Supreme Court New South Wales

• Medium Neutral Citation: Helou v Nguyen (with Addendum) [2014] NSWSC 22
• Hearing dates: 14-18 and 21-23 October and 23 December 2013 and (in relation to orders published in an addendum) 7, 12 and 17 February 2014
• Decision date: 05 February 2014
• Jurisdiction: Equity Division
• Before: Lindsay J

Decision

Orders made designed to give effect to a determination that the first defendant stole money from the plaintiffs and, at least in part, applied stolen money in the acquisition and development of property in the names of the defendants jointly

• Catchwords: PROPERTY - Theft - Stolen money - Remedies at law and in equity - Action for damages in conversion and for moneys had and received - Suit for Constructive Trust in Equity - Need for consistency - Interests of Justice; REMEDY - Remedies based on compensation for Plaintiff's loss or accounting for wrongdoer's gain - Consistency of remedy required - Interests of Justice; EQUITY - Trusts and trustees - Constructive trust; TORTS - Trover and Detinue - Action for conversion - Remedies - Waiver of Tort - Damages - Money had and received
• Legislation Cited: Civil Procedure Act 2005 NSW; Evidence Act 1995 NSW, s 140; Money-Lenders Act 1900 (UK), 63 and 64 Victoria chapter 51; 5 William IV No 10 (the Rate of Interest (Forbes's) Act 1834 NSW); Uniform Civil Procedure Rules 2005 NSW
• Cases Cited: ANZ Banking Group v Westpac Banking Corporation (1988) 164 CLR 662 at 672-673; Asim v Penrose [2010] NSWCA 366 at [140]-[143]; Australian Hardboards Limited v Hudson Investment Group Limited (2007) 70 NSWLR 201 at 213 [50] - 221 [77]; Bathurst City Council v PWC Properties Pty Limited (1998) 195 CLR 566 at 585 [42]; Baumgartner v Baumgartner (1987) 164 CLR 137 at 148; Black v S Freeman and Company (1910) 12 CLR 105; Bridgewater v Leah (1998) 194 CLR 457 at 493-494; Briginshaw v Briginshaw (1938) 60 CLR 336 at 343-344 and 360-363; Castles v Freidman (1910) 11 CLR 580 at 590-591; Commonwealth of Australia v The Official Trustee in Bankruptcy as the Trustee of Property of Stephen Vasil [2004] NSWSC 1155 at [21]; Commonwealth v SCI Operations Pty Limited (1998) 192 CLR 285 at 316; Cory Bros & Co Limited v Owners of Turkish Steamship "Mecca" [1897] AC 286 at 293-294; Creak v James Moore & Sons Pty Limited (1912) 15 CLR 426 at 432; Cultus Petroleum v OMV Australia [1999] NSWSC 435 at [2]; Deeley v Lloyds Bank Limited [1912] AC 756 at 783-784; Degman Pty Limited (In Liq) v Wright (No 2) [1983] 2 NSWLR 354 at 358; Delaforce v Simpson-Cook (2010) 78 NSWLR 483 at 494 [57] and [60]-[61]; Diemasters Pty Limited v Meadowcorp Pty Limited (2001) 52 NSWLR 572 at 579-580 [17], 580 [17]; Farrah Constructions Pty Limited v Say-Dee Pty Limited (2007) 230 CLR 89; Forgegard v Shanahan (1994) 35 NSWLR 206 at 221F-224F; Foskett v McKeown [2001] 1 AC 102 at 128; Fountain Selected Meats (Sales) Pty Limited v International Produce Merchants Pty Limited (1988) 81 ALR 397 at 401; Gerard Cassegrain & Co Pty Limited v Felicity Cassegrain [2013] NSWCA 453 at [53] (read with [2011] NSWSC 1156 at [161]) and [156]-[157] and [159]; Giumelli v Giumelli (1999) 196 CLR 101 at 111 [2] - 112 [4] and 113 - 114 [10].; Heperu Pty Limited v Belle (2009) 76 NSWLR 230 at 252 [89], 253 [92], 265-266 [154] and 267-268 [163]; 260 [127] and 263 [142]-268 [163]; Hungerfords v Walker (1990) 171 CLR 125 at 148; Income Tax Commissioner v Maharajadhiraj of Darbhanga (1933) LR 60 IND App 146 at 157; In Re Diplock [1948] Ch 465 at 517 and 557-558; J & H Just (Holdings) Pty Limited v Bank of NSW (1971) 125 CLR 546; Kinarra Pty Limited v Crawford [2006] VSC 309 at [83]; Latec Investments Limited v Hotel Terrigal Pty Limited (In Liquidation) (1965) 113 CLR 265; Lipkin Gorman v Karpnale Limited [1991] 2 AC 548 at 559; Maguire v Makaronis (1997) 188 CLR 449 at 469; McDonald v Levy (1833) 1 Legge 39; [1833] NSWSupC 47; Nominal Defendant v McLennan [2012] NSWCA 148 at [139]-[140]; Penfolds Wines Pty Limited v Elliott (1946) 74 CLR 204 at 229; Peter Butt, Land Law (Law Book Co, 6th ed, 2010), paras [14.05]-[14.09]; R v Curtis; ex parte Attorney-General [1988] 1 Qd R 546 at 548 and 551; Re Dawson [1966] 2 NSWR 211; 84WN (Pt 1) (NSW) 399; Re Global Finance Group Pty Limited (2002) 26 WAR 385 at 406 [94]; Robb Evans of Robb Evans & Associates v European Bank Limited (2004) 61 NSWLR 75 at 103 [131] - 105 [148]; Rouse v Sheppard (No 2) (1994) 35 NSWLR 277 at 279-282; Royal Insurance Co Ltd v Mylius (1926) 38 CLR 477 at 497; Sadcas Pty Limited v Business and Professional Finance Pty Limited [2011] NSWCA 267 at [42] and [83]; Samuel v Newbold [1906] AC 461 at 471-474; Scott v Scott (1964) 109 CLR 649 at 660-662 and 664; Sinclair v Brougham [1914] AC 398 at 418-419; United Australia Limited v Barclays Bank Limited [1941] AC 1; Vadasz v Pioneer Concrete (SA) Pty Limited (1995) 184 CLR 102 at 113-114; Warman International Limited v Dwyer (1995) 182 CLR 544 at 559; Wright v Gibbons (1948) 78 CLR 313 at 330-331; Youyang Pty Limited v Minter Ellison Maurice Fletcher (2003) 212 CLR 484
• Texts Cited: JH Baker, An Introduction to English Legal History (Butterworths Lexis Nexis, London, 4th ed, 2002), p 311 n 83; AWB Simpson, A History of the Common Law of Contract: The Rise of the Action of Assumpsit (Clarendon Press, Oxford, 1987), p 510; Blackstone, Commentaries on the Laws of England, p 454: Holdsworth, A History of English Law, vol 8, 2nd ed, 1937), pp 100-113, esp112; vol 11 (1938), pp 514-516; vol 13 (1952) pp 12, 29, 110-112 and 212-213; Osborn's Concise Law Dictionary (12th edition, 2013); A Smith, The Wealth of Nations; 1st edition, 1776; B Kercher, Debt, Seduction and Other Disasters: The Birth of Civil Law in Convict NSW (Federation Press, Sydney, 1996), pp 141-142 and 171-173; SJ Butlin, The Foundations of the Australian Monetary System, 1788-1851 (Sydney University Press, 1953; 1968 reprint); GW Millard and BA Helmore, The Law of Personal Property in NSW (Law Book Co, Sydney, 5th ed, 1947), pp 310-311; A Oliver, A collection of the statutes of practical utility, colonial and imperial, in force in NSW (NSW Government Printer, Sydney, 1879), vol 2, pp 2485-2486; CH Currey, Sir Francis Forbes (Angus & Robertson, Sydney, 1968), chapter 41 Historical Records of Australia, series 1, vol 17, pp 520-537; vol 18, pp 94-95; Tarrant, "Theft principle in private law" (2006) 80 ALJ 531; PW Young, C Croft and ML Smith, On Equity (Law Book Co, Sydney, 2009), paras [2.150] - [2.170], [14.50] - [14.60] and [14.180].; F Jordan, Chapters on Equity in New South Wales (6th ed, 1947), p 15, p 13; Story, Commentaries on Equity Jurisprudence (1st English ed, 1884), paras 26-28, and 31; G Spence, The Equitable Jurisdiction of the Court of Chancery (1846), Vol 1, pp 390-391; W Holdsworth, A History of English Law (3rd ed, 1944) Vol 9, p 338; JN Pomeroy, Equity Jurisprudence (5th ed, 1941), Vol 1, paras 109 and 113-116; Ashburner, Principles of Equity (Butterworth, London, 2nd ed, 1933), pp 38-39, 39-40; RP Meagher, JD Hayden and MJ Leeming (eds), Meagher Gummow & Lehane's Equity: Doctrines and Remedies (Butterworths Lexis Nexis, Australia, 4th ed, 2002), paras [12-035]-[12-045] and [12-055] FW Maitland, Equity (Cambridge University Press, 2nd ed, 1936), pp 7-8, 17 and 19; G Watt, Equity Stiring (Hart Publishing, Oxford, 2009), pp 85, 106-109 and 229; DR Klinck, Conscience, Equity and the Court of Chancery in Early Modern England (Ashgate, 2010); K Handley, The Black v Freedman Trust: Vindicating Proprietary Rights or Remedying Wrongs? in E Bant and M Bryan (ed), Principles of Proprietary Remedies (LBC, Sydney, 2013), ch 7 at pp 122-123 and 125; Halsbury's Laws of England (5th ed), Vol 22 "Contract", para 525
• Category: Principal judgment
• Parties: Mohammed Helou, Janine Helou, Suzanne Helou, Halima Helou, Walid Helou, Nozem Helou and Karia Helou; (Plaintiffs); Thai Giam Nguyen and Thi Thuy Lieu Le (Defendants)
• Representation: Counsel: M Dicker SC with Derek Hand (Plaintiffs); M Sneddon with P Kondic (Defendants); Solicitors: Paltos Briggs (Plaintiffs); Ly Lawyers (Defendants)
• File Number(s): 2012/00089044; 2013/00080448

Judgment

1 Residence in the cash economy, beyond necessities of daily living, comes at a price for altruism, no less than avarice: exposure to theft, active or passive, is one element of that price. Moderation in all things remains a virtue worthy of notice, even in the accumulation of cash, lest our property, or that of somebody else, comes to possess us. That is the "moral" demonstrated, on both sides of the record, by these proceedings.

2 The plaintiffs (a conservative Muslim family of mother, father and five adult children surnamed Helou) sue the defendants (Mr Nguyen and his wife) to recover part of the property they allege that the first defendant (Mr Nguyen) stole from one of their two family homes (both in Bankstown) on 27 March 2006.

3 The relief the plaintiffs claim against Mr Nguyen is personal and proprietary in character. They contend that the proceeds of the alleged theft were applied by Mr Nguyen in the purchase of two properties (one in Bankstown, the other in Dulwich Hill) in the names of the two defendants, and in development of the Bankstown property.

4 The property alleged to have been stolen comprises two types, only one of which is the subject of a claim for relief in these proceedings. Mr Nguyen is alleged to have stolen both a large amount of cash and a large amount of jewellery.

5 At the commencement of the trial the plaintiffs abandoned their claims for relief in relation to the jewellery, acknowledging that those claims were unsupported by any evidence as to value of the jewellery. They did not resile from their allegation that the jewellery had been stolen; but, the claims for relief relating to it having been abandoned, neither side of the record focussed attention on it or on its abandonment.

6 One extraordinary feature of the proceedings is that the quantity of cash alleged to have been stolen (from the plaintiffs' townhouse, "Unit 1" in Pringle Avenue, Bankstown) totals $467,500.00: an amount sufficient to buy a home unit, if not a house, in many parts of Greater Sydney.

7 Another extraordinary feature of the proceedings is the plaintiffs' allegation that, prior to its theft, the stolen property was kept, for security purposes, in the roof cavity of the townhouse (one of three owned by the Helou family in a strata development) pending application of the cash towards redevelopment of the family's main residence in nearby Highland Avenue, Bankstown.

8 These two extraordinary features are explained, by the plaintiffs, as incidents of the family's strong commitment to their Muslim faith.

