VCAT
Lefkas Builders Pty Ltd v Hargale Investments Pty Ltd
[2018] VCAT 935

VICTORIAN CIVIL AND ADMINISTRATIVE TRIBUNAL
CIVIL DIVISION
CIVIL CLAIMS LIST
AT MELBOURNE

LEFKAS BUILDERS PTY LTD V HARGALE INVESTMENTS PTY LTD [2018] VCAT 935 (23 JULY 2018)

Link to this case on Austlii

DATE OF ORDER: 23 JULY 2018
VCAT REFERENCE NO. C3998/2016

CATCHWORDS
Claims by applicants to be the bailors of goods – two groups of goods, those seen in the respondents’ premises during the hearing of an application for an injunction, and those alleged to have been converted by the bailees before that hearing – claims by applicants for payment for building work

FIRST APPLICANT: Lefkas Builders Pty Ltd ACN: 007 169 002
SECOND APPLICANT: George Fatouros
FIRST RESPONDENT: Hargale Investments Pty Ltd ACN: 601 576 532
SECOND RESPONDENT: Metway Group Pty Ltd (ACN 600 763 442)
THIRD RESPONDENT: Georgia Toumbouras

WHERE HELD: Melbourne
BEFORE: Deputy President I. Lulham
HEARING TYPE: Hearing
DATE OF HEARING: 14 – 16 August 2017, 25 August 2017, 13 October 2017, 27 February 2018, with subsequent written submissions
DATE OF ORDER: 23 July 2018
DATE OF REASONS: 23 July 2018
CITATION: Lefkas Builders Pty Ltd v Hargale Investments Pty Ltd (Civil Claims) [2018] VCAT 935

ORDER

The First Respondent shall pay the First Applicant $1,540.00.
The Respondents must make available for collection by the Applicants the chattels set out in paragraph 11 of the Reasons for this Order.
The Applicant have liberty to apply in the event that there is a dispute over the Respondents’ compliance with paragraph 2.
Costs reserved.

Lulham
Deputy President

APPEARANCES:

For Applicants
Mr. G. Parncutt of Counsel
Elvin Lawyers, solicitors

For First and Third Respondents
Mr. N. Agetzis, legal practitioner

For Second Respondent
Mr. V. Anastassopoulos, legal practitioner

REASONS

In this proceeding the Applicants claim rights and compensation as bailors of goods which have been in a small factory at 3 Cobham Street Reservoir (“Cobham Street”), and payment for building work performed.
Quite a few chattels are involved and there is a good deal of detail to be considered.
The proceeding was issued on 11 July 2016, by Lefkas Builders Pty Ltd (“ Lefkas ”), as sole Applicant, against Hargale Investments Pty Ltd (“Hargale”) as sole Respondent. Lefkas was then self-represented. At a directions hearing on 19 September 2016, Lefkas advised the Tribunal that the claims it intended to make in the proceeding were set out in a letter to Hargale dated 7 April 2016. The letter included some demands which have not been pressed in this proceeding, but in relation to the chattels it contained a list that began with the following words:
“Items that are withheld. Please note that it has been over years of accumulating all our equipment the following is a list of what we can recall that has been withheld … at Cobham Street”.

So, at the outset the assertion of rights by Lefkas has been somewhat qualified. It is unusual to see a demand couched in terms of “what we can recall”.
There was to be a compulsory conference on 6 December 2016. However, on 23 November 2016 Lefkas applied for an injunction to prohibit Hargale from disposing of its chattels. Mr George Fatouros (“George”) wrote on the application that
“It has come to our attention that one or all of the respondents are selling our equipment to clear their debts and as a vexatious action against Lefkas Builders and the director George Fatouros”.

Lefkas ’ application for the injunction was listed for hearing on 6 December 2016, in lieu of the compulsory conference. Member Warren heard the application. He made two Orders, on 6 and 15 December 2016.
In the Order of 6 December 2016 the Member joined George as Second Applicant, Metway Group Pty Ltd (“Metway Group”) as Second Respondent and Georgia Toumbouras (“Georgia”) as Third Respondent, and then made directions for the exchange of pleadings and the like, and for a compulsory conference to be held in January 2017.
The injunction is set out in an Order of 15 December 2016. The application took some days, and because the Respondents denied having any chattels, included Member Warren conducting part of the hearing in Cobham Street, inspecting those premises and its contents in the presence of the parties on 13 December 2016. On that date Lefkas and George, who were by then represented by legal practitioners, had filed Points of Claim with “Attachment A” being a list of “ Lefkas Equipment retained by Hargale”. Member Warren made notes on a copy of that list to identify the chattels that he saw in Cobham Street. The Tribunal’s Registry emailed that marked up list to the parties on 15 December 2016, and in his Order of that date Member Warren granted the injunction prohibiting the Respondents from disposing of the plant and equipment set out on that marked up Attachment A until further Order. Whilst in the end the injunction was granted by consent, this does not show that the Respondents acted reasonably. As I said, the Respondents’ denial of the chattels’ existence necessitated the on-site inspection. Causing Member Warren to go on site was folly – particularly once it is noted that the Applicants’ chattels seen by Member Warren included a 1937 Chevrolet. The expression “the elephant in the room” comes to mind.
For the final hearing the Applicants had prepared a Tribunal Book, and a new list of chattels which was based on the marked up Attachment A, with columns cross-referenced to documents in the Tribunal Book. That list divided the chattels into:
(a) chattels seen by Member Warren on 13 December 2016 and the subject of the injunction, some verified by receipts, but some not; and
(b) chattels not seen on 13 December 2016 – which the Applicants called “missing chattels” – some verified by receipts, but some not.

The list showed that Lefkas and George sought delivery up of the chattels seen by Member Warren, and damages in respect of the “missing chattels”.

When final submissions were made after the evidence had been given, the Applicants abandoned claims in relation to a small number of chattels which had not been seen on 13 December 2016, and for which the Applicants could not produce receipts. I will call the list in the submissions “the final list” and use it in this decision.
Using the final list, I set out below the chattels seen by Member Warren on 13 December 2016 which are the subject of the injunction (and so omitting claims which the Applicants abandoned). Where the final list described an item more generously than Member Warren’s record, I use the latter.[1] I have shown the exhibit number of any invoice which relates to a chattel, for information:
Description
Related invoice [exhibit number & description]

1 x panel saw
A2 Northern Machinery Co 16 May 2006

2 x pedestal drills
B1 Cypriana furniture 13 March 2008

1 x band saw
B2 Northern Machinery Co 3 May 2003

1 x portable dust extractor
A5 Cypriana furniture 13 March 2008

Large barrel sander
B3 Cypriana furniture 13 March 2008

1 x portable thicknesser
A3 Northern Machinery Co 23 June 2006

Dowell and bench planer / thicknesser
B4 Cypriana furniture 13 March 2008

Large mill saw with 4 blades
B5 Northern Machinery Co 23 June 2006

1 x portable dust extractor

1 x portable thicknesser

Air tools: 3 x drills, 1 x stapler and 2 x brad gun
B6 Vision Workshop Equipment 6 December 2006

General hand tools including jigsaw, saw, planner

Note vagueness of description
1 x pallet truck
B7 Cypriana furniture 13 March 2008

XA Ford GT panels, bonnet, rear boot lid and doors
B8 not an invoice, but a transfer of registration form in respect of a Ford Sedan, to Dimitrios Fatouros, 31 July 1986
Differential was claimed, but was not seen by Member Warren
1937 Chevrolet
B9 Phil Gleeson 16 June 2006 (says ‘1938’ Chevrolet, with modifications, unfinished

Tyre changer
B10 Vision Workshop Equipment 6 December 2006

Tyre balancer
B11 Vision Workshop Equipment 6 December 2006

Trolley workstation
B12 Vision Workshop Equipment 29 June 2008

4 post hoist, disassembled
B13 Vision Workshop Equipment 29 June 2008

Gear pulley set

Gearbox lifter
B14 Vision Workshop Equipment 6 December 2006

1 x trolley jack, large
A13
Not mentioned in A13
Safety barrier scaffold for internal stairs
B16, MHB Constructions 7 October 2009

24 metres of walkway scaffolding
B17, MHB Constructions 7 October 2009
24 x planks also claimed, not seen by Member Warren
3 buckets for a 7.5 tonne excavator
B18 Komatsu Australia Pty Ltd 29 January 2007

Driver for drills to suit 7.5 tonne excavator
B19 Peter Drake 13 April 2007

1 x pair of 4.5 tonne ramps for loading equipment on truck
B20 Scoreplan Pty Ltd 12 August 2008

Skid steer forklift accessory
B21 Scoreplan Pty Ltd 12 August 2008

Skid steer post hole accessory (3 augurs)
B22 Scoreplan Pty Ltd 12 August 2008

Skid steer demolishing ‘4 in 1’ bucket
B23 Scoreplan Pty Ltd 12 August 2008

Refuelling diesel tank with pump
B24, TJL Logging Pty Ltd 22 May 2008

4 way lifting chains with 6 m of chains
B25, TJL Logging Pty Ltd 22 May 2008

MIG welder
B26 extract from a finance lease agreement 9 December 1988, less the being Bill Fatouros

Aluminium MIG welder
B27 DS Builders 27 February 2001

Portable welder
B28 DS Builders 27 February 2001

Portable MIG welder
B29 DS Builders 27 February 2001

Concrete pencil vibrator, electric
B30 Nolan Fleet auctions 1 September 2012, purchaser Dimitrios Fatouros

These are the items alleged to be “missing”:
Description
Related invoice [exhibit number & description]

feeder for Hertz edger
A1 Northern Machinery Co 20 September 2006

1 x panel saw
A2 Northern Machinery Co 16 May 2006

1 x thicknesser
A3 Northern Machinery Co 23 June 2006

2 x 3 phase compressors
A4 Cypriana Furniture 13 March 2008

1 x portable dust extractor

Large dust extractor and pipes
A5 Cypriana Furniture 13 March 2008

1 x portable thicknesser

1 x portable compressor
A6 Air Supply Inc Pty Ltd, invoice to Jim Fatouras, 28 March 1985

Portable bench saw
A7 Northern Machinery Co 30 October 2001 – saw noted as 2nd hand

1 x drill
A8 Cypriana Furniture 13 March 2008

3 x hand sanders
A8 Cypriana Furniture 13 March 2008: invoice does not state the number of sanders

1 x stapler

A9 Northern Machinery Co 15 July 2003: invoice says quantity 2nd hand tools

Jig saw
A9 Northern Machinery Co 15 July 2003: invoice says quantity 2nd hand tools
Blowers
A9 Northern Machinery Co 15 July 2003: invoice says quantity 2nd hand tools

General hand tools jig saw, saw, planner
A9 Northern Machinery Co 15 July 2003: invoice says quantity 2nd hand tools

2 x pallet truck
A10 Cypriana Furniture 13 March 2008

3 phase heater fan
A10 Cypriana Furniture 13 March 2008

Gas turbo heater
A11 Cypriana Furniture 13 March 2008

XA Ford GT replica complete car
A12 apex auto salvage 31 July 2003: “rolling shell” “sold as is, no rego or RWC”

KC tools spanners, sockets, shifters and general mechanical hand tools
A13 & A14 Vision Workshop Equipment Pty Ltd 6 December 2006 and 29 May 2006

2 post hoist, disassembled
A14 Vision Workshop Equipment Pty Ltd 29 May 2006

2 temporary site toilets
A15 Nolan Fleet Auctions Pty Ltd 20 October 2011

50 panels of temporary fencing
A16 MHB Constructions 7 October 2009: 35 panels

24 aluminium planks
A17 MHB Constructions 7 October 2009

Kobelco 3.5 tonne excavator
A18: no invoice, at mentioned on an extract of a deed of company arrangement

Sorting bucket for7.5 tonne excavator
A19 T J Logging 22 May 2008

Grabber for 7.5 tonne excavator
A20 T J Logging 22 May 2008

Hitch for driver
A21 Peter Drake 13 April 2007

Extension arm for drills/ auger extension
A22 Peter Drake 13 April 2007

5 drills ranging from 600 mm to 350 mm
A23 Peter Drake 13 April 2007

Oxy welding box with gauges
A24 D S Builders Pty Ltd 27 February 2001

2 x 100 mm gas nail guns
A25 AUW building supplies 18 July 2012: invoice to D Fatouros

Hilty rotary hammer drill
A26 MHB Constructions 7 October 2009

Kanga rotary and jack hammer
A27 MHB Constructions 7 October 2009

Bosch jack jammer, large
A28 MHB Constructions 7 October 2009

Demo saw with trolley
A29 MHB Constructions 7 October 2009

Concrete vibrating plate
A31 MHB Constructions 7 October 2009

3 phase wood turning lathe
A32 Northern Machinery Co 16 May 2006

2 x electric gate openers with 12 remote controls
A33 D S Builders Pty Ltd 27 February 2001

Small hand tools, torque wrench, air-line, maintenance kit
A34 Vision Workshop Equipment Pty Ltd 12 February 2007

Turntable, vibe shaft, stair trolley
A35 Nolan Fleet Auctions Pty Ltd 1 September 2012

Concrete vibrating plate
– Claimed twice in error – see A31 above

The entities

Whilst there are three corporations involved in this legal proceeding, it essentially involves a dispute between members of the Fatouros and Toumbouros families. On the basis of the evidence (and the lack of evidence) I could not formally find that the corporations acted as trustees for the members of these families, but in a broad and colloquial sense I will say that the corporations represented their financial interests. I have no doubt that within the respective families the individuals would talk about “their” family assets, but that when it came to dealing with outsiders, such as creditors, the same individuals would profess a very clear understanding of the distinction between a corporation and its shareholders and of the limited liability of shareholders, known as the “corporate veil”.
Between 2003 and 2014 Cobham Street was owned by Lefkas , the First Applicant, which had been incorporated in March 1989. In effect it represented the financial interests of:
(a) George, the Second Applicant,
(b) George’s brother Dimitrios Fatouros [also known as Jim Fatouros] (“Dimitrios”) who went into bankruptcy and is not a party to this proceeding, and
(c) another brother Bill Fatouros who had been a director of Lefkas but who resigned and did not participate in the proceeding.
Commencing on 24 March 2014, Elizabeth Toumbouros (“Elizabeth”) leased Cobham Street from Lefkas . Elizabeth is the mother of Georgia, the Third Respondent.
Later in 2014 Hargale, the First Respondent, purchased Cobham Street. Georgia signed the contract of sale as purchaser in July 2014 but caused Hargale to be incorporated on 1 September 2014 and then nominated it as purchaser. Settlement occurred on 9 January 2015. At all times Georgia has been the sole director of Hargale.
Georgia is the daughter of Elias Toumbouros (also known as Ilias Toumbouros) (“Elias”) and Elizabeth. Neither Elias nor Elizabeth are parties to the proceeding. Georgia is now about 24 years of age, and was about 21 when Hargale was incorporated.
At various times Lefkas borrowed money to fund its business operations, and granted registered charges to secured creditors. The evidence about this was vague, but there were references to Nicholas John Sevdalis, an accountant called “John”, and by implication one or more banks.
Lefkas had not chosen to sell Cobham Street. In 2014 it put Cobham Street up for sale and signed a contract to sell it to Georgia, probably when it was already in financial difficulties, but after signing the contract Nicholas John Sevdalis took possession of Cobham Street as mortgagee and proceeded with the sale to Hargale.
For a period of a few months, Elias helped out George and Dimitrios by employing them in a business (although precisely what entity was conducting that business is most unclear). Elias had George and Dimitrios carry out work installing air conditioning ducting on building sites. Because George and Dimitrios were inexperienced in air conditioning, Elias did not have them working in his own business premises.
Elias and Elizabeth are no longer married. Until a few years ago they ran an air conditioning and refrigeration business, and they lived in North Balwyn and had a holiday house in Elphinstone. The business was conducted from premises in Preston.
Elias and Elizabeth also suffered a financial set back. They lost some significant contracts, and Elias had a minor stroke after which he reprioritised and focussed on his health. On 17 April 2015 Elias went bankrupt. The family home in North Balwyn was either sold or taken by creditors. Georgia became the owner of the house in Elphinstone, although at the time she was a full-time tertiary student, and no evidence was given as to how she raised the money to purchase this property[2].
At various times the air conditioning and refrigeration business “of Elias and Elizabeth” was vested in corporations which had the word “Metway” in their name. Given that “Metway Bank” is a large and relatively well known entity, it is curious that ASIC allowed Elias and Elizabeth to secure this name. In any event, Metway Group, the Second Respondent, was incorporated on 17 July 2014, and remains registered.
Metway Air-Conditioning and Refrigeration Pty Ltd ACN 062 533 064, which had been incorporated in November 1993, was deregistered on 24 March 2017 apparently after a period of inactivity.
For a time, Elizabeth conducted on her own account an air conditioning and refrigeration business under the registered business name “Evenair Group” [registered number B2460730L].
Another business name, “Evenair Air-Conditioning Refrigeration Units Manufacturing” [registered number B2271548M] was cancelled at some stage.
Elias had also registered the business name “Evenair Electrics Air-Conditioning Refrigeration Manufacturing Group”, and it remains registered.
Evenair Pty Ltd ACN 113 890 869 was incorporated in April 2005 and was deregistered on 12 September 2016. Evenair Airconditioning Pty Ltd ACN 078 386 400 was incorporated in May 1997 and, whilst it remains registered, it is in external administration.
On the basis of the evidence given in the hearing about these matters, which I must say was often vague and evasive, my impression is that the registration of corporations and business names by members of the Toumbouros family was not reflective of some sophisticated financial
structure, but was more a matter of them seeking to protect Toumbouros family assets and earning capacity to the extent possible once the financial setback had been suffered. Similarly, it was clear on the evidence that Lefkas has had a very chequered financial history.

