fabricate the quotations. In contrast to the Bodel matters, Mr Tomlinson admits that in respect of the Growth Australia projects.^[66] Inconsistently, however, he denies that his conduct was dishonest because his actions were to avoid a breach of s. 42 QBCC Act by Shield.
[105]
There was presumably a similar recommendation for Citilink, though I could not find it in the evidence. However, I also note the Quotation Recommendation signed by Mr Tomlinson and dated 25 April 2018 relating to the whole of the works for all three projects, reflecting the above figures, but presenting them in total for the whole of the three projects. It is reasonable to infer that this document was relied upon by Sentinel Regional in relation to the Citilink works, though there was no direct evidence of that matter, nor an admission.^[67] Ms Jones gave evidence that ultimately, Sentinel Regional did not proceed with the Citilink cladding works because the building was sold. Presumably that occurred at around this time because there is no contract for the Citilink works and no payments made to Growth Australia in respect of it.
[106]
There must have been further negotiations with Growth Australia and ACLAD prior to 2 May 2018. Strangely, there is no evidence I could locate which shows when ACLAD became aware that Growth Australia was involved, nor any evidence as to what ACLAD was told about that matter. However, it appears that Growth Australia negotiated with ACLAD to reduce its (real) quotations with success because on 2 May 2018, ACLAD provided revised quotations which reduced the amount by about 5% in each case.^[68] Strangely, the quotations were provided to Mr Tomlinson, not Growth Australia. However, on 4 May 2018, Growth Australia purported to accept the quotations provided by ACLAD on 2 May 2018.
[107]
Thereafter, Mr Tomlinson admits that in reliance on his recommendations, Sentinel Regional approved the Capex Request Forms and entered into contracts with Growth Australia for the Argyle Street and the Jacana House cladding works on 4 May 2018 for the amounts in the Growth Australia quotations, reduced, it seems, to take account of the reductions in the ACLAD quotations.
[108]
Also on 2 May 2018:
1. (a)
  Mr Tomlinson provided a letter of intent to contract with Growth Australia for the cladding projects;
2. (b)
  Contracts were executed with Growth Australia for each cladding project;
3. (c)
  ACLAD issued tax invoices for deposits directed to Growth Australia (providing the only direct evidence from ACLAD that ACLAD knew Growth Australia was involved). ACLAD sought deposits of 15%, consistent with their quotations;^[69] and
4. (d)
  Growth Australia issued tax invoices to Sentinel Regional for deposits on the same contracts of 30% of the contract price for each project (which was increased by 20% on the ACLAD quotation in each case).^[70]
[109]
The contracts each provided for payment of progress claims on the 20^th day of each calendar month and did not provide for payment of a deposit.^[71] Mr Tomlinson gave no explanation as to why Growth Australia should have been paid a deposit at all, much less a higher deposit than ACLAD.
[110]
On 10 May 2018, Sentinel Regional paid Growth Australia the deposit on the Jacana House contract of $242,573.76. On 15 May 2018, Sentinel Regional paid Growth Australia the deposit on the Argyle Street contract of $192,576.78.

Disputed facts

[111]
Unlike the Bodel projects, in this case, Mr Tomlinson’s conduct was discovered by the plaintiffs before the work was completed. The plaintiffs allege that:^[72]

73A In fact, in respect of the amounts paid to Growth Australia by Sentinel Regional being:

(a)
the amount of $192,576.78 (including GST) as part payment for the Argyle Cladding Works; and
(b)
the amount of $242,573.76 (including GST) as part payment for the Jacana House Cladding Works,

Aclad actually agreed to, and performed, the work the subject of those part payments for the total amount of $135,735 (excluding GST).

…

79 As a result of the conduct in pleaded in paragraphs 54 to 78, Sentinel Regional:

(a)
validly terminated the Growth Argyle Contract and Growth Jacana House Contract; and
(b)
contracted with Aclad directly to complete the Argyle Cladding Works and the Jacana House Cladding Works.

79A For the purposes of the contracts entered into between Aclad and Sentinel Regional as pleaded in subparagraph 79(b)(b) above Aclad:

(a)
agreed that the total contract sum of the Argyle Cladding Works was $421,000 (excl GST);
(b)
agreed that the total contract sum of the Jacana House Cladding Works was $459,012 (excl GST); and
(c)
applied the sum of $135,735 for work already performed by it as part payment of the amounts pleaded in subparagraphs (a) and (b) of this paragraph.

80 If Mr Tomlinson and Growth Australia had not engaged in the conduct pleaded in paragraphs 56 to 60 and 74 to 76 above, then, for the reasons pleaded in paragraphs 79 and 79A above, Sentinel Regional:

(a)
would have contracted with Aclad directly to undertake the Argyle Cladding Works and the Jacana House Cladding Works;
(b)
would not have paid any of the amounts pleaded in paragraphs 63 and 73 above to Growth Australia; and
(c)
would therefore not have paid the sum of $299,415.54 to Growth Australia (being the difference between the total of those amounts (being $435,150.54) and the amount paid to Aclad by Growth Australia (being $135,735)).

[112]
These allegations were not admitted by Mr Tomlinson in his defence, with the exception of paragraph 80, which he denies because he alleges ACLAD did not have a necessary builder’s licence. It is convenient to deal with these issues now.
[113]
The denial based on the lack of a licence was abandoned by Mr Tomlinson in final submissions. He accepted that ACLAD had the necessary licence to do the works (but maintained he did not realise that at the time).^[73]
[114]
As to the other matters, Ms Jones gave evidence about the process that was followed by Sentinel Regional once Mr Tomlinson’s conduct was discovered.^[74] She gave evidence that once Mr Tomlinson was dismissed, work was stopped on the Growth Australia contracts, and ACLAD was retained to do the cladding work directly.
[115]
She gave evidence that a reconciliation was undertaken as to the value of work done by ACLAD to that point against the amounts paid to Growth Australia. The amounts determined were those pleaded in paragraph 73A above. Other evidence demonstrates that Growth Australia repaid the difference between the amounts it had been paid and the value of the works negotiated with ACLAD by Sentinel Regional. None of this was challenged in cross-examination and I have no reason to reject Ms Jones’ evidence, particularly as it is supported by contemporaneous documents.
[116]
In paragraph 51(c) of the defence, Mr Tomlinson makes a positive allegation that disputes the total loss claimed, based on the above facts, by referring to difficulties which arose in the funding and performance of the Citilink property. I do not find those allegations established. They were not proved at trial, nor were they relevant to the case advanced by the plaintiff. The uncontested evidence is that the Citilink work did not go ahead and the documents support that conclusion. Further, whatever might have occurred in the structuring of costs of the three projects^[75] makes no difference to the overpayment of Growth Australia under the two contracts.
[117]
I therefore find the allegations in paragraphs 73A, 79, 79A and 80 of the statement of claim have been proved. I find that, but for Mr Tomlinson’s conduct, Sentinel Regional could have had the cladding work done by ACLAD and would have paid the amount identified in the statement of claim, rather than the amounts paid to Growth Australia before the suspension of the contracts.
[118]
There is one caveat to that finding. Paragraph 79(a) alleges that Sentinel Regional validly terminated the Growth Australia contracts. That allegation is an allegation of law and is not admitted by Mr Tomlinson. It is evident from the balance of the pleading that the basis of that allegation is that the officers of Growth Australia knew that Mr Tomlinson was altering and fabricating quotes so as to secure the cladding projects for Growth Australia in a dishonest manner.^[76] Mr Tomlinson pleads a non-admission to that allegation. Further, paragraph 85 maintains the allegation of a conspiracy between Growth Australia and Mr Tomlinson (though it may be that that is no longer maintained – I discuss that further below). Growth Australia is no longer a party to these proceedings and its officers were not called by either party to give evidence. Caution must be exercised in making such serious findings in their absence. However, it is evident from the settlement with Growth Australia that it does not assert the validity of the contracts, and given that, the points are moot in these proceedings.
[119]
Given my findings, the only disputed facts in relation to this part of the plaintiffs’ case that remain are whether Mr Tomlinson involved Growth Australia because of his view that ACLAD needed a licence, or whether he knew as at April 2018 that ACLAD was licensed and involved Growth Australia to secure a secret profit. These matters fall to be resolved in the context of Mr Tomlinson’s direct dealings with Growth Australia. To this I now turn.

Mr Tomlinson and Growth Australia

[120]
As with other areas of this proceeding, many of the plaintiffs’ allegations on this issue are admitted or demonstrably correct on the evidence. Further, the contentious aspects fall to be considered against the context provided by my findings in the previous section of this judgment. I will refer to some of those findings again in the following chronology for convenience.
[121]
Mr Tomlinson had worked with the directors of Growth Australia in his previous roles in the construction industry in Australia (see paragraph [19] above).
[122]
In his s. 92 Statement, he said that he considered that he needed a head contractor for all the cladding works because he had been told by Mr Wright of ACLAD that they did not have a builder’s licence. He said he approached another potential head contractor in late March 2018 called Keen Construction (timing is based on paragraph 57 of the s. 92 Statement). He said Keen Construction was not interested. He said that he was having a coffee with Mr Russell on 3 April 2018 and offered Growth Australia the construction manager job on the terms he offered it to Keen: a 20% mark-up on the costs of the works inclusive of “all travel, accommodation, supervision, approvals, engagement of all required subcontractors insurance and final certification of each trade package including any Form 15 & Form 16 requirements”.^[77] He said he then sought a tender “based on the current quotes from ACLAD”.^[78] This evidence is contentious.
[123]
At about the same time, on 1 April 2018, Mr Tomlinson contacted a company called Equine Business Solutions Pty Ltd (Equine) on a messaging app and enquired about acquiring stables, shelters and a tack room. On 3 April, Mr Tomlinson gave “Bec” of Equine his contact details, and by return, Bec sent a quote for the stable works.^[79]
[124]
On 9 April 2018, Mr Tomlinson sent the ACLAD quotations to Growth Australia (paragraph [97] above).
[125]
On 11 April, Mr Tomlinson messaged Bec:^[80]

Hey Bec. Just getting all the information together to get this quote paid through work.

Can you please amend the client details to:

Growth Australia Pty Ltd

10/133 Mary Street

Brisbane QLD 4000

ABN 93 622 874 426

And could you please change the descriptions to read as “site storage sheds”?

Please send this to my personal email address:

[email protected]

[126]
This message was sent eight days after Mr Tomlinson says he first raised Growth Australia’s involvement with Mr Russell and two days after the ACLAD quotes were sent to Growth Australia.
[127]
By his s. 92 Statement, Mr Tomlinson stated relevantly:^[81]

Shortly after Growth Australia submitted their tender, I was approached by Ian Gilmour, one of the directors of Growth Australia, who explained that they have a referral fee scheme for people that provide opportunities to tender to them with a typical gift of 2% of the contract value of any secured project. I initially rejected this offer, but the conversation continued with Mr Gilmour insisting that it’s very common and if I wasn’t comfortable with a monetary referral fee invoiced through an ABN, they would be happy to purchase the temporary stables we had been discussing when we caught up the previous week as they could also claim the tax back on them if they were labelled ‘site sheds’.

[128]
When challenged about the inconsistency in timing between the message to Bec on 11 April (which demonstrates agreement had by then been reached with Growth Australia) and the date of the tender from Growth Australia (sent on 20 April), Mr Tomlinson said in cross-examination that there was an earlier tender. He also said that Mr Gilmour initially offered cash, and that when that was refused, Mr Gilmour offered to pay for his stables. Mr Tomlinson said those stables were discussed at the initial meeting on 3 April.^[82]
[129]
Growth Australia provided its first quotation (for which there is any documentary evidence) on 20 April 2018. On 23 April 2018, Mr Gilmour of Growth Australia created a WhatsApp group containing Mr Tomlinson and the four directors of Growth Australia.
[130]
From 27 April to 3 May 2018, there were exchanges relating to ACLAD’s further prices (provided on 2 May 2018: see paragraph [106] above). Those exchanges are admitted. They provide:^[83]
1. (a)
  On 27 April 2018, Mr Williams wrote: “Daron followed me up…have you got any other quotes to use a a [sic] stick ?”;
2. (b)
  On 28 April 2018, Mr Tomlinson wrote: “I’ll chase the other quotes on Monday and push for approval to be as fast as possible”;
3. (c)
  On 30 April 2018, Mr Williams wrote: “NT Any traction on the quotes today and approval?”, to which Mr Tomlinson replied: “Will have it tomorrow guys”;
4. (d)
  On 1 May 2018, Mr Tomlinson wrote: “Approval isn’t an issue, it’s just a matter of waiting for sign off. Just told Neil I’d have pricing back today, will call him and give him the other ‘prices’”;
5. (e)
  On 1 May 2018, Mr Tomlinson wrote: “In your inboxes Guys. Sorry for the delay, we can’t all lunch and golf all day”;
6. (f)
  On 3 May 2018:
  1. (i)
    Mr Williams wrote: “With a $2m deal from a hardcore Manc - it’s one of the best days of my life”;
  2. (ii)
    Mr Tomlinson wrote: “Aclad are sitting as follows:

Citilink - $595k

Jacana - $500k

Argyle - $450k

Total - $1,545,000.00”

(iii)
Mr Williams wrote: “Are you happy at that or is there more room?”;
(iv)
Mr Tomlinson wrote: “Contract is the same for me regardless. Question is are you happy? Gives you a healthy margin for just bankrolling them.”

[131]
I could find no suggestion anywhere in the evidence that ACLAD needed bankrolling and subsequent events demonstrate it to have been unnecessary. Further, Mr Tomlinson’s evidence about why Growth Australia was being retained in paragraph [122] above seems directly inconsistent with his statement that Growth Australia was just bankrolling ACLAD.
[132]
Around early May 2018 (probably 11 May 2018), Equine issued tax invoices to Growth Australia for Mr Tomlinson’s stables.^[84] Whenever it was issued, the tax invoice was paid on that date.^[85]
[133]
Mr Tomlinson did not admit that Growth Australia paid that invoice in his defence, but his pleaded denial was evasive and he admitted in evidence that he received the stables as a gift from Growth Australia and conceded it was dishonest to do so.^[86] I find Growth Australia paid the Equine tax invoice of $40,613.
[134]
In broad terms, the issue to be resolved is whether Mr Tomlinson offered Growth Australia a contract with a large margin over the ACLAD prices for very little work in exchange for a kick back from Growth Australia, or whether the payment for the stables was an unexpected incident of carrying out his work consistent with his genuine belief that ACLAD needed a licensed head contractor, and that proper quotes could not be obtained because of his concerns about licensing.

Verus and the Dubbo Works

Genesis of the Dubbo Works

[135]
Sentinel Countrywide owns commercial premises, including a Woolworths supermarket at Dubbo in NSW. By about March 2018, at the latest, structural problems were identified in the concrete ramp which serviced the loading bay of the supermarket in an engineering report.^[87] That report, prepared by Barnson, was likely the catalyst for the works which followed, and the urgency attached to them. Further, I also accept that Sentinel Countrywide, by Mr Tomlinson through Shield, chose to approach Formchoice to design the repair works, because Formchoice was as an engineering consultant with relevant experience which could also supply a design for temporary works and the specialist equipment required.

Uncontentious facts

[136]
Many matters in this section are admitted by Mr Tomlinson, but are the subject of non-admissions by Verus. Unless I note to the contrary, I find the non-admitted matters proved on the evidence. The real contest in relation to this claim is not whether the dealings between Mr Tomlinson and Sentinel occurred as pleaded by Sentinel, but rather the content of the dealings between Mr Tomlinson and Mr Johnson.

The drawings

[137]
The starting point is the provision of the structural drawings used by Verus. On 9 May 2018, Mr Medina of Formchoice provided drawings with annotations which described temporary propping works pending repair of the ramp and two options for permanent repair, along with photographs of a site visit on 3 May 2018 (the Formchoice documents).^[88] Mr Medina’s email stated that further information would be submitted on Monday 14 May 2018 comprising:
1. (a)
  Structural drawings for the new blockwork and steel frames; and
2. (b)
  “Quotation for the quickstage, Formwork/Footings, and Fabrication for the steel frame”.^[89]
[138]
Formchoice’s drawings do not expressly identify that the work was to be done in two stages, however, it was not in dispute that they disclose that to an experienced reader. They show Stage 1 involving temporary propping and Stage 2 involving the substantive repairs. The Stage 1 works (also called the quickstage works) in the plans are described at Exhibit 2 page 1720 and the incidental work required for those works, particularly the work described in items 3 to 8 under the heading “Ramp Methodology Repair”.^[90]
[139]
Mr Tomlinson alleges that the work to be done in Stage 1 included the installation of expansion joints across the existing ramp (the expansion joint works). He said:^[91]

The ramp had been extended from a very small ramp to a wider one and the expansion joints were offset. The expansion joints were needing to be replaced to help cope with the impact load where, as a truck hits it, it’s essentially an impact every time it hits it. And what was happening is because, with the expansion joints being offset, it was putting more strain on one side of the ramp than the other. Both of the expansion joints needed to be removed, recut and reinstalled with some – you may see them on car parks. They’re like concertinas. They’ve got like a big rubber gasket in-between them. And that would’ve kept the ramp independent of the toe and the heel of the ramp, but secured by the structure.

[140]
The Formchoice drawings show the existing expansion joints as described by Mr Tomlinson.^[92] There is no evidence of the work Mr Tomlinson describes, whether for the Stage 1 works or for the repair options marked as Option 1 and Option 2.^[93] Mr Johnson, an experienced builder, agreed that no alleged expansion joint works were shown on the Formchoice plans.^[94] There is no documentary evidence of any supplementary plans or engineering advice from Formchoice about the work Mr Tomlinson describes. There is no documentary evidence of his consulting Formchoice about that work. Mr Tomlinson did say in cross-examination, explaining the way that work was charged for, that: “Miska’s a much more expensive format of expansion joint, and when the engineers were working on them, they realised they didn’t need to go to that level of engineering.”^[95] That is the only mention of involvement of engineers in the expansion joint works. There is evidence of subsequent advice from Formchoice being sent on 24 and 28 May 2018 to Mr Burfoot of Verus, but it has nothing to do with expansion joints.^[96] There is no credible evidence that the expansion joint works were real works required to be done. Other aspects of the evidence compel that conclusion: see paragraph [316] below. Mr Tomlinson’s evidence about those works was fabricated.
[141]
The photographs show the state of the ramp, but there is only one photograph of conditions under the ramp where the propping work was to take place. They provide no basis to assume large quantities of digging work were required. This becomes significant because Mr Tomlinson and Mr Johnson rely on this consideration as justifying the increase in the Verus quote.

The Original Quote from Verus

[142]
On 10 May 2018 at 6:35pm, Mr Tomlinson forwarded the 9 May 2018 email from Formchoice to Mr Johnson of Verus with the following covering email:^[97]

Hey Greg

We have a concrete ramp to a loading dock in Dubbo requiring back-propping initially for support and then repairing. The ramp can’t be closed for extended periods as it’s the only loading dock for the Woolworths in the Centre.

Need to get the propping done as soon as possible and I’m happy to pay for travel and accommodation for decent guys to go from QLD.

I’d like you to use GHI Formwork for supply of equipment as Eddie has really helped me out with this one.

[143]
This is evidence of Mr Johnson’s first contact with Mr Tomlinson about the Dubbo Works. Mr Burfoot, Verus’ project manager, immediately sought a quotation for the “temporary propping requirements” based on the fourth sheet of the Formchoice documents, showing the propping works^[98] from Mr Cunningham of CB Construction Workforce Pty Ltd (CBCW), a subcontractor. He appeared to have no difficulty in identifying the Stage 1 works from the drawings, nor did Mr Cunningham. On 15 May 2018, Mr Cunningham provided CBCW’s quotation in response. It is relevant that Mr Cunningham was able to quote on the propping works given that he had only the fourth sheet of the Formchoice documents. This demonstrates that the work required was reasonably intelligible to a contractor at arms’ length from the parties.^[99]
[144]
The quotation is for $20,901.32, excluding GST.^[100] It includes the following costs: Travel, Site Set up, Initial Clean up, Back Propping, Site Clean up, Hire, Accommodation and Supervision. The amounts track very closely the amounts in the first Verus quotation set out in paragraph [147] below, as can be seen from an analysis of the CBCW quote and was broadly confirmed by Mr Johnson in evidence in chief.^[101]
[145]
In the meantime, on 14 May 2018, Formchoice provided (at Mr Tomlinson’s request) separate quotations for hire and for purchase of the equipment to be supplied by Formchoice. There is no reason to doubt that those quotations were the quotations contemplated by the original Formchoice email: see [137](b) above.
[146]
It was common ground between Mr Johnson and Mr Tomlinson that Verus was to purchase the equipment from Formchoice. The purchase alternative appears at Exhibit 2 page 1731. It shows a total purchase price of $36,543.70. (Note that of that sum, $10,100 relates to the last two items.) When they are deducted, the total is $26,443.70. This can be compared to the $26,443.70 in the Original Quote and each of the two revisions described below. The correlation in the figures cannot be a coincidence, especially as the last two items by their description appear to relate to the Stage 2 works. Purchase of the scaffolding was the common intention before the Original Quote was provided. It is also plain from these documents that Mr Tomlinson made clear to Formchoice^[102] that it was Verus that was paying the purchase price (as is reflected in the tax invoice issued for the Formchoice supplied equipment to Verus for $24,416, excluding GST on 23 June 2018).^[103]
[147]
On 15 May 2018 at 2:24pm, within two hours of receiving the final CBCW quote, Mr Johnson sent Verus’ quotation for the Stage 1 works to Mr Tomlinson by email (the Original Quote).^[104] Most of the quotation is standard text. The only relevant part is the tender letter which provides:^[105]

15^thMay, 2018

Sentinel Portfolio Management

Neil Tomlinson

Level 9, 300 Queen St

Brisbane Q 4000

BY EMAIL [email protected]

DUBBO RAMP REPAIR (stage 1)

Thank you for providing us with the opportunity to tender on your upcoming works.

As requested, please find the below as per the brief and documentation supplied.

