FEDERAL COURT OF AUSTRALIA

Australian Agrivision Pty Ltd v Wolstenholme (Trial) [2026] FCA 130

ORDERS

THE COURT ORDERS THAT:

1.    Judgment be entered against the respondents, jointly and severally, in the sum of $2,886,842.

2.    The respondents, jointly and severally, pay the applicant’s costs of the proceeding.

3.    Liberty to apply within seven days to correct any error in the calculation of the judgment sum.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

STEWART J:

Introduction

1    The applicant sues as assignee of a claim against two guarantors of a loan to a third party. The question in the case is whether the guarantors are liable on the guarantees.

2    The original applicant in the proceeding was the lender, Capital Bridging Finance Pty Ltd (Capital). After the proceeding was commenced, Australian Agrivision Pty Ltd, a related company, took an assignment of the debt from Capital. Australian Agrivision was then substituted as applicant. I will refer to it as the applicant for convenience.

3    The first respondent is Tarah Wolstenholme. She has been unrepresented throughout the proceeding. The second respondent is Alexander Anderson. He was represented by a lawyer at times during the proceeding, but shortly before the final hearing he again became unrepresented. He thus conducted the hearing as a litigant in person. He has significant experience in business, particularly in property development, but he has no legal training or experience which obviously hindered the efficacy of his defence of the proceeding. Ms Wolstenholme also has no legal training or experience although she has had formal involvement in a number of companies over the years. For the most part, she adopted Mr Anderson’s conduct of the case as her own.

4    I accept that as litigants in person with much to lose, the proceeding has been very distressing and difficult for both Ms Wolstenholme and Mr Anderson. I have taken that into account in assessing their evidence and their defences to the claim.

The essential facts

5    The factual findings in this section are not seriously in dispute. I deal with the disputed facts in further sections below in dealing with each of the defences that are raised.

6    The exact nature of the relationship between Ms Wolstenholme and Mr Anderson is not clear. They have a child together, but they deny ever having been in a de facto relationship or having dated. In any event, apparently on the advice of her accountant, Ms Wolstenholme was the sole director and shareholder of B&T Holdings (ACT) Pty Ltd, which was in turn the sole shareholder of B&T Investment Group (ACT) Pty Ltd (B&T Investment). Ms Wolstenholme was the sole director of that company.

7    On 16 June 2022, Bonshaw ACT Pty Ltd (Bonshaw) as grantor granted to Brite (DC) Pty Ltd (Brite) as grantee a call option for the purchase of a property consisting of four lots at Jerrabomberra and Symonston in the ACT. The purchase price was $32,500,000. Mr Anderson was the sole director of Brite.

8    On 19 June 2023, Brite nominated B&T Investment to receive the benefit of the call option. B&T Investment then appointed Mr Anderson as a consultant for the purpose of, amongst other things, acquiring finance for the purchase of the property. Apparently, a call centre was planned for the property.

9    By a deed of acknowledgment dated 11 September 2023, Bonshaw, Brite and B&T Investment varied the call option such that, relevantly, the “call option expiry date” was amended to 15 June 2024. That meant that by that date, if it was to exercise the call option, B&T Investment had to pay the deposit for the purchase of the property. The required deposit was $3,250,000.

10    Damien Simonfi was the chief executive of Capital. On 11 June 2024, he and Mr Anderson were first in contact about the possibility of Capital providing a bridging loan to B&T Investment for the deposit. Mr Simonfi describes Capital as a specialist short-term finance company which provides immediate financial solutions for situations where most major banks or lenders are unable to meet the required timeframes.

11    On 14 June 2024, the day before the call option expired, Capital entered into a loan agreement with B&T Investment to advance the sum of $5,193,250. The total loan included an application fee of $1.5 million, legal fees of $33,000 and a brokerage fee of $85,250. The “concessional” interest rate on the loan was 3% per month accruing daily but payable monthly. Capital and B&T Investment also entered into a general security agreement which, amongst other things, gave to Capital the power to appoint a receiver to B&T Investment’s property in the event of it defaulting under the loan agreement. The secured property included all of B&T Investment’s present and future assets, undertakings, rights and property, of any kind and wherever situated.

12    At the same time, Ms Wolstenholme and Mr Anderson, separately and individually, signed a deed entitled “Guarantee and indemnity” which guaranteed B&T Investment’s obligations to Capital under the loan agreement. B&T Holdings (ACT) Pty Ltd and another company of which Ms Wolstenholme was also the sole director and shareholder, T&A Nominees (ACT) Pty Ltd, were also guarantors.