9 The parents, both born in Lebanon, migrated to Australia in about 1968. The evidence does not disclose the age of Mr Helou Senior. Mrs Helou was born in 1940. All five children of the family were born and educated in Australia: Suzanne was born in 1969; Halima (also known as Helen) in 1971; Mohammed, in 1972; Janine, in 1974; and Walid, in 1978.

10 Within the plaintiffs' family there is, also, a story of inter-generational change. Its self-professed conservatism is not limited to the parents, but is grounded in the younger generation's veneration for their parents and, in particular, the respect shown towards the family patriarch, Mr Helou Senior.

11 He was the only member of the family from whom no evidence was adduced at trial. His absence, explained by descent into dementia, is only physical. Absent though he was from the trial, his influence on his family was ever present.

12 At all times material to these proceedings the Helou family lived, in one or the other or both of the Pringle Avenue property and the Highland Avenue property, as a nuclear family. All the children lived at home. None was married. All contributed virtually all their income to the common weal.

13 The parents bought the Highland Avenue property as the family home in about 1971.

14 In about 1982 they purchased the Pringle Avenue property, then a five bedroom fibro cottage, as an investment property. In 2001-2002 they demolished that cottage and constructed there townhouses (colloquially described as "Unit 1", "Unit 2" and "Unit 3" respectively) each comprising four bedrooms and two bathrooms.

15 Unit 1 was dedicated to family occupation. Soon after, if not immediately upon construction, Units 2 and 3 were rented out. In March 2006 Unit 2 was occupied by a Mr John Williams and his son Beau, and Unit 3 was occupied by Ms Jean Field.

16 From about 1997, the Helou family began planning development of their Highland Avenue property. They began to save money for that purpose. They hid it behind a kickboard in the kitchen, and under floor boards in Halima's bedroom, of the family home at that address, in cash. In 1999 they purchased the residential property next door. They planned to develop the two properties in much the same way as the Pringle Avenue property came to be developed: with a residence for the family at the front of the site, and townhouses at the back to generate rental income for the family.

17 By December 2005 they had accumulated sufficient money to begin the transition, from residence in Highland Avenue to residence in Pringle Avenue, necessary to facilitate redevelopment of the Highland Avenue property.

18 On 11 December 2005 Mohammed and Suzanne did a stocktake of the family's cash holdings held at the Highland Avenue property.

19 On 1 March 2006 Mohammed, in consultation with Suzanne and their mother, did another stocktake. Mohammed then transferred the cash, freshly counted, to the Pringle Avenue property. He placed it, with the family's gold jewellery, in the roof cavity of Unit 1 on the Pringle Avenue property.

20 This elaborate procedure was adopted, in substantial measure, to accommodate the devout religious beliefs of Mr Helou Senior. He, in particular, is said to have believed (and I accept that he did conscientiously believe) that it is against the Muslim faith to receive income by way of interest earned on money and that, if any interest is earned, the faithful are under a religious obligation to contribute it to charity in accordance with a practice described as "the Zikat".

21 Mr Helou Senior retired from work as a cabinetmaker in about 1998. Following his retirement he went to the Haj, as a pilgrim, in 1999.

22 At this point I defer to Mohammed's description, in cross examination (at transcript pp 77-79), of the Helou family mores:

"Q. The fact is that in relation to [your evidence] that [the] Pringle Avenue [redevelopment] was saved up [for] from about 1990 onwards to about 2000?

A. From 1987 sir. From the day that there was no mortgage on the property.

Q. From 1987 to 2000 and the moneys were saved by family members and safely held in a bank account, weren't they?

A. That's correct.

Q. In stark contrast to your family's apparent other methods of saving which is to store it in cash under floorboards; correct?

A. That's correct.

Q. In relation to the question of interest, you say do you not, that the reason you put all the money in cash is because your family is not entitled, for religious reasons, to be paid or receive any interest; is that right?

A. To clarify that, firstly, there was discussion in 1997, end of 97, '98, discussion with my father. We all live in one house, it was getting quite tight. I said to my father, 'Let's build a bigger home.' My father's response to that - he is a religious person at that particular time - he says, 'Son, I will not live in a house which has money accumulated from interest in it.' I tried to reason with him, but he is a dominating, controlling person. I have to listen to what he used to say.

His beliefs are so strong, I've got to listen. If I don't, he almost starts yelling to the extent it's almost an abuse. I've got to respect his religion. He is more strict than what I am in terms of Islamic religion. I need to clarify my answer. I have to answer it. He did not want to live in a house which was from money that accumulated from interest. He then said to me, 'You're responsible.'

I then went to mum and spoke to everyone to withdraw moneys from their accounts to store under the floorboards.

In 1999, there's a pilgrimage trip called the Haj. He retired in 1998, he went to the Haj in 1999. He came back with strict Islamic beliefs that he wanted to impose on not only me, but on my brothers and sisters and my mother.

My sisters as well as myself, we're religious people.

In the year 1999, 2000, he became so strict, he didn't want any money at all in the bank. He doesn't realise that I run a business, a company, there's no alternative but to put money in the bank. And my sisters work. I said to him, 'But the religion says as well that any interest accumulated, you need to pay it in the way of charity to the orphans or human appeal.' From 1999, Suzanne set up the human appeal. Each one of us has an individual account from 1999 with the human appeal. It's a charity to give money to orphans. It was earning interest in zakat, which is to charity. From the end of 1999, I said to mum, 'Janine, Helen, they've got money in their accounts. They've been working for a long time. Withdraw it, put it into this building.' And that's the reason.

Q. So far as interest, do you say it's fine to accrue interest providing you give it to charity?

A. My belief in the Islamic way, yes. My father isn't.

Q. Similarly, banks can offer accounts to your knowledge can't they, where you don't actually get interest?

A. I explained that to my father. My father is strict in his ways. I'm fearful and I still am. He imposes these rules which you've got to abide by. I've lived with him all my life. Got to respect him. I'm fearful. I don't want to argue with him. I reasoned with him, I said, 'We can put it in Arab Bank.' 'No. Are you going against my beliefs, Mohammed?' I avoided it. I'm a peaceful person, I avoid any arguments with my father to the extent where it's fearful. He wants to impose his strict, strict Islamic beliefs on all my brothers and sisters and myself. I'm sorry, I'm a person who prays, gives money to poor, set up zakat to give money to charity. To this day I still do. For the rest of my life, I will. I said to mum, 'Get rid of them from Janine and Helen's accounts. Put them in this development."

23 Without intending to suggest that the religious faith of other members of the Helou family is any less deep than that of Mr Helou Senior, my assessment is that his theological disdain for interest income (rather than any personal disdain on the part of other family members) was the principal driving force in the family's shared practice of accumulation of large amounts of cash at home.

24 Leaving aside Walid (because of an intellectual impairment which has excluded him from communal management decisions), all members of the family, other than Mr Helou Senior, appear always to have been comfortable accommodating their theological beliefs to modern banking practice, modified by a routine practice of making donations to charity in sums equivalent to interest earned from bank deposits.

25 It is not necessary for the purpose of this judgment to explore the extent to which, if at all, the Helou family's pattern of accumulating cash at home has been driven, at least in part, by the parents' origins in Lebanon or cultural influences other than Mr Helou Senior's theology. I do not, however, exclude those factors from consideration. They may have played a part.

26 Contemporary mainstream Australian society might, reasonably, be thought not to share Mr Helou Senior's theological disdain for interest bearing bank deposits. However, against the possibility that his belief system may be regarded as entirely foreign to Australian tradition, notice might be taken of English Canon law, and English statutes against usury, not remote from the experience of the British who colonised Australia. A mindset not unlike that of Mr Helou Senior is part of this nation's Anglo-Australian heritage.

27 As in many areas of the law, the early colonial phase of Australian history coincided with fundamental change in Britain.

28 According to Canon law as applied in England in medieval times, it was a sin, and moreover a crime, to earn interest on money lent.

29 Only after the Reformation did the word "usury" shift its meaning away from the concept of earning interest at all towards the modern concept of earning an excessive amount of interest. Osborn's Concise Law Dictionary (Sweet & Maxwell, 12th edition, 2013) reflects this change in its definition of "usury":

"Usury. Originally meant interest. By Acts of [the British] Parliament known as the Usury Laws (repealed in 1854) interest above certain rates was prohibited. Usury hence came to mean only illegal or excessive interest."

30 So far has Anglo-Australian law shifted its focus, that Professor JH Baker deals with it in a footnote (in An Introduction to English Legal History (Butterworths Lexis Nexis, London, 4th ed, 2002), p 311 n 83):

"The Canon law regarded it as a sin ('usury') to take interest on a loan, and usurers were liable to punishment in the medieval church courts. The common law took a more worldly approach and did not invalidate usurious agreements, though penalties were introduced in 1495, and in 1545 parliament set an upper limit of 10% on lawful interest: Stat. 11 Hen. VII, c. 8; 37 Hen. VIII, c. 9. (The limit was later reduced to 5%, where it remained until the repeal of the usury laws in 1854.)"

31 The Reformation is not universally regarded as having effected material change. In his classic work, A History of the Common Law of Contract: The Rise of the Action of Assumpsit (Clarendon Press, Oxford, 1987), Professor AWB Simpson recorded, at p 510, his view that "[the] Reformation did not in the least bring about any weakening of the extreme vehemence with which the sin of usury was condemned. ... ": see also, pp 116-117 and 510-518.

32 Sir William Blackstone dealt with the topic in chapter 30, Book II of his Commentaries on the Laws of England, first published in four volumes between 1765-1769.

33 The flavour of his treatment of the topic can be discerned from the following extract from Dr Wayne Morrison's modernised English (2001) version of the 9th "received" edition of 1783 at p 454:

"There is one species of [the price or reward for the hiring out, or borrowing, of property], the most usual of any, but concerning which many good and learned men have in former times very much perplexed themselves and other people, by raising doubts about its legality in foro conscientiae. That is, when money is lent on a contract to receive not only the principal sum again, but also an increase by way of compensation for the use; which generally is called "interest" by those who think it lawful, and usury by those who do not so. For the enemies to interest in general make no distinction between that and usury, holding any increase of money to be indefensibly usurious. And this they ground as well as on the prohibition of it by the law of Moses among the Jews, as also upon what is said to be laid down by Aristotle, that money is naturally barren, and to make it breed money is preposterous, and a perversion at the end of its institution, which was only to serve the purposes of exchange, and not of increase. Hence the school devines have branded the practice of taking interest, as being contrary to the devine law both natural and revealed; and the Canon law has proscribed the taking any, the least, increase for the loan of money as a mortal sin."

34 Historians of English law attribute the decisive change in attitude, that came after Blackstone's death, to the influence of Jeremy Bentham (1748-1832): eg, Sir William Holdsworth, A History of English Law, vol 8, 2nd ed, 1937), pp 100-113, especially 112; vol 11 (1938), pp 514-516; vol 13 (1952) pp 12, 29, 110-112 and 212-213.

35 In 1787 Bentham first published his Defence of Usury, in which he took Adam Smith (author of The Wealth of Nations; 1st edition, 1776) to task for failing, in his promotion of free trade, to condemn the usury laws. Smith was more empirical and pragmatic, and less doctrinaire, than Bentham, a devotee of utilitarian logic.

36 Under Bentham's sway (more than, as we might, uninstructed, suspect that of Smith), the usury laws were ultimately repealed, in England, in 1854. Even then, within half a century, the need for regulatory controls over excessive interest claims manifested itself in the enactment of the Money-Lenders Act 1900 (UK), 63 and 64 Victoria chapter 51.

37 With idiosyncratic local adaptations, and hot debate about the role of law, the course of Australian legal history came, eventually, to mirror that of England as the 19th century drew to a close. New South Wales adopted English legislative models and NSW courts increasingly followed English precedents: B Kercher, Debt, Seduction and Other Disasters: The Birth of Civil Law in Convict NSW (Federation Press, Sydney, 1996), pp 141-142 and 171-173; SJ Butlin, The Foundations of the Australian Monetary System, 1788-1851 (Sydney University Press, 1953; 1968 reprint); GW Millard and BA Helmore, The Law of Personal Property in NSW (Law Book Co, Sydney, 5th ed, 1947), pp 310-311; Samuel v Newbold [1906] AC 461 at 471-474, followed in Castles v Freidman (1910) 11 CLR 580 at 590-591.