STAGE	VALUE
PRELIMINARIES	$7,053.70
BACK PROPPING AND ASSOCIATED WORKS	$10,324.22
SCAFFOLDING AND EQUIPMENT	$26,443.70
TRAVEL AND ACCOMODATION	$5,737.60
DELIVERY CHARGES	$4,520.00
BUILDERS WORKS/DEMOLITION	$2,460.55
TOTAL

Kind Regards,

Greg Johnson

Managing Director

TENDER CLARIFICATIONS AND EXCLUSIONS

CLARIFICATIONS:

Verus Construction have provided a cost based on generic plans and specifications.

APPENDIX 1:

Construction Programme and detailed breakdown available on request.

APPENDIX 2:

Safety & Environmental Plans (can be provided on request)

The first Revised Quote from Verus

[148]
It is undisputed that at some stage between 2:24pm on 15 May 2018 and 6:13pm on 16 May 2018, the tender letter was altered by Mr Tomlinson (the first Revised Quote). The dispute is as to the way that event came about: Mr Johnson and Mr Tomlinson say it was the result of a renegotiation on the telephone and the plaintiffs say it was the result of a conspiracy to defraud Sentinel Countrywide.
[149]
The first Revised Quote was sent to Mr Johnson at 6:13pm under cover of an email from Mr Tomlinson stating, “Hey Greg, Confirming you are comfortable with our scope and designs moving forward to activate Stage 1 – Temporary Support whilst we finalise the design & methodology of Stage 2 – Permanent Structure?”.^[106] No designs, other than the Formchoice drawings, had been provided.
[150]
The only changes to the previous tender letter were to the pricing table.^[107] The revised quotation pricing table provided:

STAGE	VALUE
PRELIMINARIES	$17,053.70
BACK PROPPING AND ASSOCIATED WORKS	$76,324.22
SCAFFOLDING AND EQUIPMENT	$26,442.70
TRAVEL AND ACCOMODATION	$5,737.60
DELIVERY CHARGES	$6,530.00
BUILDERS WORKS/DEMOLITION	$8,460.55
TOTAL (ex GST)	$140,539.77

[151]
The changes in the pricing table in the first Revised Quote are as follows:
1. (a)
  Preliminaries is increased by $10,000;
2. (b)
  Back Propping is increased by about $66,000;
3. (c)
  Delivery Charges is increased by $2010;
4. (d)
  Builders Works/Demolition is increased by $6000; and
5. (e)
  The total is increased by $84,010.
[152]
Mr Tomlinson and Mr Johnson both gave evidence that $40,000 of the increase was for the phantom expansion joint works already discussed (see paragraph [140] above), though the detail of their evidence varied on this issue, as will be seen.
[153]
The “Scaffolding and Equipment” item remained at $26,442.70, and “Travel and Accommodation” remained at $5,737.60.
[154]
On 16 May 2018, at 8:02pm, Mr Johnson replied by email stating that he was happy with the scope of works for Stage 1 and that it had “captured all in the attached tender submission”.^[108] The submission attached was the first Revised Quote that Mr Tomlinson had sent Mr Johnson just two hours before.

Mr Tomlinson’s dealings with Sentinel

[155]
Thereafter, Mr Tomlinson followed a familiar course, though with some variations on his previous conduct.
[156]
For some reason, he further increased the first Revised Quote to $155,548.77. He did so by adding $10,000 to “Delivery Charges” and $5000 to “Builders Works/ Demolition” (the second Revised Quote).^[109] Next, he fabricated quotes from JMC Commercial and Bodel for the Stage 1 works in the amounts of $178,658.00 and $166,372.80.
[157]
He then, on 17 May 2018, submitted a Capex Request Form for the Stage 1 works attaching the three quotations and recommending the second Revised Quote from Verus be accepted.^[110] Mr Tomlinson admitted that he knew Sentinel Countrywide would rely upon the information in the Capex Request Form. He does not admit on this occasion that in reliance on that recommendation, Sentinel Countrywide approved the second Revised Quote, but it is plain in the circumstances that it did. Further, he then sent Verus an email confirming that the first Revised Quote had been accepted (even though the second Revised Quote had in fact been accepted for some $15,000 more). A purchase order was provided on Friday 18 May 2018 at 12:15pm, which purported to accept the first Revised Quote.^[111] It seems likely that there would have been terms on the reverse of the Purchase Order, but there is no evidence of that before me.
[158]
There appears to have been no further documentation of the contract for the Stage 1 works. Accordingly, so far as it was in writing, the Verus contract comprised the first Revised Quote and the Purchase Order. It might also have been partly oral, based on the alleged conversations described by Mr Tomlinson and Mr Johnson referred to in paragraph [148] and explained in more detail below.

Events post-contract

[159]
Events moved quickly post-contract. On 18 May at 1:33pm, Mr Johnson caused Verus to issue a claim under the Verus contract for a deposit of $98,377.84 (excluding GST).^[112] I could locate no term in the first Revised Quote, nor anywhere else which conferred any right to a deposit, much less a deposit of some 70%, nor could Mr Tomlinson in evidence. I note that that claim asserted that the value of the work to date was the amount of the deposit. That was not true, as no work was done then or was done for some days after.
[160]
On the same day at 4:47pm, Mr Tomlinson forwarded Verus’ deposit claim for payment to Sentinel Countrywide. At the same time, Mr Tomlinson forwarded to Sentinel Countrywide an invoice from the Taylor Family Trust in the amount of $11,250 issued to Sentinel Countrywide. The invoice was for “Round trip to load, transport, unload and return structural steel and scaffolding”.^[113]Although this invoice is contentious, some things should be said about it here:
1. (a)
  Mr Taylor was a one-time work colleague of Mr Tomlinson and involved with Growth Australia;
2. (b)
  Mr Taylor provided a blank invoice to Mr Tomlinson on 10 May 2018;^[114]
3. (c)
  Mr Tomlinson gave evidence that Mr Taylor was to assist him in performing the expansion joint works;^[115]
4. (d)
  The sum was paid by Sentinel; and
5. (e)
  On 27 June 2018, Mr Taylor wrote to the plaintiffs’ solicitor stating he knew nothing of the use of the blank invoice form by Mr Tomlinson and thought he had been paid the funds as a gift from Mr Tomlinson.^[116] That evidence was contained in a letter admitted into evidence without objection, but Mr Taylor was not called or required for cross-examination by Mr Tomlinson, and Mr Tomlinson denied that its contents were true.^[117]
[161]
On the same day at 5:27pm, Mrs Tomlinson sent an email attaching an invoice from a company of which she was a director, Arete Park, to Mr Johnson of Verus.^[118] Mr Tomlinson sent this invoice to himself just 11 minutes earlier and sent the 5:27pm email as well. The email states: “Thank you for allowing Arete Park to be a part of your project at Riverdale, Dubbo. Please find attached our full and final tax invoice for our consultancy services…” That invoice seeks payment of $40,000 plus GST for “Project Consultancy Services – Riverdale, Dubbo”.
[162]
Arete Park was set up by Mr Tomlinson on 9 May 2018. He gave evidence that he intended to use it to carry out trade work by him as a flooring contractor and to receive income from, and to pay for, his daughter’s equestrian expenses.^[119]
[163]
On 21 May 2018, Verus issued purchase orders of its own to Formchoice and CBCW:^[120]
1. (a)
  The purchase order issued to Formchoice was $25,795.70 and did not identify the goods purchased beyond confirming the order for “Stage 1 – temp prop works”. However, given the matters in paragraph [146] above, it is likely that it was understood by both Formchoice and Verus as relating to all but the last two items in the purchase alternative provided by Formchoice. The difference in amounts is de minimus.
2. (b)
  The purchase order to CBCW was for $17,000, not the quote given by CBCW ($20,901.32). The difference is unexplained.
[164]
The Stage 1 works were in fact carried out over about seven days towards the end of May 2018 by Mr Kitcher, a carpenter, and his son. Mr Kitcher did the work in accordance with the Formchoice plans. Mr Rod Cunningham of CBCW brought down the propping materials (“the scaffolding”) from Formchoice and met Mr Kitcher at Dubbo. There were basic traffic control using barriers from Coates Hire and additional work resulting from debris in an area under the ramp not seen until a door was knocked down. Mr Kitcher saw no one from Sentinel. He recalled meeting a man on site briefly who said he was from Verus. He said he initially estimated $8000 to $12,000 for the job, but ultimately charged $14,482 to cover additional digging and some timbers he purchased.^[121] His evidence was not challenged in cross-examination.
[165]
On 29 May 2018, the Verus deposit claim was paid by Sentinel, along with Mr Taylor’s tax invoice.
[166]
On 31 May 2018, CBCW issued a variation claim for $2000 for delivering the materials to the Dubbo site (this is plainly Mr Cunningham’s work described by Mr Kitcher).^[122] On the same date, Formchoice issued Verus with an invoice for $1500 for the further design work referred to in paragraph [140] above, which was managed by Mr Burfoot for Verus. There is no documentary evidence of any other external costs being incurred by Verus apart from those the subject of the original Purchase Orders to Formchoice and CBCW. There is no evidence that CBCW passed on any claim for a variation based on Mr Kitcher’s increase in his estimate.
[167]
On 1 June, Verus paid some $22,000 to Arete Park.
[168]
On 4 June, Verus issued its second claim for payment to Sentinel for the balance of the price for the Dubbo Works: $42,161.93.^[123] That second claim was not paid by Sentinel Countrywide prior to Mr Tomlinson’s dismissal and thereafter Sentinel refused to pay it. Verus sues for the sum as the balance due under the contract.

Disputed issues

[169]
The above findings provide the context for the identification of the substantial issues in dispute on the Verus claim. The disputed issues are of larger compass, because of the case advanced against Verus.
[170]
The plaintiffs allege that:
1. (a)
  There was no change in the scope of works between the Original Quote and the first Revised Quote and Verus knew that;
2. (b)
  Mr Tomlinson had no proper basis to increase the Original Quote or to fabricate the competing quotes;
3. (c)
  But for Mr Tomlinson’s conduct, Sentinel would have paid no more for the Stage 1 works than the amount of the Original Quote;
4. (d)
  Verus in fact incurred no external costs for carrying out the work apart from the payments to Formchoice and CBCW;
5. (e)
  Arete Park had not provided, and was not intended to provide, any services to Verus and Mr Johnson knew that;
6. (f)
  For those reasons, it can be inferred that Mr Johnson of Verus, Mr Tomlinson and Arete Park conspired to obtain the increase on the Original Quote from Sentinel Countrywide for their shared benefit;
7. (g)
  Alternatively, Verus’ knowledge of Mr Tomlinson’s conduct was such as to make it liable as an accessory to Mr Tomlinson’s dishonest breach of fiduciary duty on one or both of the bases identified in Barnes v Addy.^[124]
[171]
Mr Tomlinson’s position on these matters is similar to, but distinct from, Mr Johnson’s position on behalf of Verus. Mr Tomlinson contends:
1. (a)
  There was a proper basis to increase the Original Quote because Mr Johnson misapprehended the risks associated with the work required and because the scope was changed to add the expansion joint works as explained in a telephone call by Mr Tomlinson with Mr Johnson;
2. (b)
  The lack of a relevant licence otherwise justified fabrication of the quotes;
3. (c)
  It would have been impossible for Verus to carry out the Stage 1 works for the Original Quote because that quote did not include “all of the engineering design of Formchoice or compliant structural support”, nor digging and traffic management;^[125]
4. (d)
  There was no defence to the allegation in paragraph [170](d) above, though one might think Mr Tomlinson would not be in a position to advance a positive case to the contrary;
5. (e)
  Arete Park was intended to be the vehicle by which Mr Tomlinson provided the expansion joint works, and Mr Johnson knew that; and
6. (f)
  There was accordingly no conspiracy, nor participation in any breach of duty.
[172]
Mr Johnson’s responses on behalf of Verus can be summarised as follows:
1. (a)
  There was a proper basis to increase the Original Quote because Mr Johnson had misapprehended the risks associated with the work required and because the scope was changed to add the expansion joint works as explained in a telephone call by Mr Tomlinson with Mr Johnson;
2. (b)
  There was a proper basis to increase the Original Quote to the first Revised Quote, but Verus had no knowledge of any other conduct by Mr Tomlinson in fabricating or increasing quotations;
3. (c)
  Verus denies that Sentinel would not have paid more than the amount of the Original Quote because, broadly, it properly revised its price following the discussions with Mr Tomlinson about the matters in (a) above;
4. (d)
  Verus pleaded that it incurred or would have incurred other costs in carrying out the work comprising:
  1. The additional work beyond that done by CBCW (referring to the telephone conversation covering, inter alia, the expansion joint works);
  2. The costs it incurred were those set out in the “Verus Costing Information for Dubbo Project” (the Costing Schedule);
  3. Contract administration and office overheads;
  4. Staff costs to procure subcontractors; and
  5. Third party subcontractors’ costs.
5. (e)
  Verus “believed it owed an obligation to Arete Park”;
6. (f)
  Verus accordingly denies it conspired with Mr Tomlinson; and
7. (g)
  Verus denies it had any knowledge of Mr Tomlinson’s actions fixing it with liability for any breaches by him.

Mr Tomlinson

Introductory comments on the claims against Mr Tomlinson

Deceit

[173]
Subject to proof of loss, the plaintiffs have established their cause of action in deceit against Mr Tomlinson on his own admissions in pleadings and at trial.
[174]
The elements of the tort of deceit are not contentious.^[126] The plaintiff must establish that:
1. (a)
  The defendant makes a representation of fact to the plaintiff which is untrue;
2. (b)
  The defendant knows that the represented fact is untrue or is reckless as to its truth or falsity;
3. (c)
  The defendant intends the plaintiff to rely on the representation;
4. (d)
  The plaintiff in fact relies on the representation; and
5. (e)
  The plaintiff suffers damage by such reliance.
[175]
There is no question that the evidence sustains the conclusion that in each project:
1. (a)
  Mr Tomlinson provided three quotations in a context whereby he represented that they were genuine quotations given at arms’ length for the amounts specified;
2. (b)
  That representation was false and known by him to be false because he fabricated and altered the quotations in each case;
3. (c)
  He intended the relevant plaintiff to rely on his false representation by awarding the work on the relevant project to his chosen contractor, to whom he allocated the lowest quotation; and
4. (d)
  The relevant plaintiff in each case relied on that false representation to award the work, as Mr Tomlinson intended, to his chosen contractor.
[176]
What then is Mr Tomlinson’s answer to the claims against him in deceit? He raises four.
[177]
First, he contends that he engaged in that fraud, not for the purpose of enriching himself or his chosen contractor, but rather to prevent Shield, his employer, from breaching s. 42(1) QBCC Act.
[178]
Second, he contends that in no case did the relevant plaintiff suffer any loss, because the contract sum which it paid to the selected contractor in each case was the correct market price for the work. This was so, despite the lack of an open tender process, he contended, because:
1. (a)
  In all cases, he had determined the market price using pricing software and industry data; and
2. (b)
  In some cases, because the lower genuine quotations given in most of the projects were based on incomplete scopes of work.
[179]
Third, he rejects the plaintiffs’ contention that his purpose was to benefit the builders he favoured and/or himself. He contends he did not benefit from his deceit, at least in a way which affects his credibility. He says:
1. (a)
  He received no benefit from any of the Bodel projects;
2. (b)
  His benefit from Growth Australia was admittedly wrong, but was offered as a consequence of his award of the cladding contracts, not as an inducement to facilitate the award of the cladding contracts; and
3. (c)
  His benefit through Arete Park was to be for the expansion joint works at Dubbo for the benefit of Sentinel.
[180]
Finally, he contends that the plaintiffs have been compensated for the loss they allege in any event by their settlements with the builders (apart from Verus).

Breach of fiduciary duty

[181]
The plaintiffs contend that Mr Tomlinson owed fiduciary duties to both his employer and the relevant Sentinel plaintiff:
1. (a)
  Not to obtain a benefit for himself or a third party arising from his employment without the fully informed consent of both; and
2. (b)
  Not to place himself in a position of conflict between his interests and/or those of the defendants, and his duty to the plaintiffs, arising out of his employment.
[182]
As I have found in paragraph [23] above, there is no doubt that Mr Tomlinson owed the fiduciary duties alleged. Mr Tomlinson’s contentions that his contract of employment somehow negatived those obligations were misconceived.
[183]
The nature of Mr Tomlinson’s conduct said to breach the pleaded fiduciary duty was pleaded in the same form for each project: that is, Mr Tomlinson breached his fiduciary duty to Shield and the relevant Sentinel plaintiff because, by the whole of his conduct pleaded in each claim, he:^[127]
1. (a)
  Obtained for himself and a third party a benefit from his employment without fully informed consent; and
2. (b)
  Was in a position of conflict between his own interests and the interests of the builder in question, and the interests of the relevant plaintiffs.
[184]
This formulation is based, in the case of the benefit allegedly conferred on the successful builders, on the proposition that there was no proper justification for Mr Tomlinson’s conduct in increasing the original quotations given by his favoured builder. A breach of fiduciary duty can arise without fault: that is, where the fiduciary is well-intentioned and acting in good faith.^[128] Accordingly, even if it was accepted that Mr Tomlinson was genuinely motivated by a wish to save Shield from breaching s. 42(1) QBCC Act, that would not protect him from liability where the quotation he put forward on behalf of the successful builder was in excess of the amount which would have been obtained in an open tender process. That applies with particular force to the claims by the Sentinel plaintiffs in each case, who had no interest in protecting Shield from breaching the Act.
[185]
To the extent the breach turns on Mr Tomlinson obtaining a secret profit, it requires proof of some such benefit. There is no proof of any benefit at all in the Bodel projects.
[186]
The loss to be identified of course depends on the particular breach established. Further, the measure of loss for equitable compensation for breach of fiduciary duty is not identical to that in tort. However, the same broad considerations will apply.
[187]
Subject to those observations, the same considerations raised by Mr Tomlinson in respect of the deceit claims arise in the fiduciary duty claims.

Conspiracy and breach of contract

[188]
The conspiracy claim is only maintained against Verus. I will deal with it below. I address the breach of contract claims by Shield at the end of the judgment.

Mr Tomlinson as a witness

[189]
Mr Tomlinson is not a credible or reliable witness.
[190]
First, Mr Tomlinson’s own admissions in evidence and in his pleadings demonstrate that he engaged in a sustained campaign of deception of his employer and the relevant Sentinel plaintiffs in all the projects. Even if his purpose was to avoid breaches of s. 42(1) QBCC Act, and even if he had raised this issue with Sentinel executives as he said, he admits that his specific conduct identified in this judgment was concealed and the relevant members of the Sentinel Group were deceived. The fact he admits his dishonest conduct does not mitigate its seriousness and its effect on his credibility, especially as his conduct was only ended by its discovery by the Sentinel Group and his dismissal.
[191]
Second, even on Mr Tomlinson’s case, he took a secret profit from Growth Australia valued at some $40,000. Although recognising such conduct was “selfish and greedy”, he still sought to justify his conduct on the basis that “gratuities from suppliers and service providers such as tickets to sporting events and subsidised social events was commonplace”.^[129] To equate the two examples is ridiculous and demonstrates a tendency to misconceived self-justification, which itself undermines Mr Tomlinson’s credit. Compounding this were Mr Tomlinson’s submissions on the issue at trial:^[130]

The provision of a referral fee is one that Growth Australia, along with many other businesses in the construction industry, offer to project managers, leasing agents and property managers as a reward for recommending the business for an opportunity to tender. The typical referral fee in the market is approximately 2% of the contract value. The directors of Growth adopted this process when setting up their business as it had been successful during their time with a previous employer, Amicus, where referrers were given either Westfield gift cards or Flight Centre cards pre-loaded with the amount.

There is nothing in my employment agreement regarding the receiving of referral fees or gifts from contractors and suppliers and the culture in the business of other members of staff accepting gratuities did not lead me to believe this was an issue, especially as there was no costs incurred to the plaintiff.

[192]
It is hard to believe that Mr Tomlinson genuinely holds the view that a secret kick back from a contractor to a senior project manager of $40,000 is acceptable business practice. If he does not, this evidence is dishonest. If he does, it provides support for Mr Johnstone’s (counsel for the plaintiffs) submission that Mr Tomlinson has “no conventional understanding of the…line between honesty and dishonesty”.^[131] (Further, as will be seen from paragraphs [247] to [252] below, I reject key details of his explanation as to how the profit came to be offered in any event.)
[193]
Third, I find that Mr Tomlinson’s entire story justifying the $40,000 invoice sent by Arete Park is fabricated. As I have found, there was never any genuine intention for him to carry out the expansion joint works he described, nor were any such works ever advised by Formchoice. That Mr Tomlinson could propound such a detailed narrative to justify his attempt to secretly benefit from his employment in such a large sum, and maintain it all through the trial, further damages his credibility as a witness.
[194]
Fourth, as Mr Tomlinson accepted in the course of his cross-examination, he fabricated three tax invoices from a company called Contract Floors (QLD) Pty Ltd to one of the other Sentinel Group companies, totalling some $38,000, fabricated an email chain to make the invoices appear to be genuine and overdue for payment, and signed off on them authorising their payment. They were paid to his bank account as specified on the tax invoices.^[132] None of this was ever disclosed to the Sentinel Group.
[195]
Mr Tomlinson did not deny any of this, though it was, in any event, proved by the documents. Mr Tomlinson’s explanation for this conduct was convoluted and improbable, and ultimately amounted to the proposition that his conduct was compelled by threats by a disaffected contractor.^[133] I find this explanation very improbable, but even if correct, he could always have gone to the police. There is no evidence that he did. More relevant is Mr Tomlinson’s view that, as Sentinel benefitted from the work at the price quoted in the first place, no harm was done. Even if true, his story does not significantly mitigate the dishonesty of his dealings with Sentinel.
[196]
Fifth, as will be seen in the analysis which follows of the individual claims, there are many other improbabilities which emerge from the close analysis of his evidence.
[197]
Any one of these matters would give cause to treat Mr Tomlinson’s evidence with great caution. Together, they demonstrate that Mr Tomlinson is a person who has consistently and repeatedly made use of deception and fabrication in a manner which shows that he does not understand the difference between honesty and dishonesty, truth and fiction. His evidence must be scrutinised with great care before accepting it on any point where it is not consistent with other credible and reliable evidence.