13    On the same day, Bonshaw and B&T Investment entered into a contract for sale of the property at a price of $32,500,000. Also, Capital paid $3,575,000 to Bonshaw’s lawyer’s trust account by way of bank cheque. That amount included $3,250,000 as the deposit on the contract to purchase the property. Also on that day, $30,000 in respect of “Legal Fees Payment” was credited to B&T Investment’s loan account with Capital.

14    The date for completion of the sale contract was the later of 30 days from the date of the contract and 21 days after the date that the seller notified the buyer that the condition precedent had been satisfied. The condition precedent was that the seller obtain the relevant Minister’s consent in accordance with the Planning and Development Act 2007 (ACT) to transfer the property to the buyer.

15    Between 14 June and 20 August 2024, Mr Anderson worked tirelessly to secure additional funding for B&T Investment for the balance of purchase price, including seeking further funding from Capital. He and Mr Simonfi regularly discussed and corresponded on Mr Anderson’s efforts to find funding.

16    It is not apparent on the evidence when the Minister’s consent to the transfer of the property was given, but on 12 August 2024 B&T Investment received from Bonshaw a notice to complete the contract for the sale by 27 August 2024. The notice stated that the vendor was ready, willing and able to complete the contract and that if the purchaser failed to complete within the time allowed by the notice the vendor would terminate the contract.

17    On 20 August 2024, B&T Investment received by email an extension of the time to complete the contract to 3 September 2024. Mr Anderson immediately forwarded the email to Mr Simonfi. A little later that day, Mr Simonfi sent Mr Anderson an email in which he expressed his growing concerns and his loss of confidence in Mr Anderson and B&T Investment’s ability to find the balance of the funds required for the purchase. He said that in the absence of “concrete evidence” of a finance offer sufficient to pay the whole of the purchase price including GST his “growing concerns and … loss of confidence” in Mr Anderson’s “ability to deliver this settlement” would be confirmed. He said that in the absence of a “finance solution” the extension of time to complete was of no significance.

18    Later that evening, Capital’s lawyer served on its behalf a notice of default by email on B&T Investment, Ms Wolstenholme, Mr Anderson and the other guarantors. The notice of default stated that the lender, ie Capital, had reasonably formed the opinion that there had been a material “Adverse Effect” (as defined in the loan agreement), including the lender’s assessment of the risk in lending to the borrower in light of the failure by the borrower and the guarantors to provide to the lender’s satisfaction evidence that the borrower had a finance offer sufficient to enable the borrower to repay the total debt and to pay the whole of the purchase price. It stated that as a result there was a default by the borrower and that the lender gave notice under cl 9.2(a) of the loan agreement to the borrower and each guarantor of the lender’s election to make the total debt owing under the facility immediately become due and payable.

19    On 1 September 2024, Capital appointed receivers and managers to B&T Investment’s property under the power to do so granted to Capital under the security agreement.

20    On 1 October 2024, Capital commenced this proceeding against Ms Wolstenholme and Mr Anderson in reliance on the guarantee for repayment of the outstanding loan.

21    On 30 October 2024, Capital received $2,700,000 from the receivers and managers to the credit of the loan. The only other payment that was received in discharge of the indebtedness was the sum of $30,000 on 14 June 2024 for “Legal Fees” already referred to at [13] above.

22    On 8 November 2024, by notice of assignment given to B&T Investment and each of the guarantors, Capital assigned its interest in the loan agreement and the guarantees to the applicant. There is no dispute about the efficacy of the assignment.

The respondents’ defences

23    The respondents do not dispute the various agreements or the outstanding indebtedness. Their defences (or, more accurately, their concise statements in response) are very similar and wide-ranging. A number of matters, sometimes different to what is raised in the defences, were raised in closing submissions. In what follows, I try to identify each of the discrete issues raised by the respondents and to deal with them.

The maintenance of contact with Ms Wolstenholme

24    Ms Wolstenholme pleads that she was not informed by Mr Simonfi about key decisions related to the loan agreement. She says that she was not consulted or kept informed on the decisions affecting B&T Investment and that she did not authorise Mr Anderson to make any decisions on behalf of the company.