38 However, in McDonald v Levy (1833) 1 Legge 39; [1833] NSWSupC 47 the English Usury legislation was held (by Forbes CJ and Dowling J, Burton J dissenting) not to have been received in NSW as part of local law and, to overcome Burton J's persistence in dissent, the Legislative Council of NSW enacted, in 5 William IV No 10 (colloquially known as the Rate of Interest (Forbes's) Act 1834 NSW), a legislative declaration "[that] the Laws and Statutes of England relating to Usury shall be deemed taken and adjudged not to extend to [NSW] or to be in force within the same": A Oliver, a collection of the statutes of practical utility, colonial and imperial, in force in NSW (NSW Government Printer, Sydney, 1879), vol 2, pp 2485-2486; CH Currey, Sir Francis Forbes (Angus & Robertson, Sydney, 1968), chapter 41. Burton J carried his opposition to the Colonial Office, but in due course, on the recommendation of Governor Bourke, the Colonial Secretary, Lord Glenelg concurred with the opinions of Forbes and Dowling: Historical Records of Australia, series 1, vol 17, pp 520-537; vol 18, pp 94-95.

39 None of this was in the minds of the parties presently before the Court when, in and about March 2006, their lives fatefully intersected.

40 On both sides of the record, the parties hail from communities in which possession of a horde of cash may not raise eyebrows in the same way as it can do in the broader Australian community. The plaintiffs' Lebanese cultural heritage has been mentioned. The first defendant, Mr Nguyen, was born in Vietnam in 1956. He migrated to Australia in 1984. Although the course of her life was not elaborated in the evidence, his wife appears to have a similar background.

41 On both sides of the record, uncontroversial evidence establishes that, within the family, substantial wealth was held, with makeshift security arrangements, in cash.

42 For Australians fortunate enough to have lived always in a peaceful society, with a stable economy, conscious effort can be required to displace a fixed tendency towards complete disbelief of those who inhabit a world in which cash is king and independent, verifiable accounting records are scarce. Whatever their outcome, these proceedings call for disciplined attention to evidence of what, in fact, happened: empirical observation, unconstrained by, though not unmindful of, normative standards of propriety concerning the cash economy.

43 The questions for determination in the proceedings are but three, each essentially factual:

(a) QUESTION 1: Did the plaintiffs have $467,500.00 in cash, together with a horde of jewellery, stashed in the cavity of the roof of their Pringle Avenue townhouse on 27 March 2006?

(b) QUESTION 2: If yes, was that property (the cash and jewellery) stolen by Mr Nguyen on 27 March 2006?

(c) QUESTION 3: If yes, did Mr Nguyen apply the proceeds of the theft in the purchase or development of land (in Bankstown and Dulwich Hill) in the names of himself and his wife.

44 The defendants accept that (by an application of Black v S Freeman and Company (1910) 12 CLR 105 or Farrah Constructions Pty Limited v Say-Dee Pty Limited (2007) 230 CLR 89) if proceeds of a theft by Mr Nguyen were applied in the purchase or development of that land the plaintiffs are entitled, to that extent, to a proprietary remedy.

45 The second defendant does not contend that there is a fourth question to be determined directed to preservation of her interest in land as a purchaser for value without notice. The case has been conducted upon the assumption, not that she was actively engaged in wrongdoing alleged against her husband, but that any stolen property received by her was received as a volunteer. That much is common ground.

46 The parties are agreed that the plaintiffs bear the onus of proof, on each of the three questions for determination, governed by s 140 of the Evidence Act 1995 NSW, a statutory embodiment of Briginshaw v Briginshaw (1938) 60 CLR 336 at 343-344 and 360-363. The plaintiffs, in particular, accept that the civil standard of proof (proof on the balance of probabilities) varies according to the gravity of the fact to be proved, and that their allegation of theft is a serious one.

47 The seriousness of the allegation is underscored by the plaintiffs' contention that Mr Nguyen's modus operandi in effecting the alleged theft involved him in cultivating one of their number, Walid (an impressionable, intellectually impaired, lonely person), as a means of discovery of, and obtaining access to, the hidden wealth of the plaintiffs' family.

48 The Briginshaw standard - strictly, in these proceedings, s 140 - requires application of a standard of proof approximating, but not identical with, the criminal standard of proof beyond reasonable doubt.

49 The defendants take comfort in these proceedings from the historical fact that, after investigation of the plaintiffs' allegation of theft against Mr Nguyen, the New South Wales Police declined to charge him with any offence because, the Police said, there was insufficient evidence to sustain a prosecution.

50 These proceedings cannot be determined, either way, by reference to opinions attributed, correctly or otherwise, to police officers whose opinions, if any, may have been based on evidence different from that adduced in the proceedings.

51 That said, at least some of the difficulties which the police may reasonably have thought to represent an impediment to success in a criminal prosecution of Mr Nguyen continue to represent a forensic challenge to the plaintiffs in the current, civil proceedings:

(a) The principal witness against Mr Nguyen is Walid. His intellectual impairment invites caution, and a prudential inquiry about corroborative evidence, as a test of the reliability of his evidence, without any reflection on his personal honesty.

He is the only witness who claims to have seen Mr Nguyen take some (not all) of the cash alleged by the plaintiffs to have been at the Pringle Avenue townhouse on 27 March 2006. On his evidence depends the plaintiffs' allegation that Mr Nguyen had timely possession of keys to the townhouse and an opportunity, in the absence of any member of the plaintiffs' family, to enter the townhouse for the purpose of taking the balance of the property claimed by the plaintiffs to have been stolen.

(b) The credibility of the plaintiffs' allegation of theft depends also, critically, on their assertion that, because of their theological beliefs (neither shared, nor readily comprehended, by mainstream Australia) they held a small fortune in cash at home.

(c) Mr Nguyen stoutly denies the plaintiffs' allegations, root and branch, and, moreover, alleges that the plaintiffs' undoubtedly strong, shared belief in his guilt has influenced Walid's thinking to such an extent that Walid's evidence must be treated as irretrievably tainted.

52 The defendants' defence of the proceedings strikes the foundations of the plaintiffs' allegation of theft by placing in issue the existence of any horde of cash such as that claimed by the plaintiffs to have been stolen. The defendants contend that the plaintiffs have fabricated their allegations against Mr Nguyen, and colluded in their presentation of evidence against him.

53 The defendants do not advance a case theory, based upon an assumption that the cash and jewellery alleged by the plaintiffs to have been stolen in fact existed, to the effect that the property was or may have been stolen by a person other than Mr Nguyen.

54 They have taxed the plaintiffs about an allegation, or allegations, made by one of the plaintiffs (Suzanne) against a Pringle Avenue neighbour (Mr Williams) in the heat of the moment of discovery of the alleged theft. However any such allegation was, with quiet embarrassment, disclaimed by Suzanne in her oral evidence. Mr Williams took no offence.

55 For their part the defendants, by counsel, cross examined each of the plaintiffs' Pringle Avenue neighbours (Mr Williams, his son Beau and Ms Field) on the basis of an express disclaimer of any allegation of theft against them. In final submissions he also disclaimed any attack on their credit, confining himself to a submission that, by reason of lapses of memory over time, their evidence was not reliable.

56 To meet the forensic challenges standing in their way, the plaintiffs have advanced a case that has included the following elements.

57 First, every one of them, other than Mr Helou Senior, has given evidence about their knowledge, or lack of it, about primary facts in issue and has been exposed, at length, to cross examination.

58 Secondly, corroborative evidence of primary records of the Helou family has been adduced, including Suzanne's handwritten summaries of the cash stocktakes conducted on 11 December 2005 and 1 March 2006.

59 Thirdly, a number of Mr Nguyen's (express or constructive) denials of incidental, but significant, facts have been challenged by evidence ostensibly independent of the plaintiffs. Some of that evidence has been documentary: eg, records of a fitness club, and bank statements of Mr Nguyen, evidencing that Mr Nguyen paid for Walid's subscription for membership of the club between January - August 2004 or thereabouts.

60 Other evidence has come from the plaintiffs' Pringle Avenue neighbours (Mr Williams, his son Beau and Ms Field) and the groundsman of Belmore Oval (Mr Lee Best) about contact between Mr Nguyen and Walid at times when Mr Nguyen denies there was any contact at all.

61 The neighbours deposed to having seen Mr Nguyen in the near vicinity of Unit 1, Pringle Avenue. Mr Best deposed to having seen Walid (a fanatical supporter of the Canterbury Bankstown Rugby League Team, whose ancestral home is Belmore Oval) in the company of Mr Nguyen, kicking footballs in the vicinity of Belmore Oval.

62 Fourthly, the records of the defendants have been analysed: (a) to challenge their contention that their lifestyle and acquisition of property after 27 March 2006 can be innocently explained without reference to property allegedly stolen from the plaintiffs; and (b) to demonstrate that, in the two years or so following 27 March 2006, Mr Nguyen progressively, and for a purpose which included preservation of secrecy about the amount of cash in his possession, deposited large amounts of cash in bank accounts against which he drew to fund activities that included the acquisition of land.

63 Fifthly, Mr Nguyen has been cross examined at length.

64 That cross examination may be accepted as having established a number of facts that, in combination with one another and with other evidence, tell heavily against the defendants.

65 First, on his own case, he had routinely received large amounts of cash in the course of his employment and in the course of his conduct of various businesses as a fruit and vegetable vendor and as a truck driver.

66 Secondly, on his own admission he routinely understated his income in tax returns by non-declaration of his receipt of money in cash.

67 Thirdly, he took steps to conceal from the police investigating the plaintiffs' allegation of theft the fact (asserted by him) that he had tens of thousands of dollars in cash within his possession or control.

68 Each of the witnesses called in the plaintiffs' case impressed as a witness of truth.

69 The evidently incredible version of events recounted by the Helou family attained credibility, under close cross examination, as the moral imperatives, frugal lifestyles and deep inter-personal relationships within the family were tested. All the children, including Mohammed (a chiropractor by profession, in private practice) surrendered to their mother substantial control over bank accounts to facilitate family savings in aid of communal living, both consumption and investment.

70 The nature and extent of exposure of the members of the Helou family to cross examination was calculated to expose such, if any, fissures as might have been there to be found. No rock cracked. Minor differences, natural enough in the presentation of different perspectives, can be identified. However, none of those differences calls into question the veracity of the evidence given.

71 The defendants would have the Court find that the plaintiffs made a false application for a "First Home Buyer's Grant" of a government subsidy, or at least dishonestly failed to comply with conditions attached to the subsidy, when they let out Units 2 and 3 of the Pringle Avenue property following construction of the townhouse development there. However, the evidence of Mohammed (which I accept) is that the plaintiffs complied with the formal conditions of the subsidy before letting out the leased Units. Mohammed was the person, within the Helou family, responsible for organising the development. Two of his sisters, who became registered proprietors of the Units, left everything in his care.

72 Although contemporaneous records of the police investigation following the Helou family's complaint of theft on 28 March 2006 reveal a reluctance to press charges, two important points emerge from the plaintiffs' contact with the police. First, the loud, insistent complaints of family members rebut any suggestion that the family's complaint of theft, or their version of how it occurred, is tainted by recent invention. Secondly, in the face of Mr Nguyen's denials of wrongdoing, an investigating officer counselled Mohammed to hasten slowly in the institution of civil proceedings, against the possibility (now said by the plaintiffs to have materialised) that Mr Nguyen's lifestyle or patterns of expenditure might provide evidence corroborative of the plaintiffs' allegation of theft.

73 Despite his (obvious) intellectual impairment, Walid recounted his version of events in a persuasive manner, neither by rote nor evidently rehearsed. The simplicity of his mind, apparently a weakness in the presentation of a case, became a strength.

74 Although the evidence given by the plaintiffs' neighbours and the Belmore Oval groundsman involved an element of imprecision as to dates, it was given sincerely and with detachment.

75 I do not exclude the possibility that the trauma patently exhibited by the Helou family may have drawn their neighbours closer to them, empathetically. This might be said of Mr Williams, in particular, as he appears to have provided comfort for the family in their distress. However, each of the independent witnesses struck me as a thoughtful, honest person. Mr Williams, a bus driver by occupation, presented as a calm, detached observer of events.

