JCS-6 - Arnold Bloch Leibler

IN THE COURT OF APPEAL 

IN THE SUPREME COURT OF VICTORIA 

AT MELBOURNE 

S APCI 2012 0069 

IN THE MATTER OF WILLMOTT FORESTS LIMITED (RECEIVERS AND MANAGERS 

APPOINTED) (IN LIQUIDATION) (ACN 063 263 650) 

BETWEEN 

WILLMOTTACTIONGROUP INC 

and 

Appellant (Intervener) 

WILLMOTT FORESTS LIMITED (RECEIVERS AND MANAGERS APPOINTED) (IN 

LIQUIDATION) (ACN 063 263 650) 

IN ITS PERSONAL CAPACITY AND IN ITS CAPACITY AS RESPONSIBLE ENTITY OF 

THE MANAGED INVESTMENT SCHEMES LISTED IN SCHEDULE 2 AND IN ITS 

CAPACITY AS MANAGER OF THE UNREGISTERED SCHEMES LISTED IN SCHEDULES 

3 AND 4 

AND ORS ACCORDING TO SCHEDULE I 

First Respondent (First Plaintiff) 

Date of document: 

Filed on behalf of: 

Prepared by: 

ARNOLD BLOCH LEIBLER 

Lawyers and Advisers 

Level 21 

333 Collins Street 

MELBOURNE 3000 

AFFIDAVIT OF JANE CHALMERS SHERIDAN 

17 August 2012 

the Respondents 

Solicitor’s Code: 54 

DX 38455 Melbourne 

Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 

(Jane Sheridan - jsheridan'abl.com.au ) 

I, JANE CHALMERS SHERIDAN of Level 21, 333 Collins Street, Melbourne, VIC, Solicitor, 

MAKE OATH AND SAY that: 

1~-\& 

ABL/23231600 

I am a partner of Arnold Bloch Leibler (ABL), the solicitors for: 

(a) the Respondents to this appeal proceeding, being Willmott Forests Ltd 

(receivers and managers appointed) (in liquidation) (WFL), and its liquidators, 

Messrs Craig Crosbie and Ian Carson (Liquidators), and

4 T7 

(b) the Respondents to appeal proceeding no SAPCI 2012 0068, also being WFL 

and the Liquidators 

(together the WAG Appeal Proceedings). Together with my Partner, Justin 

Vaatstra, I have the care and conduct of the WAG Appeal Proceedings on behalf of 

the Respondents to the WAG Appeal Proceedings. 

2 Except where I otherwise indicate, I make this affidavit from my own knowledge. 

Where I depose to matters from information and belief, I believe those matters to be 

true. 

3 I refer to 

(a) the summons filed in this proceeding on 7 August 2012; and 

(b) the summons filed in proceeding S APCI 2012 0068 on 7 August 2012 

(together Summonses), seeking security from the WILLMOTTACTIONGROUP INC 

A0055149L (WAG), the Appellant in each of the WAG Appeal Proceedings, for the 

Respondents’ costs and disbursements in the WAG Appeal Proceedings. 

4 I refer to the affidavit Justin Taede Vaatstra sworn 7 August 2012 and filed in S APCI 

Background 

2012 0069 (First Vaatstra Affidavit) and adopt the definitions therein. 

5 The Appellant appeals from the decision of Justice Davies in proceedings SCI 2011 

6762 and SCI 2011 6818 (Advice Applications) in which her Honour provided the 

Liquidators with directions pursuant to s 511 of the Corporations Act 2001 (Cth) that 

they were justified in procuring WFL to perform the HVP Final Implementation Deed 

the Amended Main Sale Contracts. The Appellant intervened at the hearing of the 

Advice Applications and opposed the giving of judicial advice sought by the 

Respondents. 

The WAG did not enjoin the Respondents from completing the Main Sale Contracts 

and HVP Final Implementation Deed. Those agreements have now been completed 

and the proceeds received by the Liquidators and Receivers. 

2 11

Completion of the Main Sale Contracts and HVP Final implementation Deed 

7 on 7 May 2012, I attended the offices of King & Wood Mailesons, the solicitors for 

HVP, for the implementation of the HVP Transaction. Representatives from Aliens, 

the solicitors for the WFL receivers and managers, and Michael Carmody of PPB 

Advisory, representing the Liquidators were also in attendance. implementation of 

the HVP Transaction occurred in accordance with the Implementation Deed and, 

among other things, the solicitors for HVP delivered a cheque to the solicitors for the 

WFL receivers and managers for the Receivers’ Consideration (as that term is 

defined in the HVP Implementation Deed) and a cheque to me for the Liquidator’s 

Consideration (as that term is defined in the HVP implementation Deed). I gave the 

cheque for the Liquidator’s Consideration to Mr Carmody. 