25    Mr Anderson was clearly clothed with the authority of B&T Investment as the nominated point of contact through the consultancy agreement. Ms Wolstenholme was also copied in on emails from time to time so she was in a position to see what was happening. At no stage did she intervene to require greater personal involvement. She allowed the process to continue in the hands of Mr Anderson. It is also not apparent what “decisions” on behalf of B&T Investment she is referring to. The relevant “decisions” in this case were taken by Capital. There is therefore no substance to this defence.

Misrepresentations leading to the contract

26    In his principal affidavit, Mr Anderson states that during the meeting on 14 June 2024 when the loan was settled, Mr Simonfi orally represented that he would fund the project if “senior debt financing” could not be obtained. Mr Anderson said that Mr Simonfi proposed a “1/3, 1/3, 1/3 arrangement”. He said that the representations were made both before and after the signing of the loan documents in the presence of Ms Wolstenholme, him and their lawyers. He said that the representation was a key factor in B & T Investment’s decision to proceed with the loan despite the excessive fees and interest rate.

27    I do not accept that evidence. It is not supported by Ms Wolstenholme’s evidence – she does not mention any representations of that nature. The lawyers who are said to have been present were not called to give evidence of those representations. Also, after Capital gave the default notice, Mr Anderson did not immediately complain to Mr Simonfi that he had breached his promises. Mr Anderson initially focussed on trying to challenge the notice to complete from Bonshaw including on the ground that Bonshaw was not in a position to give vacant possession. That issue was taken over by the receivers and managers who presumably had some success as evidenced by the recovery they made, apparently being the deposit less their expenses and charges.

28    On 2 September 2024, Mr Anderson wrote a lengthy email to Mr Simonfi in which he sought to address the debt owed by B&T Investment to Capital. Despite raising all manner of matters, he did not raise the representations that he relies on in his affidavit. If indeed the representations had been made, one would have expected them to have been raised then.

29    Mr Anderson seeks to pray in aid transcripts of secretly recorded conversations that he had with Mr Simonfi on 2 and 3 September 2024 in support of his contention that the representations were made, but the transcripts do not support that contention. They are irrelevant and therefore not admissible. It is consequently unnecessary to decide whether they were recorded unlawfully having regard to s 4 of the Listening Devices Act 1992 (ACT) and therefore inadmissible under s 138 of the Evidence Act 1995 (Cth).

Invocation of default and due process

30    Both Ms Wolstenholme and Mr Anderson contend that Capital’s invocation of an event of default under the loan agreement is invalid and that due process was not followed in relation to it.

31    The loan agreement, in cl 9.1, outlines a number of Events of Default. Clause 9.1(p) stipulates as an Event of Default “if in the opinion of the Lender or an Authorised Representative of the Lender (in its or their absolute discretion), there has been an Adverse Effect”. Adverse Effect is defined in Schedule 1, Part 1, as including, relevantly, “something which, in the opinion of the Lender (in its absolute discretion), now has or may in the future have an effect, which is adverse on … the Lender’s assessment of the risk of lending to the person”.

32    Clause 9.2(a) provides that if an Event of Default occurs “the Debt shall, at the option of the Lender, immediately become due and payable upon the Lender making written demand upon the Borrower”.

33    At the level of the High Court, it remains an open question as to whether there is a general obligation to act in good faith in the performance of contracts and whether contractual powers and discretions are limited by requirements of good faith and fair dealing: Royal Botanic Gardens and Domain Trust v South Sydney City Council [2002] HCA 5; 240 CLR 45 at [40] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ, [86]‑[89] per Kirby J and [156] per Callinan J; and Commonwealth Bank of Australia v Barker [2014] HCA 32; 253 CLR 169 at [42] per French CJ, Bell and Keane JJ and [107] per Kiefel J. There are nevertheless cases where, as a process of contractual construction, courts have implied a duty to act in good faith, including in the exercise of contractual powers: see, eg, Macquarie International Health Clinic Pty Ltd v Sydney Local Health District [2020] NSWCA 161; 383 ALR 688 at [268]-[269] per Bathurst CJ, Bell P and McCallum JA agreeing, where a clause giving “absolute and unfettered discretion” was held to be subject to another clause that provided for a good faith obligation.