76 In terms of their credit and credibility, the defendants' witnesses suffer by comparison.

77 Mr Nguyen's credit suffered from inconsistencies and prevarications in his presentation of evidence, reinforced by concessions made by him in cross examination (earlier noticed) that: (a) he had, deliberately, understated his income for tax purposes over several years by not declaring cash receipts; and (b) after the alleged theft, he had systematically made cash deposits, over an extended time, into bank accounts in a pattern designed to conceal the fact that he had in his possession substantial amounts of cash (not disclosed to, or found by, the police investigating the plaintiffs' allegation of robbery) that he was endeavouring quietly to deploy in the acquisition of property or in the maintenance of the lifestyle of himself, his wife and their son.

78 He claimed to have maintained a stash of about $40,000 - $50,000 in cash under the mattress of his bed.

79 Payments for the acquisition of property apparently funded through a bank appear, on closer examination, to have been sourced from Mr Nguyen's amorphous, unverifiable reservoir of cash.

80 The second defendant presented as a stolid, loyal wife, with some, but less than full, knowledge of the financial affairs of herself and her husband. In a rare manifestation of positive emotion she took evident delight in giving evidence, during the course of cross examination, that, upon execution of a search warrant at the defendants' home, the police did not notice that she had $30,000.00 in cash hidden in a rice container. I hesitate to attribute dishonesty to her, but her evidence lacks sufficient credibility to add an aura of respectability otherwise lacking in Mr Nguyen's presentation.

81 The only other witness called in the defendants' case was Mr Nguyen's long time friend, and godfather to the defendants' son, Mr Truong. His demeanour in giving evidence was controlled, but consistent with a consciousness that the evidence being given was uncritically supportive of Mr Nguyen. I would not be comfortable in accepting his evidence, in support of his friend, as reliable. Like Mr Nguyen, his residence in the cash economy, and the vagueness of his recall of detail about particular events, colours an assessment of his credit.

82 Forensically, his evidence was intended to corroborate Mr Nguyen's assertion that Mr Nguyen had borrowed $74,000.00 from him (in cash) as an interest-free loan to assist in the purchase of the defendants' Dulwich Hill property.

83 Mr Truong is a loyal friend, but his evidence is not credible. It is not susceptible to independent verification. Cash in, cash out. None of it documented. An alleged, personal loan for the acquisition of a property Mr Truong was unable to identify in cross examination, and about which he claimed to be indifferent at the time of making available to Mr Nguyen the whole of his cash reserves. A story of repayments of the alleged loan, by sporadic periodic payments, said to have been kept track of in an exercise book allegedly thrown out when the loan was repaid. I do not accept this evidence.

84 Neither do I, on the other side of the contest, place any reliance on Mr Truong's evidence that, at an indeterminate time, Walid accompanied Messrs Nguyen and Truong on one of their regular fishing trips. That may possibly be true. However, Mr Truong's evidence is generally so lacking in reliability that I am not prepared to count it against Mr Nguyen any more than I am prepared to count it in the defendants' favour.

85 In the broad, I have no hesitation in preferring the evidence of witnesses called on the plaintiffs' side of the record over those on the defendants' side.

86 That assessment is qualified only to the extent necessary to recognise that, in particular respects, error may have crept into evidence of the plaintiffs' witnesses. I have in mind as an example, the evidence of Walid that, at one time, he routinely spent fully six days a week in the company of Mr Nguyen at the defendants' fruit and vegetable shop in Marion Street, Bankstown. This is unlikely, literally, to be correct, although, figuratively, not far from the truth. Walid spent as much time as he could in the presence of Mr Nguyen, whom he regarded (on Mr Nguyen's evidence, without reciprocation) as his best friend.

87 I make the following findings of fact:

(a) On 27 March 2006 the plaintiffs had in their possession, stored in the roof cavity of their townhouse (Unit 1) in Pringle Avenue:

(i) cash in the total sum of $467,500.00 (recorded on two separate sheets of paper in the handwriting of Suzanne, one dated 11 December 2005, the other dated 1 March 2006) in the several receptacles described in the handwritten note dated 1 March 2006 given by Suzanne to her brother Mohammed; and

(ii) a substantial quantity of jewellery of a presently unknown value.

(b) That sum of money represented savings accumulated by the plaintiffs, as a family, for two particular purposes: first, $434,500.00 had been accumulated, either in cash or as withdrawals from bank accounts in order to satisfy Mr Helou Senior of the availability of a cash fund, for investment in a redevelopment of the family's Highland Avenue property; and, secondly, $33,000.00 set aside for funeral expenses (including burial in Lebanon) of Mr and Mrs Helou Senior.

(c) The money ($467,500.00) was moved from hiding places in the plaintiffs' Highland Avenue property to the Pringle Avenue townhouse on 1 March 2006 in anticipation of execution of a building contract for redevelopment of Highland Avenue.

(d) Unbeknown to other members of his family, Walid had discovered the whereabouts of the family's wealth in the Pringle Avenue townhouse (as he had earlier discovered cash behind the kickboard in the kitchen of the Highland Avenue property) by observation, deduction and an insatiable child-like curiosity about a family secret.

(e) Having earlier elicited from Walid that the Helou family had substantial cash hidden away, and having earlier in the presence of Walid dipped into cash held behind the kickboard in the Highland Avenue property, Mr Nguyen was, on the morning of 27 March 2006, introduced by Walid to the family treasure secreted in the roof cavity of the Pringle Avenue townhouse.

(f) At that time, to the direct observation and over the express objection of Walid, Mr Nguyen (using a ladder he kept in his van) took a quantity of cash from the roof cavity of the townhouse and appropriated it to himself by depositing it in the van, which he had (despite a temporary suspension of his driver's licence) driven to the Pringle Avenue property.

(g) Early in the day on 27 March 2006, before she went out, Mrs Helou Senior was confronted by Mr Nguyen, inside the entrance to the Pringle Avenue townhouse, asking for Walid. Despite his denials, he entered the townhouse that morning, as he had on earlier occasions.

(h) By chance, on a date which (by reconstruction) may have been slightly earlier than 27 March 2006, Mr Williams (the plaintiffs' neighbour from Unit 2) observed Walid, in the presence of Mr Nguyen, at Unit 1 with a ladder. As related by Janine Helou, Mr Nguyen had carried ladders in his van when, on 13 February 2006, he had (in the presence of Walid and Mrs Helou) picked her up from hospital after she had had day surgery.

(i) With imprecision as to dates, but probably on 27 March 2006, Ms Field observed Mr Nguyen's white van in the driveway of the Pringle Avenue property, adjacent to Unit 1, blocking the exit of her car from Unit 3.

(j) Having driven Walid to shops at Bankstown, having noticed that Walid had left keys in his vehicle, and having satisfied himself that nobody was home at Unit 1 in Pringle Avenue, Mr Nguyen had an opportunity sufficient to return to the townhouse for the purpose of theft of the balance of the cash, and the jewellery, then located in the roof cavity.

(k) No person outside the plaintiffs' family other than Mr Nguyen had knowledge of the location of the plaintiffs' cash and jewellery as at 27 March 2006.

(l) On 28 March 2006 Mohammed discovered that the cash and jewellery he had personally deposited in the roof cavity of Unit 1 on 1 March 2006 had disappeared.

(m) That discovery occurred because Mohammed had entered the roof cavity to investigate whether there was a presence of birds in the roof that could explain an allergic reaction from which his mother was suffering after having taken up occupation of Unit 1.

(n) After having been confronted by his family on the morning of 28 March 2006 about the loss of the family treasure, Walid called Mr Nguyen on his mobile telephone, at which time a conversation between them took place to the following effect:

Walid said:

"Hello Jim. Bring back all the money and jewellery now. Where is it? Where did you put them? Big trouble. Police are here."

Mr Nguyen (generally known as "Jimmy") replied:

"Your brother moved it to the red house [a reference to the Highland Avenue property]."

(o) Shortly thereafter, faced with allegations by the plaintiffs' family that he had stolen their property, and apprehensive about the possibility of an ongoing police investigation, Mr Nguyen ceased to see Walid and, to put an end to telephone calls from Walid, he changed his mobile telephone number.

(p) After an initial confrontation between Walid and other members of his family as they tried to piece together what had happened, Walid descended into sullen silence about what had happened until, at the request of the Helou family, Mr Williams invited Walid, in a non-judgemental atmosphere, to unburden himself about what had occurred vis á vis Mr Nguyen leading up to the events of 28 March 2006.

(q) Over a period of several years following 28 March 2006 Mr Nguyen surreptitiously enjoyed the benefit of thousands of dollars in cash, the provenance of which cannot be explained by the defendants otherwise than by their personal assertion of legitimacy, but possession of which is consistent with Mr Nguyen having stolen the plaintiffs' property on 27 March 2006.

(r) After 28 March 2006 Mr Nguyen systematically made cash deposits into bank accounts in a pattern designed to conceal the fact that he had substantial amounts of cash in his possession.

[In that regard, I accept as an accurate summary of the evidence the aide memoire dated 14 October 2013, prepared by counsel for the plaintiffs, entitled "Transactions in three bank accounts held by the defendants in the quarterly periods between 1 January 2005 to 31 December 2008 (excluding term deposits)"].

(s) In 2007 the defendants deployed substantial amounts of cash in their acquisition of the Dulwich Hill property and, in the construction of their residence, on the Bankstown property.

(t) Contracts for their purchase of the Dulwich Hill property were exchanged on 15 February 2007, and settled on 28 March 2007. Contracts for purchase of the Bankstown land were exchanged on 11 May 2007, and settled on 22 June 2007. Payments for building work on the Bankstown land were made in the months immediately following settlement of the purchase of that land. The construction work occupied the period between March - September 2008 or thereabouts.

(u) In the period between 2002 (when he first met Walid and other members of the plaintiffs' family as customers of his Marion Street shop) and 28 March 2006, Mr Nguyen had cultivated a friendship with Walid, knowing (as could hardly not be observed by a person of ordinary intelligence and perception) that Walid was no more than a boy in a man's body, and, from time to time, using Walid's limited funds to finance their activities.

(v) During that period Walid became emotionally dependent upon Mr Nguyen, whom he trusted (and in whom he confided) as, to use Walid's own words, his "best friend"

(w) During the same period (between 2002 and 2006) Mr Nguyen had frequently quizzed Walid about whether Walid had money in his possession and whether (and whereabouts) Walid's family held cash at home.

(x) The relationship between Mr Nguyen and Walid was ostensibly terminated in mid-2004, when Mohammed warned Mr Nguyen off any further contact with Walid, but (unknown to Mohammed, though reluctantly tolerated by women in the plaintiffs' family) it was in fact resumed in mid-2005, when Walid met Mr Nguyen in the fitness club earlier frequented by the two men, and it continued until March 2006.

88 I infer from these facts that, on 27 March 2006, when possessed of an opportunity to do so, Mr Nguyen returned to the Pringle Avenue townhouse, without Walid, and stole the balance of the cash, and all the jewellery, secreted by Mohammed in the Unit's roof cavity.

89 In drawing this inference I am fortified by the plaintiffs' proof that Mr Nguyen's denials of contact with Walid after 2004 are false. I accept as substantially correct the independent evidence of the plaintiffs' Pringle Avenue neighbours and the Belmore Oval groundsman, corroborative of the plaintiffs' evidence.

90 I am comfortably satisfied, despite the seriousness of the case presented against Mr Nguyen, that:

(a) the plaintiffs had $467,500.00 in cash, together with jewellery, in their possession; and

(b) on 27 March 2006, Mr Nguyen stole that property from them.

91 In reaching that degree of satisfaction I have been conscious of the constraints of the Evidence Act, s 140, embodying the standard of proof generally associated with Briginshaw v Briginshaw (1938) 60 CLR 336 at 361-362. I have also been mindful of particular discussions of onus of proof, in cases dependent on circumstantial evidence, in Nominal Defendant v McLennan [2012] NSWCA 148 at [139]-[140] and Asim v Penrose [2010] NSWCA 366 at [140]-[143], and in authorities there canvassed.