Artificiality affects both sides’ evidence. Some of the chattels claimed by Lefkas are supported by invoices from 1986, years before Lefkas was incorporated. Georgia acknowledges Hargale as being her company, and they had the same lawyers. Metway Group was established by Elias and Elizabeth, but as they have both gone bankrupt they cannot be involved in the management of a company. An ASIC search of Metway Group was tendered, showing Georgia as the sole shareholder and thus capable of appointing its directors – yet Metway Group has its own lawyers.

The claims and defences

Chattels

31. In their Points of Claim dated 28 March 2017, Lefkas and George plead:

[Paragraph 8] That between December 2014 and the settlement of the sale of Cobham Street on 9 January 2015, chattels listed in Schedule A to the Points of Claim, belonging to Lefkas and George[3] were located in Cobham Street.

[Paragraphs 6, 7 & 9] That on 3 July 2014 Lefkas was the registered proprietor of Cobham Street, and contracted to sell it to Georgia, who nominated Hargale as purchaser, and that the settlement took place on 9 January 2015.

[Paragraph 14] That in December 2014, Elias on behalf of Metway Group, Georgia on behalf of Hargale and in her personal capacity as the resident in possession of Cobham Street, “jointly verbally agreed to take possession, as gratuitous bailee, of the (chattels), with the promise that (they) would be returned to Lefkas and George on demand”.

[Paragraph 19] That despite requests for the return of the chattels, Metway Group, Hargale, Georgia, Elias and Elizabeth “jointly and severally wrongfully detained the chattels and continue to refuse to return them to the bailors”. The particulars given of this allegation are

that Metway Group, Hargale, Georgia and Elias have effective control over and possession of Cobham Street, and have actual knowledge of the identity of the owners of the bailed goods.

Lefkas and George claim the immediate return of the chattels “in the same condition as at 28 April 2015”, and alternatively, damages. The damages are said to be consequential loss resulting from the wrongful detention of the chattels, and a sum of money equal to their value if they are not returned.

In their separate Points of Defence, Hargale and Georgia, and Metway Group respectively, denied the important allegations that the Applicants owned the chattels, that they had bailed them to the Respondents, and that the Respondents had refused to return them. Whilst claims are included against Elias and Elizabeth in paragraph 19 of the Points of Claim, they are not parties to the proceeding.

Three claims by Lefkas for payment of building work

[Paragraph 10] Lefkas alleges that in early August 2014, at the request of Hargale, it supplied and fitted an entry door for the front office at Cobham Street, in exchange for the promise of payment of $5,500.00 by Hargale. Hargale and Georgia deny this allegation (even though, in this instance, no claim was made against Georgia), and Metway Group did not admit the allegation (although again, no claim was made against it).
[Paragraph 11] Lefkas alleges that in October 2014, at the request of Hargale, it supplied and installed plaster and floor joists at the house in Elphinstone, in exchange for the promise of payment of $3,840.00. Again, Hargale and Georgia deny this allegation, and Metway Group did not admit it.
[Paragraph 12] Lefkas alleges that in mid July 2015, at the request of Hargale, it cut a door opening in the rear of Cobham Street and installed a door, in exchange for the promise of payment of $1,540.00. Again, Hargale and Georgia deny this allegation, and Metway Group did not admit it.
Clearly, there are problems with the chronology in relation to the above building work allegations, in that in early August 2014 Hargale was neither incorporated nor the owner of Cobham Street, and Hargale was never the owner of Elphinstone.
In the Particulars in relation to each of these three claims, Lefkas alleges that Georgia, Elias and Elizabeth participated in each of the conversations in which the requests for the work were made, even though Georgia was the sole director of Hargale.
Hargale and Georgia, and Metway Group respectively, deny these claims. The Respondents’ denials of the three claims seems to reflect their knowledge of the “corporate veil”.

Jurisdiction

The Respondents did not plead, or submit in the hearing, that the Tribunal lacked jurisdiction to hear the claim in relation to the chattels. I proceed on the basis that the parties are satisfied that the Applicants’ pleadings are to the effect that, as gratuitous bailors Lefkas and George actually or possibly supplied the bailed chattels to the Respondents, and/or that the taking on of the chattels by the Respondents was the actual or possible supply of services to Lefkas and George in trade or commerce, thus constituting a “consumer and trader dispute” as defined by section 182(1) of the Australian Consumer Law and Fair Trading Act 2012. Section 182(2) also confers jurisdiction in relation to disputes or claims “in negligence, nuisance or trespass that relates to the supply or possible supply of goods or services” which arguably contemplates a gratuitous bailment. Clearly, Lefkas ’ claim for payment for building work is within jurisdiction.

A note on the law concerning the claims about the chattels

In the Points of Claim the Applicants use the words “conversion” and “detinue” in a heading, but not in paragraphs of the document. The paragraphs refer to the “wrongful detention of bailed goods”.
The substance of an action of detinue is the wrongful detention of goods – the unlawful failure on the part of the respondent to deliver up the goods when so demanded. The three elements of this cause of action, which the claimant must establish, are:
(a) that the claimant has demanded the return of the goods at the time when the claimant has the immediate right to possession of them,

(b) that the demand has been refused by the respondent, and

(c) that if the respondent has actual possession of the goods the refusal to return them is unreasonable, or if the respondent does not have actual possession, the respondent had wrongfully parted with them.

The substance of an action of conversion is that the respondent has wrongfully taken possession of the goods, or interfered with the true owner’s dominion over them.
On the facts alleged by the Applicants, the Applicants are suing for detinue in respect of the chattels which are the subject of the injunction granted on 15 December 2016, and damages for conversion of the “missing” chattels.
The Respondents denied the Applicants’ allegations that the Applicants owned the chattels, that they had bailed them to the Respondents, and that the Respondents had refused to return them. That last part of the denial is formulaic, in relation to those items which are the subject of the injunction, because of course the Respondents have refused to return chattels: why else would there have been a hearing?
The Applicants submit that a person may claim relief as a bailor without having to prove absolute title to the goods, and that it is sufficient if the bailor has a possessory interest, which it can assert against any person except the rightful owner[4]. The Applicants adopted commentary in “The Laws of Australia”[5] which included:
The essence of bailment is possession. Generally there can be no bailment unless one person is in possession of ‘goods which belong to another’, meaning ‘goods to which another person has a superior right of possession’. That person will normally, but not necessarily, be the owner.

… Bailment, however, involves more than possession. In addition to the physical ingredient of possession, a mental element must be proved in order for a possessor to be characterised as a bailee. It now appears that any person who is voluntarily and knowingly in possession of goods which belong to another will be considered a bailee. The relevant consent and knowledge must extend both to possession of the goods themselves and to possession on behalf of the putative bailor. Thus, a bailment cannot arise where one person is forced however knowingly to take possession of goods which to his or her knowledge belong to another, or where an alleged sub-bailee is unaware of the fact that the goods are the property of someone other than the immediate bailor. Nor can a bailment arise where a possessor is unaware of the very fact of possession. Furthermore, it appears that no bailment arises where a possessor genuinely and reasonably believes that the goods in his or her possession are his or her own. Such a possessor, though aware of what he or she possesses and willing to possess it, has not agreed to hold the goods for another. [citations omitted]

The Applicants submit that the Respondents’ denial that the Applicants owned the chattels was a purported defence of jus tertii – and that at law the Respondents may not defend the Applicants’ claim by relying on the title of a third party to the chattels.
In addition, the Applicants submit that in any event the Respondents had not established that a third party had such a title: the Respondents’ references to charges given by Lefkas to secured creditors could not do so as the charges were standard floating charges under which Lefkas could continue to trade and buy and sell assets and where the secured creditor could only obtain an interest in particular assets when the charge crystallised, for example on Lefkas ’ defaulting.
The Applicants submit that a respondent cannot deny a putative bailor’s ownership of goods, throw the burden of proof on the bailor and then submit that the bailor has not satisfied that burden.
49. Hargale and Georgia submit – and Metway adopted their submissions – that Lefkas has granted 5 registered charges over all of its present and after acquired property; and that it had been under external administration between 25 October 2011 and 9 September 2014.[6]
Hargale and Georgia submit that the 5 charges were affected by the Personal Property Securities Act 2009, which had the effect of giving the secured creditors priority over any interest asserted in the chattels by the Applicants. It was put that the Tribunal could not be satisfied on the balance of probabilities that Lefkas and George had proven a sufficient title in the chattels to mount the claim. They cited Maiden Civil (P & E) Pty Ltd v Queensland Excavation Services Pty Ltd [2013] NSWSC 852 as standing for the proposition that because Lefkas had not registered its interest in the chattels under the Personal Property Securities Act 2009, it had not perfected its security interest and so the secured creditors’ perfected security interests took priority. I note that this submission is based on the notion that Lefkas was asserting a security interest in the chattels and not ownership of the chattels.
Hargale and Georgia also submit that on the evidence Lefkas and George did not prove what chattels were inside Cobham Street at the settlement date of 9 January 2015, and that the evidence showed that George and his associates had had access to Cobham Street after the settlement, removed chattels, and sold chattels.
Hargale and Georgia submit that the various securities over Lefkas and the chattels resulted in Lefkas not having an enforceable right to possession of the chattels, thus removing its ability to make a claim as bailor.
Leaving aside the complex aspects of these submissions, at the very least the Respondents are submitting that the Applicants must do more than simply assert that they have a right to possession of the chattels, and that they face the threshold requirement of proving their interest in them. The Respondents submit that it is only after the Applicants establish that right that the Respondents’ defences are to be considered. This is another way of the Respondents submitting that the Applicants have the onus of proof.
I should mention here that the only evidence of ownership was given by George and Dimitrios. That evidence was that they (including Lefkas ) had bought the chattels at various times over a number of years, and had the receipts and invoices in respect of some of the purchases, which I have shown in the lists of chattels. The Respondents had no evidence to contradict that evidence of George and Dimitrios. All they could do on the issue of ownership as at March 2014 – when Elizabeth took possession of Cobham Street as tenant – was to attack the credibility of George and Dimitrios. Attacking credit was somewhat bold given that the evidence of Elias in particular, which I will set out as necessary below, was plainly false on the important issue of whether there were any chattels in Cobham Street, and that the evidence of Georgia and Elizabeth was vague and self-serving when it suited them. Faced with a conflict of evidence between these witnesses on the issue of whether Lefkas and George had acquired the chattels, I prefer and accept the evidence of George and Dimitrios. I find that Lefkas and George had acquired the chattels seen by Member Warren in December 2016 and had the right to possession of them. Because only George and Dimitrios gave evidence about the acquisition of the “missing” chattels and produced receipts and invoices in respect of them, I also find that Lefkas and George had acquired the “missing” chattels. Whether Lefkas and George can prove that the “missing” chattels were ever in the Respondents’ possession, and if so whether persons other than the Respondents or their agents took them, is another matter.
Again, Lefkas and George plead that in December 2014, Elias on behalf of Metway Group, Georgia on behalf of Hargale and in her personal capacity as the resident in possession of Cobham Street, “jointly verbally agreed to take possession, as gratuitous bailee, of the (chattels), with the promise that (they) would be returned to Lefkas and George on demand”.
Their evidence of such an agreement was remarkably thin. I note the following statements from Halsbury’s Laws of Australia[7] by way of background and to put the conflicts in the evidence in context:
(a) There is no exhaustive definition of possession, and possible meanings include “actual possession”, “legal possession”, “constructive possession” or “rights to possession” [315 – 145].
(b) “Actual possession” requires effective occupation or control over the item in question. The right to exclude strangers from interference with the chattels will constitute effective control. Where another person who is able to object to the occupation or control has consented or acquiesced to it, that will also constitute effective control [315-150] [8].
(c) “Legal possession” is the state of being in possession in the eyes of the law. It is ordinarily founded on actual possession, but may exist without it, as where a “bailee at will” has physical custody of the article in question. [315-165]. A “bailment at will”, also known as a “revocable bailment”, is a bailment where the bailor may repossess the bailed items at any time without the bailee’s consent and so end the bailment: Manders v Williams (1849) 4 Exch 339; 154 ER 1242[9] .
(d) A person in legal possession of something is presumed to be its owner, and the possessory title is good against the whole world except those who can show a superior title. Thus, a person in legal possession has, as against strangers and wrongdoers, all the rights and remedies of a person with an immediate right to possession [315-170].
(e) “Constructive possession” has several meanings, one of which is a right to possession without having legal possession. Accordingly, a bailee at will has constructive possession. It can assert its rights against strangers and wrongdoers, but not against the bailor or a person who can show a superior title [315-180].
(f) A bailee for a term, for example under a contract, holds legal possession of the chattels bailed as well as the right to possess them. A bailee at will holds legal possession and a right to possession until termination of the bailment. In either case, the bailee is under a duty to redeliver to the bailor on termination of the bailment [315-205].
(g) The finder of a chattel on someone else’s land acquires possessory rights over the chattel against all, save its actual owner, the finder’s employer, and the occupier of the land. However, this does not apply if the finder has dishonestly taken the thing found with an intent to conceal the find [315-210].
(h) Possession of a key to premises will give actual or legal possession of the items inside if it grants, in the circumstances, sufficient physical control over those items, but may not do so if the deliverer of the key retains a duplicate [315-215].