8 On 22 May 2012, I caused Gia Can, solicitor from Arnold Bloch Leibler, to attend at 

the offices of Aliens in Melbourne and Krystal Bedggood and Liam Thomson, 

solicitors from Arnold Bloch Leibler, to attend at the offices of Aliens in Sydney for the 

completion of the GFP Transaction. I am informed by Ms Can, Ms Bedggood and Mr 

Thomson and believe that: 

(a) representatives of Minter Ellison, the solicitors for the Purchaser, and 

representatives of Aliens, the solicitors for the Receivers and Managers, were 

also in attendance in Melbourne and in Sydney; 

(b) completion of the GFP transaction occurred in accordance with the Contracts 

of Sale; and 

(c) among other things, the Purchaser provided cheques to Ms Bedggood in 

payment of the purchase price owing under the Contracts of Sale. 

9 I am also informed by Ms Bedggood and believe that, in accordance with my 

instructions: 

(a) the cheque for the purchase price (as adjusted in accordance with the 

Contracts of Sale) payable to WFL, as the Vendor, was deposited into the 

trust account I had caused to be established for this purpose (Sale Proceeds 

Account); and 

3f

(b) the cheque for the amount to be held in escrow in a retention account 

pursuant to the Contracts of Sale was deposited into the trust account I had 

caused to be established for this purpose. 

10 Following notification of completion from Ms Bedggood, I caused the deposit which 

was held by Arnold Bloch Leibler in a trust account to be transferred to the Sales 

Proceeds Account. 

11 In accordance with the instructions I have received from the Liquidators and the 

Receivers and Managers, I have subsequently caused amounts to have been paid 

from the Sales Proceeds Account to the Receivers and Managers and Liquidators as 

agreed by them to reflect their respective entitlements to the proceeds from the 

Contracts of Sale. 

12 WFL consented to the payment of WAG’s costs of the Advice Applications out of the 

proceeds of the Amended Main Sale Contracts and Final Implementation Deed on a 

solicitor and own client basis. 

13 Now produced and shown to me and marked "JCS-1" is a copy of the Plaintiffs’ 

Outline of Submissions on Costs dated 9 May 2012 filed in the Advice Applications. 

Now further produced and shown to me and marked "JCS-2" is a copy of page 4 of 

the transcript of hearing of the Advice Applications dated 15 May 2012. 

Dispute as to costs 

14 The WAG initially claimed $903,839.75 in respect of its costs incurred in the Advice 

Applications. Now produced and shown to me and marked "JCS-3" is a letter from 

Lloyd & Lloyd Solicitors to ABL dated 10 July 2012. 

15 ABL, on behalf of the liquidators, wrote to Lloyd & Lloyd Solicitors, amongst other 

things and disputed this initial claim on the basis that amounts were being claimed 

that the WAG was not entitled to. Now produced and shown to me and marked "JCS- 

4" is a letter from ABL to Lloyd & Lloyd Solicitors dated 12 July 2012. 

16 In response to ABL’s letter dated 12 July 2012, Lloyd & Lloyd Solicitors wrote to ABL 

on 24 July 2012 and reduced the WAG’s claim for costs, claiming instead 

$892,444.18. Now produced and shown to me and marked "JCS-5" is a copy of a 

letter from Lloyd & Lloyd Solicitors to ABL dated 24 July 2012. 

4

17 The parties have not resolved the question of the quantum of the WAG’s costs of the 

Advice Applications, whether by agreement or taxation. Now produced and shown to 

me and marked JCS-6" is a letter from Arnold Bloch Leibler to Lloyd & Lloyd 

Solicitors dated 31 July 2012. 

Failure to comply with Court ordered timetable 

18 The WAG has not complied with the Court ordered timetable for the preparation of 

the WAG Appeal Proceedings. 

19 In accordance with the Orders made by the Court on 8 June 2012, the WAG was to 

provide a draft summary in each of the proceedings S APCI 2012 0068 and S APC 

2012 0069 to the respondents by 27 July 2012. 