The QBCC Licensing issue

Relevance

[198]
The explanation Mr Tomlinson gives for his admitted deceptions was his determination to avoid causing Shield to commit offences against s. 42(1) QBCC Act. This issue could potentially be relevant in the following ways:
1. (a)
  If correct, it comprises an explanation for his conduct other than simply to defraud the Sentinel Group by sharing the mark-ups on the quotes of his favoured contractor in each project. That, in turn, might have some relevance to whether there was a breach of fiduciary duty, and to whether Mr Tomlinson was conspiring with the successful builders; and
2. (b)
  As he explains his conduct, it might provide a basis to conclude that there was no loss to the relevant Sentinel owner plaintiff in each case because the price approved was the true market price for the work.
[199]
Mr Tomlinson also relied upon this issue as a defence, arising out of the breach by Shield of his employment contract in requiring him to carry out his work in a way which would have been an offence against s. 42(1).
[200]
To analyse these issues, it is first necessary to make findings about the QBCC issue as developed by Mr Tomlinson in his evidence and submissions.

Mr Tomlinson’s version

[201]
Mr Tomlinson’s version of the events relevant to his QBCC issue is set out in his s. 92 Statement and can be summarised as follows:^[134]
1. (a)
  At the time he started with Shield, he was sensitive to the risks of the importance of proper licensing because of a problem encountered by his previous employer;
2. (b)
  When he joined Shield and understood its role in the Sentinel Group, he formed the view that Shield required a Project Management licence to lawfully carry on its business and that he was unable to carry out his duties without breaching s. 42(1). He specifically said (at paragraph 7):

I used the online tool on the QBCC website ‘When a Contractor Licence Required’ to ascertain what elements of my role would be in conflict with the legislation…shown in more detail on pages 137-144 [of his trial bundle]”

(c)
He initially told Mr Tim McKinley, an executive of the Sentinel Group who asked for more information. Mr Tomlinson showed him the details on the website (presumably those referred to above) and examples of other Project Management consultancies with licences “such as those on pages 145 to 167 [of his trial bundle]”;^[135]
(d)
Mr McKinley told him to “keep this quiet” as Mr Ebert would “lose his shit” and to find a way to do the work “without compromising Shield”;^[136]
(e)
He said this was challenging because a licence was required for all contract administration tasks. He said he asked Mr McKinley for access to BlueBeam so he could create “first principle budgets” for projects with rates from Rawlinsons;^[137]
(f)
Thereafter, he says he adopted the following practice:^[138]

15 Using the combination detailed in paragraph 11, I was able to create precise budgets and approach a single select contractor for engagement on the basis that:

(a)
Their scope was complete and included all design & approvals, taking the design management responsibility and risk from Shield;
(b)
Their lump sum price was viewed as a Guaranteed Maximum Price with no variations being approved, reducing the financial management required of Shield when administering the construction contract;
(c)
They did not submit progress claims for assessment, only a deposit if required and final invoice on completion, again reducing the financial management required of Shield when administering the construction contract;
(d)
A clear and concise construction program showing a single critical path and achievable completion date is produced by the builder and included an allowance for inclement weather for them to manage, reducing the time management risk to Shield when administering the construction contract; and
(e)
Final inspections on completion were completed by either the tenant or the Facility Manager for that particular property, reducing the quality management risk to Shield when administering the construction contract.
1. The biggest problem he encountered in going about his job in that way was the need to provide three quotations to meet the compulsory Capex procedures which Mr McKinley was adamant would not be changed for “probity reasons”;^[139]
2. Without any apparent irony, he goes on to swear that, after deliberating as to how he could perform his role without offending against s. 42(1), he decided to continue with the approach set out above and adopt the device of fabricating competing quotations;
3. He did not “share [his] actions with any of [his] colleagues, builders, or anyone outside of work due to the potential damage to Shield and Sentinel Property Group should the fact they had been illegally charging their investors for almost 8 years be made public”;^[140] and
4. He said he continued to raise the issue with Mr McKinley and was told to keep quiet and do his job or Mr Ebert would likely dismiss him. He was comforted by similar sentiments from Mr Myers in a text conversation he exhibited.

[202]
He then proceeded to explain how he adopted his approach in each of the projects which were the subject of the proceedings, except the Growth Australia projects and the Springwood AC project. In each case, he set out a cost plan which he swore showed the first principle budgets he relied upon to set the contract price for the successful contractor:
1. (a)
  The Dubbo Works he valued at $157,702.20;^[141]
2. (b)
  The F45 Fitout Works he valued at $131,502.30;^[142]
3. (c)
  Springwood Lifeline Make Good Works he valued at $51,391.16;^[143]
4. (d)
  200 Creek Street Works he valued at $42,137.51;^[144] and
5. (e)
  The Hub Fitout Works he valued at $147,786.57.^[145]

Analysis of Mr Tomlinson’s version

Expression of concerns about licensing to Sentinel officers?

[203]
I reject Mr Tomlinson’s account of his discussions with officers of the Sentinel Group about the licensing issue.
[204]
The evidence at trial does not support his version. The evidence of Mr Ebert and Mr McKinley at trial is accurately summarised by the plaintiffs’ trial submissions. Mr Ebert gave evidence that:^[146]
1. (a)
  Neither Mr McKinley nor Mr Myers ever raised with him any issue that there was a requirement of Shield Property Services to hold a QBCC licence;^[147] and
2. (b)
  That the first he heard that Shield Services might require a QBCC licence was when he received a phone call from the QBCC “after Mr Tomlinson reported it”.^[148]
[205]
His evidence was not challenged by Mr Tomlinson in cross-examination.
[206]
Mr McKinley initially gave evidence that Mr Tomlinson never raised licensing issues with him and rejected the matters in paragraph [201](c) and [201](d) above. In cross-examination, the only matter initially put to Mr McKinley was that the last conversation he had with Mr Tomlinson about licensing was the beginning of March 2018. He said he recalled no such conversation.
[207]
Mr Tomlinson also relied on a document tendered in evidence that he contended was a copy of a text chain with Mr McKinley which he forwarded to Mr Myers.^[149] That appears to confirm Mr Tomlinson’s account of his discussions with Mr McKinley. Mr McKinley was recalled for further cross-examination to permit Mr Tomlinson to put this matter to him. Mr McKinley denied the exchange occurred and Mr Tomlinson’s cross-examination took the matter no further. Mr Myers was not called by either party.
[208]
The text exchange was disclosed. It looks authentic. I considered the possibility that it was in fact sent. It is not hard to imagine that if the licensing issue was one about which the Sentinel Group had concerns, but was avoiding, there would have been an incentive for Mr McKinley and Mr Myers to say the matters ascribed to them by Mr Tomlinson. However, I am not persuaded that I should reject Mr Ebert and Mr McKinley’s evidence:
1. (a)
  The basis for those witnesses to give misleading evidence about the matter which I have identified is entirely speculative. The fact that a licence was obtained by Shield later does not provide a sufficient basis to infer an earlier motive, especially as that licence was obtained because of Mr Tomlinson’s complaint to the QBCC after his dismissal for dishonesty;
2. (b)
  I have no other reason to doubt the credibility or reliability of either witness;
3. (c)
  Given Mr Tomlinson’s demonstrated practice of fabricating documents, I am not persuaded by the apparently authentic appearance of the text exchange to treat it as authentic.
[209]
However, even if Mr Tomlinson is correct that at some point he raised the question of licensing, and was told that it was not an issue and he should get on with his work, it is hard to see what possible assistance that could be to him. He concealed his conduct from everyone at the Sentinel Group and they could not possibly have imagined he would behave as he did.

Mr Tomlinson’s QBCC “risk strategy”

[210]
I refer to Mr Tomlinson’s evidence about his strategy to alleviate the risk of breaches of s. 42(1) in paragraph [201](f). Mr Tomlinson presents this as a deliberate strategy which explains his fabrications in each case in a way which shows his concern for the affairs of Shield. I do not accept he ever had such a strategy. There is no evidence at all that he ever took all the steps described there in any project. For example, there is no evidence that in any project, he engaged his preferred contractor on the communicated basis that “their scope was complete and included all design and approvals”. The presentation of this so-called strategy is at best an ex post facto reconstruction. Further, the detail of the uncontentious facts of each project is inconsistent in numerous ways with Mr Tomlinson’s evidence. The only common facts to all projects are that:
1. (a)
  Mr Tomlinson chose a contractor he wanted to give the work to;
2. (b)
  Mr Tomlinson increased the quotations initially given by those contractors; and
3. (c)
  Mr Tomlinson fabricated other quotations to ensure that his chosen contractor won the work.

Mr Tomlinson’s “market price” calculations

[211]
I refer to Mr Tomlinson’s evidence that he had worked out the proper market price for each project using Rawlinsons and an estimating software package called BlueBeam,^[150] and his evidence propounding a cost plan for each project.
[212]
I do not accept that the evidence he gave in his s. 92 Statement in this regard is correct.
[213]
First, none of this was pleaded, much less particularised. The exception which proved the rule is the defence in relation to the Verus claim at paragraph 27(h)-(i), where, in response to an allegation that the result of Mr Tomlinson’s conduct in the Verus project was that Sentinel paid more than it would otherwise have done for the Stage 1 works, Mr Tomlinson pleads a denial and this explanation:

The amount agreed upon by [him] and [Verus] was within the range of the first principle estimate generated by the estimating software provided by [Shield] and was fair and reasonable when considering the complex methodology required to complete the work.

[214]
The plaintiffs sought particulars of this allegation and none were provided. Further, nothing was disclosed about these calculations before the s. 92 Statement was delivered on the morning of the second day of the trial.
[215]
Second, it was evident in cross-examination that the cost plans were reconstructions of what Mr Tomlinson said he would have done. Given his capacity for fabrication and reconstruction, I would hesitate to accept that evidence, unless it was corroborated in some way. It was not. Further, looked at in a practical sense, it was unpersuasive. His contention was that it represented the market value for the work in the five projects he recalculated. However, a good indication of the market value of the work (absent some clear failure of the contractors to price the whole of the work) was found in the quotations given by experienced arms’ length contractors.
[216]
Third, although Mr Tomlinson was not required to comply with the rules relating to expert opinion in the Uniform Civil Procedure Rules 1999 (Qld) (UCPR) because he was a party to the proceedings, the fact remains that his evidence in the cost plans comprised expert evidence of the likely market value of building works. No proper basis for that estimate is established in his cost plans: the scope of work being considered is not properly identified (if at all), nor were the plans or other documents which provide the basis for the quantities assumed. Absent this kind of detail explaining how the cost plans were developed, I put no weight on them at all.

Place of QBCC issue in Mr Tomlinson’s conduct

[217]
What remains of Mr Tomlinson’s evidence about his motivation for his deceptions of his employer and principal? Did he engage on his campaign of marking-up arms’ length prices and fabricating higher competing quotes because of his concern about breaching s. 42(1)?
[218]
The plaintiffs’ submission is that the entire s. 42(1) issue was fabricated later to conceal his deliberate fraudulent scheme involving the contractors who benefitted. There are some difficulties with that proposition, at least in the early projects with Bodel:
1. (a)
  There is no evidence that Mr Tomlinson sought or obtained a benefit from any of the Bodel projects. It is possible that he did, and it has not been discovered by the plaintiffs, but there is insufficient evidence for me to make that assumption;
2. (b)
  The fact that the Bodel defendants repaid an amount equal to all of Mr Tomlinson’s mark-ups on their original quotations does not permit me to draw the inference that Bodel was an active participant in a conspiracy with Mr Tomlinson to profit from the Sentinel Group and share the spoils. There are any number of other inferences which explain their conduct (such as not wanting to spend money on litigation), and bearing in mind the Briginshaw principle, it is not an inference I draw; and
3. (c)
  There is also the consideration, common to all but the Growth Australia projects, that Mr Tomlinson obtained a lower quotation from the relevant builders and then increased them, creating the paper trail which ultimately is relied upon by the plaintiffs. From that perspective, if there was a conspiracy, it was not a very good one.
[219]
The plaintiffs’ hypothesis to explain those considerations was that Mr Tomlinson was trying out his scheme in a small way to see if it would work, and then embarked on profiting from it when confident of its efficacy. And of course, fraudulent conduct is often carried out incompetently.
[220]
Ultimately, I am uncertain whether Mr Tomlinson harboured real concerns about the s. 42(1) issue, fabricated them to explain his behaviour, or magnified a minor concern in reconstructing his recollection of what was in his mind. Mr Tomlinson’s conduct in relation to the plaintiffs, both in his employment and in the way he conducted the trial, was so erratic and deceptive that I am unable to form any final view on that issue. Ultimately, it matters little in any event.
1. (a)
  First, even if he did harbour concerns about licensing (and that explains some of his behaviour), it is evident that he took the opportunity to begin enriching himself in any event in relation to Growth Australia and the Dubbo Works.
2. (b)
  Second, even if he did harbour concerns, the most that could be said is that he kept his concern to himself and, in a piecemeal manner, went about his job in a way designed to secure a generous margin for a chosen contractor in the hope this would mean no contract administration was necessary. He admits he concealed this conduct from his employer, in his own interests, to protect his well-paying job.
3. (c)
  Third, because of his self-interest in protecting his employment, he concealed his concerns from the Sentinel plaintiffs. This had the effect of exposing those plaintiffs, as owners and principals for whom he was acting, to higher contract prices than were otherwise required. This comprised a clear breach of his fiduciary duty to those plaintiffs as principals.
[221]
Having dealt with those general issues relating to Mr Tomlinson’s case, I now turn to making specific findings in respect of each project.

Findings on the Bodel projects

The F45 Fitout Works

[222]
I refer to paragraphs [31] to [44] above. Mr Tomlinson gave evidence that the incorrect scope of work had been sent to all the builders except Bodel, with the result that the other quotations had “items of concern” as set out in the table in his s. 92 Statement. He said that he gave the full scope just to Bodel and negotiated the price directly with Mr McIntyre.^[151] I reject this evidence for the following reasons:
1. (a)
  First, Mr Tomlinson says that the leasing agents provided the wrong scope of work. While it is perhaps possible that the leasing agents provided the scope for the first tranche of quotations (because Mr Tomlinson was not long in the job at the time of the first lot of quotations), it seems highly improbable that the second tranche of quotations obtained after 30 November 2017 was based on documents provided by the agents. The documents show he was closely involved in this project by late November 2017;
2. (b)
  Second, there is no documentary evidence that all the other builders were sent the wrong scope. Indeed, Mr Tomlinson gives no evidence at all as to the “right” and “wrong” scope of works. While he might not have had access to such documents, it was never suggested that they existed or that the plaintiffs’ disclosure was incomplete (this is a common theme, as will be seen);
3. (c)
  Third, there is no good reason why the “right” documents would have been given to Bodel, but the “wrong” documents would have been given to Verus, which submitted its quote on the same day as Bodel. And there is no documentary evidence, as I said, of what the “right” scope of works was;
4. (d)
  Fourth, there was no evidence of what, if any, discussions occurred with Mr McIntyre about the scope of work; and
5. (e)
  Fifth, the table in paragraph 68 of the s. 92 Statement was produced years after the events. I do not accept it records views Mr Tomlinson held in early 2018. Further, the problem he identifies is “risk of variation”. That matter can only be properly assessed by reference to the scope of work.
[223]
This project also provides a further basis to reject Mr Tomlinson’s evidence as to the accuracy of his own calculation of the market price at paragraph 70 of his Statement. Four out of six builders gave prices between $70,000 and $80,000, which is direct evidence of the market price for the work. More compellingly, it is evidence of what price those builders would in fact have accepted to do the work. That is direct evidence of the actual loss arising from Mr Tomlinson’s deceit in recommending the highest of the six quotes. There is no credible evidence that the work would not have been done for the lowest of the quotes, and I accept that, on the balance of probabilities, it would have been so completed if Mr Tomlinson had not deceived Shield and the relevant Sentinel plaintiff.
[224]
This project also shows the inconsistency between Mr Tomlinson’s version of how he approached matters to avoid breaches of s. 42(1) (see paragraph [201] above) and what he actually did. The inconsistencies are numerous, but include:
1. (a)
  That he sought further prices from three builders in the second round of tenders, thereby engaging in project management work on his version; and
2. (b)
  That he says he calculated the market price, but did not inflate the Bodel quote to that level. If his practice was to do so to ensure a minimum of project management, he should have adopted his calculated price.
[225]
Accordingly, I find that the plaintiffs have established their case in deceit in respect of this project and that the amount of the loss was, prima facie, the $48,793.58 claimed. I say prima facie for this and the other Bodel and Growth Australia claims to recognise that I am yet to deal with Mr Tomlinson’s contention that no loss remains following the settlements.
[226]
I deal with the fiduciary duty claim for all of the Bodel projects at the end of this section.

The Lifeline Make Good Works

[227]
I refer to paragraphs [53] to [55] above. For the reasons already given, I reject the defence based on concerns about s. 42(1). I add further that his admitted conduct in this case is inconsistent with the practice he described in his s. 92 Statement, because he approached two tenderers, not just one. Further, I do not accept that he increased the Bodel quote based on his own market value calculation as sworn to at paragraph 76 of his Statement for the reasons already given.
[228]
As to his change of scope case, I do not accept that any change of scope ever occurred. Mr Tomlinson describes what he says occurred in this regard at paragraphs 74 to 75 of his Statement. However, there is no evidence of these events at all apart from his uncorroborated testimony and the increase in the price. I do not accept his uncorroborated testimony.
[229]
I find that Mr Tomlinson unilaterally increased the Bodel price for the Lifeline Make Good Works and that no reason justifying that step in the interests of the relevant Sentinel plaintiff is shown. There is no credible evidence that Bodel would not have done the work for the original price.
[230]
Accordingly, I find that the plaintiffs have established their case in deceit in respect of this project and that the amount of the loss was prima facie the $10,000 claimed.

The Hub Fitout Works

[231]
I refer to paragraphs [57] to [67] above. I reject Mr Tomlinson’s propositions advanced to justify the increase in price summarised in paragraph [66] and in his s. 92 Statement. The timing and way the price was increased from the Original Quote are inconsistent with all his explanations:
1. (a)
  As summarised in paragraph [58], Mr Tomlinson increased the quotation and sent it back to Bodel in 34 minutes, and 14 minutes later, Bodel purported to resend Mr Tomlinson’s revised quote as its own.
2. (b)
  It is extraordinarily improbable that an assessment of the scope of the work priced, a discussion about price and the determination of a higher price occurred in that short time and in that manner.
3. (c)
  Most remarkable was Mr Tomlinson’s action in proposing the price increase to Bodel. As he recognised, that is not how building commerce works.
4. (d)
  Further, there is no suggestion in writing that the price is a so-called Guaranteed Maximum Price, whatever that phrase is meant to mean in this context.
[232]
Further, Mr Tomlinson’s Statement at paragraphs 94 to 99 gives a version of the events which cannot be reconciled in any way with the uncontentious facts. I do not accept any of that evidence.
[233]
Again, I find that Mr Tomlinson unilaterally increased the Bodel price for The Hub Works and that no reason justifying that step in the interests of the relevant Sentinel plaintiff is shown. There is no credible evidence that Bodel would not have done the work for the original price.
[234]
Accordingly, I find that the plaintiffs have established their case in deceit in respect of this project and that the amount of the loss was prima facie the $11,442.60 claimed.

Creek Street Property Tenancy Works

[235]
I refer to paragraphs [68] to [74] above. Mr Tomlinson’s Statement sought to explain the increase in the Bodel price at paragraphs 86 to 90. There is no documentary evidence before the Court of any of the facts he describes. Further, the account is inconsistent with the admitted facts. One glaring example is the contrast between paragraph 86 of his Statement (the initial quote being based on a sketch) and the admitted facts in paragraph [69] above. I reject the evidence in his Statement. Again, I find that Mr Tomlinson unilaterally increased the Bodel price for the Creek Street Works and that no reason justifying that step in the interests of the relevant Sentinel plaintiff is shown. There is no credible evidence that Bodel would not have done the work for the original price. Accordingly, I find that the plaintiffs have established their case in deceit in respect of this project and that the amount of the loss was prima facie the $10,442.60 claimed.

Springwood Property Air Conditioning Works

[236]
I refer to paragraphs [75] to [80] above. Mr Tomlinson purports to explain his argument about the change in the scope of work in his Statement. However, I do not accept his explanation. It is inconsistent with the admitted facts, not least because it is premised on events which occurred after he altered the original quotations. It also fails to explain why the Bodel quotation was increased.
[237]
Again, I find that Mr Tomlinson unilaterally increased the Bodel price for the AC Works and that no reason justifying that step in the interests of the relevant Sentinel plaintiff is shown. There is no credible evidence that Bodel would not have done the work for the original price, and again some support for that conclusion can also be drawn from Bodel’s willingness to repay the excess by way of settlement.
[238]
Accordingly, I find that the plaintiffs have established their case in deceit in respect of this project and that the amount of the loss was prima facie the $9,155.60 claimed.

Breach of fiduciary duty and the Bodel projects

[239]
The plaintiffs allege that by his conduct in respect of each of the Bodel projects, Mr Tomlinson breached the fiduciary duties he owed both to Shield and the relevant Sentinel plaintiff because he:
1. (a)
  Obtained for himself and Bodel a benefit from his employment without consent; and
2. (b)
  Was in a position of conflict between his own interests and those of Bodel, and the interests of Shield and Sentinel.
[240]
Although not the subject of detailed submissions, the plaintiffs maintained the fiduciary duty claims.
[241]
The statement of claim never identified the benefit Mr Tomlinson received, nor how he favoured his own interests by his dealings with Bodel. There is no suggestion in the evidence that he sought or obtained any payment or other benefit from Bodel and it was not suggested in cross-examination that he did. That seems to leave concerns about QBCC compliance as the only remaining candidate. However, I repeat and rely on the analysis set out in paragraphs [217] to [221] above.
[242]
As stated there, I am unable to work out exactly what Mr Tomlinson was doing and why. However, even if his explanation was his concerns about QBCC compliance, his conduct was in breach of his fiduciary duties because he adopted his bizarre strategies to protect his high paying job. In that respect, he preferred his own interests to those of his employer and the Sentinel principal to whom he owed duties, even if he did not benefit directly from payments from Bodel.
[243]
I find that the relevant plaintiffs have also made out their claims for breach of fiduciary duty in relation to the Bodel projects as well.