The hearing

All the parties were represented by legal practitioners. Delays were incurred in the hearing as a result of the difficulty in securing a Greek interpreter for sufficient periods of time, during the giving of Elias’ evidence. Another cause of delay was the legal practitioners’ requirement to obtain a transcript of the hearing in order to make final submissions.
The following persons gave evidence:
For the Applicants

George Fatouros

Dimitrios Fatouros

[The Applicants also tendered a statutory declaration of Sam Macheras, but did not call him as a witness]

For the Respondents

Georgia Toumbouros

Elizabeth Toumbouros

Elias Toumbouros

Frank Puyol (called by Hargale)

The Applicants handed up a “Tribunal Book”, but there was no agreement between the parties enabling the whole contents of that Book to be tendered as exhibits. Individual documents were tendered, as well is some others which were not in the Book.
Significantly in the context of the claim for the chattels, by the beginning of the hearing Counsel for the Applicants had prepared the list of chattels that I have referred to, cross referenced to invoices and receipts in the Book, and the Respondents’ legal practitioners advised that they did not admit the contents of that document and thereby put the Applicants to their proof on the important issue of ownership of the chattels.
Given that the law is concerned with the right to possession, more than ownership, this obstructive tactic during the hearing is a matter that may be relevant on the question of costs.

A note on the witnesses’ oral evidence

None of the witnesses were forthcoming in their evidence. This is not to say that all of them were untruthful, but their general approach was of denial.
The Applicants’ witnesses were vague about how the Applicants came to be the owners of the chattels in the dispute. Some of this might be explicable by the chattels having been acquired long ago. In their favour, they had disclosed invoices in the Tribunal Book.
The Respondents’ witnesses were, depending on the issue in question, vague or precise. This seemed to me to depend on which approach the witness thought would best serve their position. I accept that Elias has experienced ill health, which can explain a loss of recall. But it cannot explain his asserted inability to recall the interior of Cobham Street, a building in which he has lived for some three years and in which he continues to live; and his alleged failure to notice the presence of the old Chevrolet and the panels for a Ford sedan inside that building, amongst other things. It cannot explain his description of a house in Elphinstone, which he and Elizabeth had owned and transferred to Georgia, as being “somewhere in Elphinstone” as if he had barely noticed it while driving on the highway.
I will set out some of the evidence as it was presented in the course of examination and cross-examination, because doing so demonstrates how witnesses were reluctant to give evidence, and were essentially caught out with contradictions in cross examination. Witnesses professed belief in events which was not based on evidence. Witnesses described what other witnesses had allegedly done, when those witnesses had not given evidence of those matters. Witnesses alluded to documents which were neither discovered or in some cases ever produced in the hearing.
When it comes to the question of credit, I find Elias in particular to be an unsatisfactory witness; and Elizabeth and Georgia to have chosen to be vague when it suited them. I find George to have been a poor witness, who had to have specifics dragged out of him even in chief, which made his evidence on the building work claims largely unacceptable. I am at least able to rely on the fact that Member Warren saw some chattels at Cobham Street in December 2016, that only the Applicants asserted ownership in them, and that the Respondents did not assert that they had acquired them in any way other than the Applicants having left them in Cobham Street without permission.
Whilst the Applicants pleaded, in paragraph 14 of the Points of Claim, that in December 2014, Elias on behalf of Metway Group, Georgia on behalf of Hargale and in her personal capacity as the resident in possession of Cobham Street, “jointly verbally agreed to take possession, as gratuitous bailee, of the (chattels), with the promise that (they) would be returned to Lefkas and George on demand”, George did not give evidence to that effect. Georgia gave imprecise evidence that in April 2014 either George or an estate agent told her that a penalty for late settlement would be waived if she agreed to the chattels remaining, but this evidence went nowhere: there could not have been a penalty because this was before she had signed a contract to purchase Cobham Street, and she did not say that she agreed to the offer. The evidence only supports the conclusion that George and Lefkas left chattels at Cobham Street when they leased it to Elizabeth, in effect getting rent free accommodation for them, because they thought they could get away with doing so. This put Elizabeth in possession of them, when she was the tenant of Cobham Street, and then Hargale after it purchased Cobham Street. George and Lefkas have not sued Elizabeth and Elias, probably because they are or have been bankrupt, but it seems that Elizabeth, Elias, Georgia and Hargale have all had actual or constructive possession of the chattels which are the subject of the injunction. There was no “joint verbal agreement” by the Respondents to act as gratuitous bailees. They had the burden of being bailees foisted on them by George and Lefkas . But having had that status thrust on them, they acted as bailees – refusing to give George and Lefkas the chattels unless they could produce receipts to prove ownership but, at least in relation to the chattels which are the subject of the injunction, not asserting that they had acquired ownership themselves.

I set out this brief summary of my findings

The chattels

I accept that the chattels seen and identified by Member Warren when granting the injunction on 15 December 2016 existed and were in Cobham Street on that date, that Lefkas and George are entitled to possession of them, that Hargale as owner of Cobham Street and Elias and Georgia as occupants of Cobham Street have actual possession of them. By reference to the final list, I have made an order to that effect. More precisely, referring to the chattels which were the subject of the injunction, George is entitled to the collection of XA Ford panels bonnet rear boot lid doors (but not a differential, which was not seen by Member Warren); the trolley workstation with spanners sockets and shifters; and the aluminium MIG welder. Lefkas is entitled to all of the other chattels the subject of the injunction.
Lefkas and George say that they have receipts and invoices for some of the chattels the subject of the injunction. I accept that Lefkas and George are entitled to them. There is a difficulty here in that some of the invoices are very old and may as well say “a box of sundries” (for example, an invoice of 28 March 1985 for “cash sale”). Similarly, some invoices identify Dimitrios as a purchaser, and neither George or Dimitrios gave evidence of how chattels acquired by individuals in 1985 were transferred to Lefkas after it was incorporated in 1989. Some of these items would be expected to have worn out in the many years between the invoice and the alleged bailment agreement. On the other hand, Lefkas was the entity which carried on business as a builder; after its incorporation George, Dimitrios and Bill were merely officers of Lefkas ; and Hargale, Elias and Georgia never asserted that they had bought them, instead only resisting the Applicants’ claims to them. It is logical to conclude that (apart from the few chattels of George that I identified in paragraph 68) Lefkas became the owner of the chattels which are the subject of the injunction, even when they had been bought by George or Dimitrios.
Further, many of these chattels are of a kind used by a builder. They would not be used by Georgia, who is trained as an architect. Hargale was incorporated to own real estate, and does not trade. Elias has retired, after experiencing ill health. These matters are consistent with Hargale, Elias and Georgia not asserting that they had bought or otherwise acquired the right to the chattels.
As to the so called “missing” chattels, whose acquisition is supported by invoices and receipts, but which were not seen by Member Warren in December 20016 in Cobham Street and otherwise are not to be found, I am not satisfied that Lefkas and George are entitled to any relief. There is too much evidence of George and Dimitrios entering Cobham Street with a key after both the lease to Elizabeth and the sale to Hargale, and of George taking things away (including a truck). None of the parties conducted a “stocktake” or made a list of the chattels before Lefkas ’ letter of demand of 7 April 2016. Similarly, for Lefkas and George to rely on invoices which are around 30 years old, to support claims for tools and items which would be expected to wear out, and to have made a demand couched in terms of “what we can recall” is simply not credible in the absence of Member Warren having seen them.
One of the more substantial items alleged to be missing was an excavator. The evidence on this was most unsatisfactory. There is no invoice for the purchase of an excavator: document B18, Invoice to Lefkas Builders Pty Ltd dated 29 January 2007, refers to a used 1997 Kobelco excavator, but that invoice was relied on to prove the purchase of buckets. The allegedly missing excavator was not supported by an invoice, but only an extract of an undated deed of company arrangement, document A18, which refers to a 2001 model – that is, a different excavator. George said the excavator had been inside Cobham Street, and that there had been an excavator on the land near Cobham Street, which was very vague evidence on its own right. Dimitrios said nothing about the excavator. Elias’s evidence provides a good example of his dissembling evidence generally: he said he had never seen an excavator; it was theoretically possible that an excavator was not in the factory but on the land behind it; if that was so, the excavator was owned by a plumber called Crow; and Elias had never met Crow and so relied on what a neighbour had told him. Elizabeth and Georgia said they had never seen an excavator. Frank Puyol had never seen an excavator, but he had never been inside the building in Cobham Street and did not know what was in there. This at least suggests that Frank Puyol had not seen the excavator on the land outside the factory.
The photograph of the excavator shows a smaller machine of a fairly garish blue colour. It is not the sort of thing that one could not notice if it was inside a small factory, or even parked close by.
I am not satisfied on the evidence of Lefkas and George that the allegedly missing excavator was ever in the possession of any of the Respondents. The Applicants’ evidence on this point was hopelessly vague. There is no evidence that any of the Respondents disposed of an excavator. If the excavator is that in the photograph, left in the elements near a building, it was available to be stolen.
Another item allegedly “missing” is a Ford GT replica. Dimitrios purported to give evidence this car was worth $55,000.00, and I must reject that. First, he is not an expert in the valuation of cars, and he made that assessment of value on the basis of advertisements he had seen for fully restored cars of the same make and model at auction. However the allegedly missing Ford was not restored. Dimitrios tried to give evidence that it was a small step to restore the car, but that is simply unsustainable. There is an invoice to record the purchase of this car: document A12, a handwritten receipt to George for “1 x XA GT sedan rolling shell minus motor and gearbox, sold as is no rego or RWC” for $5,500.00 in July 2003. A “rolling shell” is an empty car body on wheels. Below that document in the Tribunal book was an email George had sent the Police on 9 April 2017, in which he gave them a chassis number, and the Police’s reply to the effect that the chassis number did not show up on registration records. Frankly anything could have happened to this rolling shell in the decade between the receipt and the demand on the Respondents. Given the email from the Police, it could have been cannibalised. I am not satisfied on the evidence of Lefkas , George and Dimitrios that the allegedly missing XA GT was ever in the Respondents’ possession.
It is obvious from the list of allegedly “missing” chattels that many of them are small items, and would be regarded as consumables in the building industry. Drills and sanders purchased in 2008. A stapler purchased, secondhand, in 2003. Drills purchased in 2007. I am not satisfied on the evidence that these things were still in existence when Cobham Street was leased to Elizabeth in 2014.
As to the larger items of allegedly “missing” chattels, it is very significant that they were not seen by Member Warren in the hearing of the injunction application in December 2016. That is, if the chattels existed, and had ever been at Cobham Street, they were gone by December 2016. There is evidence of George and Dimitrios entering Cobham Street after it was leased to Elizabeth. I cannot be satisfied that the Respondents are responsible for these larger allegedly missing chattels. I am not able to find that they existed in 2014. I do not consider that Hargale, Elias or Georgia are succeeding with a jus tertii defence in respect of these chattels. Instead, it is that George’s evidence was so vague that I am not satisfied that he has identified these items.
I note in passing that Lefkas and George abandoned any claim to items allegedly “missing” which are not supported by invoices.
The Personal Property Securities Act 2009 could have application if any of the Respondents were asserting a security interest in any of the chattels. They do not. The Applicants have not mortgaged or charged the chattels to the Respondents. Nor have they pledged them to the Respondents, the essence of a pledge being that possession of goods is given to the security holder, and the pledge exists for as long as the security holder or its assigns keeps possession. Nor do the Respondents have a possessory lien, such as a repairer’s lien or a lawyer’s lien over a client’s documents. The Personal Property Securities Act 2009 regulates certain types of security interests in chattels. Because neither the Applicants nor the Respondents assert a security interest in the chattels, that Act is irrelevant and the Respondents’ reliance on it is misconceived. Lefkas and George say that they own the chattels, not that they hold an interest as secured creditors, and so there can be no relevant ‘omission’ on their part to register their interest.
That Lefkas had granted charges to secured creditors is also irrelevant. The charges were floating charges. There is no evidence that they have crystallised, and no claim has been brought by the secured creditors. Until a floating charge crystallises, the company which granted the charge can deal with its assets.
Lefkas had possession of the chattels which were seen by Member Warren in Cobham Street, until it leased Cobham Street to Elizabeth. When Lefkas leased Cobham Street to Elizabeth it breached its obligations to her by leaving chattels there and not giving her vacant possession. However,
Lefkas and George did not abandon those chattels. They merely imposed on Elizabeth to give Lefkas rent free accommodation in her leased premises. Elizabeth could have taken various steps, such as demanding rent or a license fee, or demanding that the chattels be removed, but she did nothing.

Subsequently, when Hargale settled on the purchase and became the owner of Cobham Street, it too became the innocent party in a breach of obligation, because by leaving the chattels there Lefkas and George prevented Hargale from obtaining vacant possession of Cobham Street when it purchased the property from Nicholas John Sevdalis. Lefkas did not abandon the chattels, and Hargale did not demand rent or a license fee.
It is more likely than not that Lefkas and George left the chattels in Cobham Street and sought to “get away with” having them stored in another person’s property for as long as it could, rent free. As Lefkas seems to have been inactive as a builder, if not on the borderline of insolvency, getting rent free accommodation would be to its advantage. Lefkas and George did not abandon the chattels, which is evidenced by the fact that from time to time people representing Lefkas would enter the factory and the land, and take things. These persons even entered Cobham Street using a key, which was appalling conduct given that it was no longer the owner of Cobham Street, but which is consistent with Lefkas and George continuing to assert ownership of chattels. Elizabeth, and later Hargale, acquiesced in the chattels remaining, even though they were inconvenienced. The result is that the persons in possession of Cobham Street, namely Elizabeth and then Hargale and also Elias as the resident in Cobham Street as licensee or tenant of Hargale, have been and remain the bailees of those chattels which are the subject of the injunction.
Lefkas did not sell the chattels when Hargale bought Cobham Street. The chattels were not fixtures. Nor were they “goods sold with the land” within the meaning of the contract of sale.
Lefkas did not transfer the chattels to Nicholas John Sevdalis.
Lefkas has proven, on the balance of probabilities, the existence and right to possession, of the chattels which were seen by Member Warren in December 2016.
There is no real evidence of the value of the chattels which are the subject of the injunction. Many of the old tools would have no resale value, but be inconvenient to replace. It is appropriate that Lefkas and George retake possession of these chattels. If after that is done they allege that any of these chattels were missing, they could consider claiming damages, although for that purpose they would have to provide evidence of value. Certainly the parties should conduct a “stocktake” as Lefkas and George take away their chattels, to minimise the scope for future arguments.
The Applicants’ claims for payment for building work

The Applicants have the burden of proof. Their allegations are weak and confused, including for example that Hargale incurred a liability before it had been incorporated, in respect of work on a building that, had it been extant, it did not own.
Lefkas has not proven, on a balance of probabilities, an entitlement to payment of $5,500.00 or $3,840.00. Both claims must fail against Hargale, which had not been incorporated at the relevant time and which has not been shown to have confirmed its liability after incorporation. Even though Georgia became the owner of Elphinstone, where the $3,840.00 work had allegedly been performed, there is no satisfactory evidence that she agreed to it being done. It is more likely than not that Elias was doing work at that property for his daughter gratuitously, and that George and Dimitrios helped out a bit as a mates’ job. I will dismiss these claims.
Photographs establish that a door was installed in the rear of Cobham Street. I accept that this occurred in 2015, when Hargale owned the factory. George physically performed work, but he channels his income through Lefkas . Elias also physically performed work. As Elias did not own the building, I conclude that Elias arranged for the door to be installed with the acquiescence of Hargale, which stood to benefit from the improvement of its building. There was no satisfactory evidence of there having been any agreement as to a price. Lefkas is entitled at law to a reasonable sum. Lefkas says this is $1,540.00. There is no objective evidence of a contrary reasonable sum. I will order Hargale to pay Lefkas $1,540.00. Because of the delay in Lefkas pressing for payment, I will not award interest.