92 Had I not had a prolonged opportunity to observe members of the Helou family, and the defendants' witnesses, in the stressful environment of a forensic contest, my initial scepticism about the plaintiffs' allegations might not have matured into a conviction that, despite Mr Nguyen's attempts to refute it, the evidence they gave was, in essentials, correct.

93 The conduct of the plaintiffs, in their management of cash, may be condemned as imprudent, eccentric or economically irrational. However, in the context of Mr Helou Senior's strong religious belief about the proper use of money and the equally strong cultural imperatives of a close knit, conservative family, what they did with what they had and why they did it is understandable. Misguided they may have been; dishonest and greedy they were not.

94 The same cannot be said for Mr Nguyen. On his own evidence, deceit and avarice claimed more of his attention than, perhaps, he fully realised. An opportunity for gain, at the expense of the Helou family, presented itself to him courtesy of Walid's simple dependency upon him, and the vulnerability of the Halou family because of their weakest link (Walid) and the improbability of anybody believing that they had a small fortune in cash held, at home, without security. Succumbing to temptation, he took that opportunity, exposing himself to a perceived need for systematic concealment of more cash than he could innocently explain. He ended up living a lie.

95 Each of the three questions stated for the Court's determination should be answered in the affirmative. The first two can be answered without qualification; the third not.

96 Question 1 should be answered: The plaintiffs did have $467,500 in cash, with jewellery, stashed in the roof cavity of their Pringle Avenue townhouse on 27 March 2006.

97 Question 2 should be answered: That property was stolen by Mr Nguyen on that date, 27 March 2006.

98 Question 3 should be answered: The plaintiffs have established that, on the balance of probabilities $304,588.15 of the cash stolen from them by Mr Nguyen on 27 March 2006 was subsequently applied by him in the acquisition and development of real estate (at Dulwich Hill and Bankstown) in the name of himself and his wife as joint tenants.

99 With chapter and verse set out in a Schedule to their written submissions dated 14 November 2013 and entitled "Plaintiffs' Outline of Submissions" (elaborated, in the text of the submissions, in sub paragraphs 41-85 of paragraph 55), counsel for the plaintiffs have demonstrated that Mr Nguyen applied $140,335.50 of the plaintiffs' funds in the purchase of the Dulwich Hill property; $139,568.35 in the purchase of the defendants' Bankstown land; and $24,684.30 in construction of their residence on the Bankstown land - $304,588.15 in total.

100 The defendants have not in detail traversed the analytical tracing exercise undertaken by counsel for the plaintiffs, which analysis I adopt.

101 I note, in passing, that this analysis accommodates the defendants' sale of a property at Petersham, between 30 August 2006 and 20 December 2006, for $500,000. It treats as part of the moneys stolen from the plaintiffs the $74,000 allegedly borrowed by Mr Nguyen from Mr Truong to fund the payment of deposit moneys on the defendants' Dulwich Hill property in February 2007. It also allows for the fact that, in their purchase of both the Dulwich Hill property and the Bankstown land, the defendants paid stamp duty and legal fees in cash.

102 The plaintiffs' bear the onus of proving that money stolen from them can be traced into the real estate acquired, and developed, by the defendants after the theft. However, in circumstances in which Mr Nguyen deliberately took steps to conceal his possession and deployment of cash, the defendants cannot complain if the Court more readily draws an inference against their interests than it might otherwise have done had they offered a reasonable, alternative explanation of transactions analysed in the process of tracing what became of the plaintiffs' property.

103 The complexity that can attend the process of tracing money should not obscure the purpose, and nature, of the exercise. It involves a demonstration, by an application of logic and experience to evidence, of what has in fact happened to identified property, with changes of form, over time. It is a process of identification to ascertain whether property can be traced from one form to another, culminating in a finding that property in its current form can properly be regarded as a substitute for the claimant's original form of property: Foskett v McKeown [2001] 1 AC 102 at 128, approved in Robb Evans of Robb Evans & Associates v European Bank Limited (2004) 61 NSWLR 75 at 103 [131] - 105 [148] and Heperu Pty Limited v Belle (2009) 76 NSWLR 230 at 252 [89]; Re Global Finance Group Pty Limited (2002) 26 WAR 385 at 406 [94] et seq, approved in Commonwealth of Australia v The Official Trustee in Bankruptcy as the Trustee of Property of Stephen Vasil [2004] NSWSC 1155 at [21].

104 In the absence of any reasonable, alternative explanation of transactions emanating from the defendants' side of the record, and having regard to the context in which transactions took place, a fair inference is that Mr Nguyen deployed the plaintiffs' cash in the acquisition and development of real estate in the names of himself and his wife.

105 In the two years or so immediately following the theft of the plaintiffs' money, the defendants entered three major transactions (purchase of the Dulwich Hill property, purchase of the Bankstown land, and construction of a residence on the Bankstown land) when, for much of the time, Mr Nguyen was unemployed or in irregular employment; his wife was not in paid employment; and their living expenses included their son's private school fees. On his own evidence, Mr Nguyen was awash with cash which he was anxious to conceal by a series of transactions.

106 Reasonable alternative explanations not having been forthcoming from the defendants' side of the record, I am comfortably satisfied, on the balance of probabilities, that no less than $304,588.15 of the $467,500 stolen by Mr Nguyen from the plaintiffs can be identified as having been traced into the defendants' Dulwich Hill and Bankstown properties.

107 By agreement between the parties during the course of final submissions, I am entitled to know that, since the close of the evidence on 23 October 2013, the defendants have sold the Dulwich Hill property, with the consequence that (pursuant to an interlocutory order earlier made by another judge) the Bankstown property, registered in the names of the defendants as joint tenants without encumbrance, stands as a substitute for both properties to the extent that, as I have found, stolen money belonging to the plaintiffs can be traced into either.

108 In their pursuit of remedies against the defendants the plaintiffs' invoke the common law, equity and declaratory jurisdictions of the Court.

109 At common law their claims against Mr Nguyen are grounded on causes of action in conversion (Penfolds Wines Pty Limited v Elliott (1946) 74 CLR 204 at 229; Sadcas Pty Limited v Business and Professional Finance Pty Limited [2011] NSWCA 267 at [42] and [83]; Kinarra Pty Limited v Crawford [2006] VSC 309 at [83]) and for moneys had and received by the defendants to the use of the plaintiffs (Lipkin Gorman v Karpnale Limited [1991] 2 AC 548 at 559; ANZ Banking Group v Westpac Banking Corporation (1988) 164 CLR 662 at 672-673).

110 In equity, the plaintiffs' rely upon Black v S Freedman & Co (1910) 12 CLR 105 at 109-110, Creak v James Moore & Sons Pty Limited (1912) 15 CLR 426 at 432 and Heperu Pty Limited v Belle (2009) 76 NSWLR 230 (as well as other cases) to ground the imposition of a constructive trust on Mr Nguyen immediately upon his wrongful taking of possession of the stolen money, and on his wife from a time no later than when she received notice, at or about the time of commencement of these proceedings, that she had property (the Dulwich Hill and Bankstown properties) paid for, at least in part, with money stolen from the plaintiffs. Cf, J Tarrant, "Theft principle in private law" (2006) 80 ALJ 531.

111 On the findings of fact that have been made, the plaintiffs have made out their causes of action against Mr Nguyen and established that, in equity, they are entitled to relief against both defendants.

112 The equitable relief to which the plaintiffs are entitled, against both defendants, is an equitable charge over the Bankstown property to the extent that the money stolen from them has been traced into it or the Dulwich Hill property: Australian Postal Corporation v Lutak (1991) 21 NSWLR 584.

113 On the findings that have been made (hotly contested though they have been), no substantial controversy attaches to this conclusion. Nothing of substance turns on whether equity's intervention takes the form of a declaration that the Bankstown property is held, to a limited extent, on trust for the plaintiffs or a declaration that the plaintiffs are entitled in equity to a charge on the property.

114 There is, however, an underlying controversy that requires consideration of how the plaintiffs' respective causes of action and their equitable entitlements fit together.

115 At common law the plaintiffs claim, in the same amount (namely $467,500), an award of damages in conversion and moneys had and received, together with an award of pre-judgment interest under the Civil Procedure Act 2005 NSW, s 100. In equity, they claim an entitlement to a proportionate share of the Bankstown property (Scott v Scott (1964) 109 CLR 649 at 660-662 and 664) or an equivalent amount; they thereby claim an entitlement to share in any increase in the respective values of the Dulwich Hill and Bankstown properties arising from deployment of their stolen money in those properties.

116 Each of the plaintiffs' causes of action and equitable entitlements has a different jurisprudential foundation. Their cause of action in conversion provides an award of damages as compensation for a loss suffered by them. Their action for moneys had and received is capable of producing a money judgment measured by that same loss or a monetary gain made by Mr Nguyen (reflecting Lord Mansfield's endeavours to assimilate the cause of action and equitable principles in the late 18th century), but the plaintiffs rely upon it for a monetary judgment equal to the amount of their loss.

117 The way the plaintiffs have put their case against Mr Nguyen, at law, has circumvented any need to consider whether the principles formally encapsulated in the expression "waiver of tort" (but explained, in United Australia Limited v Barclays Bank Limited [1941] AC 1, in terms of a need for consistency of rights and remedies) need to be explored in depth: SJ Stoljar, The Law of Quasi-Contract (Law Book Co, Sydney, 2nd ed, 1989), pp 99-112; Mason & Carter's Restitution Law in Australia (Lexis Nexis Butterworths, Australia, 2nd ed, 2008), paras [1618]-[1622], [1632] and [1636]-[1639]; M Lobban, "Contract: Restitutionary Remedies" in The Oxford History of the Laws of England, Volume 12 (1820-1914, Private Law) (Oxford UP, 2010), pp 573-583 (and pp 601-610).

118 It is sufficient for present purposes to notice that the need for consistency of rights and remedies, and for coherence in the law, is not confined to a consideration of alternative causes of action at common law. It extends no less to a consideration of alternative remedies available in equity and, in a broader sense, to the Court's consideration of what is required, in a particular case, to do justice between parties.

119 In the interests of justice, the plaintiffs cannot fairly have both: (a) a remedy that, in substance, compensates them for their loss with pre-judgment interest; and (b) a remedy that, in substance, returns to them property with an accretion in value arising from the defendants' use of it. Whether this is described as an inconsistency in remedy, or an application of considerations of fairness, the plaintiffs must, before judgment, elect whether they seek only a loss-based remedy or, to some extent, a gain-based remedy and (if the latter) they must confront how their remedies fit together.

120 In discharge of its primary obligation to do justice between the parties, and in the exercise of its powers and in the performance of its duty (illustrated by the Civil Procedure Act 2005, s 90 and the Uniform Civil Procedure Rules 2005 NSW, r 36.1) to give such judgment and to make such orders as the nature of the case may require, the Court must bear in mind the purpose the current proceedings are designed to serve.

121 That purpose is the provision of an orderly process for determination of whether the plaintiffs had property of which they have been deprived and, if so, whether they can recover it or its equivalent.

122 Significance attaches to the form of the property in dispute - currency without any special value beyond its character as currency - because: (a) as a medium of exchange, title to it generally passes by delivery (Sinclair v Brougham [1914] AC 398 at 418-419; R v Curtis; ex parte Attorney-General [1988] 1 Qd R 546 at 548 and 551; Stoljar, The Law of Quasi Contract (2nd ed, 1989), pp 112 et seq) and it is not universally recoverable by an action in detinue at common law or in a suit for specific restitution in equity; (b) a person wrongly deprived of it must generally be satisfied with recovery of its equivalent via processes which, in substance, require a wrongdoer, or any person who comes into possession of it otherwise than as a bona fide purchaser for value without notice of wrongdoing, to account for it to the plaintiff; and (c) the law recognises that, by a process of tracing, a person wrongfully deprived of it may identify it in the hands of another person, and may recover it from that person, as property notwithstanding that it has changed in form: C Proctor, Mann on the Legal Aspect of Money (Oxford UP, 6th ed, 2005), para 1.55; D Fox, Property Rights in Money (Oxford UP, 2008), paras 2.01-2.02 and 4.86-4.92.