34    Turning to the particular contractual power in issue in this case, the phraseology of “absolute discretion” is very wide, and the nature of the assessment being an assessment of risk is one that may vary from one person to another. Also, there is no other clause in the contract that imposes a good faith-type obligation. Those factors weigh against the imposition of a good faith requirement. However, the event of default in question requires that the lender has the opinion that there is something that has or may in the future have an adverse effect on the lender’s assessment of the risk of lending to the borrower. That requires that the requisite opinion is actually held. The condition for the exercise of the power is not satisfied by the pretence of having the requisite opinion. In that sense, the opinion must be honestly held. Also, the exercise of the power can significantly affect the interests of the other party. In those circumstances, “the words of the contract are fairly readily construed … as requiring a reasonable as well as honest state of satisfaction”: Service Station Association Ltd v Berg Bennett & Associates Pty Ltd [1993] FCA 638; 45 FCR 84 at 94 per Gummow J. See also Bartlett v ANZ Banking Group Ltd [2016] NSWCA 30; 92 NSWLR 639 at [49] per Macfarlan JA, Meagher and Simpson JJA agreeing, in the context of an employment contract. I find that the relevant clause required, for the exercise of the power, a reasonable and honest opinion that there had been the relevant “Adverse Effect”.

35    The respondents challenge the notion that Mr Simonfi, being the relevant person whose opinion is ascribed to Capital, had formed the requisite opinion reasonably or honestly. They submit, in effect, that he purported to have that opinion in order to call in the loan and in that way get B&T Investment out of the picture so that he could deal directly with the vendor for the purchase of the land by a company controlled by him. That contention requires further attention to the facts.

36    The representative of the vendor, Bonshaw, was Amresh Sharma (aka Kumar). Mr Simonfi did not have contact with Mr Sharma until shortly before the default notice was given. That was at a meeting at Hotel Realm in Canberra at 4.00pm on Saturday 17 August 2024. There is some dispute between Mr Anderson and Mr Simonfi about that meeting and how it came about.

37    Although Mr Anderson in his principal affidavit in the proceeding stated that Mr Simonfi established direct communications with Mr Sharma without Mr Anderson’s consent, the documentary record reveals that to be wrong. Mr Simonfi’s evidence, which I accept, is that on 15 August 2024 Mr Anderson telephoned him and during the call Mr Anderson joined Mr Sharma to the call.

38    That there was a call of that nature is confirmed by an email from Mr Simonfi to Mr Anderson on 16 August 2024 which refers to things said in the conversation between Mr Simonfi, Mr Anderson and Mr Sharma. Mr Anderson responded to the email by inserting comments on the various paragraphs of Mr Simonfi’s email, including the paragraph in question, without disputing that there was such a conversation.

39    Further, Mr Simonfi’s email mentions a meeting that had been arranged for that weekend in Canberra for Mr Simonfi, Mr Anderson and Mr Sharma but that Mr Anderson had then asked for it to be cancelled or postponed so that he could attend a wedding. Mr Simonfi complained to Mr Anderson about that, saying that his presence at the meeting was not “critical” but that he could not understand how Mr Anderson could prioritise a wedding over “this” (ie taking the opportunity to find a solution to the absence of funding and the looming deadline for completion). Mr Anderson’s comment in response to that paragraph was to say that he would attend the meeting.

40    There is thus no doubt that Mr Anderson knew that Mr Simonfi was going to meet with Mr Sharma, and that Mr Anderson participated in setting up that meeting.

41    The same email from Mr Simonfi also states that one of three “viable options” that he foresaw was: “I develop a new strategy with Amresh to ensure the involvement of key persons. Again, no free rides.” Mr Anderson replied to that “option” with “Understood”. Mr Anderson thus knew that Mr Simonfi intended exploring other solutions with Mr Sharma and that that might leave Mr Anderson with little if any role in the development in the future.

42    Mr Anderson says that Mr Simonfi nevertheless cut him out of the meeting with Mr Sharma. The meeting was initially arranged for 4.00pm on the Saturday. There is a calendar invitation for the meeting at that time that was sent by Mr Simonfi’s office to Mr Anderson and Mr Sharma. Mr Anderson says that he tried to change the meeting to 7.30am on the Sunday so that he could still attend the wedding in Sydney on the Saturday and drive back to Canberra very early on the Sunday morning. That is confirmed by an email from him to Mr Simonfi at 1.46pm on the Saturday.