I now summarise the witnesses’ evidence

Evidence of George Fatouros in chief

George Fatouros said that he assisted in the preparation of “Attachment A”, which was prepared for the hearing and that it listed all of the equipment the Applicants owned.[10]
When Cobham Street was sold, he would remove the equipment so that vacant possession could be given. George spoke to Elias and Elizabeth, before the settlement. Elias said he proposed to live in the front of Cobham Street and Elias said that George did not have to move his goods out because George had helped Elias as a carpenter and had helped Elias protect his equipment.
Elias put George and Dimitrios on his list of suppliers, and engaged them to build ductwork for air-conditioning in Cobham Street, and also to refurbish Cobham Street. George worked for Elias between November 2014 and March-April 2015, both in Cobham Street and installing air conditioning at various building sites. Elias trained George in the making of ducting, using a guillotine and a bender. George also used his own hand tools. He was paid wages.
Elias lost contracts in April 2015 and George lost his job with Elias. However until October 2015 he continued to work for Elias on and off. In October 2015 George got a job elsewhere, and he was content to leave the chattels in Cobham Street because he and Elias kept in touch.
Dimitrios also worked for Elias as an employee. He became disgruntled when his wages were not paid and he commenced Court proceedings against Elias. This affected the relationship between Elias and George.
In April 2016 George went to Cobham Street to collect his Volvo tip truck, an excavator and a ramp. These were inside the factory. George gave two versions of events, in chief:
(a) Elias had a van parked in front of the truck. Elias moved his van so that George could drive the truck out, but he was unable to take the excavator and ramp, which remained inside the factory.
(b) George went to Cobham Street to collect the Volvo tip truck. Elias was not there. Elizabeth and Georgia were there together, and they said they did not know anything about an arrangement under which George could collect the truck. They said that the truck belonged to them because George had sold all of the goods to them. George said that he had not sold the goods. Elias had never said anything to George to the effect that the Toumbouros family had purchased the chattels. George asked the lawyer who had prepared the contract of sale, and was advised that the chattels were not part of the sale. The last part of this conversation was when George asked when his wages would be paid, to which he did not receive an answer. Thereafter Elias would not return his phone calls.
George had communications with Elias about the return of the equipment, by SMS message. I note that no such messages were tendered in evidence.
George relies on an email of 28 April 2015.[11] The document is of two pages in length, set out as a chain of 3 emails. The elder is dated at “11:31:52 + 1000” and is from “Liz-Metway Group” to Lefkas . [ Other evidence stablishes that this was Elizabeth]. It is expressed as a reply to a request for information, and says that within 48 hours Elias will send Lefkas ’ accountants copies of timesheets and documents relating to superannuation. The second is dated at 4:15 pm, and is set out as a demand by Dimitrios to Elias, Liz (ie Elizabeth) and Georgia in relation to the chattels: “I put you on notice that if any items are removed from your premises that belong to me or my companies in full or in part, you will be held responsible for the replacement value. This comes as a direct threat to (sic) George Fatouras and myself”.
The most recent, and the email upon which George relies, is dated 7:32 pm on 28 April 2015, and is from Liz-Metway Group to Dimitrios. It says, “Elias has spoken to George and guaranteed that all your items are still here and safe. As you know we have ducts that are in the way of your items and would be difficult to remove them”.[12]
In relation to the email of 7:32pm on 28 April 2015, George said that he had a conversation with Elias, after Dimitrios had threatened to sue for wages, in which Elias told George to get Dimitrios to back off, but also in which Elias went on to say that he guaranteed that the chattels were safe. I note that the emails do not contain any demand that Dimitrios drop any legal proceedings.
So if I pause for a moment: George did not give evidence of any joint verbal agreement by Elias Georgia and Elizabeth to take possession of chattels as gratuitous bailees.
George identified two Contracts of Sale of Cobham Street.[13]
The first contract was signed by George and by Georgia on 30 April 2014. It names Lefkas as vendor and “Georgia Toumbouras and/or nominees” as purchaser. It is in a standard form, and displays the logos of the REIV and the Law Institute of Victoria. As with many such contracts it contains spaces for people to write in relevant details.
At the top of page 3 there is a paragraph which says, “Goods sold with the land (general condition 2.3 (f)) (list or attach schedule)”. The remaining space in that paragraph was been left blank, and there was no attached
schedule. This means that, according to this contract, no goods were sold with the land. In a clause headed “GST” on page 3, a handwritten insertion was made to the effect that the sale was of a “going concern”.[14]

At around the middle of page 3 there is a paragraph which says, “At settlement the purchaser is entitled to vacant possession of the property unless the words ‘subject to lease’ appear in this box, in which case refer to general condition 1.1”. In the box the words “subject to lease” have been inserted.
A handwritten special condition on page 4 said, “The vendor agrees to remove and clean the back common area of all rubbish on or before the settlement date”.
There were 4 pages of typed special conditions, and in them was clause 11 which said, “It is expressly agreed and declared that the Purchaser has examined the fixtures and fittings and chattels to be sold with the property prior to the signing thereof and the Vendor and the Purchaser agrees that no express or implied warranties or conditions as to the quality and fitness of same apply in respect thereof”. This does not imply that there were chattels being sold.
There were five pages of typed general conditions, and in them were these:
2.3(f) the vendor warrants that the vendor will at settlement be the unencumbered owner of any improvements, fixtures, fittings and goods sold with the land.

7.2 if any part of the property is subject to a security interest to which the Personal Property Securities Act 2009 applies, at or before settlement the vendor will ensure that the purchaser receives a release from the secured party releasing the security interest in respect of the property.

However, the vendor’s obligations were qualified in relation to items that are sold in the ordinary course of the vendor’s business, items not described by a serial number in the Personal Property Securities Register, or items worth less than $5,000.00.
I conclude that this contract of sale did not provide for the sale of the chattels to Georgia or anyone she nominated as purchaser. Even the clause saying that the sale was of a “going concern” only seems to be directed to liability for GST and not to carry with it any notion of business equipment being sold. I also note here, that none of the Respondents’ witnesses gave evidence that they, or Hargale, had called for a release from any person with a security interest in the chattels, which confirms that they did not purchase the chattels or consider that the contract of sale had the effect of transferring ownership to them.
The second contract was signed by Nicholas John Sevdalis as mortgagee in possession as vendor on 3 July 2014. It identified the purchaser as “Georgia Toumbouras and/or nominee”. The price was the same. Again it said that the sale was of a “going concern” (although it is interesting to contemplate how a mortgagee in possession of this factory could sell a going concern). There is nothing in this contract to the effect that the mortgagee in possession was selling chattels, which is consistent with Lefkas having retained ownership of them.
At this point in Mr George Fatouras’ evidence in chief the Respondents made it clear that they were putting the Applicants to their proof in relation to ownership of the chattels, and so George gave evidence as to all of the receipts and invoices which were contained in the Tribunal Book, by way of proving that the chattels were owned by the Applicants. As a matter of completeness I set out this evidence in the Table below, even though as I have said above the final list is what is important. The point of doing this is to record George’s evidence in proof of the acquisition of the chattels. The Table is largely consistent with “Schedule A” to the original Points of Claim dated 13 December 2016, which was referred to in Member Warren’s Order to identify the chattels made subject to the injunction:
Chattel
Document in Tribunal Book
Relevant document, including purchaser, date, amount
George Fatouras’ oral evidence
Seen by Member Warren?
Holtz edger
A1
Invoice to Lefkas dated 20 September 2006 for $10,450 – various equipment including Holtz edge bander
Lefkas paid this invoice and the edger was at Cobham Street
Feeder only
2 x panel saws
A2
Invoice to Lefkas dated 16 May 2006 for $8,250 – for “one only 18’ tilt panel saw”
There were two panel saws at Cobham Street, but George cannot produce an invoice in relation to the second one
One only
2x thicknessers
A3
Invoice to Lefkas dated 23 June 2006 for $5,313, for 2 thicknessers + 7 other items
The item is a plane. There were two of them
One only
2 x 3-phase compressors
A4
Invoice to Lefkas dated 23 June 2006 for various items, including two compressors for a total of $5,700
The items on the invoice for $1,500 and for $4,200 relate to these items. They were not at Cobham Street [15]
No
Large 4-bag dust extractor and pipes to machines
A5
Invoice to Lefkas dated 23 June 2006 for various items, including dust extractor for $850 (same invoice as A4)
The item is missing from Cobham Street, but was there on 6 December 2016. The VCAT member hearing the injunction application saw it.
One only
2 x portable compressors
A6
Invoice to J Fatouros dated 28 March 1985, “cash sale” for various items including one compressor for $380
Even though the invoice is $300, it means $380. George remembers that his tools were scattered around the place in Cobham Street, in the back corner, and he remembers these compressors
No
Portable bench saw
A7
Invoice to “Jim & George Lefkas Pty Ltd” dated 30 October 2001 for one second hand 10 inch mitre crosscut saw, $495
Lefkas bought it. It is missing
No
3 x hand sanders
A8
Invoice to Lefkas dated 23 June 2006 for various items, including “assorted hand air tools” for $670 (same invoice as A4)
Lefkas bought them. They were missing
No
Jig saw
A8
Not specifically mentioned in Invoice to Lefkas dated 23 June 2006 for various items
Lefkas bought them. They were missing
No
Blowers
A8
Not specifically mentioned in Invoice to Lefkas dated 23 June 2006 for various items
Lefkas bought them. They were missing
No
General hand tools, jig, saw, planner
A9
Invoice to Lefkas dated 15 July 2003 for various secondhand power tools for $450
Lefkas bought them. They were missing
Yes
3 phase heater fan
A11
Invoice to Lefkas dated 13 March 2008 for various items, including one gas turbo heater without gas bottle, for $170
Lefkas Builders bought it. It was missing
No
Car: XA Ford GT replica, complete car
A12
Handwritten receipt to George Fatouros for “1 x XA GT sedan rolling shell minus motor and gearbox, sold as is no rego or RWC” $5,500; plus some Internet advertisements for restored XA Falcons
The last time George saw this car, it was on site in February 2016.
No.
Trolley workstation with all KC tools, spanners, sockets, shifters and general mechanical hand tools
A13 & A14

(also B12)
“Trolley workstation” is not specifically mentioned in either of invoices dated 29 June 2006 or 6 December 2006, however the invoices referred to various tools
In chief, George was asked the whereabouts of these items, and he did not answer
Yes, but not all KC tools
2 post hoist disassembled
A14
Referred to in invoice to Jim/George dated 29 June 2006, $2,950.35 plus GST charged for a “two post”
George said, in chief, that he noted that the amount of the invoice was different to $2,950.35, and he said that he cannot say what items in the invoice relate to this item
Yes
Two temporary site toilets
A15
Invoice by an auctioneer to Lefkas for two Portaloos, 20 October 2011, $134.44. Note, invoice shown as “paid by contra”
George said he last saw these items in February 2016, at Cobham Street
No
50 panels of temporary fencing
A16
Invoice to Lefkas dated 7 October 2009 for 35 temporary fencing panels, for $700

No
24 m of roof walkway scaffolding, with 24 aluminium planks
A17 (also B17)
Invoice to Lefkas Builders dated 7 October 2009 for 1 x roof walkway scaffold, for $4,500 (same invoice as A16)
George said, in chief, that he has seen the invoice. He did not give evidence orally about the items themselves
Scaffolding yes; planks no
Kobelco 3.5 tonne excavator
A18
Very brief extract from a deed of company arrangement between Lefkas Builders Pty Ltd and Ross McDermott as administrator, comprising a coversheet and one page said to be of an inventory, which refers to a used Kobelco excavator, plus an undated photo.
George said, in chief, that Lefkas went into administration. Mr McDermott was the administrator. The Comalco excavator was on the list of equipment. The administrator did not sell any equipment. He just prepared an inventory, and then “we” reached an agreement and paid the creditors. Once the administrator withdrew, George assumed that the excavator was still there. He identified the photograph as being of the excavator.
No
Sorting bucket for 7.5 tonne excavator
A19
Invoice to Lefkas dated 22 May 2008 for various items including a 1.5 m sorting bucket for $1,000
No oral evidence
Yes
Grabber for 7.5 tonne excavator
A20
Invoice to Lefkas dated 22 May 2008 for various items including “Grab mechanical 3 “finger” for $2,000
No oral evidence
No
Hitch for driver
A 21
Invoice to Lefkas dated 13 April 2007 for various items including “quick hitch driver assembly” for $650
Lefkas paid this invoice
No
Extension arm for drills
A 22
Invoice to Lefkas dated 13 April 2007 for various items including “auger extension” for $250 (same invoice as A21)
Lefkas paid this invoice. It is missing
No
Five drills ranging from 600 mm to 350 mm
A 23
Invoice to Lefkas dated 13 April 2007 for various items including “5 augers” for $3,200 (same invoice as A21)
Lefkas paid this invoice
No
Oxy welding box with gauges
A 24
Invoice to Lefkas dated 27 February 2001 for various items including “one set Oxy welding gauges” for $250
Lefkas paid this invoice in 2001. The last time he saw these items was February 2016, when he was using it at Cobham Street.
No
2 x 100 mm gas nail guns
A 25
Invoice to D Fatouros dated 18 July 2012 for one 50 – 90 mm nail gun: not this item
No oral evidence
No
Hilti rotary hammer drill
A 26
Invoice to Lefkas dated 7 October 2009 for various items including Hilti hammer drill for $150
Lefkas paid this invoice
No
Kanga rotary hammer drill
A 27
Invoice to Lefkas dated 7 October 2009 for various items including Kanga hammer drill for $50 (same invoice as A26)
Lefkas paid this invoice
No
Bosch Jack Hammer, large
A 28
Invoice to Lefkas dated 7 October 2009 for various items including “Bosch hammer” for $450 (same invoice as A26)
No oral evidence
No
Demo saw with trolley
A 29
Invoice to Lefkas dated 7 October 2009 for various items including “stihl demo saw with trolley” for $750 (same invoice as A26)
Lefkas paid this invoice
No
Concrete vibrating plate
A 31
Invoice to Lefkas dated 7 October 2009 for various items including “concrete vibrator plate” for $350 (same invoice as A26)
Lefkas paid this invoice
No
3 phase wood turning lathe
A 32
Invoice to Lefkas dated 16 May 2006 for various items including a wood lathe, total for all items $770
Lefkas paid this invoice
No
2 x electric gate openers, with 12 remote controls
A 33
Invoice to Lefkas dated 27 February 2001 for various items including 2 X electric gate openers for $900
Lefkas paid this invoice. They were in good working order
No

Chattel seen by VCAT Member Warren at the injunction hearing on 13 December 2016: in respect of which the Applicants seek an order for delivery up
Document in Tribunal Book (if any)
Relevant document, including purchaser, date, amount
George Fatouras’ oral evidence

2 x pedestal drills
B1
Invoice to Lefkas dated 13 March 2008 for various items, including two pedestal drills with bits, for $230
George wants this item back. Lefkas paid for it

Band saw
B2
Invoice to Lefkas dated 3 May 2003 for 3 items, including a 12 inch bandsaw for $550
George wants this item back. Lefkas paid for it