Findings on the Growth Australia Projects

[244]
I deal with the facts relating to these claims at paragraphs [88] to [134] above. As with the Bodel claims, Mr Tomlinson engaged in deceitful conduct by fabricating competing quotations for higher amounts than the quote initially obtained: see paragraph [102]. He also increased the Original Quote obtained by him, this time because of the margin added by Growth Australia to the authentic ACLAD quotations: see paragraphs [101] and [103]. There is no question then that Mr Tomlinson prima facie committed the tort of deceit in inducing the relevant Sentinel entity to enter into the contracts with Growth Australia.
[245]
There is also no question that the loss suffered was the amount claimed: that is, the difference between the amount which had been paid to Growth Australia when the fraud was detected and the value of the work done to that point: see paragraphs [111] to [117] above. The review of the ACLAD tenders shows that ACLAD priced the whole of the works, including project administration, and had the licence to do so.
[246]
The claim for damages in the amount of $299,415.54 is prima facie made out.
[247]
That leaves the fiduciary duty claim to be determined. Unlike the Bodel claims, Mr Tomlinson received a secret profit valued at $40,613 by payment by Growth Australia for the stables at his home. Mr Tomlinson nonetheless maintains that he did not negotiate the Growth Australia contracts for the purpose of obtaining that benefit, but that he did so because of his bona fide concerns that ACLAD did not have a proper licence. He said the kick back was offered after the contract was awarded.
[248]
As I have observed, care must be taken in making findings of involvement in serious misconduct in circumstances where the officers of Growth Australia involved in the cladding contracts are not before the Court. That is particularly so where the only person giving evidence about their involvement is Mr Tomlinson. It might be thought, however, that it is difficult to conclude other than that Growth Australia knew that it was improper to pay Mr Tomlinson the benefit that it did.
[249]
In any event, I do not have to make final findings about what was known by Growth Australia’s officers from time to time to deal with Mr Tomlinson’s position as a fiduciary of the relevant plaintiffs.
[250]
The starting point is to identify Mr Tomlinson’s state of mind about the licensing of ACLAD in April 2018, as that is relied upon by him to explain his conduct in retaining Growth Australia at all. In my view, Mr Tomlinson did not believe that ACLAD was unlicensed in April 2018. The ACLAD quotations on their face make crystal clear that ACLAD had the necessary licence: see paragraph [96] above. I do not accept that someone like Mr Tomlinson, who on his own admission was very concerned about licensing, would have failed to notice that.
[251]
Once that is recognised, the overwhelming inference is that he involved Growth Australia for the purpose of securing the payment for the stables. That inference is also supported by other specific matters:
1. (a)
  First, I refer to the matters in paragraphs [124] to [128] above. There is no evidence of any earlier quotation and the uncontested facts are directly inconsistent with that occurring, given that ACLAD was only asked to quote on 6 April 2018 and only provided one quotation on 11 April 2018. Given Mr Tomlinson was already counting on the bill for the stables being paid by Growth Australia on the evening of the same day, he must have already sought that benefit before 11 April. This strongly suggests that the payment was a condition of awarding the contract to Growth Australia, rather than a spontaneous offer from Growth Australia;
2. (b)
  Second, there is the inexplicable payment of a large deposit when no such deposit was provided for in the written contracts with Growth Australia and it was considerably more than the amount of the deposit sought by ACLAD. This appears to have been a non-contractual benefit just given to Growth Australia;
3. (c)
  Third, there appears to be nothing of substance that Growth Australia was required to do for the large net profit built into the two contracts. This is consistent with the email stating that all Growth Australia had to do was “bankroll” ACLAD. As we have seen, even that was not necessary. ACLAD did the work without any financial assistance from Growth Australia.
[252]
Whatever might have been understood by various officers of Growth Australia from time to time, in my view, Mr Tomlinson’s motivation in respect of these projects was to award highly profitable contracts to Growth Australia which were detrimental to his employer and to the relevant Sentinel plaintiffs so as to secure the benefit he sought. This conduct involved a breach of both limbs of the fiduciary duties owed by Mr Tomlinson to both Shield and Sentinel.
[253]
I find that the relevant plaintiffs have also made out their claims for breach of fiduciary duty and are entitled to equitable compensation for the loss which flowed and separately to recover the secret profit in the amount of $40,613.

Findings on the dubbo project

[254]
I refer to the findings in relation to the Dubbo project set out in paragraphs [135] to [169] above. The issues in dispute are summarised at paragraphs [170] to [172] above. Resolving those issues requires findings to be made about the dealings between Mr Tomlinson and Mr Johnson over the period 10 May 2018 (when Mr Johnson was first approached about this project) to 4 June 2018 (when the second claim for payment was issued by Verus). It is convenient to set out the account of both witnesses dealing with these specific matters.

Mr Tomlinson’s evidence

[255]
Mr Tomlinson’s s. 92 Statement dealt with these issues as follows:
1. (a)
  In paragraphs 34 to 40 of his Statement, he dealt with the two quotations:

34 Once I received the designs from Formchoice, I approached two contractors via the telephone who had strong backgrounds in projects of this type, Sean O'Reilly of LK Constructions who was too busy with Orana Jevenile Justice Centre project in Dubbo and Tony Pepe of Niepe Constructions who didn’t have the capacity as they had recently secured further works at the Sunshine Coast University Hospital.

35 I turned to Greg Johnson of Verus Construction as I had worked with Greg previously and knew him to be a knowledgeable builder and someone I could trust to complete the works and operate as per the conditions I expected in paragraph 15.

36 I sent the Formchoice drawings to Mr Johnson along with the quote they had provided showing weekly hire rates and outright purchase with a request that his quote be returned promptly, explaining the situation in relation to the urgency and that the cost of travel and accommodation wouldn’t be an issue if we could get the works completed within the week.

37 It wasn’t possible for Mr Johnson to conduct a site inspection given the urgency and he had to rely on a series of photographs taken by Mr Myers to ascertain existing conditions.

38 Mr Johnson submitted a quote to me that didn’t allow the procurement of the Formchoice equipment and other ancillary items, because they incorrectly believed these would be procured by Sentinel. I informed Mr Johnson that the Formchoice costs would fall under their contract and that I would prefer they purchase the equipment outright as some would be sacrificial in the permanent works to follow and a weekly hire rate of around $5,000.00 would soon see costs exceed the outright purchase cost of approximately $30,000.00.

39 When Mr Johnson submitted an updated quotation, I called him on the telephone on my way home from work at approximately 18:30-18:45 on the evening of 16^th May 2017 and explained that he would need to be confident that he had captured the full scope of the project as we would not be awarding any variations for latent conditions in stage 1. The conversation resulted in a greater understanding of the expectations of Shield and the current conditions on site, including a large amount of soil, hard rock and masonry to remove and dispose of.

40 During the course of the conversation, Mr Johnson mentioned that he wasn’t keen on installing the expansion control joints to the toe and heel of the ramp to replace the existing failed joints and provide ongoing and improved protection against the Impact/Dynamic (lateral force) load on the ramp when trucks entered and exited the loading bay.

(b)
In paragraphs 41 to 43, he dealt with the arrangements to do the expansion joint works:

41 I had recently met with a friend and qualified builder, David Taylor of Growth Australia, who was in the process of going through a costly divorce and was considering additional work outside of his role as a director of Growth Australia back ‘on the tools’. With this in mind, I told Greg to allow for the expansion joints in his works and I would have Formchoice complete the expansion joints with David Taylor as the installer.

42 I called Mr Eddie McInulty, director of Formchoice, to discuss the proposal. Mr McInulty informed me that they wouldn’t be able to assist in this instance due to workload, so I spoke with David Taylor and we agreed we would do the works together.

43 I had David issue me with an invoice for his labour, travel and accommodation for the 4 days we expected to be on site and submitted this as a capex for transport. This amount was for $11,250.00. This invoice can be found on page 1825 of the Trial Bundle of the Plaintiffs.

44 I then submitted an invoice to Mr Johnson using the company we had recently set up for my daughter to use in her ongoing equestrian pursuits, Arete Park, for $20,000.00 excluding GST. This amount allowed for the purchase of the custom made Veda expansion joints and non-shrink grout, travel to and from Dubbo, accommodation in Dubbo and the hire of the tools required to carry out the works.

45 After the purchase and hire of all materials and plant, I expect there to have been approximately $800.00=$1,200.00 remaining from the $20,000.00 I invoiced Mr Johnson. The full amount paid to Arete Park by Verus of $22,000.00 inclusive of GST was repaid in trust to Russells due to the works not occurring as planned.

46 The works were planned to have taken place on 23^rd June over the weekend and would have cost a total of $33,250.00 inclusive of GST, $6,500.00 less than the verbal quote I was provided by Mr McInulty of Formchoice.

[256]
His Statement also includes a reconstructed cost plan for the Dubbo Works which values the works at $157,702.20.
[257]
He was cross-examined at length on this evidence.
[258]
In relation to the conversation he had with Mr Johnson about increases in the back propping amount by $66,000, he said:^[152]

Is this scaffolding and equipment $26,443.70?‑‑‑I can – yeah, I read that.

And how do you know when you received his initial quote – this quote – that that number he’d allowed for was incorrect?‑‑‑Because that number – 26,443.70 – even the back-propping and associated works at 10,324.22, didn’t match or I don’t – or get anywhere near to the cost of the equipment that Formchoice had provided. That’s why when I called Greg and said, “What’s your cost of the propping”, he said to me, “I just allowed for the extras on Formchoice’s quote.” And that’s when I told him, we weren’t providing the equipment. Because if we’d have bought the equipment, it makes it Sentinel’s property and issue to maintain. And because there had to be ongoing engineering while the scaffold – the property when the scaffolding were in place, it had to go through the builder.

So he, having put in there, “Back-propping and associated works: $10,324.22; scaffolding and equipment: $26,443.70”, you then change it. You don’t ask him to resubmit a quote; you just change it yourself?‑‑‑Yep. It would’ve been through a conversation or ‑ ‑ ‑

…

And when you sent it back, you increased back-propping by $66,000, and you kept scaffolding and equipment the same?‑‑‑Because, like I said, the scaffolding and equipment wasn’t scaffolding and equipment for the back-propping purposes. It was additional scaffolding and equipment.

And, in fact, the amount that Verus ended up paying Formchoice for the back-propping, which is scaffolding, the same thing, was almost identically 26,442.70, wasn’t it?‑‑‑I don’t know, because there was a lot of items they credited back to Verus.

[259]
Mr Tomlinson then explained in response to my questioning what actual items were included in the “scaffolding and equipment for the back propping purposes”.^[153] The premise of his explanation was that the “scaffolding and equipment: $26,443.70” did not refer to the equipment used to complete the back propping for the Stage 1 works. However, there was no evidence that the materials he described were ever ordered, delivered or paid for by anyone, nor that any such equipment was used for the back propping works. Rather, the evidence shows that the equipment supplied by Formchoice, designed to be used for the “quickstage” works (i.e. Stage 1 works), was delivered to the site and was used by Mr Kitcher, who needed only a few extra items for the work which he bought himself. It appears to me that Mr Tomlinson’s evidence about this was fabricated in the witness box while under cross-examination.
[260]
Mr Tomlinson was also cross-examined about his Statement that in his discussion of the Original Quote with Mr Johnson at paragraph 39, he warned about “a large amount of soil, hard rock and masonry to remove and dispose of”. There was no suggestion in any contemporaneous document of any rock or masonry to be removed, much less extra digging. There had been no inspection of the site at the time. The photographs did not suggest that. The additional digging to which Mr Kitcher referred did not come to light until he started work in late May. In my view, paragraph 39 of Mr Tomlinson’s Statement was, at best, a reconstruction. However, in cross-examination about this, he nonetheless tried to sustain the substance of his assertion, when it must have been obvious to him that it was incorrect.^[154]
[261]
He was then cross-examined about the expansion joint works. I have already dealt with that in paragraphs [139] and [140] above.
[262]
Mr Tomlinson was also cross-examined by Mr Baroni for Verus.
[263]
Mr Tomlinson said again he had approached other builders before approaching Verus.
[264]
Mr Tomlinson said that he had a first conversation with Mr Johnson on 10 May 2018 when he sent the Formchoice drawings. He said he would have told Mr Johnson of the urgency of the work because the ramp was in danger of collapsing, would have told him about traffic management issues because Woolworths required 24 hour access, that Mr Johnson needed to get the right people to do the work and that he should include travel and accommodation costs, and that there were engineering costs to be included for continued certification until Stage 2. Mr Baroni challenged that latter evidence, and Mr Tomlinson then backtracked on it.^[155] He said he had no discussions about the Stage 1 items in the Formchoice drawings at that time.
[265]
Mr Baroni then asked Mr Tomlinson to explain how he considered the Original Quote to be “undercooked”.
[266]
He said that he thought the preliminaries were inadequate because he:^[156]

didn’t see a – an actual breakdown for traffic management to keep the ramp open to have someone there. And admittedly, the drawings didn’t say to have a traffic management person there to manage it. But I didn’t notice there was nothing there allowed for that. It also seemed pretty weak for – for what was going to be two to three weeks worth of works on site and then continued review of the scaffold, and the drawing did say it would only be two weeks before stage 2 would happen, but we – it was going to be much longer than that…

[267]
He then said, on the increase for back propping, that Mr Johnson had “not allowed for the works for the expansion joint that was on the – on the drawings”.^[157] This is inconsistent with the evidence described in paragraph [259] above, which did not mention the expansion joints, which were not shown on the drawings in any event.
[268]
He then said that he considered “Delivery Charges” in the Original Quote to have been too low because Mr Johnson had not included Formchoice’s additional delivery charges. He then repeated his evidence that the “Builders Works/ Demolition” amount was too low because of the soil removal required.
[269]
He was then cross-examined by Mr Baroni about his telephone conversation with Mr Johnson leading to the first Revised Quote. This evidence was very difficult to interpret. Mr Tomlinson was unable to focus on giving evidence about his exact recollection of what was said in the conversation with Mr Johnson, as opposed to what he was thinking at the time or what might have happened at other times.
[270]
The key points that I could identify were:
1. (a)
  He said he explained the big increase in the back propping figure in the first Revised Quote by reference to the need for the expansion joint works to be done. Strangely, given his evidence in paragraph [266] above, he also mentioned traffic management here;^[158]
2. (b)
  He also explained it by reference to the need for extra propping in the toe of the ramp.^[159] As far as I could tell, this was the first time this was raised. Mr Tomlinson referred again to advice from Formchoice which was not in writing or otherwise corroborated;
3. (c)
  He said Mr Johnson said he did not wish to deal with the expansion joint works because of their uncertainty;
4. (d)
  He said again he told Mr Johnson that no variations would be permitted so to allow for latent risks; and
5. (e)
  He said he told Mr Johnson that someone he knew would do the expansion joint works.
[271]
He was then cross-examined about a conversation which followed the issue of the Arete Park invoice. He agreed that he had a conversation on 18 May 2018 with Mr Johnson. This was the only evidence he gave about this alleged conversation. He said the Arete Park invoice was sent to cover the cost of buying materials for the expansion joint works. For the reasons already given, this was false. He said he told Mr Johnson that he (Mr Tomlinson) would be doing the expansion joint works. He accepted Mr Johnson was angry with him. He accepted Mr Johnson asked him why the invoice was from his wife. He said he told Mr Johnson that the work was supposed to be done by Mr Taylor. He did not recall if Mr Johnson had hung up on him.
[272]
He then gave evidence about a meeting a week later at Mr Johnson’s business premises on about Monday 21 May. This was the only evidence he gave about this meeting. His evidence was (though not in this order) as follows:
1. (a)
  He said the meeting went for about 30 to 45 minutes;
2. (b)
  He accepted he was trying in the meeting to persuade Mr Johnson that the invoice from Arete Park was “above board”;
3. (c)
  He told Mr Johnson that Mr Taylor was doing the labour and the Arete Park invoice was for the materials because of some issue with Mr Taylor’s marital affairs;
4. (d)
  He told Mr Johnson that he was using Mr Taylor and Arete Park because:^[160]

I wanted to make a good impression and keep it as cheap as possible for the guys at Sentinel. If I had to go to another contractor, it would have taken longer to get everything arranged, and I’d already been told when the – the findings of the original structural report came through that there wasn’t that much money left in the – the trust or the fund that that property’s under, and we had to try and keep it as low as possible.

(e)
He accepted he had not previously told Mr Johnson about the involvement of Arete Park or Mr Taylor.

[273]
He accepted that he offered a deposit payment of between 40% and 50% to Verus (the first claim was about 70%).

Mr Johnson’s evidence

[274]
Mr Johnson said that he set up Verus about four years before the trial. It was a small company which carried out commercial building work. He knew Mr Tomlinson before he worked for Sentinel. The Sentinel Group was a target client for Verus. Before the Dubbo job came up, he had quoted for a few Sentinel Group projects without success and had provided free assistance to Mr Tomlinson with pricing of another Sentinel project. Mr Johnson said he received the Formchoice documents by email on 10 May 2018 and that there was a follow-up call from Mr Tomlinson.
[275]
He said Mr Tomlinson told him broadly about the nature of the Dubbo ramp work, that it was a “shit job” and that it was urgent. He was asked to provide a price as soon as possible for the Stage 1 propping works. He said that he would.
[276]
He said he recognised the job was risky (by which I infer he meant financially risky), but was willing to do it with a view to doing a good job and getting to the “front of the line”. He recognised the two stages of the work contemplated by the Formchoice documents and understood he was quoting on the Stage 1 works.
[277]
He produced the Original Quote based on those documents alone. His recollection of the manner that the quotation was put together was not precise, particularly regarding the determination of the scaffolding and equipment figure. That might be because it appears that Mr Burfoot, his project manager, did the work. However, broadly, he said the figures were based on the CBCW quote for back propping and travel, Formchoice figures for scaffolding and some delivery costs, and the Formchoice plans for the small sum for builder’s works and demolition.^[161]
[278]
He said the next event was the key telephone call on 16 May 2018. He said this occurred between 6 and 7pm that evening.
[279]
He said Mr Tomlinson rang him. This conversation is central to the case against Verus. Mr Johnson said the following passed in that conversation.
[280]
His initial statement is worth quoting verbatim. He said:^[162]

And can you tell his Honour what that discussion was about?---Yeah, it was basically that Neil believed I’d grossly under-priced it, that I’d missed a lot of the scope, that I hadn’t gone into the detail of what was … entailed in this project. He also made it very clear that there’ll be no variations approved whatsoever approved on this project, that he literally couldn’t spend a dollar more than the price that went in. Yeah, basically, once we just spoke about the project and what was involved in it, that, you know, he believed that … the ramp access wouldn’t work as it was dictated in the methodology. We also spoke about that, you know, there was going to be a lot of hand labour, hand digging and stuff underneath the ramp. Basically stuff that he’d seen while he’d been down there. Whereas I’m trying to price off floor plans and a methodology.

[281]
Mr Baroni then asked Mr Johnson about any discussions on the items in the first Revised Quote. While I do not think this was necessarily leading the witness, it did seem to cause Mr Johnson to want to say something above every topic.
[282]
Asked about preliminaries, he said Mr Tomlinson told him that he was too light on preliminaries because the amount of physical labour meant the job could not be done in a few days on site.
[283]
Asked about discussions about scaffolding, he gave evidence seemingly about a discussion with Mr Tomlinson that Verus had to buy the scaffolding not hire it, although he accepted the price did not change (and the objective evidence indicates that the purchase of the equipment was in place before the Original Quote: see paragraph [146] above). This was an example of Mr Johnson reconstructing, rather than recalling, the content of the conversation (assuming it occurred).
[284]
Asked about back propping, he said Mr Tomlinson told him about the expansion joint works and that he (Mr Tomlinson) would take care of it. He also said Mr Tomlinson told him that he would take care of certification by Formchoice of the back propping works. (Mr Johnson accepted there was no indication of the expansion joint works on the Formchoice documents.) He said Mr Tomlinson nominated $40,000 for that work but did not explain how the figure was calculated.
[285]
Mr Johnson gave evidence that Mr Tomlinson was going to pay this sum direct but that Verus was going to charge for it. Again, his evidence was vague as to what he recalls being discussed. Ultimately, he said in the conversation that he was “just to allow a sum”.
[286]
The back propping figure in the Original Quote was about $10,000. The back propping figure in the first Revised Quote was some $76,000. Allowing for $40,000 for the expansion joint works, I asked Mr Johnson if there was any discussion about the balance of the higher sum of some $25,000. His response was also vague as to exactly what was discussed and what was supposition. He said:^[163]

Yeah, this all comes down to … this is a firm price, so make sure you allow for contingency for anything – you won’t get a variation past. So I don’t know. I mean, I had to throw figures at it to make sure that I was covered. Because Neil had made it very clear that if I get down there and there’s something disastrous, I’ve got no room to ask for any additional funds.

Do you remember discussing any figure in – that was intended to cover that assumption of risk? No. We went through it but there was a lot of backwards, forwards. It’s really hard to remember three years with that. But you know, that’s where that figure would have gone up from.

[287]
Mr Johnson did not ever refer to traffic management as a matter discussed to explain increases in his quotation, although he did adopt it as a factor in cross-examination: see paragraph [297] below.
[288]
A little later, a further matter emerged which Mr Johnson said was discussed in the 16 May conversation.^[164] When asked about the deposit claim referred to in paragraph [159] above, he said he had discussed a deposit with Mr Tomlinson and that it was to cover the $40,000 for the expansion joint works plus a further sum up-front. He gave evidence that it was commonplace for large deposits in shop fitting projects, but it was not clear what else he recalled about the actual discussion of the deposit or its amount with Mr Tomlinson.
[289]
Mr Johnson agreed that he received the first Revised Quote from Mr Tomlinson and said that his response was that he was grateful he did not have to do the work of revising the Original Quote.
[290]
Mr Johnson then gave evidence about the Arete Park invoice referred to in paragraph [161] above. He said he received it in a hotel room (it was Friday evening) and opened it on his phone. He said he immediately rang Mr Tomlinson and abusively questioned what the invoice was for. He cut short Mr Tomlinson’s explanations and asked him to come to the Verus office on the Monday.
[291]
He said that at that meeting, Mr Tomlinson endeavoured to persuade him that the payment was legitimate. He was persuaded to pay $22,000. His explanation is central to the credibility of his account:^[165]

Now, what did Mr Tomlinson say to you during that meeting that persuaded you or satisfied you that Arete was a legitimate business? That it was a registered proprietary business that was all set up legit and clean, that I could ABN search it, everything was fine with it.