43    Mr Simonfi says that he was on a flight from the Gold Coast to Canberra at the time that email was sent and that he did not see it until after he had met with Mr Sharma at 7.00pm in Canberra. There is an entry in Mr Simonfi’s diary which shows that his flight was scheduled to depart from the Gold Coast at 12.45pm and land in Canberra at 2.25pm. That suggests that Mr Simonfi was on the plane and likely in the air at the time of Mr Anderson’s email. There is, however, an email from Mr Simonfi to Mr Anderson at 12.54pm on the Saturday, which suggests that Mr Anderson’s plane was delayed by at least 10 minutes, but it does not gainsay that Mr Simonfi was not in a position to receive the email at 1.46pm.

44    At 8.02pm on the Saturday, after the meeting between Mr Simonfi and Mr Sharma, Mr Simofi sent a text to Mr Anderson that stated (as written):

Alex, no need to come down tomorrow. I thought you were going to be at the meeting today. I don’t need to speak to Amrish any further. Let’s connect tomorrow afternoon/Monday.

45    Mr Anderson replied as follows (as written):

Thanks mate, I have been on this all day. I have a few real solutions to repay the debt (with their own cash) by people I know personally who are real. I already have a freind that will repay the debt and will confirm by COB Monday.

Have a safe trip back mate, I’m doing everything not to let you down and will get you something solid in writing soon. Have a good night.

46    Notably, Mr Anderson did not complain about the meeting having gone ahead contrary to any arrangement that he thought that he had made, or without him; Mr Anderson appears to have been content with what had occurred.

47    Mr Simonfi’s evidence, which I accept, is that he met Mr Sharma at 4.00pm at the Hotel Realm as arranged and that he was expecting Mr Anderson to turn up. I accept that he had not at that time read Mr Anderson’s email which had sought to rearrange the meeting for the following morning – it stands to reason that he had not seen it on the plane or as he had to make his way quickly to the hotel before the meeting. Mr Sharma told him that Mr Anderson was not coming to the meeting. The two of them then had a discussion which included the possibility of Mr Simonfi purchasing 100 of the 300 acres that were for sale.

48    Although most of the details are not in evidence, it appears that a company of which Mr Simonfi was the principal, namely DJ Partners Holdings Pty Ltd, thereafter entered into a contract with the vendor concerning the property. Mr Anderson’s evidence is that that occurred on 31 August 2024, ie some 11 days after the notice of default under the loan agreement. Mr Sharma and DJ Partners Holdings also concluded an escrow agreement the effect of which was to make the first agreement effective only if the prior sale contract between B&T Investment and Bonshaw did not complete. There was an apparent attempt to keep alive the possibility of the Bonshaw/B&T Investment contract completing.

49    In those circumstances, I do not accept that Mr Simonfi acted in bad faith or dishonesty in having the meeting with Mr Sharma and, thereafter, concluding an arrangement with him in relation to the property which was secondary to the pre-existing contract for sale with B&T Investment.

50    There is also ample evidence to support Mr Simonfi’s stated and growing concern with regard to B&T Investment’s ability to raise the necessary finance to complete on the contract for sale. There is a significant amount of correspondence between Mr Simonfi and Mr Anderson which demonstrates a basis for that concern, and also that Mr Simonfi had conveyed it to Mr Anderson from time to time. Mr Simonfi’s email to Mr Anderson on 16 August 2024 (discussed at [38]-[41] above) serves as a significant example of that. It includes statements that Mr Anderson appears to have “lost control of delivering the outcome” and that Mr Simonfi intended for Mr Anderson to succeed but not at Mr Simonfi’s risk. Another good example is the email from Mr Simonfi to Mr Anderson on 20 August 2024 discussed at [17] above.

51    Mr Simonfi’s evidence was that in his capacity as Capital’s director, he was not satisfied that B&T Investment had provided satisfactory evidence that it had a finance offer sufficient to enable it to pay the whole of the purchase price to the vendor of the property. He said that he formed the opinion on behalf of Capital that because B&T Investment had not provided evidence of finance sufficient to enable it to repay the monies loaned by Capital to it and the remainder of the purchase price, there was a substantial risk that B&T Investment would be unable to comply with its obligations to Capital. He formed the opinion that B&T Investment could not settle on the contract for purchase of the property. It was on the basis of those opinions that he instructed that the notice of default be prepared and given. I accept that evidence. I am satisfied that the requisite opinion was reasonably and honestly held.