Large barrel sander
B3
Invoice to Lefkas dated 13 March 2008 for various items, including a single barrel sander for $3,500
George wants this item back. Lefkas paid for it

Dowel and bench planer/ thicknessers
B4
Invoice to Lefkas dated 13 March 2008 for various items, including thicknesser with dowell attachments for $2,500
George wants this item back. Lefkas paid for it

Large mill saw with four blades
B5
Handwritten Invoice to Lefkas dated 23 June 2006 for various items including a 36 inch bench saw for $1,250
George wants this item back. Lefkas paid for it. It had four blades

3 x drills
B6
Invoice to Lefkas dated 6 December 2006, which contains one Naylor, and to drills for $105.80, $62.11 and $81.95 respectively
George wants this item back. Lefkas paid for it

3 x staplers
B6
Not mentioned in Invoice to Lefkas dated 6 December 2006

2 x brad gun
B6
Not mentioned in Invoice to Lefkas dated 6 December 2006

2 x pallet truck
B7
Invoice to Lefkas dated 13 March 2008 for $350; one working and one with a faulty wheel

XA Ford GT panels, bonnet, rear boot lid, doors and differential
B8
Road traffic authority document dated 31 July 1986 about the transfer of registration of a Ford Sedan. No mention of individual panels
The differential is missing. The other items were all there on 6 December 2016

1937 Chevrolet body on rotisserie, Chasse, complete running gear and all parts for assembly
B9
Handwritten receipt issued by Phil Gleason to George Fatouros dated 16 June 2006 for a 1938 Chevrolet in unfinished condition, for $13,000
The 1937 Chevrolet was on site on 6 December 2016

Tyre changer
B10
Invoice to Lefkas dated 6 December 2006, one item of which is a tyre changer for $1,000
George wants this item back. Lefkas paid for it

Tyre balancer
B11
Invoice to Lefkas dated 6 December 2006, one item of which is a wheel balancer for $1,000
George wants this item back. Lefkas paid for it

4 post hoist, disassembled
B13
Invoice to Lefkas dated 29 June 2005, the first item of which is a 4 post hoist for $4,675
George wants this item back. Lefkas paid for it

Gearbox lifter
B14
Invoice to Lefkas dated 6 December 2006, one item of which is a “transmission stand” for $318.18
George wants this item back. Lefkas paid for it

Air impact drill
B15
Invoice to Lefkas dated 12 February 2007, including a “1/2 impact wrench” for $116.69
George wants this item back. Lefkas paid for it

Safety barrier scaffold for internal stairs
B16
Invoice to Lefkas dated 7 October 2009, including roof walkway scaffold for $4,500
George wants this item back. Lefkas paid for it

4 buckets for 7.5 Tonne excavator
B18
Invoice to Lefkas dated 29 January 2007, for a used 1997 Kobelco excavator fitted with 3 GP buckets and a mud bucket, for $41,800
George wants this item back. Lefkas paid for it

Driver for drills to suit 7.5 Tonne excavator
B19
Invoice to Lefkas dated 13 April 2007

Two pairs of 4.5 tonne ramps for loading equipment on truck
B20
Receipt dated 12 August 2008 to Lefkas for one ramp, 2 x $1,200
Even though the invoice is one ramp, ramps come in pairs and so it means two pairs of ramps. George wants this item back. Lefkas paid for it

Skid steer forklift accessory
B21
Receipt dated 12 August 2008 to Lefkas for Skid steer, $1,200
The items in B21 and B22 are collectively called a ‘skid steer’. George wants this item back. Lefkas paid for it

Skid steer post hole accessory
B22
Receipt dated 12 August 2008 to Lefkas for various items including post hole auger drive, $2,500

Skid steer demolishing four in one bucket
B23
Receipt dated 12 August 2008 to Lefkas for various items including ‘demo bucket’ for $1,000
‘Demo bucket’ means ‘demolition bucket’. George wants this item back. Lefkas paid for it

Refueling diesel tank with pump
B24
Invoice to Lefkas Builders Pty Ltd dated 22 May 2008, for various items including a refuelling tank for $450
George wants this item back. Lefkas paid for it

Four way lifting chains with 6 m of chain
B25
Invoice to Lefkas dated 22 May 2008, for various items including “assorted chains not certified” for $150
George wants all the chains back. Lefkas paid for them

MIG welder
B26
Finance lease, Bill Fatouros as lessee, commencing 9 December 1988 and terminating 9 December 1992 with a residual value of $364 .04
Bill Fatouras was George’ brother, and was a director of Lefkas

Aluminium MIG welder
B27
Invoice to Lefkas dated 27 February 2001 for various items including one model WF4 welder for $2,100
George wants all the chains back. Lefkas paid for them

Portable welder
B28
Invoice to Lefkas dated 27 February 2001 for various items including one portable welder for $350
No oral evidence

Portable MIG welder
B29
Invoice to Lefkas dated 27 February 2001 for various items including one portable MIG welder for $570
No oral evidence

Concrete pencil vibrator electric
B30
Auctioneer’s invoice to “Jim Fatouras” dated 1 September 2012 for a vibe shaft, for $182
This device vibrates concrete within a wall cavity. George wants it back. Lefkas paid for it

George did not give evidence in chief about the three items of building work.

Evidence of George Fatouros in cross examination

George is the sole director of Lefkas . George had been a registered builder, before Lefkas went into administration in 2011, but is no longer a registered builder. He is able to do carpentry work, but he cannot enter contracts as a builder. By carpentry work he means framework, fixing and cabinet making.
National Australia Bank had become mortgagee in possession of Cobham Street, before Nicholas John Sevdalis had become mortgagee in possession.
Lefkas was requested by Hargale to fit doors to Cobham Street in August 2014. Even though this was before Hargale took possession, on 9 January 2015, it had moved into Cobham Street by then. George Fatouros considers Hargale, Elias, Elizabeth and Georgia Toumbouras to be “all the same thing” saying he “talks to people, not companies”. Georgia asked him to do the work.
George and Lefkas owned all the chattels in Cobham Street. The tenant who was in possession before the settlement – that is, Elizabeth – did not own any of them.
Before the agreed sale to Georgia, Lefkas had not leased Cobham Street to any other business, and there was no one else who owned the excavation equipment or the Volvo truck.
The Volvo truck was parked on common property, being the car park shared by Cobham Street and other factories in the same complex. It was not parked inside the factory at Cobham Street. Therefore George did not trespass when he went onto the common property to take possession of the Volvo.
It was put to George that he stole equipment from the Toumbouras or from a business proprietor called Chris Wilson Plumbing. George vehemently denied this allegation. It was then put to him that he had been previously charged with theft, to which he answered that this was true but that it occurred in 1997 in the context of a civil dispute with an owner builder.
It was put to George that the Invoice to Lefkas dated 7 October 2009 for 1 x roof walkway scaffold, for $4,500.00 (invoice as A17) showed an ABN for Lefkas which was not its ABN. Mr Fatouras conceded that.
It was put to George that the Invoice to Lefkas (document A20 above), dated 22 May 2008 for various items including “Grab mechanical 3 finger” for $2,000.00 did not display the correct ACN for the vendor of that item. George answered that if that was true, it had nothing to do with him. All he had done was produce evidence and invoices that had been issued to him.
George was asked whether any third parties had a property interest in any of the chattels, and he answered in the negative. A deed of charge was then put to him. George said that he did not recall whether it had been a fixed charge. He also admitted that Lefkas had borrowed money from National Australia Bank, and had signed a mortgage to one Vassilios in respect of a loan of $783,428.91, and had mortgaged Cobham Street as security for that debt.
George said the chattels in Cobham Street are relevant to the carpentry type work that he performs.
George engaged an estate agent to sell Cobham Street. The agent marketed the property in the usual way, and George first met Elias through the agent. At this time Elias “was going belly up”, losing his property. George and Elias did not have any direct negotiations about the sale, all of which were done through the estate agent. The property was sold to Hargale subject to a lease.
George stands by the various receipts and invoices on which the Applicants rely. He maintained that the chattels were purchased over a period of time. The finance came from Lefkas ’ own money, and from money borrowed from banks in the usual way.
George and Lefkas had access to the chattels after the settlement of the sale of Cobham Street. George spoke to Elias before the settlement, about entering a commercial lease. George does not remember the date of this discussion, but it was after the estate agent had begun marketing Cobham Street for sale. Elias, Elizabeth and Georgia wanted to lease Cobham Street
before the settlement date. They discussed that matter with George and Dimitrios. The discussion took place at Cobham Street. Elias proposed the lease, and then Elizabeth came into the conversation and said that she would be the tenant. Eventually a lease was signed, with Elizabeth as the tenant. George did not speak directly, or separately, to Georgia.

After the lease was signed George and Lefkas continued to have access to the factory premises and to the chattels. That was part of the deal, although it was not written into the lease document. After all, George “was still the owner of Cobham Street”, and was employed by Elias as an employee between November 2014 and August 2015. George was allowed to take any equipment he wanted, from Cobham Street. He concedes that the start date of the lease was 24 March 2014.
I note here that George was not the owner: Lefkas was, and it had granted at least one mortgage over Cobham Street.
George conceded that after Lefkas had signed the contract of sale, it lost control of Cobham Street to Mr Sevdalis as mortgagee in possession, and that he sold the property as mortgagee. He said that whilst the administrator had not taken over Cobham Street, the mortgagee in possession did.
George was asked about the agreement he alleges, under which Elias and Georgia became gratuitous bailees of the chattels. He said that the agreement was made orally and in text messages, mostly between him and Elias. Even though Elizabeth was literally the tenant, George believed that in reality the three of them were tenants, and so he spoke to all three of them in the kitchen of Cobham Street. At the time Elias, Elizabeth and Georgia were living in Cobham Street. They had many conversations, but he does not recall how many conversations he had about the bailment.
Significantly, George was asked to carefully read paragraph 14 of the Points of Claim and the Particulars thereunder, in which the allegation of the gratuitous bailment is pleaded, and having read it he said, “I don’t remember”. He also said that whilst he does not understand what the words “gratuitous bailee” mean, he could leave his possessions in Cobham Street and that the Toumbouras would keep them on his behalf.
George said that there was no reason for him to speak to the mortgagee in possession about the chattels. That said, he agreed that neither he nor Lefkas had control of the property, in the sense that it was leased to Elizabeth and had been seized by a mortgagee in possession. He agreed that he had no control over the settlement date or the ability of Georgia to nominate a purchaser, but he maintained that the mortgagee in possession had no interest in the chattels so that ownership of them remained with him and Lefkas .
George said he “drafted” the email of 4.15pm on 28 April 2015 which set out the demand by Jim Fatouras to Elias, Elizabeth and Georgia Toumbouras in relation to the chattels: “I put you on notice that if any items are removed from your premises that belong to me or my companies in full or in part, you will be held responsible for the replacement value. This comes as a direct threat to (sic) George Fatouras and myself”. However he did not send it himself.

Evidence of George Fatouros in re examination

George Fatouras said he carried out building work in Cobham Street for the whole Toumbouras family. They wanted to create a doorway between the factory area and the room at the front of the building. George was in the factory, and he spoke to all of Elias, Elizabeth and Georgia. They sought his advice on the type of door and asked whether he could put it in. George said he could do the work and that Lefkas would invoice Hargale.
In relation to the work at Elphinstone, George read paragraph 11 of the Points of Claim and said that he remembered that conversation, which took place at Cobham Street. The Toumbouras said they wanted to use Elphinstone as security for some refinance, and so wanted to improve the quality of the house to increase its value. They wanted to close off a laundry and add some floor joists. The agreement was that Lefkas would invoice Hargale.

Evidence of Dimitrios Fatouros in chief

Dimitrios said that over the years when Lefkas had available money, it would buy goods and equipment at auctions. Sometimes an invoice would be addressed directly to him, but it was all in relation to the business.
Dimitrios was involved in engaging the estate agent to sell Cobham Street. The agent got two potential purchasers interested. Dimitrios knew Elias from before. He was aware that Elias had been dispossessed of his property by his bank, and that he needed somewhere to stay. In May 2014 Dimitrios and George agreed to sell Cobham Street to Elias, and Elias said he would settle within three months. However he was unable to do so.
Dimitrios met Elias at Cobham Street. Elias said that he wanted to put his equipment in Cobham Street for storage, but to live in the property. He offered $320,000.00. Elias also wanted to enter a lease of Cobham Street so that he could buy it as a going concern and thereby not have to pay GST.[16]
Dimitrios granted a lease, so that Elias was in possession before settlement. Elias said he wanted his wife Elizabeth to be the tenant on paper, because Elias had Court proceedings arising from his company Metway going under. Elizabeth signed the lease and the Toumbouras family moved in two weeks later.
In October 2014 Dimitrios became an employee of the Toumbouras family. They said they had a contract and that Dimitrios could be the supervisor of the jobs. Dimitrios worked in that capacity until January 2015. By then, the Toumbouras family had refused to pay Christmas holiday pay and they owed him other wages. They said that they could not pay his wages because they were very short of money, which made Dimitrios angry and disappointed when he observed them take an overseas holiday.
Dimitrios had a key to Cobham Street and it was not until February 2015 that the Toumbouras family pretended that he was not allowed to have access to the premises. Elias started requiring Dimitrios and George to obtain express permission before entering Cobham Street.
Dimitrios sought to recover the chattels in January 2015 because of the outstanding wages, but that is when Elias told George to get Dimitrios to back off, and threatened to sell the equipment. This was how the email exchange of 28 April 2015 came about. The “Liz” who signed some of those emails was Elizabeth Toumbouras. From his observation, Dimitrios says that she physically did the wages and the secretarial work for Metway.
To summarise, then, Dimitrios did not give evidence of an oral agreement in December 2014 under which Elias and Georgia jointly agreed to act as gratuitous bailees of the chattels. His evidence was to the effect that chattels were left in Cobham Street when Elizabeth became the tenant, and that between then and February 2015 Dimitrios freely access to Cobham Street using a key.

Evidence of Dimitrios Fatouros in cross examination

Dimitrios conceded that he had become bankrupt on 29 April 2016, the petitioning creditor being Bank of Queensland. He agreed that Lefkas had signed a mortgage of Cobham Street in favour of one Vassillious in respect of a loan of $783,428.91.
Dimitrios maintained that Lefkas owns all the chattels claimed in this proceeding, and that no third parties have an interest in them. There was litigation when Dimitrios was a director of Lefkas , but that litigation was settled and Vassillious released Lefkas .
Dimitrios was asked about the XA Ford GT panels, bonnet, rear boot lid, doors and differential, referred to in document B8. He said those items do not exist anymore, and that they were entirely separate to the XA Ford GT replica referred to in document A12.
Dimitrios said that any reference in documents to a business called “A1 Design Kitchens” is not to some third-party asserting a proprietary interest in any of the chattels, but was actually a business unit or profit centre of George and Dimitrios. They used that name to differentiate their kitchen business from their other building-like activities.
Dimitrios denied that he ever trespassed. He denied taking any chattels. He threatened to sue Metway – being Elias’s business – for wages due, but he did not consider Georgia to be involved with that issue. All he wanted was due payment of wages and superannuation from Metway.
Dimitrios said that he had some 35 years’ experience as a carpenter, and had supervised subcontractors and employees in the building industry. He had supervised as many as 50 people at a time. He was employed both as a labourer and as a supervisor by Metway.
The lease was negotiated at a time when the sale was virtually agreed. Elias was desperate to have premises to move into. He said that they were having financial problems and he asked whether they could stay in the factory and live there prior to settlement. Elizabeth was to be the tenant, on paper. Dimitrios did not actually meet Elizabeth at this time. Dimitrios knows from his own observation that they lived in Cobham Street for a period. He literally observed a bed, and one morning he arrived at 7:00 am and observed Elias in his underwear.
Whilst Dimitrios worked for the Toumbouras family from November 2014, he observed that business slowed down over Christmas. He did not believe that its takings diminished, though, because they still spent time making ducts over the Christmas period.
Dimitrios said the agreement under which the Toumbouras became gratuitous bailees came about because Lefkas found a new property but was not able to move its equipment into the new property quickly.
Dimitrios Fatouros insisted the email exchange of 28 April 2015 took place and was genuine.