And did he tell you why he had set up this business? No. He just said this is an easier way for – that was his wife’s business and that was an easier way for him to be able to pay the engineers and to get the expansion joins works done if it fed through, and doing it this way was a legit way because it was going through a registered business.

And did he tell you why he had to do it this way? Not in huge detail. He just said it was easier to do it this way with what was going on in turn. I said I didn’t want to know what the crux of what was happening internally, like, I – that’s – that was none of business. I – I’d committed to this project and said I could get it done. This – once he gave me comfort around that Arete was a legitimate business and it didn’t matter to me, as long as at the end of the day the services that were promised that I was going to get that I was paying for got done, that was it. Hence, I paid 20,000 or 22 because I want to make sure that he kept his word and everything got done, and then the balance was going to be paid.

Why did you pay only the amount you did? Because I wanted to make sure that this was legit. I wanted to make sure that if there became hiccups with the engineer that, you know, I hadn’t handed over $40,000, that I had money that wasn’t going to keep me out of pocket to get an engineer to come and sign off on it because at the end of the day, again, it’s my responsibility.

[292]
Mr Johnson was then referred to a document which appears to be a summary cost plan for the Dubbo Works.^[166] The document is a copy of an earlier cost plan prepared after the Dubbo Works contract was awarded. Mr Johnson said it was prepared to assist the project manager to administer the project. It was therefore prepared to allocate the increased contract sum from the first Revised Quote to various cost centres after the fact. There is no evidence it had any relationship to how the Dubbo Works were actually costed. Beyond the amounts allocated for labour, scaffolding and the $40,000 added by Mr Tomlinson (called external consultants), it bears only an arbitrary relationship to the actual works. It is not useful in resolving any issue in this case.
[293]
Mr Johnson also gave evidence that Verus paid some $5000 for materials for the job over and above the amounts paid to CBCW.^[167] There is no evidence of any such payments identified, nor was there an explanation as to how these materials were purchased or delivered or who used them. Things got no better for Mr Johnson on this in cross-examination.^[168] It was not suggested to Mr Kitcher that that occurred. I reject that evidence.
[294]
Finally, Mr Johnson said that the project would have taken three weeks maximum after it commenced.
[295]
In cross-examination, the following material matters arose.
[296]
Mr Johnson said he did not ask why the expansion joints were raised by Mr Tomlinson in the alleged second telephone call because he said that the Formchoice documents were not detailed.^[169]
[297]
Mr Johnstone cross-examined Mr Johnson about allowances in his price for traffic management. It appears from my review of the transcript that it was Mr Tomlinson who gave evidence about a discussion in the 15 May telephone conversation about allowances for traffic management: see paragraph [266] above. Mr Johnson did not. However, it is notable that Mr Johnson, when asked, said that in his discussion with Mr Tomlinson, extra time was added for traffic management. This was also pleaded in the defence.^[170]
[298]
Having said that, Mr Johnson also agreed that he did not retain any person to carry out traffic management and no document about that was produced. Mr Kitcher took care of traffic management in an ad hoc manner when doing the work for the good reason that he did not want to be working under a structurally questionable ramp when a prime mover was on it.
[299]
Mr Johnson was cross-examined about divergences in his evidence from his pleading. It is fair to say that Mr Johnson’s evidence about his alleged conversation with Mr Tomlinson on 16 May 2018 diverged very significantly from the defence. Paragraph 19A(1)(iv) deals with that conversation. Mr Johnson was cross-examined on the pleaded case in relation to the $40,000. It is pleaded that Mr Tomlinson described the following work: provision should be made for $40,000 for Formchoice to provide engineering and certification reports including supply and installation of expansion joints for Stage 2 and that Mr Tomlinson would organise that work.^[171] Mr Johnson ultimately conceded that the defence was wrong in referring to Stage 2 because “it’s the way things are explained that makes it look like it is”.^[172] He was not further challenged on the inconsistencies between his evidence and the pleading, though there were more. Most glaringly, Verus’ defence alleged it was supposed to be Formchoice doing, at the least, the design work for the expansion joints. That never happened. Instead, Mr Johnson gave evidence about his response to the Arete Park invoice at the Monday meeting (which is also never pleaded). Also in re-examination, and inconsistently with his evidence in cross-examination, he said that the $40,000 was to be in part for Stage 1 and in part for Stage 2.^[173]
[300]
Mr Johnson was then cross-examined about how it could be that the $40,000 worth of work for engineering and for the expansion joint works could be part of Verus’ scope of work if Mr Tomlinson had said he was going to arrange it all and Mr Johnson had said that that work was separate to his scope and nothing to do with him. I found Mr Johnson’s attempts to explain this were not credible.^[174] He tried to describe that sum as being equivalent to a provisional sum, but a builder remains responsible for work done for which a provisional sum is provided. It is part of the builder’s scope of work. He also repeated his earlier evidence that he had told Mr Tomlinson verbally that the expansion joint works were not part of his scope and that he did not take it out of his scope because the work “was non-existent at the time”.^[175]
[301]
He was then cross-examined about the summary cost plan referred to in paragraph [292] above. Nothing in that cross-examination justifies treating it as anything other than an ex post facto allocation of the available contract sum. To the extent Mr Johnson’s evidence sought to create the impression it was used to determine the contract sum shown in the first Revised Quote, I reject it.
[302]
Mr Johnson was then cross-examined about his response to the Arete Park tax invoice. Mr Johnson repeated that he considered Arete Park legitimate because it was incorporated, had an ABN and had insurances. He firmly asserted that he believed Verus had an obligation to Arete Park. His highest and best effort to explain his conduct in paying half the invoice is as follows:^[176]

Do you still believe that Verus owed a obligation to Arete Park? Absolutely.

Right? Whether it be Arete Park or whoever it was, I was told by the project manager that was running the project to an – allow a nominated amount for a set of services that I agreed on that the time, confirmed that I’d do the works, and that’s where I found myself.

Right. So your view is that whatever Mr Tomlinson was doing, he must have done it? Well, I’d see the first lot of – the methodology at stuff that had been done already. There was already engineering drawings done.

So why haven’t you paid him the other 20,000? Because I haven’t see the – I haven’t seen the work’s been done.

Right. So you believe he’s done half of it? Possibly. I don’t know. I’ve not been allowed to go to site. I was told that I’d – the police would be called if I went and checked on work.

HIS HONOUR: Mr Johnson, I just want to ask you what your response to something is. What do you say if someone said to you that when you got that invoice from Arete Park? Yep.

That you suspected there was something wrong in what Mr Tomlinson was doing… but it was in your interest in getting future work from him not inquire too much about it. What would you say to that proposition? I wouldn’t put the emphasis on future work, but I say, yeah, agree. That’s why I went off because I did think that there was – I was more concerned in the exposure to Verus. Rather than any additional work or any of that, I was more concerned about where it left my business.

MR JOHNSTONE: And as for your exposure to Verus, did you pick up the phone to Sentinel and say, listen, your employer – your employee has engaged me to do this work for you and he wants me to – sorry, he wants me to pay his wife’s horse company $44,000 for works which aren’t in the scope but for which I have to get engineering certification at some point to complete this stage and I’m a little concerned that it doesn’t make sense? No, I did not.

Don’t you think that that would be the reasonable response of somebody in your position who, as you say, is carrying out an arm’s length construction contract? Very easy to say reasonable in hindsight, with all due respect.

[underlining added]

[303]
And later, the following exchange occurred:^[177]

MR JOHNSTONE: Based on your experience in the building industry, you knew that no employer in the building industry would simply allow an employee to make a claim on a contractor, like yourself, like Verus, in that amount of money through a company with an email address Arete Park performance horses, for services which it had not supplied to you? I don’t know what Neil’s deal was within his work. I don’t know anything about that.

I’m asking your experience? In what regard?

HIS HONOUR: Well, what would you do if one of your employees purported to issue a tax invoice to one of your clients for $40,000 to be paid to them or their wife? Yes, obviously there’d be – yes, I wouldn’t allow it.

There’d be hell to pay, wouldn’t there? Yes.

The claims to be resolved

[304]
There is added complexity to the claims to be resolved in relation to the Dubbo Works because of the active involvement of Verus. The claims to be resolved are:
1. (a)
  Sentinel Countrywide’s claims:
  1. against Mr Tomlinson in deceit;
  2. against Verus and Mr Tomlinson in conspiracy;
  3. against Mr Tomlinson in breach of fiduciary duty; and
  4. against Verus for knowing assistance in breach of fiduciary duty.
2. (b)
  Shield’s claims against Mr Tomlinson for breach of contract; and
3. (c)
  Verus’ claims against Sentinel Countrywide for:
  1. $46,378.12, being the balance of the Contract Price; and
  2. Delivery up of the scaffolding or damages in the amount of $26,857.60.^[178]

The plaintiffs’ case on Mr Johnson’s dealings with Mr Tomlinson

[305]
The plaintiffs put two alternative cases on the facts.
[306]
The first is that Mr Johnson and Mr Tomlinson conspired together to benefit from inflation of the Original Quote by sharing a mark-up of about $80,000. The central factual premise of that case is that the entirety of the evidence given by Mr Johnson and Mr Tomlinson about the way the first Revised Quote was agreed was fabricated. Rather, there was a conversation in which they agreed on the course described.
[307]
If I reached those conclusions on the facts, then tortious conspiracy would, not surprisingly, be established. As would a fraudulent breach of fiduciary duty by Mr Tomlinson and Verus’ liability as a knowing accessory to that breach. As is the case with most conspiracy claims, the conspiracy alleged can only be inferred from other facts. And in drawing such an inference, particularly against Verus’ guiding mind, Mr Johnson, I must keep in mind the principle in Briginshaw v Briginshaw.^[179]
[308]
The plaintiffs do not have to make out every allegation pleaded to sustain the inference of conspiracy or knowing assistance in breach of fiduciary duty. However, to infer the existence of either cause of action can become more difficult where only some of the facts alleged are established.
[309]
The premise of the alternative case is to accept that there was some discussion about the works of the kind alleged by Mr Johnson, but that by the time the Arete Park invoice was issued, Mr Johnson had sufficient knowledge that the $40,000 payment negotiated by Mr Tomlinson was a fraud for his own benefit to fix Verus with accessory liability from that point on in Mr Tomlinson’s breach of trust, in particular, in paying the $22,000 to Arete Park and asserting a claim to that part of the contract sum.
[310]
Mr Baroni submitted that the alternative case was not open on the pleadings. I disagree. Cases of breaches of fiduciary duty involving employees and third parties are difficult precisely to plead and prove, given that the plaintiff employer has no direct knowledge of what passed. The alternative case arises from a combination of allegations made in the statement of claim and the defence. None of the facts relied upon in the alternative case, therefore, are a surprise to Verus, and the circumstances of Mr Johnson’s state of mind from time to time were fully explored in examination in chief and in cross-examination. If amendment was required for this alternative case to be advanced, there could have been no persuasive reason against permitting such an amendment.

Some introductory findings

[311]
I accept that the Dubbo Works needed to be done, and that they needed to be done urgently. I am not persuaded that Mr Tomlinson approached other builders before approaching Mr Johnson. This evidence was self-serving and not corroborated. However, whether he did or not is largely moot, because I accept that the initial contact occurred as Mr Johnson testified: that is, Mr Tomlinson sent the 10 May email and followed up the email with a call in which Mr Tomlinson said that the job was a difficult and urgent one.
[312]
I find that there was no conspiracy at this point, nor anything which should have given Mr Johnson cause to suspect Mr Tomlinson was seeking to benefit personally from the Dubbo Works contract. I find that remained the situation up to at least Tuesday 15 May 2018 at 2:24pm when Mr Johnson caused the Original Quote to be sent. I make that finding for the following reasons:
1. (a)
  First, as I find above, Mr Johnson said that his reaction to receiving the Formchoice drawings and the related call was that, although this was a risky job, he was willing to do it on the terms put to him to get in good with Mr Tomlinson and Sentinel. That is an objectively likely response to the email and content of the call he alleged, and was consistent with his evidence overall about his prior relationship with Sentinel;
2. (b)
  Second, and tellingly, all of Mr Johnson’s actions between receiving the Formchoice drawings on 10 May and sending the Original Quote on 15 May are consistent with that motivation and with Mr Johnson making genuine efforts to obtain a proper price. This is disclosed by the acts of Mr Burfoot described in paragraphs [143] to [147] above, which are corroborated by email traffic. It is also supported by the fact that the Original Quote was calculated by reference to the prices obtained from third party suppliers;
3. (c)
  Third, it is not credible to suggest Mr Johnson was doing this to make it look like the fix was not in. The work done by Mr Burfoot served to generate a bona fide price against which any inflated price resulting from a conspiracy could be compared, and by sending it to Mr Tomlinson by email, Mr Johnson created an electronic record of it. While frauds are frequently inept, I do not think this conduct can be explained by ineptitude; and
4. (d)
  Fourth, I do not accept that the fact Mr Johnson sent the quotation in a form easily edited suggests some pre-planned opportunity for Mr Tomlinson to amend it. The above three points tell against it, and Mr Johnson’s explanation that he sent the document in that form because time was pressing and so he cut corners on the creation of the tender is believable.
[313]
The case against Verus really comes down to the circumstances that led to the creation of the first Revised Quote. In resolving this, it is convenient to identify some objective reference points. They are:
1. (a)
  Mr Tomlinson altered the Original Quote and sent the first Revised Quote back to Verus at 6:13pm the following Wednesday evening, 16 May, with the price increased by some $83,000;
2. (b)
  Based on my findings already made, any conspiracy had to have been hatched between about 2pm on Tuesday and 6pm on Wednesday;
3. (c)
  By the next day, 17 May, Mr Tomlinson had produced the second Revised Quote which increased the contract sum by a further $15,000 and had submitted that quotation, along with two other higher fabricated quotations; and
4. (d)
  The next day, 18 May 2018:
  1. At 1:33pm, Mr Johnson caused Verus to issue a deposit claim for 70% of the contract price; and
  2. At 4:47pm, Mr Tomlinson caused the Arete Park tax invoice for $40,000 to be emailed to Verus.
[314]
I also find that Mr Tomlinson’s motivation in his dealings with Mr Johnson was, by Wednesday 16 May at the latest, to secure for his own benefit the $40,000 payment he ultimately sought through Arete Park. I make that finding for the following reasons:
[315]
First, by May 2018, Mr Tomlinson had already taken the step of secretly obtaining benefits for himself from his position, in the order of $40,000, from Growth Australia.^[180] His dealings with Verus also repeated the modus operandi disclosed in his dealings with Growth Australia of inviting, and certifying, a large deposit payment not called for by any contractual obligation which covered his secret payment. Accordingly, as at May 2018, Mr Tomlinson was a person who was demonstrably willing to use his position as employee to benefit himself by inflating the price of works and securing his secret profit from the successful contractor, using a large first payment to secure it.
[316]
Second, as I have found in paragraph [140] above, there never were any expansion joint works. Apart from the matters mentioned there, there are other considerations which demonstrate that to be so:
1. (a)
  There was no credible explanation as to why Mr Tomlinson caused his wife’s company, Arete Park, to send a tax invoice for $40,000 for that work. Arete Park had nothing to do with building, was not licensed to do building work, and was set up just days before the tax invoice was issued; and
2. (b)
  On Mr Tomlinson’s and Mr Johnson’s evidence, Mr Tomlinson was to carry out the expansion joint works. But after the work was completed by Mr Kitcher, nothing was done by Mr Tomlinson to carry out that work, except to secure payment of $22,000 for it to Arete Park. I find that the whole of Mr Tomlinson’s evidence about the expansion joint works was fabricated.
[317]
Third, it is an unusual step for a project manager with duties to his principal and his employer to approach a contractor who has quoted on a set of plans, and seek to persuade them to increase their price because of their failure properly to price the work. It is a remarkable step for that project manager to amend the quotation of the contractor, increasing it by more than 100%, and to send it back enquiring if the contractor is satisfied. It is positively bizarre when one considers the areas where the increases were said to have been justified: for traffic management steps which were never taken, for additional works in the toe of the ramp which were never designed or done, for additional digging which only emerged as necessary after Mr Kitcher arrived on site and for phantom expansion joint works.
[318]
Given my findings so far, I draw the inference that, at some stage between when Mr Tomlinson approached Mr Johnson on 10 May 2018 and when he sent the first Revised Quote on 16 May 2018, Mr Tomlinson decided that he would use the Dubbo Works to obtain a secret profit of $40,000. All of Mr Tomlinson’s evidence about his dealings with Mr Johnson must be approached on that basis and must be treated with the greatest scepticism.
[319]
Another matter which can be resolved before analysing Mr Johnson’s evidence is the place of the telephone record analysis produced by Mr Hains. Briefly, the position is this. Mr Hains was presented to the Court as an expert in, broadly, the forensic analysis of mobile telephone data contained on a particular device. However, Mr Hains was not a technical expert, such as an electrical or computer systems engineer or mobile software expert. Rather, his background is forensic accounting. The true nature of his expertise seems to be that he has experience in using and interpreting the result of software which can be used to analyse data contained on a mobile device.
[320]
The problem with that kind of expertise, where it collides with inconsistent evidence, is that Mr Hains is not able to explain, by reference to the technical characteristics of a mobile device, why that evidence must be incorrect. A good example is the lack of evidence in the logs of Mr Tomlinson’s mobile phone of the important 16 May telephone call. Mr Hains opines that either that call did not occur, or alternatively, that it was deleted. However, the logs in his report do not contain much at all in the way of calls between Mr Tomlinson and Mr Johnson.
[321]
Mr Baroni made the credible point that even if there was a conspiracy, one would imagine there would be calls between the conspirators. Further, Mr Hains seemed to accept that calls could be deleted. Given my findings about Mr Tomlinson’s motivation, it would not be surprising if he did choose to delete phone calls to Mr Johnson. However, that does not mean Mr Johnson knew he had done so, or that he asked Mr Tomlinson to do so. Ultimately, I was not persuaded that Mr Hains’ evidence was of much assistance in determining the credibility and reliability of Mr Johnson’s account.

Analysis of Mr Johnson’s account

[322]
I start by accepting that there was discussion between Mr Tomlinson and Mr Johnson at around the time of the first Revised Quote. The email of 16 May refers to a discussion, and of course, whether there was a conspiracy or not, logic dictates that there must have been a conversation about the first Revised Quote. That question is what conversation and when.
[323]
Mr Johnson’s evidence about that conversation is summarised in paragraphs [280] to [289] and [296] to [300]. There are considerable difficulties with Mr Johnson’s version of that conversation.
[324]
First, starting with his initial account of the conversation, there are a number of matters affecting persuasiveness:
1. (a)
  Mr Johnson said that Mr Tomlinson told him he had missed a lot of the scope, though the Formchoice drawings and work actually done never changed;
2. (b)
  There was no basis for Mr Tomlinson’s statement that the ramp access methodology would not work. Further, there was never any change to the Formchoice drawings and the work was carried out in accordance with them. Mr Johnson apparently did not ask about what the methodology would be, nor ever receive or act on any revised methodology;
3. (c)
  Mr Tomlinson had never been to the site and had no basis at the time to assume that there would be a lot of hand digging under the ramp. That did not emerge until it was discovered by Mr Kitcher when on site. It is a serious problem with Mr Johnson’s evidence that he quotes Mr Tomlinson as saying something Mr Tomlinson did not know at the time; and
4. (d)
  The rest of the account emerged as matters were raised with him in evidence in chief. Whole areas of important discussion that he later gave detailed evidence about were not mentioned in his first attempt to describe the conversation, even though it must have been known to him to be the central event about which he had to give evidence.
[325]
Second, his evidence about the scaffolding referred to in paragraph [283], though given with certainty, was clearly wrong. The direction to buy the scaffolding had clearly been given before 16 May 2018.
[326]
Third, Mr Johnson’s evidence about the discussion relating to the central question of how the back propping amount increased from $10,000 to $76,000 was not credible. The starting point is to recall that Mr Johnson gave evidence that the back propping figure was the figure included for labour in the Original Quote. So it is difficult to understand why he would increase that figure by $66,000.
[327]
His explanation for $40,000 of that increase was for the expansion joint works he said Mr Tomlinson described, however, his evidence about that is difficult to accept. Mr Johnson was an experienced builder. He knew that the Formchoice drawings showed no such expansion joints. Even allowing for the informality of the quotation process, I find it impossible to accept that he would have been willing to accept responsibility for those works. That is particularly so, given the vagueness of Mr Tomlinson’s description of them.
[328]
Mr Johnson’s response was that he was not responsible for them because they were not part of his scope of works. However, his evidence, that it was normal practice in the construction industry to include works in the price for a job while not including those works in the scope of works under the contract, is highly improbable, even allowing for the informality of the process he described (see paragraph [300]).
[329]
Then there is the substantial inconsistency between his evidence about the expansion joint works and his pleaded case described in paragraph [299] above. These damage Mr Johnson’s evidence substantially. The $40,000 and its justification have always been central to the case against Verus. Mr Johnson is the guiding mind and will of Verus. He had personal knowledge of what occurred. I do not accept that the pleading is a mistake.
[330]
Also problematic is Mr Johnson’s explanation for why he did not challenge Mr Tomlinson on the vague nature of the so-called expansion joint works. His explanation in paragraph [296] above, that the Formchoice documents were not detailed, was clearly wrong. The evidence shows that Mr Johnson quoted on those documents, that the scaffolding was designed consistent with those documents, and that it was installed by Mr Kitcher. The Formchoice documents did not lack detail – they just did not mention the illusory expansion joint works. Every objective fact demonstrates that they were perfectly adequate, and Mr Johnson knew that. His evidence in this regard was not credible.
[331]
Added to that is the improbable nature of the explanation given for the other $25,000 added to the back propping figure in paragraph [286] above. It is difficult to accept that he agreed with Mr Tomlinson to simply throw the figure of $25,000 at the job to “make sure he was covered”. Recall that at this stage, Mr Tomlinson knew no more about the job than he did on 10 May, and he had not visited the site in Dubbo, nor had anyone else involved in the project. And, one might ask, why would Mr Tomlinson agree to more than triple the labour costs estimate in that context? The best that could be said about this aspect of the evidence is that Mr Johnson simply had no recollection as to where the other $25,000 came from or why it was included.
[332]
Fourth, Mr Johnson’s evidence about traffic management was also not persuasive. I refer to paragraphs [287], [297] and [298]. If Mr Johnson did include an amount for traffic management, he failed to do anything at all with that money. It is difficult, in that context, to accept that evidence.
[333]
Fifth, I repeat my comments about Mr Johnson’s evidence in paragraph [293] above.
[334]
Finally, there is Mr Johnson’s evidence about the so-called deposit claim set out in paragraph [288] above. That evidence came out in cross-examination. My impression of that evidence, as it was given, was that it was being reconstructed (at best). I also consider the evidence to be highly improbable. There was no justification for a “deposit” of 70%. Only $26,000 had to be outlaid to buy the scaffolding. There was no up-front obligation to pay anything in relation to any other of the costs of the work. The plain purpose of the large deposit, as Mr Johnson conceded in part, was to get in the money for the illusory expansion joint works. Mr Johnson must have known that, particularly given that he had no legal entitlement to any deposit, and Mr Tomlinson was inviting him to claim it in any event.
[335]
I now turn to his evidence about the Arete Park tax invoice. Again, I find his account of his response to this improbable. The most glaring improbability arises from his evidence about how he was persuaded by Mr Tomlinson that the Arete Park invoice was legitimate. He relied, he said, on the fact that Arete Park had an ABN, was a “registered business” and had unspecified “insurances”. None of these factors would persuade even the most naïve of contractors that the tax invoice was legitimate, especially one issued by an agent of the principal in favour of a company controlled by his wife to carry out the undocumented and undesigned expansion joint works. Mr Johnson is an experienced contractor. I reject his evidence that he was persuaded by the factors he identified that the Arete Park invoice was legitimate. I find he believed it was not.
[336]
The above analysis demonstrates that almost every material point contained in Mr Johnson’s account of events after he sent the Original Quote is problematic. Looked at individually, such problematic points might be explained away as the result of mistake or unintentional reconstruction of events. However, taken together, as they must be, they demonstrate that Mr Johnson’s account is not credible or reliable and cannot be accepted at all.