123 Another characteristic of currency that is of significance in these proceedings is that, both tangibly and intangibly, it may be divisable - perhaps not infinitely so, but in large measure - and, accordingly, recovery of it or an equivalent can take divergent forms. Currency, if stolen, might be recovered, in part, in specie; in part, in an equivalent amount of other currency; and, in part, in the form of other property into which it has been traced.

124 Although the causes of action and equitable entitlements called in aid by the plaintiffs have different jurisprudential foundations, there is no inconsistency in the rights claimed by the plaintiffs. Each cause of action on which they rely is predicated on their entitlement, in essence, to possess, use and enjoy the money stolen from them. So too is equity's imposition of a constructive trust.

125 On the facts as found, prima facie (unless the plaintiffs duly elect for a judgment measured by gains made by the defendants from use of their stolen money) the plaintiffs are entitled to, and ought be granted, a judgment measured by their loss of the money, and having the following elements:

(a) a judgment for the payment of money in a sum representing the amount stolen from the plaintiffs ($467,500) together with an award of pre-judgment interest under the Civil Procedure Act, s 100.

(b) a declaration that so much of that judgment debt as represents a principal sum of $304,588.15 (an amount equivalent to the stolen funds traced into the Dulwich Hill and Bankstown properties) and an award of pre-judgment interest under the Civil Procedure Act, s 100, together with interest accruing after judgment on that portion of the judgment debt, pursuant to s 101 of the Civil Procedure Act, constitutes an equitable charge on the defendants' title to the Bankstown property.

126 If, before judgment, the plaintiffs elect to take a judgment measured by gains made by the defendants from use of their stolen money, they may be entitled to a judgment having the following elements:

(a) a judgment for the payment of money in the sum of $162,911.85 (representing the balance of the stolen money after deducting $304,588.15 traced into real estate) together with an award of pre-judgment interest under the Civil Procedure Act, s 100.

(b) a declaration that the defendants' title to the Bankstown property is subject to an equitable charge in favour of the plaintiffs to the extent of the sum of the following amounts:

(i) an amount equal to that share of the defendants' proceeds of sale of the Dulwich Hill property, net of costs of sale, proportionate to the share of the defendants' costs of acquisition of the property borne by the $140,335.50 of stolen money traced into the property;

(ii) an award of pre-judgment interest (under the Civil Procedure Act, s 100) on that amount calculated from the date of completion of the sale.

(iii) an amount equal to that share of the current market value of the Bankstown property proportionate to that share of the defendants' costs of acquisition of the Bankstown land, and the costs of construction of their residence on the land, borne by the $164,252.65 of stolen money traced into the Bankstown property.

127 Whichever form of judgment the plaintiffs elect to take, it should include the following additional elements:

(a) a reservation of liberty to apply for orders for the sale of the Bankstown property to enforce the plaintiffs' equitable charge on the property.

(b) an order varying an extant freezing order against Mr Nguyen to allow payments in favour of the plaintiffs to be made as contemplated by the judgment.

(c) an order that the defendants' pay the plaintiffs' costs of the proceedings.

128 The plaintiffs having foreshadowed an application that their costs be assessed on the indemnity basis, rather than the ordinary basis, I will hear the parties on that application before determining the basis upon which costs are to be assessed.

129 The plaintiffs are entitled, within reasonable bounds, to call in aid the Court's procedures to enable them to be properly informed about facts underlying the election they have to make about alternative remedies. To the extent that any further hearing may be necessary for that purpose, each party will be at his or her own risk as to the costs of that further hearing.

130 Under the Court's current administrative arrangements, any inquiry into those facts must be conducted, not upon a reference to another judicial officer, but as a further stage of the final hearing.

131 For completeness, I formally record that any equitable charge to which the plaintiffs are entitled over the Bankstown land is a charge over the joint interests of the defendants, as joint tenants.

132 I will allow the parties an opportunity to peruse these Reasons for Judgment before either making final orders or giving directions to enable any residual contest to be determined. To facilitate the process of moving towards final orders, I direct that the plaintiffs' bring in Short Minutes of Orders designed to give effect to these Reasons.

ADDENDUM (25 February 2014)

Introduction

133 Upon publication of the Court's principal Reasons for Judgment, the plaintiffs elected for the remedy summarised in paragraph 125 of the Reasons and sought an order that the defendants pay their costs on the indemnity basis.

134 Upon an intimation of judicial reluctance to make an indemnity costs order against the second defendant, the plaintiffs modified their application for costs to an application that the first defendant (Mr Nguyen) pay their costs assessed on the indemnity basis and that the second defendant (his wife) pay their costs assessed on the ordinary basis.

135 The defendants have raised three issues arising out of the orders sought by the plaintiffs:

(a) First, they resist an award of "pre-judgment interest" against the second defendant.

(b) Secondly, they resist an order for the payment of indemnity costs by Mr Nguyen.

(c) Thirdly, they contend that the second defendant's liability for costs should be limited to costs referable to her only after she was joined as a defendant in the proceedings.

"Pre-judgment interest"

136 Introduction. The defendants' submissions about an allowance of "pre-judgment interest" affecting the second defendant require that, in formulating a remedy to meet the justice of the case, closer attention be given to the facts of the case and the principles to be applied.

137 In undertaking that task, several features of the Court's jurisdiction may be noticed.

138 First, the question of "pre-judgment interest" arises, in these proceedings, at this time, in the context of an exercise of equitable jurisdiction. The plaintiffs have traced stolen funds into land owned by the defendants. The defendants are obliged, in equity, to account for such funds. The focus for attention is, generally, on the nature and extent of that obligation to account and, especially, on the rights and obligations of the second defendant as an accounting party.

139 Secondly, as the jurisdiction being exercised is in character equitable, it is discretionary in the sense that, unlike a common law claim to establish a legal right, relief is not available as of right; the Court's discretion must be exercised having regard to all facts (established by evidence, admitted or otherwise properly before the Court) material to the decision to be made; and the time for assessment of those facts, and their materiality, is the time when the decision (whether to grant or withhold relief and, if so, on what, if any, terms) is made: PW Young, C Croft and ML Smith, On Equity (Law Book Co, Sydney, 2009), paras [2.150] - [2.170], [14.50] - [14.60] and [14.180]; Story, Commentaries on Equity Jurisprudence (1st English ed, 1884), paras 26-28, and 31; G Spence, The Equitable Jurisdiction of the Court of Chancery (1846), Vol 1, pp 390-391; W Holdsworth, A History of English Law (3rd ed, 1944), Vol 9, p 338; JN Pomeroy, Equity Jurisprudence (5th ed, 1941), Vol 1, paras 109 and 113-116.

140 Thirdly, equitable jurisdiction must be exercised in accordance with settled principles, but it is of such a scope that the Court may adjust relief to the merits of the case: F Jordan, Chapters on Equity in New South Wales (6th ed, 1947), p 15. A cardinal principal of equity is that a remedy must be fashioned to fit the nature, and the particular facts, of the case: Warman International Limited v Dwyer (1995) 182 CLR 544 at 559.

141 Fourthly, upon an exercise of equitable jurisdiction a guiding principle is, generally, that the Court will provide relief against conduct that is unconscionable: Jordan, op cit, p 13; Ashburner, Principles of Equity (Butterworth, London, 2nd ed, 1933), pp 38-39; RP Meagher, JD Hayden and MJ Leeming (eds), Meagher Gummow & Lehane's Equity: Doctrines and Remedies (Butterworths Lexis Nexis, Australia, 4th ed, 2002), paras [12-035]-[12-045] and [12-055]; FW Maitland, Equity (Cambridge University Press, 2nd ed, 1936), pp 7-8, 17 and 19; G Watt, Equity Stiring (Hart Publishing, Oxford, 2009), pp 85, 106-109 and 229; DR Klinck, Conscience, Equity and the Court of Chancery in Early Modern England (Ashgate, 2010). That conduct may be actual or, on reasonable grounds, apprehended. Equity may intervene to restrain unconscionable conduct, compel the performance of duties, and otherwise make orders as the nature of a case may require to prevent a departure from the dictates of good conscience.

142 Where circumstances permit, an equity court prefers to allow a defendant an opportunity to conform to the dictates of conscience. That is why equity lawyers sometimes speak of making orders "to relieve the conscience" of a wrongdoer (eg, Jordan, Ibid), and equity judges make an order that a defendant execute a conveyance in favour of a plaintiff instead of simply an order that property be vested in the plaintiff. This is not merely formal obscurantism, but an incident of equity jurisprudence designed to bring home to parties foundational reasoning for the Court's intervention and, one hopes, thereby to aid in the quelling of disputation. That said, if and when circumstances require, coercive orders can be, and not uncommonly are, made without the courtesy of an opportunity, by an act of choice, to conform to the requisite standard. Equity retains a hard edge with a tender heart.

143 Fifthly, in its endeavour to grant remedies calibrated to match appropriate standards of conduct to the facts of a particular case the Court can, and must, do what is "practically just", accepting that parties may not be able to be fully, or precisely, restored to the position they were in before the occasion for equitable intervention arose: Vadasz v Pioneer Concrete (SA) Pty Limited (1995) 184 CLR 102 at 113-114; Bridgewater v Leah (1998) 194 CLR 457 at 493-494; Delaforce v Simpson-Cook (2010) 78 NSWLR 483 at 494 [57] and [60]-[61]. Once a court has determined upon the existence of a necessary equity to attract relief, the moulding of relief may produce a final result which, after balancing competing interests, may not exactly represent what any party may have wished: Bridgewater v Leah (1998) 194 CLR 457 at 494 [127].

144 Sixthly, an exercise of the Court's jurisdiction requires it to consider whether its remedial response to unconscionable conduct is a measured one having regard to the availability of other remedies and the balancing of competing interests to which, in the particular circumstances, weight is to be given: Bridgewater v Leah (1998) 194 CLR 457 at 494 [127]; Bathurst City Council v PWC Properties Pty Limited (1998) 195 CLR 566 at 585 [42]; Baumgartner v Baumgartner (1987) 164 CLR 137 at 148; Giumelli v Giumelli (1999) 196 CLR 101 at 111 [2] - 112 [4] and 113 - 114 [10].

145 The defendants contend that the second defendant's interest in the Bankstown property cannot be charged with anything other than the total amount ($304,588.15) traced into the Dulwich Hill and Bankstown properties, together (at most) with an allowance for interest accruing on that amount from the time when she has been proven to have had actual notice of the plaintiffs' claim.

146 In dealing with this contention, the purpose these proceedings are designed to serve must (as noted in paragraphs 120-121 and 124 of the principal Reasons for Judgment) be borne in mind: the provision of an orderly process for determination of whether the plaintiffs had property of which they have been deprived, and if so, whether they can recover it or its equivalent. A constructive trust attaching to stolen property (in accordance with Black v S Freedman & Co (1910) 12 CLR 105 and subsequent case law based on it) is imposed to vindicate the property rights of the plaintiff: K Handley, "The Black v Freedman Trust: Vindicating Proprietary Rights or Remedying Wrongs?" in E Bant and M Bryan (ed), Principles of Proprietary Remedies (LBC, Sydney, 2013), ch 7 at pp 122-123 and 125.

147 Topics which the defendants' submissions require be given further consideration include: First, what is (or, in the case of the Dulwich Hill property, was) the nature of the second defendant's interest, as a joint tenant, in the land into which stolen money has been traced? Secondly, what is the significance of the fact that (upon an application of the reasoning in Heperu Pty Limited v Bell (2009) 76 NSWLR 230 at 253 [92], 265-266 [154] and 267-268 [163]) the second defendant only came under an equitable obligation to the plaintiffs in relation to proceeds of Mr Nguyen's theft at the time she received notice of the plaintiffs' claim or otherwise became aware she had property paid for with stolen funds? Thirdly, what is the nature of the equitable obligation under which the second defendant came?

148 These topics were touched upon in paragraphs 43(c), 44, 45, 107, 125(b) and 131 of the principal judgment.

149 An underlying question is whether, in relation to the land acquired by them as joint tenants with the benefit of funds stolen from the plaintiffs, the defendants are to be treated differently in the formulation of a proprietary remedy in favour of the plaintiffs.

150 The answer to that question implicit in the draft orders proposed in paragraph 125(b) of the principal Reasons for Judgment is "no". In these supplemental Reasons, I adhere to that answer.