Evidence of Dimitrios Fatouros in re-examination

The XA Ford sedan is said by the Applicants to be worth $55,000.00, but the receipt produced in relation to it (Document A12) was for $5,500.00. Dimitrios said this was not an error, but because the sedan’s value grew over time as it is a rare and collectable car. It was bought as a shell, and Dimitrios and George bought hoists to work on it. They fitted an engine worth $7,500.00, a gearbox worth $2,500.00, and in 2006 they rebuilt the differential. It only needs wiring in order to be complete. Dimitrios has seen advertisements for this model Ford and says it is worth $55,000.00.
Dimitrios was last in Cobham Street in late January 2015. He saw all of the chattels there. He asked for them. He has not attended the premises since.
An agreement was negotiated with one Vassillious under which he dropped all claims against all property including the chattels.

Evidence of Frank Puyol in chief

Mr Puyol is a self-employed electrician, who works from number 5 Cobham Street Reservoir, and so has observed 3 Cobham Street. He knows Georgia, as a neighbour. He also knew the previous owners, and worked with them: George, Dimitrios and Bill Fatouras.
Mr Puyol bought his premises, 5 Cobham Street, from George and Dimitrios.
Mr Puyol identified, in a photograph of an excavator, some containers that he had constructed at the rear of the factory premises. He said that the local Council had been concerned with rubbish being dumped in the area, and he installed the containers to hold his goods. He said that he had never seen the excavator at the property. He said that George and Dimitrios put rubbish around the property. A tenant of Mr Puyol took photographs of George and Dimitrios dumping rubbish, mainly building materials, and they were prosecuted. Mr Puyol personally did not see George and Dimitrios dumping rubbish.
George and Dimitrios sold Cobham Street before cleaning up their rubbish. Mr Puyol has never seen inside 3 Cobham Street, but believes George and Dimitrios left rubbish inside the property as well, but that the local Council cannot take steps in relation to rubbish that is not external. As a matter of logic, Mr Puyol does not believe anyone would have taken any of the rubbish, because it was of no value. Mr Puyol has not seen George and Dimitrios, or anyone else, removing chattels from 3 Cobham Street. Mr Puyol is not at his premises all the time.
At least 12 months ago there was a tipper truck in the car park. Mr Puyol noticed it when he went to his containers. It was removed.
A moulding machine, which would weigh 3.5-4 tonnes, is still sitting in the car park. Mr Puyol says it was removed from 3 Cobham Street, but he does not know who owns it.
Behind the factories is a paved car park which is common property. There are four carpark spaces per factory. Mr Puyol constructed his containers on the corner of his designated carpark spaces.

Evidence of Frank Puyol in cross examination by the Applicants

Mr Puyol reiterated that he had never seen the excavator depicted in the photograph.
Mr Puyol reiterated that he had never been inside 3 Cobham Street, and that he does not know what is inside it.

Evidence of Frank Puyol in cross examination by Metway Group

As well as knowing Georgia, Mr Puyol also knows Elias.
There are five factories, and a common property carpark. Mr Puyol attends 5 Cobham Street 2 to 3 times a week, for about three hours at a time in the afternoons. He is familiar with the other factories, which are used by some clothing manufacturers and for storage.

Evidence of Frank Puyol in re examination

Mr Puyol also knows Bill, but has not seen him for about two years. He has no knowledge of the financial affairs of the Fatouros family.

Evidence of Georgia Toumbouras in chief

Georgia said she is 24 years old, and works doing office administration in Cobham Street.
Her family saw Cobham Street for sale in April 2014, and dealt with the vendors’ estate agents. Her mother Elizabeth started leasing the premises and later they made an offer to purchase it.
In April 2014 Georgia inspected Cobham Street, with the estate agent. She saw that there were chattels everywhere. She observed that you could not get through the building because of the amount of equipment, including heavy industrial machinery. The estate agent said that all of the chattels would be removed from the warehouse area if the Toumbouras family leased or bought Cobham Street. Georgia does not believe the contract of sale says anything about the removal of chattels. She understands that it required the back of the common area to be cleaned of rubbish, but says that did not occur. Subsequently, the estate agent, or George, told her that he would not remove any chattels, and in return for Georgia agreeing to let them remain, he would waive a penalty that would have been payable by Georgia for late settlement.
Georgia remembers having signed two contracts of sale, the first with Lefkas and the second with Nick Zevdalis as the mortgagee in possession. Her solicitors looked after the documentation.
The estate agent said that the goods were owned by an accountant called “John”, whose surname Georgia does not recall, and not by the owner of Cobham Street.
In January 2005 Georgia attended the Office of Titles with Nick Zevdalis, the mortgagee in possession, because there was some confusion with the certificate of title that had to be cleared up.
At the date the purchase was settled on 9 January 2015, Elizabeth was the tenant. Georgia did not inspect Cobham Street immediately before settlement, but after settlement when she saw the property it was still full of machinery and the common area at the back contained rubbish. She was disappointed.
Georgia went on an overseas trip from 15 January 2015 until February 2015. She believed all of the machinery, chattels and rubbish would be removed whilst she was overseas and that Cobham Street would be clear by the time she came back. However when she returned, machinery, chattels and rubbish were still there. [If I interject here, Georgia did not give evidence of precisely what machinery and chattels she had seen, and so the reference to seeing such things in February 2015 is again imprecise. She does not identify particular chattels].
After the settlement, Georgia arranged for the locks of Cobham Street to be changed. She was uncomfortable about the possibility that George and Dimitrios had retained their old keys.
During 2014, after Elizabeth had become the tenant in Cobham Street but before settlement of the purchase, Georgia was at Cobham Street with Elizabeth and she observed George let himself in to the premises and introduce himself.
During 2014 Georgia was living in the house in Elphinstone and studying at Deakin University in Geelong. She would commute between the two. She was also the only person to be working at Cobham Street.
Georgia did not meet George or Dimitrios again at Cobham Street after settlement of the purchase. She did see Dimitrios drive past at some stage.
Georgia knows that George took the tipper truck from the common property area in April 2016. She was with Elizabeth at Cobham Street, and she heard the truck start-up, and saw George in the driver’s seat. She asked him what he was doing, and when he said “I’m getting the truck” Georgia told him
not to because he had abandoned the truck and that he was now trespassing on private property. Georgia said that he should consult his lawyer and show her his receipts for the purchase of the truck. George did not remove the truck that day. Nor has he supplied any receipts, as he had agreed to do.

After this Georgia arranged, with the occupant of number 1 Cobham Street, for gates to be installed at the property. She has not seen George or Dimitrios since April 2016.
In relation to the alleged agreements for building works to be performed, Georgia said that she did not participate in any conversation with George or Dimitrios about supplying an entry door for the front office, in August 2014[17], and that she was in Elphinstone at the time. Anyway, Hargale did not own Cobham Street in August 2014, so it was not a position to have building works performed there.
Georgia said that she did not participate in any conversation with George or Dimitrios about them performing work at Elphinstone[18]. She said that she owns that property. Her father Elias has been extending it on and off for about five years. She would not have been home in Elphinstone on 10 October 2014, which she recalls as being a Friday. She recalls spending the Friday and the weekend in Melbourne.
Georgia said that she did not participate in any conversation with George or Dimitrios about them cutting a door opening at the rear of Cobham Street[19]. She is aware that Elias installed a door at the back of Cobham Street, to give better access to the car park, but she did not ask George or Dimitrios to do that work.
Georgia has not received any invoices in relation to the work allegedly performed by Lefkas .
Georgia has never seen the excavator depicted in the photograph which was shown to her.
Georgia has seen the emails of 28 April 2015[20].
Georgia has never, on behalf of Hargale, asked Elias or Elizabeth to discuss the property with any other party, nor discussed with them all the chattels which are in the premises. She is the sole director of Hargale and has not authorised anyone else to speak on its behalf.

Evidence of Georgia Toumbouras in cross examination by the Applicants

Georgia has graduated in Architecture. She has never participated in any design or building works at Cobham Street. She was happy with how it was.
Until April 2014 she lived in North Balwyn, and then she and her parents Elias and Elizabeth moved to Elphinstone. She denied that Elias and Elizabeth ever lived at Cobham Street.
Georgia signed both contracts of sale for the purchase of Cobham Street, and received legal advice in that respect. She chose to put Cobham Street in Hargale’s name and she arranged for it to be incorporated. Even though an ASIC company extract of Hargale records Georgia’s address being Cobham Street, that was just because the accountants supplied the information.
As to the list of chattels which were identified by Member Warren in the Order of December 2015, Georgia did not know that Lefkas and George asserted ownership of the goods on that list. No one asked Georgia to hand them over[21]. She assumed the chattels had been abandoned. She asked Elias who owned them, and he said he was not sure. If George ever demanded that Elias deliver up the chattels, Elias never told her about it.
Georgia did not get involved in the leasing of Cobham Street. She did not ask Elizabeth about it, or even why she was doing it.
Prior to the settlement the estate agent said that he would speak to the owners of Cobham Street and get their accountant to remove the chattels. Heavy machinery was removed, and Georgia assumed that was done by the accountant.
Georgia did not inspect Cobham Street immediately prior to the settlement, and she did not really think about doing so.
Georgia was shown some photographs of a restored Ford XA GT. She does not remember that car. She had wanted to get rid of it, but did not know what to do. She denies putting any items up for sale.
Georgia did not see Cobham Street being modified. Her father Elias told her that he had installed the new door. She did not instruct George to carry out building work to create a laundry and bathroom in Cobham Street.
Georgia did not instruct George in how to fix frames to a building to take air conditioning ducts. She has seen air conditioning ducts – that is, stock – inside Cobham Street. She did not see ducts placed outside the perimeter of the building.

Evidence of Elizabeth Toumbouras

I make this introductory comment. Elizabeth is not a party to the proceeding. Because she is the mother of Georgia, it was unsurprising when she was called as a witness by Hargale and Georgia. After giving her evidence in chief she was cross-examined by all other parties. Only later, when Elias was giving his evidence did the lawyer for Metway Group say that Elizabeth was its witness, and that it sought to call her to give further evidence in chief. This was quite irregular but, on the bases that section 98(1)(c) of the Victorian Civil and Administrative Tribunal Act 1998 empowers the Tribunal to inform itself as it sees fit; that I would not allow Elizabeth to revisit her original evidence but only to deal with matters that were new; that I would give the Applicants and the First and Third Respondents leave to cross-examine her on her new evidence in chief; and further because the Applicants did not oppose it, I allowed Metway Group to call Elizabeth to give further evidence in chief.

Evidence of Elizabeth Toumbouras in chief, when called by Hargale and Georgia Toumbouras

Elizabeth first met George or Dimitrios after she had moved into Cobham Street as tenant. Before then her only discussions about leasing or buying Cobham Street had been with the estate agent.
The air-conditioning business had been conducted in High Street Preston, in premises which, as she put it, “we” owned. When those premises were sold, they needed premises in which to put their stock and equipment.
Elizabeth continues to run an air-conditioning business under the name “Evenair”.
Elizabeth, Elias and Georgia inspected Cobham Street together in April 2014 with the estate agent, who told them that the premises would be empty when they moved in. Elizabeth observed heavy machinery in Cobham Street, from floor-to-ceiling, as if it was stored. There were even chattels stored in the foyer.
Another group were inspecting Cobham Street on the same day. Elizabeth, Elias and Georgia were also inspecting another property around the same time.
Elizabeth, Elias and Georgia had a big “bending machine” that was used in the manufacture of ducting. They put it outside Cobham Street after Elizabeth had taken possession as the tenant, because they could not find enough room inside. The bending machine was stolen in July 2014.
There was no excavator at Cobham Street when Elizabeth moved in as tenant.
Elizabeth intended to use the premises for business from day one, however there were so many chattels there that they could only use the premises for storage themselves.
A company called Austral Machinery took some other machinery away from Cobham Street on instructions of George and Dimitrios, before settlement of the purchase. Somehow the Toumbouras were conned into paying Dimitrios $1,000.00 in cash as part of this process of the machines being removed. The driveway in the common property was damaged by the removal of this heavy machinery, and it has never been fixed.
Georgia was going to buy Cobham Street from Lefkas , but her lawyer advised that Nick Sevdalis had become mortgagee in possession.
Elizabeth was shown a photo of an XA Ford sedan, and said she had never seen such a vehicle at Cobham Street. There is a shell of a black car in Cobham Street. If there were other vehicles in Cobham Street, she does not recall.
In relation to the alleged agreements for building works to be performed, Elizabeth said that she did not participate in any conversation with George or Dimitrios about supplying an entry door for the front office, in August 2014[22], and that Elizabeth lived in Elphinstone at the time, and that she, Elias and Georgia were all there together in Elphinstone at the time. Hargale did not own Cobham Street in August 2014.
Elizabeth, Elias and Georgia had lived in North Balwyn until August 2014, and Elphinstone had been their “weekender”. In August 2014 they moved in to Elphinstone.
There was not even a toilet in Cobham Street in August 2014. The estate agent had told Elizabeth that a toilet would be installed before settlement. By August 2014 there was just a portaloo amongst all the junk in Cobham Street. Elizabeth believes that in 2014 George Fatouros took that portaloo away, without permission. She did not notice that it was missing until after it had gone.
Elizabeth said that she did not participate in any conversation with George or Dimitrios about them performing work at Elphinstone[23]. There was no such conversation. If George or Dimitrios had a conversation with Elias about doing work at Elphinstone, Elizabeth was not present.
In July 2015 Metway Group, with Elias speaking on its behalf, hired George and Dimitrios as casual workers. When the business did not have contracts that required their labour, they stopped working.
Elizabeth Toumbouras said that she did not participate in any conversation with George or Dimitrios about them cutting a door opening at the rear of Cobham Street[24]. She did not want any building work to be performed at Cobham Street.
Elizabeth has checked her emails. She did send the email of “11:31:52 + 1000” on 28 April 2015, signing it “Liz-Metway Group”. The Toumbouros were disappointed that they could not work in Cobham Street because it was full of chattels, when it should have been emptied out by George or Dimitrios.
George or Dimitrios told the Toumbouros, after they had begun moving in as tenants, that the chattels were owned by their accountant. “John” the accountant said directly to the Toumbouros that he owned the chattels and he would organise to have them all removed. He did not do so.
Later, George and Dimitrios told Elizabeth that they had the accountant’s permission to move things out. However even then they did not move any chattels out.
Whilst Elizabeth did not witness this personally, she believes that during 2014 George and Dimitrios would attend Cobham Street and let themselves in. Elizabeth asked Georgia to get the locks changed. Elias told Elizabeth that they would come into Cobham Street, even before he started employing them.
Elizabeth was present when George started up the truck intending to drive it away. She observed Georgia becoming quite upset with him about this.