Conclusion

[337]
Neither Mr Tomlinson nor Mr Johnson have given a truthful or accurate story of their dealings post-15 May 2018. However, it remains to consider whether the plaintiffs can make out their positive case on the evidence before the Court.
[338]
Once Mr Johnson’s and Mr Tomlinson’s evidence is put to one side, the remaining evidence demonstrates the following:
1. (a)
  At the time of his dealings with Mr Johnson, Mr Tomlinson was a person ready, willing, and able to use his position to obtain secret benefits in the order of $40,000;
2. (b)
  On the afternoon of 15 May 2018, Mr Johnson provided a quotation, prepared with some care, for a scope of work based on information provided by Mr Tomlinson comprised in the Formchoice documents and photographs and Mr Tomlinson’s requirement that the work be done quickly;
3. (c)
  There was never any change in the scope of the works to be done and the work done was consistent with the initial scope;
4. (d)
  Despite that, Mr Tomlinson, a person with duties to his employer and his principal, offered to Mr Johnson an increased price for the same scope of work, increased by $80,000. No good reason for that increase has been given;
5. (e)
  Mr Tomlinson, again in the context where he had duties just described, invited Mr Johnson to put in a claim for 70% of the inflated price in circumstances where there was no legal right in Verus to such a payment and in circumstances where nothing about the nature of the works justified it;
6. (f)
  At the same time, Mr Tomlinson issued a tax invoice for $40,000 from his wife’s company in circumstances where there was and is no credible explanation for that to have occurred legitimately. It is highly improbable that Mr Tomlinson would have taken such a remarkable step without having a basis to believe it was expected by Mr Johnson; and
7. (g)
  The work on site was completed by Mr Kitcher in early June and he left the site. No step was taken to do any other work on the site. No work was ever done or arranged by Mr Tomlinson or Arete Park. Despite that, on 7 June 2018, Mr Johnson caused Verus to pay $22,000 to Arete Park, two days after receiving payment by Sentinel Countrywide of the inflated and unjustified first claim.
[339]
Added to that are the following considerations. Mr Johnson has given an account seeking to explain these events which, quite separately from any inference of conspiracy, is neither credible nor reliable. That creates a situation where Mr Johnson had every opportunity to explain what inference, other than that contended for by the plaintiffs, might be drawn from these facts and has not put a believable account before the Court. Further, I have already found that Mr Tomlinson obtained a dishonest benefit from Growth Australia prior to this transaction. The probability that he would repeat that conduct is therefore not so unlikely in his case.
[340]
These facts and considerations support the inference, on the balance of probabilities, that Mr Johnson and Mr Tomlinson reached an agreement or understanding to increase the Original Quote by about $80,000, with a view to sharing the increase between them, and gave effect to that plan by:
1. (a)
  Mr Tomlinson preparing and Mr Johnson adopting the first Revised Quote without demur;
2. (b)
  Mr Tomlinson procuring the agreement of Sentinel to contracting on the terms of the first Revised Quote and Verus (by Mr Johnson) agreeing to contract on those terms;
3. (c)
  Mr Johnson issuing the first claim to obtain funds to pay the secret benefit for Mr Tomlinson;
4. (d)
  Mr Tomlinson issuing and Mr Johnson paying (in part) the Arete Park invoice; and
5. (e)
  Verus (by Mr Johnson) maintaining this claim to the balance of the contract sum, thereby obtaining the benefit of Verus’ share of the wrongfully inflated invoice.
[341]
I draw that inference, bearing in mind the requirements of Briginshaw. However, in my respectful view, the inference is a strong one.

Deceit and fiduciary duty: Mr Tomlinson

[342]
I refer to paragraphs [173] to [180] above. The plaintiffs have made out the claim in deceit based on the facts in paragraphs [155] to [157]. The only matter which requires further consideration in respect of Mr Tomlinson’s liability in deceit for the Dubbo Works is his argument that the scope of work changed for the Dubbo Works. As explained in the previous section of this judgment, it did not.
[343]
The claim for breach of fiduciary duty is also established. On the findings made, Mr Tomlinson used his fiduciary position to try to obtain a secret benefit for himself, being the $40,000 payment which he conspired with Mr Johnson to secure for himself, and in fact obtained in the amount of $22,000.
[344]
He also used his position to obtain a benefit for Verus in a state of the most acute conflict with his duty to exercise his powers for the benefit of, directly, his employer, and indirectly, Sentinel Countrywide.
[345]
Given the findings made as to his conduct, each of those breaches were, in the circumstances, fraudulent.

Verus’ accessory liability for breach of fiduciary duty

[346]
In Equity and Trusts in Australia (7^th ed), Professor Dal Pont writes (footnotes omitted):^[181]

In its classic formulation, that of Lord Selborne LC in Barnes v Addy, a person becomes subject to what has been termed “accessory liability” if he or she, without any applicable existing fiduciary duty in the circumstances, assists the trustees “with knowledge in a dishonest and fraudulent design on the part of the trustees”. Although originally couched by reference to trustees, the doctrine has subsequently been applied more generally to breaches of fiduciary duty, whether or not by trustees proper.

On the traditional formulation, what attracts liability in that person (the “accessory”) is her or his knowledge of the trustees’ “dishonest and fraudulent design”. In what ostensibly remains the leading case on the point in Australian law, Consul Development Pty Ltd v DPC Estates Pty Ltd, their Honours therefore focused on the level of knowledge sufficient to attract this liability. Notwithstanding its venerated status, given fulsome endorsement by the High Court over 30 years later in Farah Constructions Pty Ltd v Say-Dee Pty Ltd, Consul was no paragon on clarity on the point. The stream of Australian case law debating the appropriate knowledge threshold following Consul is testament to this. In an attempt to avoid detailed inquiry into levels of knowledge, the Privy Council in Royal Brunei Airlines Sdn Bhd v Tan redirected the relevant inquiry, and the touchstone for the accessory’s liability, to one grounded solely in whether or not the accessory had behaved dishonestly. Comparison between the two approaches is made below.

[347]
The elements of the claim have been recently restated by the Victorian Court of Appeal in Harstedt Pty Ltd v Tomanek (2018) 55 VR 158 as follows:

[70] Turning then to the second limb of Barnes v Addy, the necessary elements of liability under that limb, as conventionally understood in Australia, are:

(a)
the existence of a fiduciary duty owed by the fiduciary (as trustee or otherwise);
(b)
a ‘dishonest and fraudulent design’ on the part of the fiduciary;
(c)
assistance by the third party in that design; and
(d)
knowledge on the part of the third party of the circumstances constituting that design.

[348]
I have already found that there were fraudulent breaches of fiduciary duty by Mr Tomlinson in obtaining a secret profit, and in procuring his principal to enter into a contract which provides for Verus to obtain a windfall of some $40,000.
[349]
Further, on the findings made as to Mr Johnson’s conduct, I am satisfied that Verus, by him, had actual knowledge of both dishonest breaches and actual knowledge of Mr Tomlinson’s fiduciary obligations to his employer and to Sentinel Countrywide. That leaves the question of whether Verus assisted in those breaches. In Harstedt, the Court held in that regard:

[116] The authorities offer little guidance on the meaning of ‘assistance’ in a dishonest and fraudulent design. Plainly, whether a third party has assisted is a question of fact and, in practical terms, the ways in which a third party may provide assistance are myriad. However, there are at least two principles that emerge from the authorities and commentary on this point.

[117] First, there will be assistance where, but for the action or inaction of the third party, the breach of fiduciary duty would not have occurred. A common example is the role of a bank or other financial intermediary the function of which is essential to effect a transaction that amounts to a breach of trust.

[118] Secondly, there may also be assistance where the third party has facilitated a breach of fiduciary duty that would have occurred in any event. It is difficult to see how, in view of equity’s broad concern with preventing unconscionability, a third party in these circumstances could not be liable under the second limb of Barnes v Addy, even if there is evidence to suggest that the commission of the primary breach was a foregone conclusion.

[350]
Verus, by Mr Johnson, did so assist in both breaches in the manner described in paragraph 117 from Harstedt. Mr Tomlinson’s scheme to benefit himself and Verus secretly at the expense of Sentinel Countrywide was carried out by, and with the essential assistance of, Verus by at least the following acts by Verus:
1. (a)
  Agreeing to the scheme;
2. (b)
  Adopting the first Revised Quote as if it was a genuine arms’ length agreement;
3. (c)
  Issuing the first claim to obtain funds to pay the secret benefit for Mr Tomlinson;
4. (d)
  Paying $22,000 to Arete Park; and
5. (e)
  Maintaining this claim to the balance of the contract sum, thereby seeking to obtain the benefit of Verus’ share of the wrongfully inflated invoice.
[351]
The claim for accessory liability has been established for both breaches.

Tort of conspiracy

Relevant principles

[352]
As will be seen, the conduct which comprised the carrying out of the conspiracy has already been found to give rise to liability in equity for both participants. Unless there was some reason why the remedy for conspiracy was more efficacious, there seems little purpose in pursuing the cause of action. As will be seen, the remedies in equity are more than sufficient to secure for the relevant plaintiffs efficacious remedies. However, in case I have overlooked something, I will make findings on the tort claim.
[353]
The elements of the tort of conspiracy were articulated most recently by Bond J in Lee v Abedian [2017] 1 Qd R 549:

[68] There are two torts of conspiracy to injure – the first is a conspiracy to injure by lawful means and the second is a conspiracy to injure by unlawful means.

[69] The elements of the tort of conspiracy to injure by lawful means are:

(a)
there was a combination or agreement between two or more persons;
(b)
the sole or dominant purpose of the combination or agreement was to injure the plaintiff;
(c)
the combination or agreement was carried into effect by the defendants’ conduct;
(d)
the defendants’ conduct in carrying the combination or agreement into effect caused damage to the plaintiff.

[70] The elements of the tort of conspiracy to injure by unlawful means are:

(a)
there was a combination or agreement between two or more persons to engage in conduct amounting to unlawful means;
(b)
a purpose of that combination or agreement was to injure the plaintiff;
(c)
the combination or agreement was carried into effect by the commission of the agreed unlawful acts; and
(d)
those unlawful acts caused damage to the plaintiff

[354]
His Honour provided a comparison and contrast of the elements of the two torts:

[71] It can be seen that the two torts have in common the need to prove the conspiracy; that the conspiracy involved an intention to injure; that the conspiracy was carried into effect; and that so doing caused damage to the plaintiff. And it may also be observed in relation to both torts, that in a case based on a clandestine arrangement or arrangements between conspirators, a plaintiff, who can be expected to be unable to plead the terms of an express agreement in the usual way, must at the least be able to plead and particularise the overt acts it intends to rely on to justify the inference that the agreement on which it relies was in fact made as it alleges.

[72] There are three key distinctions between the two torts.

[73] The first lies in the prominence of the required purpose of injuring the plaintiff. Both torts require the plaintiff to prove that a purpose of the conspiracy was to injure the plaintiff. For a lawful means conspiracy, however, the plaintiff must prove that the purpose of injuring the plaintiff was the sole or predominant purpose of the conspiracy. That is not required for an unlawful means conspiracy where it will suffice for a plaintiff to prove that causing injury to the plaintiff was a purpose of the conspiracy.

[74] The second lies in the nature of the means agreed to be used to injure the plaintiff. For an unlawful means conspiracy, the plaintiff must prove that the combination or agreement was to engage in conduct which amounted to unlawful means. In other words, the unlawful means aspect must exist at the time the combination or agreement was made. That is not required for a lawful means conspiracy.

[75] The third lies in the nature of the means in fact used to carry the conspiracy into effect and cause injury to the plaintiff. For an unlawful means conspiracy, the plaintiff must prove that the conspiracy was carried into effect by commission of the agreed unlawful acts and those agreed unlawful acts caused damage to the plaintiff. That is not required for a lawful means conspiracy where the plaintiff does not have to show that it was the unlawful part of the conspiracy that caused loss to the plaintiff.

[355]
His Honour was assessing the adequacy of the pleading of the two torts. The pleading advanced conspiracy by lawful means and unlawful means as alternatives. His Honour concluded that it did not do so in a manner which clearly identified the facts relevant to each separate cause of action. The tort is pleaded in this case as follows:

41 By reason of the matters pleaded in paragraphs 9(d), 10 and 21 to 36, it is to be inferred that:

(a)
each of Mr Tomlinson, Verus Construction, Arete Park and Mrs Tomlinson had, on a date, and in a form, both of which the plaintiffs cannot further particularise until completion of disclosure and other interlocutory steps, but which in any event was on or prior to 16 May 2018, in respect of building works to be undertaken by one or more of the plaintiffs, agreed (the Verus Conspiracy) to the following:
1. (i)
  Mr Tomlinson would alter quotations from potential contractors including Verus Construction by increasing them;
2. (ii)
  Mr Tomlinson would ensure that the altered quotation from Verus Construction was for the least amount amongst the altered invoices;
3. (iii)
  Mr Tomlinson would invite Verus Construction to “confirm” and thereby “offer” to undertake the work for the sum in the altered quote;
4. (iv)
  Mr Tomlinson would provide the three altered quotes to the relevant plaintiff in a Capex Request Form for the particular work to be undertaken;
5. (v)
  Mr Tomlinson would do so in the knowledge that the quote which appeared to be for the smallest amount, being the altered quote from Verus Construction would be accepted by the relevant plaintiff;
6. (vi)
  either upon performance of the work, or during the course of the work, Verus Construction would issue an invoice in a sum equal to the sum in the altered quote; and
7. (vii)
  upon payment by the relevant plaintiff, Verus Construction would either:
  1. (A)
    keep all of the difference between the original quote and the altered quote for its benefit (the Verus Difference); or
  2. (B)
    keep part of the Verus Difference and pay the balance to Mr Tomlinson or as directed by Mr Tomlinson; and
(b)
in carrying out the Verus Conspiracy pleaded in subparagraph (a), Verus Construction and Mr Tomlinson intended to injure Sentinel Countrywide by requiring it to pay the amount of the Verus Difference in circumstances where, but for the Verus Conspiracy, it would not have paid such amount.

42 The Verus Conspiracy was carried out by:

(a)
Mr Tomlinson engaging in the conduct pleaded in paragraphs 25 to 28, 0 to 31 and 36;
(b)
Verus Construction engaging in the conduct pleaded in paragraphs 24, 0, 32 and 35;
(c)
Mrs Tomlinson and Arete Park doing the things pleaded in paragraphs 9(d) and 10(d) above; and
(d)
Arete Park engaging in the conduct pleaded in paragraphs 31 and 35.

43 By reason of the matters pleaded in paragraph 32 to 36 and 42 above:

(a)
Sentinel Countrywide suffered injury in the form of financial loss as a consequence of the Verus Conspiracy in the amount of the Verus Difference being $46,021.87;
(b)
each of Mr Tomlinson, Verus Construction, Mrs Tomlinson and Arete Park are liable to pay damages for conspiracy in the sum of $46,021.87.

[356]
Whatever objections might have been made to the form of the pleading on an interlocutory basis, it is clear me that the case advanced was conspiracy to injure by unlawful means. The conduct alleged in paragraph 41(a) identifies conduct which could be characterised as an offence against s. 408C of the Code. Further, read in the context of the allegations in the statement of claim as to Mr Tomlinson’s duties to Shield and Sentinel Countrywide, the pleaded conduct amounts to a fraudulent breach of fiduciary duty in which Verus was an active and knowing participant. Accordingly, the plaintiffs must establish the matters identified in paragraph 70 of the passage cited from Bond J’s judgment.
[357]
There are, therefore, three specific issues to be resolved.
1. (a)
  First, have the plaintiffs established an agreement to engage in conduct which was unlawfully carried into effect on the facts as found?
2. (b)
  Second, if so, was a purpose of that conduct to injure Sentinel Countrywide or Shield?
3. (c)
  Third, if so, did that conduct cause damage to Sentinel Countrywide or Shield?

Analysis

[358]
My findings thus far do not coincide entirely with the conduct pleaded as agreed and carried out by the participants in the tortious conspiracy. I have not found that Mr Johnson knew and agreed in the detail of Mr Tomlinson’s method for ensuring that Mr Johnson’s quote would be accepted. However, I am satisfied that, either expressly or by implication, Mr Tomlinson communicated that his position in the Sentinel Group allowed him to ensure that the first Revised Quote would be accepted to the mutual benefit of Verus and Mr Tomlinson. These findings are within the scope of the understanding and conduct pleaded in the statement of claim.
[359]
Mr Baroni, for Verus, submitted that even if I found that Mr Johnson had agreed to, and carried out, the acts alleged by the plaintiffs, and even if that conduct comprised unlawful means, the claim in tort would still fail because the plaintiffs would not be able to establish that a purpose (note, not the dominant purpose) of the agreement was to injure Shield or Sentinel Countrywide. He submitted that the purpose of the understanding and conduct was to secure the benefits to Verus and Mr Tomlinson. There was no purpose to injure the party impacted by the secret benefits. I reject that contention.
[360]
It can be accepted as a matter of fact that, in broad terms, Mr Johnson and Mr Tomlinson’s objective was to enrich themselves and that they otherwise harboured no particular malice to, or wish to harm, Sentinel Countrywide. On the other hand, it could be contended that the tort arises where harm to a third party is an inevitable consequence of an agreement to carry out unlawful acts which procure benefits at the expense of that party. The intention could be characterised in this latter case as being one to enrich themselves by the device of inflicting economic harm on the third party.
[361]
In my opinion, authority supports the latter characterisation of the conduct of Mr Tomlinson and Verus in a case of this kind. In McKellar v Container Terminal Management Services Ltd (1999) 165 ALR 409, Weinberg J observed:

[135] After a period of uncertainty, the House of Lords in Lonrho Plc v Fayed [1992] 1 AC 448 reaffirmed that this form of the tort, unlike the Crofter variety, does not require a predominant purpose to injure the plaintiff. However, the tort still requires an intention to injure: it is not enough that the defendants combined to do an unlawful act which has the effect of causing damage to the plaintiff. In Rogers’ Winfield and Jolowicz On Tort (15th ed, 1998) it is suggested that the precise nature of the mental element required for this form of the tort remains somewhat elusive (p 645):

. . . not least because (1) the cases tend to be decided on assumed facts or on applications to strike out where the plaintiff has merely to show that it is arguable that there is a cause of action and (2) the courts speak of ‘‘intention’’, a legally complex and protean concept, as if it were something with a fixed and self evident meaning.

[136] The author continues (p 646):

The true test of intention in this context is probably that stated by Lord Denning MR in the Court of Appeal and quoted with apparent approval in Lonrho v Fayed.

‘‘I would suggest that a conspiracy to do an unlawful act — where there is no intention to injure the plaintiff and it is not aimed or directed at him — is not actionable . . . But if there is an intent to injure him then it is actionable. The intent to injure may not be the predominant motive. It may be mixed with other motives . . . It is sufficient if the conspiracy is aimed or directed at the plaintiff, and it can reasonably be foreseen that it may injure him, and does in fact injure him’’ [footnotes omitted].

[137] The requirement that the conspiracy be ‘‘aimed at’’ the plaintiff, though perhaps difficult to apply in some cases, is sufficient to keep liability within reasonable grounds. It prevents claims by those who suffer incidental, though foreseeable, loss as a result of the commission of what is sometimes described as an ‘‘undirected’’ crime.