151 Different perspectives of the problem point in the same direction, towards that answer. They are: the nature of a joint tenancy in property law; the availability of rights of indemnity, contribution or adjustment on an accounting between co-owners; the entitlement of an owner of traced funds to restoration of property; the nature of the jurisdiction in equity to award interest in connection with the process of tracing property; and, on the facts of this case, the second defendant's acquiescence in the sale, and distribution to the first defendant of proceeds of sale, of land (the Dulwich Hill property) over which, to the knowledge of the second defendant as a party to the proceedings, the plaintiffs claimed an equitable entitlement.

152 Factual context. In dealing with these questions, the parties' leading counsel have agreed, the Court can have regard to the course of the proceedings following closure (on 23 October 2013) of the evidence adduced at the main hearing, and the evidence then adduced, relating to the defendants' sale of the Dulwich Hill property, including affidavits sworn by Mr Nguyen on 13, 19 and 21 November 2013 respectively.

153 The evidence before the Court, including that evidence, grounds the following findings of fact:

(a) The defendants acquired, and held, the Dulwich Hill property as joint tenants. They contracted to purchase the property on 15 February 2007. That contract was completed on 28 March 2007. They were registered on the title to the land (folio identifier 62/228473) as joint tenants of an estate in fee simple by registered dealing AD21108. They sold the land by a contract dated 6 September 2013, completed on 22 October 2013.

(b) The defendants acquired, and continue to hold, the Bankstown property as joint tenants. They contracted to purchase the property on 11 May 2007, and completed the purchase on 22 June 2007. They were registered on the title to the land (folio identifier 47/13055) as joint tenants of an estate in fee simple by registered dealing number AD236514. The $24,684.30 of the plaintiffs' funds applied to improvements on the land were so applied on various dates around that time.

(c) The defendants remain the registered proprietors of the Bankstown property, subject to a mortgage registered (as dealing AD236515) in favour of Australia & New Zealand Banking Group Limited and Caveat No. AH532493 lodged by Mohammed Helou, but the moneys secured by the mortgage have been repaid and it does not secure any current liability.

(d) On 16 April 2013 the Court ordered that a caveat (lodged in the interests of the plaintiffs) then on the title to the Dulwich Hill property be withdrawn and noted that "the defendants agree, on a without admissions basis, that so far as the plaintiffs have any claim or interest in [the Dulwich Hill property] (which the defendants deny), that [the Bankstown property] is to be used in substitution of any interest or claim in the plaintiffs' favour".

(e) The defendants sold the Dulwich Hill property for a contract price of $1,150,000. After adjustments for council and water rates, and costs associated with the sale, the net proceeds of sale were divided between the defendants (in payments to Mr Nguyen totalling $559,168.57 and a payment to the second defendant in the sum of $570,000), following which Mr Nguyen paid, from the moneys paid to him, various amounts totalling not less than $171,500 said to have been repayments of loans made to him by friends or family (including the second defendant).

(f) The evidence does not disclose the terms upon which, as between themselves, the defendants agreed to a division of the proceeds of sale of the Dulwich Hill property.

(g) The fact of the defendants' sale of the Dulwich Hill property was not disclosed to the plaintiffs until after the evidence closed in the main, final hearing of the proceedings on 23 October 2013. [Paragraph 107 of the principal judgment requires correction here. The fact of the sale did not become known to the plaintiffs, or the Court, until after the close of evidence on 23 October 2013; but the contract for sale entered into by the defendants was on foot at the time the final hearing commenced on 14 October 2013, and the sale was completed on 22nd October 2013, the day before the evidence closed].

154 The plaintiffs originally sued only Mr Nguyen. Following her joinder in the proceedings, the second defendant conducted her defence to the plaintiffs' claims in common with the defence of her husband. She adopted his case as her own, relying, additionally, on the fact that it was common ground that, to the extent that she had received the benefit of stolen funds, she had not been an original party to the theft, but had received it as a volunteer.

155 In describing the circumstances in which, during the course of the final hearing, the defendants sold the Dulwich Hill property it is not necessary, or appropriate, for me to enter fully upon any question about the propriety of their conduct or the recoverability or otherwise of proceeds of sale by or on behalf of the plaintiffs. Any controversy in that department may be left to future proceedings, if any. For the present, it is sufficient to notice that, having regard to the course and manner of the defendants' conduct of these proceedings, there is no self-evident injustice to the second defendant in declining to differentiate between her and her husband in the proprietary relief granted to the plaintiffs.

156 The defendants acted in concert in effecting a sale of the Dulwich Hill property. The second defendant acquiesced in a distribution of sale proceeds to her husband without any overt reservation of any rights she may have had to an indemnity, or contribution, from him in relation to stolen funds of the plaintiffs. In so acting, she took no steps to warn the plaintiffs to protect their interests in connection with the sale, leaving them to discover it (and her husband's partial disbursement of sale proceeds) after the close of evidence.

157 The practical effect of this sale, distribution and partial divestiture of property held by Mr Nguyen may have been to deprive the plaintiffs of a fund against which they can enforce their entitlements. A fair inference is that the defendants, jointly and severally, had that as an object in effecting the sale as and when they did.

158 The Nature of the Second Defendant's interest as a Joint Tenant. As joint tenants of their Dulwich Hill and Bankstown properties, the defendants' co-ownership of the land has been characterised by "the four unities" (of title, interest, possession and time): Peter Butt, Land Law (Law Book Co, 6th ed, 2010), paras [14.05]-[14.09].

159 One sometimes reads that the law treats joint tenants as one person for some purposes. This may be over simplistic (as Dixon J demonstrated in Wright v Gibbons (1948) 78 CLR 313 at 330-331) but it does provide a dramatic representation of how the law may, in some circumstances, be perceived to operate.

160 In these proceedings, I am content, if not bound, to act upon the following statement of principle, drawn from Professor Butt's exposition of the principles governing joint tenancy in land law.

161 Where, as here, D1 and D2 acquire land as joint tenants in circumstances where D1 has notice of an earlier equitable interest held by P in the land, but D2 has no notice of P's interest, then P's interest has priority over the interests acquired by both D1 and D2. However, P's rights over those interests does not affect such rights that D1 and D2 may have between themselves so that (for example) if P were to enforce its interest against the land then, on an accounting between D1 and D2, D2 could insist that the burden of P's entitlements be borne by D1: Butt, Land Law (6th ed) paras [14.07] and [19.70], citing Diemasters Pty Limited v Meadowcorp Pty Limited (2001) 52 NSWLR 572 at 579-580 [17], since approved in Gerard Cassegrain & Co Pty Limited v Felicity Cassegrain [2013] NSWCA 453 at [53] (read with [2011] NSWSC 1156 at [161]) and at [156]-[157] and [159].

162 Timing of the Second Defendant's obligation to the Plaintiffs. The defendants notice, correctly, that the second defendant's obligation to account, as a volunteer, arose only upon her receiving notice of the plaintiffs' claim or when she became aware that she had property paid for with their stolen funds: [2014] NSWSC 22 at [45], [110] and [125].

163 It was at that time that (in accordance with Black v S Freeman & Company (1910) 12 CLR 105 at 109-110 and Creak v James Moore & Sons Pty Limited (1912) 15 CLR 426 at 432) she came under an equitable obligation, touching her conscience, to restore to the plaintiffs the proceeds of the stolen funds traced into her real estate: Heperu Pty Limited v Belle (2009) 76 NSWLR 230 at 267 [163] - 268 [164].

164 The Nature of the Second Defendant's obligation to the Plaintiffs. That she came under an equitable obligation only at that time does not preclude an allowance for "pre-judgment interest" on the stolen funds, affecting her, calculated from an earlier time.

165 The content of her equitable obligation is to restore to the plaintiffs the proceeds of the stolen funds traced into her real estate.

166 Her obligation is, in a sense, ancillary to the pre-existing and continuing obligation of Mr Nguyen (which arose immediately upon his theft of the plaintiffs' property) and it derives in large measure from the fact that, as a joint tenant with her husband, she has taken the benefit of the stolen money. It would be unconscionable for her to retain any benefit of it.

167 Her obligation is consistent with the obligation of her husband as a trustee of the funds. His obligation is to restore the trust estate, accounting for stolen funds with interest: Re Dawson [1966] 2 NSWR 211; 84WN (Pt 1) (NSW) 399; Maguire v Makaronis (1997) 188 CLR 449 at 469; Youyang Pty Limited v Minter Ellison Maurice Fletcher (2003) 212 CLR 484.

168 Where, as here, stolen funds are traced into land the subject of co-ownership by joint tenants, the burden of repayment of the stolen funds charged against the land must, prima facie, be borne by the co-owners vis-á-vis the owner of the funds, but it may be the subject of adjustment between the co-owners upon an accounting undertaken between them: Diemasters Pty Limited v Meadowcorp Pty Limited(2001) 52 NSWLR 572 at 580 [17]; Forgegard v Shanahan (1994) 35 NSWLR 206 at 221F-224F.

169 A claim in rem may require different treatment than a claim in personam, vis á vis the question of interest, upon an exercise of equitable jurisdiction: In Re Diplock [1948] Ch 465 at 517 and 557-558. Without an allowance for interest in favour of a party whose property has been traced into the property of another, the party entitled to recover property through a process of tracing may be deprived of full restoration of its property, and there may be an element of unjust enrichment.

170 Although convenience may invite description of such an allowance as "pre-judgment interest", or adoption of a rate of interest by reference to a statutory power to award interest (such as that found in the Civil Procedure Act 2005 NSW, s 100), an allowance of interest may (as here) more correctly be characterised as an exercise of equitable jurisdiction in ensuring that there is a full accounting for money (in the character of a return of property) in favour of the party entitled to it.

171 As between the plaintiffs and the defendants, the allowance for interest included in the formulation of a charge over the defendants' land has, in substance, the character of a return of property rather than that of income or an award of damages in the nature of interest.

172 The Nature of Equity's jurisdiction to award interest. In Hungerfords v Walker (1990) 171 CLR 125 at 148 Mason CJ and Wilson J made the following observations about the nature of equity's jurisdiction to award interest:

"Equity has adopted a broad approach to the award of interest. It has long been accepted that the equitable right to interest exists independently of statute: Wallersteiner v Moir [No 2] [1975] QB 373. Equity courts have regularly awarded interest, including not only simple interest but also compound interest, when justice so demanded, eg, money obtained and retained by fraud and money withheld or misapplied by a trustee or fiduciary: President of India v La Pintada Compania Navigacion SA [1985] AC 104 at 116. ..."

173 To similar effect are the observations of McHugh and Gummow JJ in Commonwealth v SCI Operations Pty Limited (1998) 192 CLR 285 at 316:

"... [In] the administration of its remedies, equity followed a different path to the common law with respect to the award of interest. In cases of money obtained and retained by fraud and money withheld or misapplied by a trustee or fiduciary, the decree might require payment of compound interest: Hungerfords v Walker (1989) 171 CLR 125 at 148..."

174 Absence of any equity displacing the plaintiffs' entitlement to a proprietary remedy. Analysis of the plaintiffs' rights as an equitable interest in the defendants' land opens a possibility, at least theoretically, that their interest might, by events subsequent to its genesis, be lost or displaced in the priority it would otherwise have over any competing interest: Latec Investments Limited v Hotel Terrigal Pty Limited (In Liquidation) (1965) 113 CLR 265; J & H Just (Holdings) Pty Limited v Bank of NSW (1971) 125 CLR 546. Cf, K Handley, "The Black v Freedman Trust: Vindicating Proprietary Rights or Remedying Wrongs?" in Bant and Bryan, Principles of Proprietary Remedies (2013) at pp 118 and 123-124.

175 There is no foundation (in the pleadings, evidence or submissions made on behalf of the second defendant) for a finding that the plaintiffs' equitable entitlements should be found to have been lost or displaced in favour of the second defendant. There is nothing inequitable, vis-á-vis the defendants jointly or severally, in the plaintiffs' enforcement of their equitable interest in the land held, at law, by the defendants.