Evidence of Elizabeth Toumbouras in cross examination by the Applicants

When asked the source of the money that enabled Georgia Toumbouras to buy Elphinstone, Elizabeth said “The bank”. By the time Georgia purchased Elphinstone, Elias was bankrupt.
When shown a photograph of the entry door at the front office of Cobham Street, which the Applicants said was the work which was the subject of paragraph 10 of the Points of Claim, Elizabeth said she did not know who did that work but that she had assumed that Elias had, and that Elias told her that he had. Whilst she did not see Elias do the work, she did see him do some plasterwork, and she knows that Elias is capable of having installed that door. She did not see George and Dimitrios install the door either.
George and Dimitrios did not start working for Metway Group until November 2014. They did work as directed. Whilst Elias is not a registered builder, in practical terms he is a builder and he and Elizabeth have renovated houses over the years.
After settlement of the purchase of Cobham Street, the Toumbouros wanted a door at the rear. Metway Group supplied the door and other materials, and Elias made the opening in the wall and installed the door.
George and Dimitrios told Elizabeth that their accountant owned the equipment in Cobham Street, and she believed them. The accountant telephoned and told Elizabeth Toumbouras that he was going to remove his goods.
Elizabeth was not certain of the number of vehicles that had been in Cobham Street, but she says there is currently one vehicle.

Evidence of Elizabeth Toumbouras when questioned by Metway Group (by way of cross examination and in chief)

Elizabeth did the administrative work for Metway Group, including calculating the wages of George and Dimitrios on the basis of their timesheets. In her administrative role she sent the email of “11:31:52 + 1000” on 28 April 2015, signing it “Liz-Metway Group”, and she would concede that she probably received a reply. She is confident that she would have sent it. The accountant, Ken Wallace, needed information, because the business needed to pay Dimitrios. Elias instructed Elizabeth to send it. Ken Wallace had been asking Dimitrios for how many hours he had worked and when Dimitrios did not provide that information, Elias asked Elizabeth to chase it up.
Elizabeth did not send the final email to Dimitrios, dated 7:32 pm on 28 April 2015, which reads, “Elias has spoken to George and guaranteed that all your items are still here and safe. As you know we have ducts that are in the way of your items and would be difficult to remove them” [25]. Elizabeth
notes that the subject matter of that email is Elias having custody of the chattels. Elizabeth says she had no such discussion and had no reason to send such an email.

Elizabeth said she did not have written authority or even oral permission to speak on behalf of Metway Group. She was however conducting an air-conditioning business in her own right, under a registered business name “Evenair”.
Elizabeth pointed to some apparent discrepancies in the emails of 28 April 2015. She notes that they appear to have come from the same address but that the layout is different. She cannot explain that changing of position if the email is genuine. Similarly, the positioning of the headings is different and she cannot explain that. Elizabeth said she has only written to Dimitrios about wages and seeking information about wages. She has never written about items in the factory. She notes that she does not put her signature in bold in emails, and yet one of the emails produced has bold text.

Evidence of Elizabeth Toumbouras in cross examination by the Applicants arising from the above examination by Metway

Elizabeth said that she and Georgia, and no one else, sent all the emails for Metway Group. She does not accept the Applicants’ proposition that in a chain of emails, address and signature details can change. Elizabeth said she does most of the emails and that she sends emails from different locations including from a laptop. She does not send emails from the telephone. She is sure that if Georgia sent an email she would first get Elizabeth’s permission.
Metway Group did not receive any invoices. All invoices went to its accountant. Also, any invoices are received by email, and not in hard copy. Elizabeth did not instruct the accountant who to pay or not to pay. The director of the company would do that.
When a creditor sent Metway Group an invoice, Elizabeth does not remember how it would be processed and whether it would be sent to the accountant.
Elizabeth first saw Cobham Street in April 2014 and at that stage it was full of chattels. Elizabeth leased Cobham Street to run her business in it. She paid the rent. She paid $5,000.00 in cash to Dimitrios. But then the receiver moved in.
Elizabeth was annoyed that Lefkas had its goods in the factory when she was leasing it. She was not sharing the premises. It should have been empty. Elizabeth used the front of the building and she had a limited
amount of space. Lefkas was storing goods there, and Elizabeth was told that the accountant was storing goods. Elizabeth never told Lefkas that it could leave its goods there. Elizabeth regretted ever taking up the lease.

Evidence of Elias Toumbouras in chief (called by Hargale and Georgia Toumbouras)

Elias gave evidence with the assistance of an interpreter. Difficulties with having the interpreter attend the hearing uninterrupted led to some adjournments of the hearing.
Elias lives in Cobham Street.
The purchase of Cobham Street was straightforward. They wanted to buy a building. They found the estate agent who was marketing Cobham Street, and they inspected it with him. Elias saw Cobham Street, and saw that it had a lot of rubbish in it, that the building had been neglected, that there were machines and engines in Cobham Street. Elias asked the agent to disclose the sales price and having heard it said that they would think about. At the time of Elias’ inspection of Cobham Street with the agent, he did not know the identity of the owners.
Counsel for Hargale and Georgia carefully read paragraph 10 of the Points of Claim and its Particulars, through the interpreter, and then put questions to Elias. He said that the conversations alleged to have occurred on 1 August 2014 did not occur, either with the three of Elias Elizabeth and Georgia together as alleged by the Applicants, or with Elias alone.
However, in August 2014 George and Dimitrios were working for Elias, and so of course they spoke. As George and Dimitrios were his employees who would work under his direction, Elias wanted them to supply and fit an entry door for the front office of the factory into the warehouse, and a second door from the warehouse to the showroom. However, Elias was not authorised by anyone to incur debts on behalf of Hargale.
Next, Counsel for Hargale and Georgia carefully read paragraph 11 of the Points of Claim and its Particulars, through the interpreter, and then put questions to Elias. In that paragraph the Applicants allege that Lefkas was retained to do plastering and floor joist works at Elphinstone. Elias said that the conversation alleged to have occurred on 10 October 2014 did not occur, either with the three of Elias Elizabeth and Georgia Toumbouras together as alleged by the Applicants, or with Elias Toumbouras alone.
Elias said that he had told George and Dimitrios to come along to Elphinstone and to help him. They were working for Elias anyway, and he paid them $600.00 extra as wages, which was consistent with the rate they were earning as labourers. Not only was Elias not authorised by Georgia, as owner of Elphinstone, to get that work done but he actually had an argument with her when she complained that he had arranged for the work to be done without even asking her.
Counsel for Hargale and Georgia also carefully read out paragraph 12 of the Points of Claim and its Particulars, through the interpreter, and then put questions to Elias. He said that the conversation alleged to have occurred in mid July 2015 did not occur, either with the three of Elias Elizabeth and Georgia Toumbouras together as alleged by the Applicants, or with Elias alone. Elias said that he was putting the door up and George arrived and said he would help.
Neither Georgia or Hargale authorised him to install the door. Once it was done, Georgia was critical of the door.
Elias said that he has not seen any invoices from Lefkas for any of the above items of work, and that no one has told him about invoices either. Elias said that he offered payment to George but the latter said he did not want any money.
Elias also created a bathroom in Cobham Street, and after he had finished another job George spent about an hour helping with that project. Elias paid for this hour of work, within the wages paid to George.
Counsel for Hargale and Georgia also carefully read out paragraph 14 of the Points of Claim and its Particulars, through the interpreter, and then put questions to Elias. In that paragraph the Applicants allege that Elias and Georgia jointly verbally agreed to take possession, as gratuitous bailees, of the chattels and equipment in Cobham Street. Elias denied that any such discussion had taken place. There was no discussion at all about holding items belonging to Lefkas or George. [Apparently I am expected to believe that it did not occur to Elias or Georgia that the chattels might have some connection with the vendor of Cobham Street. For goodness sake].
Because there had been no discussion about the chattels, when the Toumbouras took possession of the factory and saw the chattels, they did not know who owned them. They took the view that whoever had the receipts would be the owner of the chattels.
When Hargale bought Cobham Street from the mortgagee in possession, the mortgagee wrote to Hargale and said that everything in Cobham Street was confiscated. The mortgagee in possession had an agent, called Con Orkatis.
When settlement of the purchase had taken place, the mortgagee in possession told Georgia as the new owner that she should get rid of all the rubbish. Elias decided to throw away items which were not the subject of security. Later, other people asserted that the goods at Cobham Street belonged to National Australia Bank or to Con Orkatis: this was not said directly to Elias, but to Dimitrios who passed the information on. [ This was not put to Dimitrios during his cross examination].
Georgia had told Elias before the settlement that she wanted and expected a vacant building when the settlement took place.
Con Orkatis told Elias that he wanted to take the chattels because “they” owed him money, but Elias did not know who he was referring to. Elias told Con Orkatis that he would see what he could do, but in fact he did nothing. Elias understood that Con Orkatis acted for Lefkas and also for Hargale.
Georgia told Elias that she wanted him to throw away the rubbish. When George said he wanted the chattels, Elias said he needed to see receipts. George did not respond.
Elias did not see the emails[26]. He does not use the sort of words that appear in that email.
Lefkas took chattels after Hargale bought Cobham Street. Georgia had to change the locks because George and Dimitrios were coming in taking items. For example, George took a toilet without showing Elias any receipts.
When shown a photograph of the excavator, Elias said he had never seen it. He had inspected Cobham Street and there was no excavator there.
Elias believes that George and a plumber possibly called Crow had been partners, and that they had a falling out, and that the plumber owned the excavator. Even though Elias has never seen the excavator, he believes the plumber has taken it. The Respondents wanted to call the plumber as a witness but could not find him. Elias has never spoken to him.
Cobham Street had moulding machines in it. There was not enough space for Elias’ goods, so he had to leave some of his goods outside. One of the goods was a machine, and it was stolen.
Elias did not see, and does not remember, any cars stored at Cobham Street.
Elias has seen the statutory declaration of Sam Macheras[27] made on 5 December 2016. [ In this statutory declaration, Mr Macheras – who was not called as a witness – said that Elias owed him $3,000.00 in wages as at 18 January 2016, and that he attended Cobham Street to discuss the matter. Mr Macheras declared that Elias “said he didn’t have any money as his daughter controlled the money but he said I can take whatever tools I wanted from the factory as a final payment for my wages”. He wrote that he then took 12 items, including some hand tools, welding equipment, and a scaffold].
Elias denied Sam Macheras’ assertions. Sam Macheras had worked for Elias for 15 years and Elias knows that Sam Macheras has been involved with the police. The statutory declaration is a fabrication. Sam Macheras stopped working in about 2016. Sam Macheras did not attend Cobham Street when Elias was there. Elias did not owe Sam $3,000.00.
Elias did not give any items from Cobham Street to anybody else. Nobody else claimed any of the goods in Cobham Street. George took the truck. That was the last time Elias saw George. Elias saw George swearing about Georgia. Elias told George that it was okay to take the truck as long as George could produce a receipt, because Elias believed chattels were owned by a mortgagee.