52    There is an additional basis on which the respondents rely in contending that the notice of default is ineffective. They contend that cl 18.8 was not followed. That clause provided that if, by the date which is 14 days before the settlement date of the contract for the purchase of the property, the borrower was unable to demonstrate to the reasonable satisfaction of the lender that the borrower would be able to complete the contract for the purchase by the borrower of the property, that would be an event of default. The respondents contend that the applicant has failed to show that B&T Investment was unable to complete. However, that event of default was not relied on by Capital in giving the notice of default. Clause 18.8 is irrelevant to the applicant’s claim, and to the defence to the claim.

53    I thus reject the respondents’ contention that the notice of default is ineffective.

Breaches of the loan agreement

54    Both Ms Wolstenholme and Mr Anderson allege that Capital breached the loan agreement in various ways. I will deal with each complaint in turn.

55    The first complaint is that Capital and the applicant “unlawfully and materially varied the Loan Agreement”. There was no variation of the loan agreement. The complaint is misconceived.

56    The second complaint is that there was a breach of cl 18.1 in that Capital “failed to seek refinancing options in the event of default or one month before repayment, which authorises the lender to apply for refinancing on behalf of the borrower to other financial institutions”. Clause 18.1 provided that when an event of default occurred or at any time after the date which was 1 month before the repayment date, the lender was authorised to make applications for refinance of the debt and sign supporting documents on behalf of the borrower to other financial institutions for finance to repay the debt. That is an authorising provision. It did not require Capital to do anything. It was not breached.

57    The third complaint is that there was a breach of cl 18.7. That clause gave the lender powers to explore financing options with the borrower. It is also an authorising provision. It did not require Capital to do anything. It was not breached.

58    The fourth complaint is that there was a breach of cl 18.6. That clause provided that until the debt is fully repaid, “the Borrower must invite and allow the Lender to attend … and actively participate in weekly project meetings …” That placed an obligation on the borrower, B&T Investment, and not on Capital. It did not require Capital to do anything. It was not breached by Capital.

Settlement offers to pay the debt

59    The respondents contend in their concise responses that multiple reasonable settlement offers were made to Mr Simonfi to resolve the debt, and those were rejected by him. There appear to be two “offers” that are relied on.

60    In his principal affidavit, Mr Anderson says that on 2 October 2024 Kamyar Saeedi, a director of Bonshaw KS Investment Pty Ltd, offered to purchase the debt from Capital and settle the property transaction directly but that Mr Simonfi “rejected this viable solution”. The “offer” is said to be evidenced by an affidavit by Mr Saeedi filed in a proceeding in the Supreme Court of the ACT. There is a dispute between the parties as to whether that affidavit is caught by the Hearne v Street undertaking (see Hearne v Street [2008] HCA 36; 235 CLR 125) insofar as its use in this proceeding is concerned. The resolution of that issue may depend on who bears the onus to establish the circumstances in which that affidavit was produced for the other proceeding as well as whether or not it was read in the other proceeding. It is, however, unnecessary to resolve that question. Mr Saeedi was not called as a witness in this proceeding and what he said is sought to be relied on to prove that the offer was made, ie for a hearsay purpose. What he said about the offer is therefore inadmissible hearsay in terms of s 59(1) of the Evidence Act. In any event, the affidavit does not reveal any “offer” to pay or purchase B&T Investment’s debt to Capital. Rather, it reveals the possibility of finance on complicated terms being available to B&T Investment to complete the contract with Bonshaw. By 2 October 2024, that was too late. Capital had already called on the debt and appointed receivers and managers to B&T Investment. There was no obligation on it to entertain uncertain financing facilities for B&T Investment.

61    In oral submissions, the respondents also rely on the following “offer”. It appears that on 14 September 2024, Neville Margi of Blackbird Capital was authorised by Mr Anderson to discuss the outstanding debt with Mr Simonfi “to pay out or reassign the debt owed to Capital” – there is an email to that effect. Then on 3 and 4 December in an unidentified year but presumably 2024, Mr Anderson told Mr Margi in text messages that he had made offers to Mr Simonfi to “reassign” the debt.

62    Mr Simonfi’s evidence is that there was an offer to his company that it sell the debt, but he was not interested in doing so. He expressed some concern about the circumstances, including risk arising from a possible fraud. That is a perfectly adequate explanation for not assigning the debt to Blackbird Capital. It is not to the point that Capital later assigned the debt to the applicant – the applicant is a related company so there is not the same risk in doing so.