[underlining added]

[362]
The policy evident in that articulation of the nature of the link between the conduct proved and the infliction of harm on a plaintiff was explained in Fatimi Pty Ltd v Bryant [2004] NSWCA 140. Handley JA, with whom McColl JA agreed, explained:

[13] His Honour then considered the claim of conspiracy to injure by unlawful means. He held, correctly, that if such claim was to be actionable one of the purposes of the conspiracy must have been to injure the plaintiff. However this requirement will be satisfied if the conspiracy and the unlawful means were aimed at or directed at the plaintiff. In Williams v Hursey (1959) 103 CLR 30 at 78 Fullagar J (whose judgment received the concurrence of Dixon CJ and Kitto J) said that the conspiracy there was “a combination to do unlawful acts necessarily involving injury”. In the same case Menzies J put the matter equally broadly when he said at 122:

“If two or more persons agree to effect an unlawful purpose, whether as an end, or a means to an end, and in the carrying out of that agreement damage is caused to another, then those who have agreed are parties to a tortious conspiracy.”

If the conspiracy and the unlawful means were aimed at the plaintiff damage to the plaintiff that was foreseen or foreseeable or was necessarily caused in carrying out the conspiracy will satisfy the requirements for this branch of the tort.

[14] Where as in Lonrho Ltd v Shell Petroleum Co Ltd (No 2) [1982] AC 173 the joint illegal action was not directed at the plaintiff the fact that damage to it was reasonably foreseeable did not make the conspiracy actionable. See also Lonrho Plc v Fayed [1992] 1 AC 448, 467 where Lord Bridge quoted with approval from the unreported judgment of Lord Denning MR in the earlier Lonhro case:

“I would suggest that a conspiracy to do an unlawful act – when there is no intent to injure the plaintiff and it is not aimed or directed at him – is not actionable, even though he is damaged thereby. But if there is an intent to injure him then it is actionable. The intent to injure may not be the predominant motive. It may be mixed with other motives.”

[15] Hence, despite the statement by Mason P in McWilliam v Penthouse Publication Ltd [2001] NSWCA 237 at [13], in which I concurred, that:

“It is not enough to establish that the acts of the conspirators necessarily involved injury to the plaintiff or that the plaintiff was a person reasonably within the contemplation of the conspirators as a person likely to suffer damage … “

I would not accept the correctness of the statement by the trial Judge (red 115):

“… the purpose to harm must still be what is actuating the defendants in acting. That the defendants realise that damage to the plaintiff is a likely, or indeed an inevitable, consequence of their action is not enough to satisfy this element of the tort. Rather, damage to the plaintiff must be one of the things which the defendants are trying to achieve.”

[16] The Judge’s findings establish that the predominant purpose of the defendants was to preserve the value of the land for the benefit of the Bryant family but, in the words of Fullagar J in Williams v Hursey at 78 this “necessarily” involved injury to Fatimi, because their predominant purpose could not otherwise be achieved. In this situation the relevant principle, as re-established by Lonrho Plc v Fayed is that stated in that case by Lord Bridge at 465-6: “But when conspirators intentionally injure the plaintiff and use unlawful means to do so, it is no defence for them to show that their primary purpose was to further or protect their own interests; it is sufficient to make their action tortious that the means used were unlawful.”

[363]
Based on these authorities, I find that the conduct of Mr Tomlinson and Mr Johnson was “aimed at” Sentinel Countrywide in the sense described in those cases. Their scheme “necessarily involved” injury to Sentinel Countrywide, specifically because it was the third party which was to be deceived into paying more for the Dubbo Works than otherwise would have been paid without the collusion of the two men involved. Damage was plainly suffered by the tortious conspiracy, despite the recovery of the payment to Arete Park, because Sentinel Countrywide has overpaid for the Dubbo Works by a substantial sum and because that company is exposed to a claim by Verus for the balance of the contract sum.
[364]
Accordingly, the claim for damages for conspiracy is established.

Remedies

Growth Australia Projects

[365]
I refer to paragraphs [5] to [7] and [180] above. In his trial submissions, Mr Tomlinson contended that the plaintiffs had suffered no loss in respect of the Bodel or Growth Australia projects because the difference between the lowest genuine quotation in each case and the amount actually paid had been recovered by the settlements.
[366]
The plaintiffs accept that the amount paid by way of settlement by Bodel/ Mr McIntyre, and by Growth Australia, exceeds the amounts claimed by way of damages against Mr Tomlinson for the Bodel and Growth Australia projects. However, they contend that they still have a loss because each settlement was a settlement inclusive of costs, and once part of the settlement is applied to costs incurred in respect of the claims up to the time of settlement, the remainder is inadequate to meet the whole of the damages claimed against Mr Tomlinson in respect of each project.
[367]
The analysis of the plaintiffs is articulated in the affidavit of their solicitor, Ms Craig, tendered at trial.^[182]
[368]
On 1 April 2019, Sentinel Regional entered a Deed of Settlement and Release^[183] with Growth Australia (the Growth Deed), which relevantly provided:
1. (a)
  By clause 1.1, that the Settlement Amount was $320,000;
2. (b)
  By clause 4:

(a)
Without any admission of liability, and in consideration of discontinuing the Action, Growth Australia shall pay to Sentinel and Sentinel will accept, the Settlement Amount in full and final satisfaction of all claims, actions, demands (including without limitation any claims in respect of costs and interest) in respect of the Action.
(b)
The Settlement Amount must be paid:
1. (i)
  within two (2) Business Days of the Effective date; and
2. (ii)
  to the Trust Account of Sentinel’s Solicitors, being:

Account: Russells Solicitors Law Practice Trust Account

Bank: Macquarie Bank

BSB No: 184-446

Account No: 3019-12002

Reference: MMC: 20180416

(c)
Within two (2) Business Days of receipt of the Settlement Amount, the parties will sign, and Sentinel will file, a notice of discontinuance of the Action, with no order as to costs.
1. (c)
  By clause 5, for broad releases in relation to the claims advanced in the proceedings against Growth Australia.

[369]
Growth Australia paid the settlement sum.
[370]
Based on the case as argued before me on the pleadings, I have found the damages sum to be $299,415.54. However, Ms Craig, solicitor for the plaintiffs, swears the sum claimed is $272,195.94.^[184] Given the difference is 1/11^th of the total sum claimed, I infer that Ms Craig has adjusted for GST. The sum claimed in the pleading appears to include GST. Difficulties can arise in determining the interaction of settlements and the GST legislation, both as to whether damages should be calculated as excluding or including GST and whether the settlement itself gives rise to a taxable supply. However, as the plaintiffs have adopted the position that the correct sum of damages was represented by a GST exclusive figure, I will not enquire further into that matter.
[371]
Ms Craig summarises the damages claimed for as follows:^[185]

Compromise sum	$320,000.00
Less	$16,049.75
Less	$25,932.03
Balance to be applied to claim		$278,018.22
Claim		$272,195.94
Amount of loss remaining as claimed in proceeding			($5,822.28)

[372]
That schedule demonstrates the settlement sum exceeded the damages claimed arising out of the common law causes of action advanced against Mr Tomlinson and Growth Australia.
[373]
The first two figures are for costs as explained in Ms Craig’s affidavit:^[186]
1. (a)
  The amount of $16,049.75 is the amount of costs and disbursements which she has determined from the firm’s records were incurred in pursuing Growth Australia specifically; and
2. (b)
  The amount of $25,932.03 is 1/7^th of the amount of costs which represents a pro rata share of the total common costs and disbursements at the time of the settlement (calculated on the basis that there were six other defendants at the time).
[374]
The result of Ms Craig’s analysis is that, regardless of whether Sentinel Countrywide and Shield are entitled first to apply settlement funds to costs or not, those plaintiffs have been fully indemnified for that loss. Damages are the gist of the deceit claim. Accordingly, while the cause of action is otherwise made out, the claim in deceit against Mr Tomlinson for the Growth Australia projects fails.
[375]
That is not the end of the matter. The plaintiffs have also established that Mr Tomlinson breached his fiduciary duty, both by obtaining a secret profit and by permitting his duty to conflict with his personal interest and the interests of Growth Australia. The measure of equitable compensation for those breaches would not, on the facts of this case, materially differ from the measure for tort, and that loss has been alleviated by the Growth Settlement.
[376]
However, Mr Tomlinson retains the benefit represented by the secret profit obtained in the form of the payment by Growth Australia of the invoice from Equine as found in paragraphs [247] to [253] above. Why should he not be ordered to pay the value of that benefit to Sentinel Countrywide? No arguments to the contrary were advanced by Mr Tomlinson, but two occur to me.
[377]
First, I have found that the large upfront payments to Growth Australia were made to get in the funds necessary to pay the secret benefit to Mr Tomlinson. As Sentinel Countrywide has been indemnified for the whole of the loss suffered from those upfront payments, it might be contended that the amount it has recovered includes, in a broad sense, the amount paid by Growth Australia to Equine for Mr Tomlinson’s benefit.
[378]
However, the character of the remedy of account differs from compensatory remedies. An account aims to strip a defaulting fiduciary of the gain to the fiduciary from his or her breach, not to compensate for the loss suffered by the beneficiary.^[187] Accordingly, there is no theoretical barrier to ordering Mr Tomlinson to account for the value of the secret profit, even if no loss can be shown from the transaction.
[379]
Further, it is not an answer to the claim that, in the circumstances of this case, ordering recovery of the secret profit might lead Sentinel Countrywide recovering the whole of its loss plus the secret profit. While equitable remedies are discretionary, the purpose of the remedy in account is to prevent unjust enrichment and thereby to maintain the integrity of fiduciary relationships. That policy is met by preventing Mr Tomlinson from retaining that benefit.
[380]
Second, in final submissions, the plaintiffs stated that they did not press the account and constructive trust remedies in respect of the secret profits. That position was advanced on the basis that the secret profit from Growth Australia could be recovered pursuant to the claim for equitable compensation. That seems doubtful to me because of the compensatory character of that remedy. However, the Court may grant such relief as is justified on the pleadings. Further, given the timing of the plaintiffs’ concession, it works no injustice by granting a remedy in account. The injustice would arise from permitting Mr Tomlinson to retain the secret profit he procured by misusing his position.

The Bodel Projects

[381]
On 11 July 2019, the plaintiffs entered a Deed of Settlement and Release^[188] with Bodel and Mr McIntyre (the Bodel Deed), which relevantly provided:
1. (a)
  By clause 1.1, that the Bodel Settlement Amount was $97,361.08 and the McIntyre Settlement Amount was $18,000;
2. (b)
  By clause 3:

(a)
Without any admission of liability, and in consideration of discontinuing the Action, Bodel shall pay to Sentinel the Bodel Settlement Amount on or before 9 October 2019 and Sentinel will accept, the Bodel Settlement Amount in full and final satisfaction of all claims, actions, demands (including without limitation any claims in respect of costs and interest) in respect of the Action.

(b)
Without any admission of liability, and in consideration of discontinuing the Action, McIntyre shall pay to Sentinel the McIntyre Settlement Amount on or before 8 August 2019 and Sentinel will accept, the McIntyre Settlement Amount in full and final satisfaction of all claims, actions, demands (including without limitation any claims in respect of costs and interest) in respect of the Action.

…

(d)
Within two (2) Business Days of receipt of the Bodel Settlement Amount, Sentinel and Bodel will sign, and Sentinel will file, a notice of discontinuance of the Action, with no order as to costs.

(e)
Within two (2) Business Days of receipt of the McIntyre Settlement Amount, Sentinel and McIntyre will sign, and Sentinel will file, a notice of discontinuance of the Action, with no order as to costs.

(c)
By clause 4, for broad releases in relation to the claims advanced in the proceedings by the plaintiffs against Bodel and Mr McIntyre, including any claims for costs.

[382]
Bodel and Mr McIntyre paid the settlement sums.
[383]
The damages claimed by the relevant plaintiffs, because of the various breaches alleged against Mr Tomlinson for the Bodel projects, do not appear to be agreed between the parties. The sums claimed in the statement of claim can be summarised as follows:

Bodel Project	Overpayment alleged (excl. GST)
The F45 Fitout Works	$48,793
Lifeline Make Good Works	$10,000
‘The Hub’ Fitout Works	$11,442
Creek Street Tenancy Works	$10,000
Springwood AC Works	$9,155
Total	$89,390

[384]
Ms Craig’s affidavit, however, alleges that the claim for loss from the Bodel projects was $112,913.78. I do not understand how that figure is derived. It might be that the sums have reduced somewhat since the Bodel Deed. There is no suggestion, however, that the sum claimed in the Bodel contracts was calculated on a different basis than that pleaded at trial against Mr Tomlinson. I will adopt the figure in the current pleadings of $89,390 (excluding GST). The total of the settlement sums paid by Bodel and Mr McIntyre was $115,361. That amount exceeded the damages claimed for the Bodel projects by $25,971.
[385]
Ms Craig’s affidavit summarises the claim in respect of Bodel as follows:^[189]

Total compromise sum	$115,361.08
Less costs and disbursements	$29,951.60
Less proportion of common costs	$76,656.95
Balance to be applied to claim		$8,752.53
Claim		$112,913.78
Amount of loss remaining as claimed in proceeding			$104,161.25

[386]
As she explains:^[190]
1. (a)
  $29,951.60 is the amount of costs actually incurred by the plaintiffs in pursuing Bodel and Mr McIntyre specifically; and
2. (b)
  $76,656.95 is the amount of costs which represents a pro rata share of the total quantity of common costs and disbursements at the time of the settlement (calculated on the basis that there remained six defendants at the time of the settlement and that Bodel and Mr McIntyre represented two of those defendants).
[387]
Adjusting for my finding in paragraph [383] above, the remaining loss would be reduced to $80,638. If the deduction of the plaintiffs’ actual costs from the settlement sum is not a valid approach, however, then the plaintiffs have suffered no damage from Mr Tomlinson’s deceit or breach of fiduciary duty.
[388]
This squarely raises the question of whether the plaintiffs’ approach of applying the settlement sum first to costs, and only after costs are paid, to the damages, binds Mr Tomlinson. I do not think that it can.
[389]
First, the plaintiffs settled with Bodel and Mr McIntyre on the basis that no liability was admitted, whether for the damages claimed or for the costs claimed. While the plaintiffs could apportion and apply that sum to whichever of the claims they asserted as they wished internally, they could not bind Bodel nor Mr McIntyre to that apportionment, much less Mr Tomlinson. Further, to the extent the plaintiffs rely on the existence of its claim for costs against Bodel to sustain the apportionment, there is no basis to conclude that they would have recovered on an indemnity basis. Indeed, given the amounts involved, their claim for costs might properly have been measured on the Magistrates Court scale: Rule 687 UCPR.
[390]
Second, I do not see how the plaintiffs can bind Mr Tomlinson to an apportionment of the settlement which included an apportionment of the sum paid on account of costs unless those costs were established at trial against Mr Tomlinson as an additional head of damages. Mr Johnstone contended that they were. He relied on paragraph 152 of the statement of claim which articulated the damages claimed in deceit for each Bodel project as follows:

152 By reason of the matters pleaded in paragraphs 113, 126, 137, 147 and 151 above:

(a)
In respect of the F45 Fitout Works, Sentinel Countrywide has suffered damage as a result of the making of the representations in the sum of $48,793.58, being the difference between the amount Sentinel Countrywide would have paid for the F45 Fitout Works and the amount it in fact paid for the F45 Fitout Works;
(b)
In respect of the Air Conditioning Works, Sentinel Springwood has suffered damage as a result of the making of the representations in the sum of $9,155, being the difference between the amount Sentinel Springwood would have paid for the Air Conditioning Works and the amount it in fact paid for the Air Conditioning Works;
(c)
In respect of The Hub Fitout Works, BCC Mackay has suffered damage as a result of the making of the representations in the sum of $11,442.60, being the difference between the amount BCC Mackay would have paid for The Hub Fitout Works and the amount it in fact paid for The Hub Fitout Works;
(d)
In respect of the Lifeline Make Good Works, Sentinel Springwood has suffered damage as a result of the making of the representations in the sum of $11,000.00, being the difference between the amount Sentinel Springwood would have paid for the Lifeline Make Good Works and the amount it in fact paid for the Lifeline Make Good Works;
(e)
In respect of the Creek Street Works, Sentinel Regional has suffered damage as a result of the making of the representations in the sum of $11,000.00, being the difference between the amount Sentinel Regional would have paid for the Creek Street Works and the amount it in fact paid for the Creek Street Works.

in each case together with legal costs less the amount of the Bodel Settlement.

[underlining added]

[391]
Mr Johnstone submitted that the words “in each case together with legal costs” comprised a pleading that the legal costs incurred in recovering the settlement sum from Bodel/Mr McIntyre comprised damages flowing from Mr Tomlinson’s deceit in each case. I respectfully disagree that those words plead such a head of loss:
1. (a)
  The words used do not say that;
2. (b)
  The facts which give rise to such a head of loss are not pleaded; and
3. (c)
  The amount of the loss claimed is not pleaded.
[392]
These omissions are not merely formal. For example, what are the facts relied upon to establish that the costs of suing a third party for a common loss in conspiracy comprise damages which are recoverable from Mr Tomlinson in deceit? And what facts establish that such damages are reasonably foreseeable and not too remote in law?
[393]
Even if the legal costs incurred in recovering from Bodel/Mr McIntyre had been pleaded, a further difficulty would arise: whether the costs incurred were reasonably incurred in recovering the settlement sum. The evidence did not address that question in any detail. That is not to say the amounts were not reasonable, just that they were not proved to be so.
[394]
No other basis was advanced to sustain the proposition that the plaintiffs could allocate the settlement sum under the Bodel Deed, first to costs incurred in the proceedings against Bodel and Mr McIntyre, and then to the damages claims.
[395]
It occurred to me that one way which might have been open to advance such a claim was to argue that the litigation against Bodel/Mr McIntyre produced a fund to be set against the co-incident liability of Mr Tomlinson and Bodel/Mr McIntyre for damages for the claims in deceit and conspiracy, and that the plaintiffs had a charge over the fund for the costs of creating it. The authorities recognise the equitable principle that the reasonable costs of realisation of a fund may take priority over the claims of persons with a prior interest in that fund: the so-called “salvage principle”.^[191] A convenient summary of the leading cases appears in Richardson v Aileen Pty Ltd [2007] VSC 104 at paragraphs 37 to 45. More recently, the principle was considered and applied in Coad v Wellness Pursuit Pty Ltd (2009) 71 ACSR at paragraph 71 and IMF (Australia) Ltd v Meadow Springs Fairway Resort Ltd (2009) 69 ACSR 507 at paragraph 63. The principle can apply in novel situations. However, this is neither pleaded nor contended for.
[396]
How then should the settlement sum be dealt with? It seems to me that it must be allocated to the damages sought against Mr Tomlinson for deceit. I reach that view because:
1. (a)
  The settlement sum was paid at least in part on account of the same loss as is claimed in the deceit causes of action against Mr Tomlinson; and
2. (b)
  That is the only loss which has been established against Mr Tomlinson in respect of the Bodel projects.
[397]
I suspect that there is much more to this subject than has been explored in this judgment. However, on the submissions put to me, I find that the plaintiffs have recovered the whole of the loss claim against Mr Tomlinson in respect of the Bodel projects, and accordingly, the claim in deceit must be dismissed. Further, I can see no basis why equitable compensation would produce a different result in these circumstances. That claim must also be dismissed.

The Dubbo Works

[398]
Sentinel Countrywide claims damages for deceit and conspiracy of $46,021.87, alleged to be the difference between the amount paid for the Dubbo Works and the amount which would have been paid but for Mr Tomlinson’s deceit. That amount seems to be calculated as follows. Sentinel Countrywide paid the deposit claim of $98,377.84 (excluding GST) referred to in paragraph [159] above. The Original Quote was $56,539.77, with no reference to GST. The assumption upon which the damages figure is calculated is that the Original Quote was GST inclusive. While that is the presumption where no reference to GST is made, it seems more probable than not that that figure was supposed to be excluding GST. That is the basis upon which all discussions appeared to be conducted at the time and I consider it very likely that would have been insisted upon by Mr Johnson before he undertook the work. On that basis, the loss suffered is $41,838.
[399]
The next question is one of causation. If Mr Tomlinson had not encouraged Mr Johnson to review his price, would Verus have done the work for the price in the Original Quote? In my view, it would have done so. Mr Johnson was very keen to undertake the Dubbo Works and was willing to take a risk on the project to build his standing with Mr Tomlinson and the Sentinel Group.^[192] Further, the quoted price had been worked out with some care – it was not a figure plucked at random and the actual cost of the works was generally consistent with the figures assumed in the Original Quote.
[400]
Sentinel Countrywide is entitled to judgment in its claim for deceit against Mr Tomlinson for $41,838, and against Verus and Mr Tomlinson in the tort of conspiracy for the same amount.
[401]
In addition, it seems to me that, in the absence of the contract with Verus being set aside in equity, Sentinel Countrywide would also be entitled to damages in the amount of any sum owed under the contract over and above the amount in the Original Quote. That was not contended for by Sentinel Countrywide and it is unnecessary to decide the matter given that the contract with Verus is to be set aside, as will be explained next.
[402]
Verus counterclaims seeking payment of the balance of the sum due under the contract between Sentinel Countrywide and Verus. However, that contract was entered into because of a fraudulent breach of trust by Mr Tomlinson which was assisted with knowledge by Verus. Such a contract is voidable in equity and has been avoided by Sentinel Countrywide, by the terms of the answer to the counterclaim if in no other way. I therefore order that the contract be set aside in equity.^[193] Rescission as a remedy in an executed contract depends on the ability to give practical counter-restitution. However, that principle is given effect by Sentinel Countrywide allowing Verus a credit for the value of the work done in the amount of the Original Quote.

The counterclaims

[403]
The effect of the setting aside of the contract between Verus and Sentinel Countrywide is that the counterclaim for sums due under that contract must be dismissed.
[404]
That leaves the claim of Verus for the value of the scaffolding. Verus contends that, on its proper construction, the contract provided for title to the scaffolding to pass to Verus. The contract arose from acceptance of the quotation by a purchase order. There is no express language which casts any light on the matter. Verus therefore must establish that the objective circumstances sustain the conclusion that the intention of the parties was that title to the scaffolding remain with it.
[405]
I do not accept that Verus has done so. Verus appeared to rely on two matters:
1. (a)
  That Verus was instructed by Mr Tomlinson to buy the scaffolding equipment rather than hire it; and
2. (b)
  That Verus in fact did so and paid for the equipment.
[406]
It is true, as Verus contended, that it is not unusual for a contractor to take away from site equipment provided for use on the site. However, if Verus was to buy and retain the scaffolding, then one would expect that it would acquire the equipment from its own funds and then charge Sentinel for its use. However, the opposite occurred: although Verus bought the scaffolding, it was paid the purchase price by Sentinel as an express component of the contract price. Verus’ argument is that it should keep the scaffolding which was, in substance, paid for by Sentinel. That is a very unlikely intention for commercial parties. The counterclaim to recover the scaffolding is rejected.