Evidence of Elias Toumbouras when cross-examined by the Applicants

Elias has lived at Cobham Street now for three months. He has fixed up some rooms in it. There are also offices in Cobham Street. Cobham Street contains a bathroom and bedroom but not a designated apartment or house. Georgia lives there too.
When shown a sketch of the internal walls and room configuration at Cobham Street, Elias said he cannot remember the layout of the building. He denied that there was a compressor room. He concedes there was a rear door, and said that he built it. He said Cobham Street contained a showroom and that he had built a toilet in that area. It also contains a shower and bathroom facilities. There are now three toilets in the building.
Before the settlement in January 2015 Elias had work and jobs. He was working with Metway Group, which ran an air-conditioning business. The “Metway” that he referred to is his company. Evenair is a second business, operated under a business name.
Elias was not using Cobham Street while it belonged to other people. Georgia formed a company called Metro Group but Elias does not remember if that is its full name.
Elias concedes that he went bankrupt but did not concede the date was 17 April 2015, nor does he remember the date he ceased being a director of Metway Group. He lost two big contracts and then had a mini stroke and sold everything. He decided to look after his health. He sold assets. After that he went bankrupt.
Metway Air-Conditioning and Refrigeration Pty Ltd is an old company of his. Elias had been a director. It was sent broke by the Australian Taxation Office. It has nothing to do with Metway Group Pty Ltd.
The accountant files everything with ASIC. Elias does not consider that the accountant acts on instructions, but rather that the accountant does everything. While Elias says the company was “taken” by the Tax Office, he does not understand the mechanics.
When Elias and Elizabeth first saw Cobham Street through the estate agent, they intended Elizabeth to rent it. They only decided to buy Cobham Street when the agent suggested that as a possibility. They made an offer. Elias was not involved in the detail of what entity became the registered owner of Cobham Street, but he knows now that Hargale owns it. Georgia decided to put the property in that company. Elias understands that she bought it from the trustees, but he does not exactly know what happened at settlement, nor who paid the purchase price. Elias has never asked Georgia who paid.
Elias knows that Georgia owns property somewhere in Elphinstone and that she borrowed money from the bank to buy it. Elias did not give Georgia any money in relation to purchasing Elphinstone. He does not remember ever giving Georgia any money to buy any real estate.
When shown photograph 18, of the door, Elias said he recognised it and that he had installed the door. He took the door from a house in Clayton. George helped Elias install the door and also to cut the hole in the wall. George used a big hammer to cut the hole in the wall, but not a demolition saw. Elias worked as well, not just supervising George. He does not remember when the new door was installed.
Lefkas has never worked for Elias.
Elias does not remember exactly when he employed George and Dimitrios Fatouros. He directed them what to do. They did not work in the ducting business, because they were not experienced with air conditioning. They worked as labourers for Metway Group, doing plastering and floor joists.
George and Dimitrios also worked on the Elphinstone house. Elias called them to a barbecue and on the same day they helped him out. They did not finish the work in Elphinstone. Elias offered to pay them money but they refused to take it. The reason he wanted to pay was that he recognised they had travelled about 100 kilometres to get to Elphinstone. It was their idea to come out and help him: Elias had told them he wanted to put up four or five sheets of plaster, and they said, ‘Well, we will come out and help’.
When shown a photograph of the door[28] Elias said he recognised the photograph. It was already in the building but was permanently closed. Elias wanted to be able to open it. George said he would help. Elias and George took the bricks out, which was easy. And then George helped Elias screw the door in. Whilst Elias does not remember the details, as a general comment he says that in order to fit in a door, you need to install a beam around and above the hole you have created in the brick wall. There is also a need to do some concreting. It was easy to make the hole in the wall. When shown a photograph of a mash hammer, Elias said he does not remember having seen it. The bricks were not strongly mortared in. There was insufficient cement in the mortar and there was no fireproofing either.
Elias still runs a business in Cobham Street and his accountant issues invoices. The accountant also receives all bills payable by the business. Elizabeth also gets some mail. After Hargale bought Cobham Street, Elias received mail at that premises. Georgia would open the mail. She was at Deakin University but not five days a week.
Cobham Street was a neglected building when Hargale bought it. There were big machines inside but Elias did not know who owned them. He does not remember whether it occurred to him that they might belong to Lefkas or to Dimitrios or George.
When shown the emails[29] Elias said he had never seen them, and that he does not use emails. Elias was never even told the demand was made for return of the chattels. Elias had already paid wages to Dimitrios and so has no knowledge of Dimitrios demanding wages. Elias is aware that George signed something saying that he had received payment of wages. Elias was told by the accountant that everyone had been paid.
It was put to Elias that he threatened George with the sale of the equipment if George kept pushing for payment of wages. He denied making such a threat and he said he was not aware that George was the owner of the equipment.
It was put clearly and plainly to Elias, that he was asked whether he was saying that George never made a claim to the equipment. Elias’ answers were evasive. He said that he does not know who owns the equipment. He said that he bought Cobham Street from the mortgagee and that people claim the chattels. The property was sold with the equipment and the mortgagee was in charge.
Elias was asked who is “Liz – Metway Group”, as mentioned in the email which is document 16. He answered that he did not write the email. He has never seen it. He says he does not have an email address. The email address on the email is fake. He did not write the email. It is possible that he has an email address, in that his son might have set one up, but Elias has never used email.
Elias does not know whether his son ever sends emails for him. He and his son do not work together anymore. There are personal reasons and Elias does not want to talk about him. Elias has separated from Elizabeth, but the two of them work together. They do not live together.
Similarly, Georgia comes to the office. Elias does not know what Georgia does with Elizabeth. Elizabeth comes and goes from Cobham Street and Elias does not even know when she arrives or leaves. He does not give Elizabeth instructions in the business. Elias does not even know if Georgia speaks to Elizabeth.
Elias did not instruct Georgia to instruct Elizabeth in the business.
There are computers in the office but Elias does not use them. Elizabeth might use them, but Elias does not know. He does not know why Elizabeth would use the computer. Elizabeth asks Elias before she does anything. But Elias does not know what she does. Whilst Elizabeth asks permission, he does not know who was responsible for this email. He is not sure who sent it.
If mail is received at Cobham Street, Elias would not know what happens to it. Georgia is in charge of running the business at Cobham Street. Elias does not get involved with correspondence or with bills.
The accountant takes care of them. Georgia was a university student, but she is an adult and Elias does not know what she does all the time. He does not know if Georgia was living at Cobham Street.
When Elias said to George that whoever has the receipts is the owner of the equipment, what he meant was that the Respondents bought Cobham Street from the mortgagee, who provided a letter that said that Georgia could throw the chattels away. Various people were claiming them. Elias’ view was that people claiming the chattels had to prove ownership of them by producing receipts.
Elias is a witness in the case, not a party, and so he did not file a Defence. If the Applicants now produced receipts, it would be up to Georgia to decide whether to release the chattels to them.
Elias has never looked at the equipment. It is Georgia’s matter.
Elias confirms that Cobham Street was full of equipment, some of it being big. Dimitrios sold some equipment to Austral Machinery and some concrete was damaged. Elias saw this afterwards but he does not know how it happened. There are huge machines in Cobham Street and Dimitrios Fatouros sold them. Elias had no involvement in the building after this sale of equipment.
Elias knows that Dimitrios Fatouros sold the equipment. He saw Austral Machines and Elias give Dimitrios Fatouros $1,000.00 to close the factory. Dimitrios took the goods to Austral Machines, but not all of them. Some chattels were left behind.
It was put that at a previous hearing the Respondents told the Tribunal that no equipment was at Cobham Street. Elias said that he does not know.
When asked whether at an earlier hearing a Tribunal Member identified equipment at the factory, he answered that he did not know what they said about ownership.
A new document which the Applicants say lists the goods in Cobham Street and contains photographs was shown to Elias. He said he cannot say whether he saw goods like that in Cobham Street, as he did not look closely enough. He has never seen even the big items. He just does not know what is there. When he was asked whether he could not remember a single item, he answered that he could not say.
Elias was then taken to several of the particular items and documents, such as A1, and A2. He repeatedly said that he did not know, could not say, or did not see that item. When he said of a matter that “he couldn’t recall”, it was put to him that “it was possible”, and he answered that “he did not know”.
Georgia runs her own air-conditioning business and she uses her own tools in it. She has worked in air conditioning since she was 10 years old. We cannot use the factory because it is full of rubbish.
When asked whether he had seen the tools that Georgia found, Elias answered that they were abandoned. When Georgia bought Cobham Street she told Elias to get rid of all of these things, but Elias did not because he did not know who owned them. He did not think that Lefkas or George owned them, but he did not know. He asked George to produce receipts[30].
Elias was asked whether he was just referring to the truck, or to many items. He answered that George said he wanted the truck. Elias told him to speak to Georgia. Georgia told him to produce a receipt. George did not produce a receipt, and the same night he stole the truck.
Elias has not been involved with or event spoken to George since the day George took the truck.
Elias did see tools in Cobham Street but he did not identify them. He just means that he saw workshop tools generally, all over the place. He is able to distinguish between tools. When asked whether he saw a pallet truck at Cobham Street, he answered that he does not know what is there or not, which was an evasive answer.
He conceded that he had long experience in air-conditioning and in the building industry. That is why he is familiar with tools. He said he has not used the tools in Cobham Street. When he used tools, it was to build cupboards but he does not do that anymore.
He does not recall having seen a purple Ford.
He gave one portaloo to George, on the basis that George would return it but he has not. Elias has not seen another portaloo inside and does not believe there was another one inside.
Elias knows what temporary fencing is but has not seen any in Cobham Street.
In relation to the excavator, Elias changed his evidence. He retracted his statement that he thought the excavator belonged to a plumber, and said instead that a neighbour told him it belonged to a plumber but that Elias has never seen the item. Elias does not know the plumber. He simply heard about this through a neighbour.
Elias could tell that some of the machines inside Cobham Street, when Hargale bought it, were moulding machines for plastic. If the excavator had been in the building it would been a very large item. There was no room for it given all the other equipment.
The excavator does not collapse to become a very small vehicle. Elias is not aware that you can fold up the excavator to make it smaller. He has never handled that sort of machinery.
Cobham Street is not full of machinery now because Dimitrios sold machinery. Some things were left behind. When Georgia bought the building from the mortgagee all these things were there. The things that were left are still in the premises.
Elias was shown the following documents and photographs, set out in items 20 – 28 of the Tribunal Book, and in response to all of them he said he did not remember. Documents 20 & 21 were photographs inside Cobham Street. Documents 22 – 24 were invoices from Lefkas to Hargale in 2014 and 2015. Documents 25 – 28 were copy invoices from various businesses to Lefkas .

Evidence of Elias Toumbouras when cross-examined by Metway Group

Elias said he was formerly a director of Metway Group but is not now.
He does not recall when he first met Dimitrios and George, but it was probably when they rented Cobham Street.
Elias has always worked in air-conditioning. He is a builder. He was previously registered as a builder, and he has allowed that registration to lapse. However air-conditioning is his specialty.
He said that it was hard to remember dates, but he verified that for a time he had employed George and Dimitrios, although that had to stop because there was no work. George and Dimitrios did not work at Cobham Street, they worked on building sites. 90% of Elias’ work was on building sites, and 10% was spent on the phone.
Elias was busy with work before January 2015. He paid Dimitrios and George depending on how much time they had spent on site. He did not provide any training for them.
As a director of Metway Group, Elias did not intend Metway Group to buy the building in Cobham Street. He did not give any financial assistance to Georgia to buy the building.
He did not speak to George or Dimitrios about holding chattels as a bailee.
Never as a director of Metway Group, or with Georgia, did he make a promise to George or Lefkas that he would keep the items in Cobham Street until they demanded the back. He would have no reason to make such promise. He does not use any of the items in his business, including the portable items.
Elias never asked George or Dimitrios whether he could borrow any of their items situated in Cobham Street to use in his business.
George and Dimitrios had their own tools and scaffold.
Sam Macheras worked for Elias and he has been paid. There is a document dated 25 March 2015 called Agreement between Metway Group and Sam Macheras. Norm Kelly of a Union negotiated on behalf of Sam Macheras, and Metway Group paid $4,000.00 in full and final settlement. Elias remembers the agreement but until it was shown to him he did not remember the date. He does not dispute that the date was 25 March 2015. CEPU is the Plumbing and Electrical Union. [This document had not been discovered, but was handed up during the hearing].
Elias signed the agreement at the Union’s office and Sam Macheras has been paid the $4,000.00.
After the agreement Sam Macheras did not come and work again. Elias would not have taken him back on. Sam Macheras’ claim for wages was a lie and Elias would not be prepared to work with him again. Elias did not give any of the items to Sam Macheras, even before the agreement. After the agreement Sam Macheras did not make any more demands of Elias. Sam Macheras did not visit on 20 March 2016 as stated in his statutory declaration. Elias is adamant that he did not give Sam Macheras any goods.
Elias cannot remember whether he ever had a personal email account, but he can say that he never used one.
Elias was shown the three emails [Tribunal Book document 16]. He does not remember speaking to George on 28 April 2015. He does not remember using words to the effect that the items would be safe. As a director of Metway Group, he did not instruct any employees to send that email.
When he said he wanted to see receipts, he was after proof of ownership.
Elias was not involved in the handover from the mortgagee in possession to the purchaser. Elias paid $1,000.00 to Dimitrios in relation to the rubbish removal. Dimitrios had moved a machine from the inside and also other stuff. Elias paid the $1,000.00 so that he could put his goods in the factory.
Elias did not see an excavator at Cobham Street but it is theoretically possible that an excavator was around the back of the building.
Drawing the threads together

I have noted my views of the evidence above. I think it is apparent in my summary of the witnesses’ evidence that some statements made by witnesses are plainly extraordinary.
George and Dimitrios, and therefore Lefkas , had access to Cobham Street after the lease to Elizabeth and after the sale to Hargale. George and Dimitrios had a key, until Georgia had the locks changed. George drove off in a truck.
Dimitrios’ evidence about the XA Ford sedan, which was not seen by Member Warren in December 2016, was of interest in that it is the only source of the allegation that the sedan was worth $55,000.00. However that evidence was that the sedan was a shell into which he and George had fitted an engine and gearbox, and in which they had rebuilt the differential. It “only” needed wiring, and if the wiring was done the value of other such sedans reflected its value. This evidence is completely unpersuasive. It amounts to saying that the shell was still incomplete after for some 10 years. The wiring of an old shell for the purpose of restoring a car is a significant job.
Georgia’s evidence that in April 2014 George or the estate agent told her that George would not remove any chattels, which George impliedly conceded should not have been in Cobham Street, in return for a penalty being waived goes some way to suggesting that Hargale as the owner of Cobham Street agreed to be bailee of chattels for consideration. However even though this evidence is somewhat to the detriment of Hargale, it is too vague and of course is inconsistent with the evidence of George who asserted that the respondents were gratuitous bailees whilst disclaiming comprehension of that expression. As even George said that a secured creditor sold Cobham Street to Hargale, I cannot imagine what penalty Lefkas could have purported to waive in return for Hargale’s agreement to act as bailee.
Elizabeth’s evidence that in April 2014 the estate agent for Lefkas said that the chattels in Cobham Street would be gone by the commencement of her lease give some support to the view that George and Dimitrios removed, or allowed others to remove, the chattels which were not seen by Member Warren in December 2016 and which they describe as “Missing”. I am not enamoured of Elizabeth’s evidence but this part of it had some flavour of truth.
I noted in several respects that Elias’ evidence was just unbelievable. His professed inability to remember the layout of the building in which he lives, or to have seen a 1937 Chevrolet in that building, is simply contemptable.
What I am left with is that I accept that the chattels which Member Warren saw in Cobham Street in December 2016 must be delivered up to the Applicants.
I do not accept that the Applicants have proven the existence of the allegedly “missing” chattels at the time Elizabeth took possession of Cobham Street, or that they were placed in her possession or subsequently in the possession of Hargale.
I am satisfied that Lefkas is entitled to $1,540.00 for the work of cutting and installing a door at Cobham Street. I find that Hargale is liable to pay this.
I will reserve costs.

Lulham
Deputy President

23 July 2018

[1] There are not many of these, but for example the second item was said by the Applicants to be “2 x panel saws” but Member Warren had written “1 x panel saw”. I adopt Member Warren’s information, and include one panel saw.

[2] When Elizabeth was asked how her daughter, a full-time University student in her early twenties, could fund the purchase of a house in Elphinstone that had been owned by Elizabeth and her then husband Elias prior to his bankruptcy, her ‘answer’ was to ask whether there was an age limit on a person’s right to purchase real estate.

[3] Schedule A said that four groups of chattels belonged to George and that all the others belonged to Lefkas . I note that as almost 2 years passed between 9 January 2015 and Member Warren seeing certain chattels in Cobham Street in December 2016, chattels could have been removed between those two dates.

[4] Applicants’ written submissions, paragraph 2.1; various texts and authorities cited.

[5] Thomson Reuters / Westlaw AU, at [8.5.20].

[6] The Respondents also submitted that when the sale of Cobham Street to Hargale settled on 9 January 2015 the title to Cobham Street was encumbered by a first and second mortgage, a statutory charge to the State Revenue Office, and that two caveats had been registered on the title. It must be said, though, that the encumbrances on the title to Cobham Street are irrelevant to the title in the chattels.

[7] Butterworths 1994 (and on line); Volume 19, commencing at [315 – 140].

[8] It seems to me that this principle describes the position of a secured creditor under a floating charge, who allows the borrower to trade and buy and sell assets until such time as the charge crystallises.

[9] This begs the question for determination in this case: if the Applicants succeed in this case you would say that the Respondents were bailees at will, and that the Applicants had legal possession of the chattels.

[10] In fact Mr Fatouras said Attachment A lists “all the equipment I owned”. In many respects his evidence was most imprecise. In relation to the contents of Attachment A I will give him the benefit of the doubt and assume he was speaking on behalf of himself and Lefkas Builders Pty Ltd.

[11] Tribunal Book, Document 16.

[12] I must say that this document does not look genuine. First, it does not appear to be an original chain of emails, but rather to be a document created by copying and pasting. Secondly, even though the elder and younger emails are supposed to be from Liz-Metway Group, and to have been sent within about eight hours of each other, the position on the page of the sender, heading and recipients are inconsistent which is inexplicable in my mind. That is, emails are created in a template, which always places the sender, heading and recipients in the same place. They do not change position by themselves. I note in passing at this point that Elizabeth denied having sent the emails, but as I say the document itself appears not to be genuine.
[13] Tribunal Book, Documents 27 and 26 respectively.

[14] I am satisfied that a “going concern” was not sold under this contract. It was a statement calculated to affect liability for GST. Ironically for Lefkas , had it really sold a “going concern” it would expose Lefkas to an argument that it sold the chattels for use in the “going concern”, yet George’s evidence was that Lefkas had not sold the chattels.
[15] It would follow from this evidence either that George means that the 2 x 3-phase compressors should not have been made subject to the injunction in Member Warren’s Order, or that Member Warren was more observant than George.
[16] It is unclear how GST would be avoided. There is no evidence that Lefkas had a “going concern” to sell, given that George and Dimitrios were working for Elias. If the “going concern” was supposed to be Elizabeth’s business, on the evidence before me there was no sale of business by Elizabeth to Hargale.
[17] Paragraph 10 of the Points of Claim.

[18] Paragraph 11 of the Points of Claim.

[19] Paragraph 12 of the Points of Claim.

[20] Tribunal Book, document 16.

[21] This contradicts her evidence in chief, in respect of the truck she says George sought to take away in April 2016.

[22] Paragraph 10 of the Points of Claim.

[23] Paragraph 11 of the Points of Claim.

[24] Paragraph 12 of the Points of Claim.

[25] Tribunal Book, document 16.

[26] Tribunal Book, document 16.

[27] Tribunal Book, document 17.

[28] Tribunal Book, document 19.

[29] Tribunal Book, document 16.

[30] This evidence is contradictory. If Elias believed the goods to have been abandoned, and he was told by Georgia as the director of the company which owned the factory in which the supposedly abandoned goods were situated, he could not logically not follow Georgia’s instructions to dispose of the items on the basis that he did not know who owned them. If he believed they were abandoned, he would believe that no one owned them.