63    I am not persuaded that there was any offer to “pay” the debt. If there was such a thing, the debt could simply have been paid. No acceptance of an offer to pay was required. There may have been an offer to buy the debt, but the terms of the offer are unknown. In any event, Mr Simonfi was within his rights to refuse the offer. There was no obligation on Capital to sell or assign the debt.

64    In short, this point offers no defence to the claim.

Abuse of process

65    The respondents also contend that Capital or the applicant engaged in an abuse of process by bringing the proceeding, at least against Ms Wolstenholme and possibly also against Mr Anderson.

66    The respondents rely on an email on 20 September 2024 from Paul Davis of Davis Lawyers, Capital’s lawyers in Brisbane, to Bernice Ellis of Mills Oakley lawyers in Canberra. Mr Davis explained that he acted for Capital. The purpose of the email was to enquire whether Mills Oakley would accept an instruction to institute proceedings on behalf of Capital against Ms Wolstenholme. Mr Davis briefly set out the circumstances and said that for “tactical reasons” they wished to commence proceedings “ASAP” against Ms Wolstenholme, and that it is “all about getting a judgement ASAP, that she won’t be able to effectively defend”. He stated that: “We are after an unsatisfied judgement debt, to potentially use as a threat of bankruptcy.”

67    That email, and a chain of emails that followed it between Mr Davis and Ms Ellis, was apparently inadvertently forwarded to Ms Wolstenholme by Mr Simonfi when he forwarded to her an email to which the originating process in this proceeding was attached. That is how the otherwise privileged correspondence was revealed to Ms Wolstenholme and Mr Anderson.

68    The respondents also rely on the chain of emails revealing that Mr Simonfi pressed for the proceeding to be commenced as soon as possible, and a comment by Ms Ellis that commencing the proceeding in a particular way would serve “a collateral purpose that your good evidence upfront will (should) taint Ms Wolstenholme’s position from the outset”.

69    Although the comments made by Mr Davis and Ms Ellis are perhaps unfortunate, and one can understand why Ms Wolstenholme has taken some offence to them, they do not establish that the proceeding is itself an abuse of process. Save in the respects identified by the respondents, the correspondence is typical of what one would expect between solicitors in those circumstances – Ms Ellis sought further instructions on various aspects of the claim in order to prepare the originating documents and she advised on various matters including in which court to commence the proceeding. There is nothing in those exchanges which shows anything other than a genuine desire on the part of Capital to pursue legal rights that it was entitled to pursue, including to do so with reference to timing and form that would be tactically advantageous. It also comes as no surprise that Mr Simonfi wished the proceeding to be commenced as soon as possible – that is a typical wish of a party that believes it has been wronged.

70    I reject the contention that the proceeding is an abuse of process.

Additional matters

71    The respondents make a variety of other serious allegations against Capital, the applicant and Mr Simonfi, including of dishonesty, fraud and conflicts of interest. The allegations are unparticularised in the defences and in the evidence given by the respondents. They do not rise to the level such as to warrant being addressed, beyond recording that I reject them.

Conclusion

72    In the circumstances, the applicant is entitled to a joint and several judgment against the respondents for the capital sum plus interest and costs.

73    Apparently for simplicity and because it does not expect a full recovery, the applicant has waived pre-judgment contractual interest which is at a higher rate than pre-judgment interest otherwise allowed under s 51A of the Federal Court of Australia Act 1976 (Cth) read with the Interest on judgments (GPN-INT) practice note. Also, the contractual interest is compounded whereas under the practice note it is simple interest. Thus, the respondents are better off on the approach taken by the applicant when compared to the approach that it could have taken. I therefore think that it is fit to order pre-judgment interest as provided for under the practice note.

74    Also, the applicant has approached the recovery of $2.7 million on the basis that it is to be appropriated entirely to the principal debt and not to any of the interest that accrued between the advance of the loan on 14 June 2024 and the recovery. That is also an approach which is to the respondents’ benefit. I will accordingly allow it.

75    The calculation of the judgment sum (omitting cents) is thus as follows:

76    The indebtedness as at the date of judgment is accordingly $2,886,842.

77    Allowing for the possibility that there is some error in the calculations set out above, the parties shall have liberty for seven days to apply to correct any such errors.

Associate:

Dated:    20 February 2026