The alleged compromise

[407]
By his defence, Mr Tomlinson pleaded that Mr Ebert compromised all the plaintiffs claims at a meeting on 22 January 2019. Mr Tomlinson made no submissions about that matter in his final submissions nor did he give any evidence on the matter. It was unclear to me whether he pressed that contention. However, the onus was on Mr Tomlinson to prove his allegations of compromise and he did not attempt to do so. To the extent it matters, the alleged conversation in his defence, even if accurate, does not demonstrate a certain comprise of the plaintiffs’ claims which was objectively intended immediately to bind the plaintiffs.

The claims by Shield

[408]
Shield Property seeks damages from Mr Tomlinson for breach of his employment contract. It can scarcely be doubted that his conduct in relation to each project was a breach of that contract. The issue which arises is what consequence flows from those breaches.
[409]
Shield’s case is articulated in paragraphs 161 to 163 of the statement of claim as follows:

161 Each of the losses pleaded in paragraphs 40, 43, 84(g), 87, 152 and 155 (the Sentinel Losses) arose out of the fraud or dishonesty of Shield through its employee Mr Tomlinson.

162 By reason of the matters pleaded in paragraphs 16 to 18 and 161 above, Shield Property has accepted liability for the Sentinel Losses.

163 By reason of the matters pleaded in paragraphs 16 to 18, 37, 82, 149, 161 and 162 above:

(a)
Shield Property has incurred a loss of at least $139,382.95, to be particularised after the completion of disclosure and other interlocutory steps; and
(b)
Mr Tomlinson is liable to pay damages for breach of his Employment Contract in the amount of at least $139,382.95, to be particularised after the completion of disclosure and other interlocutory steps.

[410]
Paragraphs 16 to 18 of the statement of claim plead the indemnity to which I have already referred.
[411]
The effect of the pleading is that Shield alleges it is obliged by the indemnity to indemnify the respective Sentinel plaintiffs and that, for that reason, Shield has “accepted liability for the” losses pleaded.
[412]
The first point to note is that the effect of this judgment is that the only Sentinel plaintiff which will obtain judgment for a loss is Sentinel Countrywide for $41,838. The judgment in favour of Sentinel Regional is not to make good a loss, but to strip a profit, and is not pleaded to be, and does not, fall within the scope of the indemnity.
[413]
The next point to note is that Shield does not plead any demand by Sentinel Regional, nor any other Sentinel plaintiff, made on the indemnity. Further, there is no evidence that they have sought indemnity from Shield, nor any evidence that they ever will. And it is to be doubted that such a claim could not be defended now that the Sentinel plaintiffs have permitted this matter to run to judgment without seeking to recover on the indemnity. Such a claim might credibly be now met with an Anshun defence. If one adds the fact that Sentinel Regional has obtained a judgment against Mr Tomlinson and Verus, I am not persuaded that Shield has in fact suffered loss by its indemnity, nor that it ever will.
[414]
It might have been possible to make a declaration of some kind in respect of any future liability asserted against Shield, but no such order was sought, and such relief might encounter difficulties in its formulation.
[415]
Ultimately, I am not persuaded that Shield is entitled to the relief sought in the statement of claim against Mr Tomlinson.
[416]
Finally, I should briefly mention Mr Tomlinson’s contention that his employment contract is affected by illegality. Mr Tomlinson relied on his argument that Shield was acting unlawfully in providing project management services without a licence to argue that his employment contract was void. The law of illegality, as it impacts on the validity and enforceability of contracts, is not straightforward.^[194] It can be accepted that a contract by which a person undertakes to carry out construction work without a licence is unenforceable at the suit of the unlicensed person. However, that does not address the position of a contract of employment by the unlicensed person.
[417]
Mr Tomlinson’s submissions did not, unsurprisingly, contain any analysis of the specific impact of the broad issue of unlicensed work on the specific rights and obligations under his contract of employment. It is unnecessary to embark on that analysis here. However, that issue might play out if fully analysed, it provided no answer to his liability to the Sentinel plaintiffs. And it was unnecessary to deal with it in respect of Shield’s claims against him because those have been dismissed.

Winding up

[418]
Steven Naidenov of Aston Chace Group was appointed liquidator of Verus by order of the Supreme Court of Victoria on 9 June 2021. An originating application was filed by Sentinel Countrywide in the Supreme Court of Queensland seeking orders pursuant to s. 471B(a) of the Corporations Act 2001 (Cth). By order of Martin J on 14 July 2021, leave was granted to Sentinel Countrywide to proceed with its proceeding against the respondent, such leave being limited to permitting the applicant:
1. (a)
  to appear in Court to receive judgment when delivered;
2. (b)
  to apply for any order for costs of those proceedings;
3. (c)
  to draw up and file any judgment given or order made in favour of the applicant in those proceedings (and to ask for same to be filed);
4. (d)
  otherwise to perfect any such judgment or order; and
5. (e)
  to obtain and serve on the respondent a certified duplicate of any such judgment or order.

conclusion

[419]
The result of these reasons is that:
1. (a)
  Judgment should be entered against Mr Tomlinson and Verus in favour of Sentinel Countrywide in the amount of $41,838;
2. (b)
  Judgment should be entered against Mr Tomlinson in favour of Sentinel Regional in the amount of $40,613;
3. (c)
  The claims of the plaintiffs should otherwise be dismissed; and
4. (d)
  The counterclaims of Verus should be dismissed.
[420]
I will hear the parties as to interest and costs and any residual matters not covered by the above orders.

Footnotes

[1] There are other causes of action which do not need to be considered at this stage.

[2] The precise basis upon which the various plaintiffs are related to each other was not explored in evidence, but there was no challenge to the authority of Ms Jones nor Mr Ebert to give evidence on behalf of the plaintiffs, and there was no contentious issue in the proceedings about the operation of the plaintiffs as a group.

[3] See the agreement between Shield and the eighth plaintiff, Shield Property, from page 508 of the Trial Bundle (Exhibit 2).

[4] See paragraph 16 of the Fifth Amended Statement of Claim filed 3 February 2021 (Statement of Claim).

[5] See Exhibit 6.

[6] See the cases analysed in Metal Manufacturers Limited v GMJ Electrical Projects Pty Ltd & Ors [2019] QDC 62 at paragraphs [212] to [220].

[7] Dal Pont, Equity and Trusts in Australia (7th ed, 2018, Thomson Reuters) at [4.15].

[8] See paragraph 14(a) to (g) of the Statement of Claim.

[9] Pleaded from paragraph 93 of the Statement of Claim.

[10] Exhibit 2 page 1058.

[11] Exhibit 2 page 1060.

[12] Exhibit 2 pages 1065 to 1066.

[13] Exhibit 2 page 1057.

[14] See paragraph 61(a) of the First, Second and Third Defendants’ Amended Defence filed on 4 April 2019 (First, Second and Third Defendants’ Defence).

[15] Exhibit 2 page 1072.

[16] Exhibit 2 pages 1113 to 1117.

[17] TS4-73.9.

[18] TS3-58.43 to TS3-59.3.

[19] Exhibit 2 page 1086.

[20] Exhibit 2 page 1063.

[21] Exhibit 2 page 1070. The figure alleged in the statement of claim is higher but is clearly the GST inclusive figure which has been pleaded as the GST exclusive figure by mistake.

[22] Exhibit 2 page 1082.

[23] Pleaded from paragraph 127 of the Statement of Claim.

[24] Exhibit 2 pages 1019 to 1022.

[25] Exhibit 2 page 1012.

[26] Exhibit 2 page 1032.

[27] See paragraph 88 of the First, Second and Third Defendants’ Defence.

[28] See paragraphs 91(b), 93 and 96 of the First, Second and Third Defendants’ Defence.

[29] See paragraphs 95(a) and 96 of the First, Second and Third Defendants’ Defence.

[30] Pleaded from paragraph 114 of the Statement of Claim.

[31] Exhibit 2 page 917.

[32] Exhibit 2 page 930.

[33] Exhibit 2 page 936.

[34] Exhibit 2 pages 978 to 988.

[35] The facts are admitted, but the Capex Request Form for this project could not be located in Exhibit 2.

[36] See paragraphs 76(a) and 79 of the First, Second and Third Defendants’ Defence.

[37] See paragraph 78 of the First, Second and Third Defendants’ Defence.

[38] From paragraph 138 of the Statement of Claim.

[39] Exhibit 2 page 990.

[40] Exhibit 2 pages 991 to 995.

[41] Exhibit 2 page 1001.

[42] Exhibit 2 page 1011. The denial of this allegation at paragraph 95(c) amounts in substance to an admission of this fact.

[43] Exhibit 2 page 996.

[44] See paragraph 96(a) of the First, Second and Third Defendants’ Defence.

[45] See paragraph 96(b) of the First, Second and Third Defendants’ Defence.

[46] See paragraph 98(b) of the First, Second and Third Defendants’ Defence.

[47] From paragraph 102 of the Statement of Claim.

[48] See the dates of the documents created for this project.

[49] Exhibit 2 page 1048.

[50] Exhibit 2 page 1049.

[51] Exhibit 2 page 1041.

[52] Exhibit 2 pages 1045 to 1046.

[53] Exhibit 2 page 1042.

[54] See paragraph 67 of the First, Second and Third Defendants’ Defence responding to paragraph 106 of the Statement of Claim.

[55] Paragraph 51 of the s. 92 Statement (Exhibit 10).

[56] Exhibit 2 pages 1171 to 1188.

[57] Exhibit 2 page 1196.

[58] See, for example, Exhibit 2 pages 1172 to 1173.

[59] See, for example, Exhibit 2 page 1174.

[60] Exhibit 2 page 1195.

[61] Exhibit 2 page 1238.

[62] Exhibit 2 page 1241.

[63] For “Scope Allowances” and “Site Specific Allowances” cf Exhibit 2 pages 1242 to 1243 and 1172 to 1174.

[64] The plaintiffs do not plead the Citilink quotations, but they provide useful context for making findings of fact about Mr Tomlinson’s conduct with Growth Australia.

[65] In a single document at Exhibit 2 page 1257.

[66] See paragraphs 41 and 43 of the First, Second and Third Defendants’ Defence.

[67] Exhibit 2 page 1259.

[68] Exhibit 2 page 1321 and see the revised quotations from page 1323.

[69] Exhibit 2 pages 1434 to 1435.

[70] Exhibit 2 pages 1431 to 1433.

[71] Exhibit 2 pages 1440 to 1441.

[72] See paragraphs 73A, 79, 79A and 80 of the Statement of Claim.

[73] TS3-97.35 to .46 and TS3-87.20.

[74] TS2-21.34 to TS2-24.10.

[75] And I am not persuaded that anything of the kind occurred: see Exhibit 10 paragraphs 62 to 63..

[76] See paragraph 77(b) of the Statement of Claim.

[77] Exhibit 10 paragraph 59.

[78] Exhibit 10 paragraph 61.

[79] Exhibit 2 pages 859 to 860.

[80] Exhibit 2 page 861.

[81] See Exhibit 10 paragraph 64.

[82] TS3-89.5 to TS3-91.34 and TS3-95.4 to .13.

[83] See paragraph 75(a) to (f) of the Statement of Claim.

[84] See Exhibit 2 pages 865 to 866.

[85] See paragraph 75(g) of the Statement of Claim.

[86] See TS3-82 and TS3-97.9.

[87] Exhibit 2 pages 1705 to 1713. The precise circumstances of when and how this issue arose were in dispute at trial but ultimately that issue was irrelevant and I have not dealt with it here.

[88] Exhibit 2 pages 1715 to 1724.

[89] Exhibit 2 page 1716.

[90] Exhibit 2 page 1720.

[91] TS3-115.31 to .39.

[92] Exhibit 2 page 1717, especially the key at the bottom of the page headed “Denotes”.

[93] Exhibit 2 pages 1718 and 1719 respectively.

[94] See paragraph [284] below.

[95] TS3-128.36 to .38.

[96] Exhibit 2 pages 1857 and 1895.

[97] Exhibit 2 page 1715.

[98] Exhibit 2 pages 1725 to 1727.

[99] Exhibit 2 pages 1750 to 1751.

[100] Exhibit 2 pages 1750 to 1751.

[101] TS4-81.35 to .39.

[102] Actually, Mr McInulty who was supplying through Formchoice for convenience: see Exhibit 2 page 1742.

[103] Exhibit 2 page 1856.

[104] Exhibit 2 pages 1752 to 1760.

[105] Exhibit 2 pages 1756 to 1757.

[106] Exhibit 2 page 1761.

[107] Exhibit 2 page 1766.

[108] Exhibit 2 page 1771.

[109] Exhibit 2 page 1801.

[110] Exhibit 2 page 1783.

[111] Exhibit 2 page 1808 and 1814.

[112] Exhibit 2 page 1822

[113] Exhibit 2 page 1825.

[114] Exhibit 2 page 1816 to 1817.

[115] TS3-99.10.

[116] Exhibit 2 page 1527.

[117] TS3-122.35.

[118] Exhibit 2 page 1810.

[119] TS3-81 to 82.

[120] Exhibit 2 pages 1834 to 1838.

[121] Exhibit 4.

[122] Exhibit 2 page 1904.

[123] Exhibit 2 pages 1913 to 1915.

[124] Barnes v Addy (1874) LR 9 Ch App 244.

[125] See paragraph 20(b) of the First, Second and Third Defendants’ Defence.

[126] Derry v Peek (1889) LR 14 App Cas 337; Magill v Magill (2006) 231 ALR 277 at paragraph [114].

[127] See paragraphs 38, 83 and 150 of the Statement of Claim.

[128] Warman International Ltd v Dwyer (1995) 182 CLR 544 at 557.

[129] Exhibit 10 paragraph 65.

[130] Paragraphs 9.11 to 9.12 of the Closing Submission of the First Defendant.

[131] Paragraph 17.4 of the Plaintiffs’ Closing Submissions.

[132] See Exhibits 11, 12 and 13.

[133] TS3-71 to 80.

[134] Exhibit 10 paragraphs 5 to 23.

[135] Exhibit 10 paragraph 11.

[136] Exhibit 10 paragraph 12.

[137] Exhibit 10 paragraph 13.

[138] Exhibit 10 paragraph 15.

[139] Exhibit 10 paragraph 16.

[140] Exhibit 10 paragraph 19.

[141] Exhibit 10 paragraph 48.

[142] Exhibit 10 paragraph 70.

[143] Exhibit 10 paragraph 76.

[144] Exhibit 10 paragraph 92.

[145] Exhibit 10 paragraph 101.

[146] Paragraph 18.12(a)-(b) of the Plaintiffs’ Closing Submissions.

[147] TS3-29.

[148] TS3-29.

[149] Exhibit 9 page 175.

[150] Exhibit 10 paragraph 13.

[151] Exhibit 2 paragraphs 66 to 69.

[152] TS3-103.41 to TS3-104.10; TS3-104.33 to .41.

[153] See TS3-104.46 to TS3-107.17.

[154] See TS3-113.23 to TS3-115.2.

[155] TS4-33.15 to .19.

[156] TS4-39.42 to TS4-40.2.

[157] TS4-40.11 to .12.

[158] TS4-56.36.

[159] TS4-54.

[160] TS4-60.24 to .29.

[161] TS4-81.15 to 83.20.

[162] TS4-84.4 to .14.

[163] TS4-91.40.

[164] TS4-93.10 to TS4-94.12.

[165] TS4-96.44 to TS4-97.21.

[166] Exhibit 2 page 1660.

[167] TS4-103.

[168] TS4-108.15.

[169] TS4-106.30 to TS4-107.16.

[170] Paragraph 19A(1)(iv)(G) to (I) of the Fifth Further Amended Defence of the Fifth Defendant filed 8 April 2020 (Fifth Defendant’s Defence).

[171] See paragraph 19A(1)(iv)(A)(2)(a) and (B) to (F) of the Fifth Defendant’s Defence.

[172] TS4-119.36.

[173] TS4-139.10.

[174] TS4-121.19 to TS4-123.27.

[175] TS4-123.17 to .18.

[176] TS4-130.38 to TS4-131.32.

[177] TS4-132.31 to .44.

[178] TS1-54.

[179] Briginshaw v Briginshaw (1938) 60 CLR 336.

[180] See paragraphs [133] and [251] above.

[181] Dal Pont, Equity and Trusts in Australia (7th ed, 2018, Thomson Reuters) at [38.65].

[182] Exhibit 1.

[183] Exhibit 2 pages 837 to 848.

[184] Exhibit 1 paragraph 31.

[185] Exhibit 1 paragraph 35.

[186] See Exhibit 1 paragraphs 31 to 34.

[187] Colbeam Palmer Ltd v Stock Affiliates Pty Ltd (1968) 122 CLR 25 at 33.

[188] Exhibit 2 pages 837 to 848.

[189] Exhibit 1 paragraph 41.

[190] See Exhibit 1 paragraphs 36 to 40.

[191] See Shirlaw v Taylor (1991) 102 ALR 551 at 560.3.

[192] See paragraphs [274] to [277] above.

[193] Paragraph 24.15 of the Plaintiffs’ Closing Submissions.

[194] See J.W. Carter, Contract Law in Australia (6th ed, 2013, LexisNexis Butterworths) at [25-02] and [27-01].

Editorial Notes

Published Case Name:
Sentinel Springwood Retail Pty Ltd & Ors v Tomlinson & Ors
Shortened Case Name:
Sentinel Springwood Retail Pty Ltd v Tomlinson
MNC:
[2021] QDC 159
Court:
QDC
Judge(s):
Porter QC DCJ
Date:
05 Aug 2021

Appeal Status

Please note, appeal data is presently unavailable for this judgment. This judgment may have been the subject of an appeal.

Cases Cited List of Cases Cited by this judgment

Case Name	Full Citation	Frequency
Barnes v Addy	(1874) L.R. 9 Ch. App. 244	2 citations Jump To Cite 1 - (1874) L.R. 9 Ch. App. 244 Cite 2 - (1874) L.R. 9 Ch. App. 244
Briginshaw v Briginshaw	View on:JADE(1938) 60 C.L.R 336	2 citations Jump To Cite 1 - (1938) 60 C.L.R 336 Cite 2 - (1938) 60 C.L.R 336
Coad v Wellness Pursuit Pty Ltd (In Liq)	[2009] 71 ACSR 250	2 citations Jump To Cite 1 - [2009] 71 ACSR 250 Cite 2 - [2009] 71 ACSR 250
Colbeam Palmer Ltd v Stock Affiliates Pty Ltd	View on:JADE(1968) 122 CLR 25	2 citations Jump To Cite 1 - (1968) 122 CLR 25 Cite 2 - (1968) 122 CLR 25
Derry v Peek	[1889] L.R. 14 App. Cas. 337	2 citations Jump To Cite 1 - [1889] L.R. 14 App. Cas. 337 Cite 2 - [1889] L.R. 14 App. Cas. 337
Fatimi Pty Ltd v Bryant	View on:JADE[2004] NSWCA 140	2 citations Jump To Cite 1 - [2004] NSWCA 140 Cite 2 - [2004] NSWCA 140
Harstedt Pty Ltd v Tomanek	View on:VR(2018) 55 VR 158	2 citations Jump To Cite 1 - (2018) 55 VR 158 Cite 2 - (2018) 55 VR 158
IMF (Australia) Ltd v Meadow Springs Fairway Resort Ltd	(2009) 69 ACSR 507	2 citations Jump To Cite 1 - (2009) 69 ACSR 507 Cite 2 - (2009) 69 ACSR 507
Lee v Abedian	[2017] 1 Qd R 549; [2016] QSC 92	2 citations Jump To Cite 1 - [2017] 1 Qd R 549 Cite 2 - [2017] 1 Qd R 549
Lonhro Ltd v Shell Petroleum Co Ltd (no 2)	View on:ICLRUK(1982) AC 173	1 citation Jump To Cite 1 - (1982) AC 173
Lonrho Plc. v Fayed	View on:ICLRUK[1992] 1 AC 448	2 citations Jump To Cite 1 - [1992] 1 AC 448 Cite 2 - [1992] 1 AC 448
Magill v Magil	(2006) 231 ALR 277	2 citations Jump To Cite 1 - (2006) 231 ALR 277 Cite 2 - (2006) 231 ALR 277
McKellar v Container Terminal Management Services Ltd	(1999) 165 ALR 409	2 citations Jump To Cite 1 - (1999) 165 ALR 409 Cite 2 - (1999) 165 ALR 409
McWilliam v Penthouse Publications Ltd	View on:JADE[2001] NSWCA 237	1 citation Jump To Cite 1 - [2001] NSWCA 237
Metal Manufacturers Limited v GMJ Electrical Projects Pty Ltd	[2019] QDC 62	2 citations Jump To Cite 1 - [2019] QDC 62 Cite 2 - [2019] QDC 62
Richardson v Aileen Pty Ltd	View on:JADE[2007] VSC 104	2 citations Jump To Cite 1 - [2007] VSC 104 Cite 2 - [2007] VSC 104
Shirlaw v Taylor	(1991) 102 ALR 551	2 citations Jump To Cite 1 - (1991) 102 ALR 551 Cite 2 - (1991) 102 ALR 551
Warman International Ltd v Dwyer	View on:JADE(1995) 182 CLR 544	2 citations Jump To Cite 1 - (1995) 182 CLR 544 Cite 2 - (1995) 182 CLR 544
Williams v Hursey	View on:JADE(1959) 103 C.L.R 30	1 citation Jump To Cite 1 - (1959) 103 C.L.R 30

Cases Citing List of cases on Queensland Judgments citing this Judgment

Case Name	Full Citation	Frequency
Sentinel Springwood Retail Pty Ltd v Tomlinson	[2021] QDC 219	2 citations

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Sentinel Springwood Retail Pty Ltd v Tomlinson[2021] QDC 159