176 Quantification of the Charge on the Defendants' land. In substance, and in terms reflective of the Court's general practice in making awards of interest, the plaintiffs will have received a return of their stolen property, insofar as (only) that property has been applied in the purchase and development of the defendants' land, if they receive:

(a) in relation to the Dulwich Hill property: the sum of $140,335.50 traced into the property, together with an allowance of $82,968.27 for interest at the rate ordinarily applied under s 100 of the Civil Procedure Act 2005 NSW for the period between 28 March 2007 (when the defendants' purchase contract was completed) and the date of judgment (the principal sum), and an allowance for interest on that principal sum, at the rate ordinarily allowed on judgment debts under s 101 of the Act, between the time of judgment and payment of the principal sum and accrued interest to the plaintiffs; and

(b) in relation to the Bankstown property: the sum of $164,252.65 (representing $139,568.35 traced into the property on its purchase by the defendants, and $24,684.30 applied by them in constructing their residence on the property), together with an allowance of $93,144.78 for interest calculated at the rate ordinarily applied under CPA s 100 between 22 June 2007 (the date of completion of the defendants' purchase contract) and the date of judgment (the principal sum), and interest accruing, between the date of judgment and payment of the principal sum to the plaintiffs at the rate ordinarily allowed under CPA s 101.

177 Those sums total $480,701.20 (representing a combined principal sum of $304,588.15 together with interest of $176,113.05 to the date of judgment), with interest accruing on that total sum at the rate ordinarily allowed under CPA s 101.

178 The plaintiffs are content with an award of interest at the rates prescribed by CPA ss 100-101. I am satisfied that those rates are appropriate.

179 Accordingly, it is not necessary to visit the question whether a different, or compound, rate of interest should be awarded in exercise of equity's jurisdiction independently of statute. Cf, Commonwealth v SCI Operations Pty Limited (1998) 192 CLR 285 at 316 [74]; Ashburner Principles of Equity (2nd ed, 1933), pp 39-40.

180 There is no anomaly in the application of the statutory rate of interest arising from cases such as MBP (SA) Pty Limited v Gogic (1991) 171 CLR 657 at 663, which establish that an award of pre-judgment interest is generally granted to compensate a plaintiff (suing for damages or in debt) for the loss or detriment which he or she has suffered by being kept out of his or her money. An award of interest such as that proposed in these proceedings is intended to make good the plaintiffs' loss in the process of returning their property to them: Re Dawson (1966) 84 WN (Pt 1) (NSW) 399 at 408 and 409.

181 The amount charged against the Bankstown property (directly and as a surrogate for the Dulwich Hill property) is intended, as an exercise in doing substantial justice between the parties, to restore to the plaintiffs the proceeds of stolen funds traced into the two properties. It does not relieve Mr Nguyen of his personal obligation to restore to the plaintiffs, with interest, the balance of the funds he stole from them.

182 The plaintiffs' entitlement, overall, is to have returned to them the sum of $467,500 plus pre-judgment interest calculated, from the time of the theft, at the rate ordinarily allowed under CPA s 100 (the amount of the judgment debt to be entered against Mr Nguyen personally), together with interest on that debt calculated at the rate ordinarily allowed under CPA s 101 until payment of the debt and accrued interest.

183 In practical terms, the plaintiffs' charge over the Bankstown property provides partial security for the payment of the judgment debt. Any recovery arising from enforcement of the charge operates as a payment on account of Mr Nguyen's larger obligation to restore the whole of the funds he stole from the plaintiffs.

184 Summary. Having received the benefit of the plaintiffs' stolen funds as a volunteer, and as a joint tenant acquired an interest in land with those funds, the second defendant's conscience must be taken to have been touched to the extent necessary to require her to return the plaintiffs' funds with interest calculated from the time the land was acquired, not from the time of her discovery that it had been acquired with stolen funds. If her submissions were to be accepted, she would have retained the benefit of stolen funds to the extent of an absence of any allowance for the time value of money.

185 To the extent that her interest in land is charged with an obligation to pay money to the plaintiffs, she may have a commensurate entitlement against her husband in the nature of a right to an indemnity, contribution or adjustment, and it is to him she must look.

An award of indemnity costs against Mr Nguyen

186 The defendants do not resist an order that they pay the plaintiffs' costs. They seek, rather, to qualify the costs orders sought.

187 The plaintiffs' application for an order that the first defendant (Mr Nguyen) pay their costs assessed on the indemnity basis is based upon findings made in the principal Reasons for Judgment to the effect that Mr Nguyen's wrongful conduct took the character of a deliberate theft, coupled with a maintenance of a denial of any theft.

188 The defendants accept, as they put it, that the circumstances in which the Court can depart from the general rule that costs are ordered to be paid on the ordinary basis (Uniform Civil Procedure Rules 2005 NSW, r 42.1) rather than on the indemnity basis (UCPR R 42.5) include cases in which:

(a) a party has misled the Court (Wentworth v Rogers[1999] NSWCA 403 at [85]) or conducted proceedings on a false basis and given untruthful evidence (Degman Pty Limited (In Liq) v Wright (No 2) [1983] 2 NSWLR 354 at 358);

(b) a party has maintained proceedings that they should have known had no real prospects of success: Fountain Selected Meats (Sales) Pty Limited v International Produce Merchants Pty Limited (1988) 81 ALR 397 at 401;

(c) proceedings were maintained for an ulterior purpose: Cultus Petroleum v OMV Australia [1999] NSWSC 435 at [2] et seq; and

(d) a defendant unreasonably delayed an admission of liability for the purpose of obtaining a tactical advantage: Rouse v Sheppard (No 2) (1994) 35 NSWLR 277 at 279-282.

189 These are, of course, only instances of the application of a broad, judicial discretion about costs orders, for which s 98 of the Civil Procedure Act 2005 NSW provides the current legislative foundation.

190 On the findings made against Mr Nguyen, an order for the assessment of his costs liability on the indemnity basis is both open and appropriate. His conduct is not unlike the examples of cases in which he concedes that an indemnity costs order can properly be made.

191 I am mindful that the findings made against him were made after contested proceedings. However the findings, as made, are of a character that cannot be readily discounted upon a consideration of the costs orders to be made.

192 The plaintiffs have been required to incur the expense of lengthy proceedings, including a final hearing extended by the length of cross examination to which their principal witnesses were subjected. In all the circumstances, the justice of the case requires an award of indemnity costs against Mr Nguyen.

The second defendant's costs liability

193 The second defendant submits that her liability for costs should not extend to a period earlier than her joinder as a defendant in the proceedings.

194 There is some force in that submission, but it should not be acted upon without qualification.

195 Had she filed a submitting appearance she might have avoided liability for any costs order at all.

196 However, upon her joinder in the proceedings she aligned her interests with those of her husband and, without any material procedural distinctions, she effectively adopted his defence of the proceedings and added her own.

197 I do not propose, as the defendants would have it, to acquiesce in their contention that the costs for which the second defendant is liable are limited to those referable to the period after her joinder.

198 I accept, as an abstract proposition, that she should not necessarily be held accountable for costs incurred in the proceedings before her joinder; but I apprehend no difficulty in her being held liable for earlier costs insofar as they may have been necessarily incurred in the claim ultimately made against her or connected with her adoption of the first defendant's case in her own cause.

199 Where any line should be drawn between costs for which the defendants are jointly liable and costs for which Mr Nguyen alone is liable is a matter best left to a costs assessor able to review facts relating to the course and conduct of the proceedings.

Orders

200 Against the possibility that the defendants do not, or cannot, make a prompt restoration of property to the plaintiffs according to their respective obligations, to forestall unnecessary disputation, and to constrain the defendants to conform to the dictates of good conscience in return of the plaintiffs' property to them, I include in the Court's orders, a direction that any payments made by the defendants on an interest bearing debt due to the plaintiffs under these orders be applied, first, to discharge their obligation to pay interest: Cory Bros & Co Limited v Owners of Turkish Steamship "Mecca" [1897] AC 286 at 293-294; Deeley v Lloyds Bank Limited [1912] AC 756 at 783-784; Halsbury's Laws of England (5th ed), Vol 22 "Contract", para 525.

201 Halsbury cites Income Tax Commissioner v Maharajadhiraj of Darbhanga (1933) LR 60 Ind App 146 at 157. There the Privy Council observed that "... where interest is outstanding on a principal sum due and the creditor receives an open payment from the debtor without any appropriation of the payment as between capital and interest, by either debtor or creditor, the presumption is that the payment is attributable in the first instance towards the outstanding interest."

202 Given the course of these proceedings, the interests of justice dictate that any right of appropriation not be left to the defendants (in whom, under the general law, it may first reside), or the operation of a mere presumption, but be recognised as residing in the plaintiffs as an incident of orders made for return of their property.

203 I make the following orders, together with the standard order for the return of exhibits:

(1) ORDER that judgment be entered for the plaintiffs against the first defendant in the sum of $789,662.00 (being a principal sum of $467,500.00 plus pre-judgment interest, calculated at the rate ordinarily allowed under s 100 of the Civil Procedure Act 2005 NSW, in the sum of $322,162.00).

(2) DECLARE that so much of the judgment amount referred to in Order 1 above as represents the principal sum of $480,701.20 (being a principal sum of $304,588.15 plus an allowance for interest, at the rates ordinarily allowed under s 100 of the Civil Procedure Act 2005, in the sum of $176,113.05), together with interest accruing after judgment on the sum of $480,701.20 under s 101 of the Civil Procedure Act 2005 constitutes an equitable charge on the title of the defendants to the land contained in folio identifier 47/13055 and located in Vimy Street, Bankstown in the State of New South Wales ("the Bankstown property").

(3) DIRECT that, subject to any written direction that might be given by the plaintiffs or any agreement in writing made between the parties, any payments made to the plaintiffs, pursuant to these orders for the payment of interest bearing sums, be brought to account as a payment of interest before any reduction of a principal sum payable.

(4) ORDER that liberty be reserved to the parties to apply for: (a) orders for the sale of the Bankstown property to give effect to the plaintiffs' equitable charge on the property as declared in paragraph 2 above; or (b) orders otherwise working out the operation of these orders.

(5) ORDER that the freezing order made on 5 November 2013 and varied on each of 7, 18 and 22 November 2013 be further varied to permit the defendants to meet their obligations (including their obligations as to costs) under these orders, but that the freezing order as varied be confirmed.

(6) ORDER that the first defendant pay, on the indemnity basis, the plaintiffs' costs of the proceedings respectively numbered 2012/00089044 and 2013/00080448.

(7) ORDER that the second defendant pay, on the ordinary basis, the plaintiffs' costs of the proceedings respectively numbered 2012/00089044 and 2013/00080448.

(8) NOTE that on 16 April 2013 (in the proceedings numbered 2013/00080448) the Court ordered that the operation of Caveat No. AH532493 in relation to the property located at 8 Vimy Street, Bankstown be extended "pending the determination of these proceedings or until further order of the Court".

(9) ORDER that that order for the extension of the operation of Caveat No. AH 532493 be varied by omission of the words "pending the determination of these proceedings or" and that, as varied, it be confirmed (to the intent that the operation of the caveat shall be extended until further order of the Court).

204 Because the interest calculations underlying orders 1 and 2 work from different bases in time, there may be scope for disagreement in their implementation. The governing principle is that the plaintiffs are entitled to recover the whole of their stolen cash, with interest, as provided for in order 1, calculated from the time of Mr Nguyen's theft of the cash. Order 2 works from a different foundation because the plaintiffs are entitled to an equitable interest in the defendants' land only to the extent that their cash has been traced into the land, with interest calculations from the dates of acquisition of the land. Their recovery of anything more than that may depend for its efficacy on the pendency of a freezing order, proceedings in bankruptcy or the like.

205 An express reservation of liberty to apply in the working out of the Court's orders is, accordingly, appropriate (Australian Hardboards Limited v Hudson Investment Group Limited (2007) 70 NSWLR 201 at 213 [50] - 221 [77]) although every declaration, such as order 2, implicitly carries with it liberty to apply for consequential relief (Royal Insurance Co Ltd v Mylius (1926) 38 CLR 477 at 497) to enforce it.

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Amendments

06 February 2014 - Incorrect spelling of Briginshaw.
Amended paragraphs: 46 and 48

25 February 2014 - The Addendum contains Lindsay J's Supplementary Reasons for Judgment in response to submissions about the orders to be made to give effect to the Principal Reasons for Judgment
Amended paragraphs: Title Page, Hearing Dates and Decision; 133-205

Decision last updated: 25 February 2014