20 On 27 July 2012, Lloyd & Lloyd wrote to ABL stating that due to Counsel’s 

unavailability, WFL could expect the draft summaries by 7 August 2012. Now 

produced and shown to me and marked "JCS-7" is a copy of the letter from Lloyd & 

Lloyd to ABL dated 27 July 2012. 

21 As at the date of swearing this affidavit, WAG has still not served the draft summaries 

as required under the orders made on 8 June 2012. Now produced and shown to me 

and marked ’JCS-8" is a copy of a letter from ABL to Lloyd & Lloyd dated 13 August 

2012. No response has been received to this letter. 

SWORN at Melbourne ) 

in the State of Victoria ) 

by JANE CHALMERS SHERIDAN ) 

this 17 day of August 2012 ) 

Before me: ......................... 

5 

J(S11N TAEDE VMTSThA 

MMU Lebw 

Level 21, 333 COIS Stret 

An AusUailan Log& Practiboner MW to 

meaning of the Legal PtfeSSIOn Act 2004


and 

SCHEDULE I - PARTIES 






CAPACITY AS MANAGER OF THE UNREGISTERED SCHEMES LISTED IN SCHEDULES 

3 AND 4 


and 

CRAIG DAVID CROSBIE 

IN HIS CAPACITY AS LIQUIDATOR OF WILLMOTT FORESTS LIMITED (RECEIVERS 

AND MANAGERS APPOINTED) (IN LIQUIDATION) (ACN 063 263 650) 

Second Respondent (Second Plaintiff) 

and 

IAN MENZIES CARSON 

IN HIS CAPACITY AS LIQUIDATOR OF WILLMOTT FORESTS LIMITED (RECEIVERS 

AND MANAGERS APPOINTED) (IN LIQUIDATION) (ACN 063 263 650) 

Third Respondent (Third Plaintiff)

SCHEDULE 2- REGISTERED MANAGED INVESTMENT SCHEMES 

1 Willmott Forests 1989 - 1991 Project (ARSN 092 516 651) 

2 Willmott Forests Project (ARSN 089 379 975) 

3 BioForest Dual Income Project 2006 (ARSN 119 153 623) 

4 BioForest Sustainable Timber and Biofuel Project 2007 (ARSN 124 135 535) 

5 Willmott Forests Premium Forestry Blend Project (ARSN 131 549 589) 

6 Willmott Forests Premium Forestry Blend Project - 2010 Project (ARSN 142 722 585) 

7 Willmott Forests Premium Timberland Fund No. 1 (ARSN 136 768 520) 

7

SCHEDULE 3- UNREGISTERED MANAGED INVESTMENT SCHEMES: 

PROFESSIONAL INVESTOR SCHEMES 

1 Willmott Forests - Professional Investor - 2001 Project - 2001 Information 

Memorandum 

2 WiIImott Forests - Professional Investor - 2002 Project - 2002 Information 

Memorandum 

3 WiIlmott Forests - Professional Investor - 2003 Project - 2003 Information 

Memorandum (2003) and 2003 Information Memorandum (2004) 


Memorandum and 2004 Information Memorandum (2005) 

5 2005 BioForest Wholesale Project No. 2 - 2005 Wholesale Forestry Memorandum 

(Bioforest) 


Memorandum 

E.

SCHEDULE 4- UNREGISTERED MANAGED INVESTMENT SCHEMES: 

CONTRACTUAL SCHEMES AND PARTNERSHIP SCHEMES 

Contractual Schemes 

7 1983 (No Project) 






13 1990 (No Project) Interest Only Offer 


15 Sharp/Reed Plantation Project -1998 Information Memorandum 


Partnership Schemes 

17 McKenzie & Partners - Forestry Partnership No.1 (1993) 

18 Grimsey & Associates Pty Ltd - Forestry Partnership No. 1 (1994) 



21 McKenzie & Partners - Forestry Partnership No. 2 (1994) 

1’



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 






CAPACITY AS MANAGER OF THE UNREGISTERED SCHEMES LISTED IN 

SCHEDULES 3 AND 4 





Prepared by: 



Level 21 



CERTIFICATE IDENTIFYING EXHIBIT 





Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 

(Justin Vaatstra - jvaatstra@abl.com.au ) 

This is the exhibit marked "JCS-I" now produced and shown to JANE CHALMERS 

SHERIDAN at the time of swearing his affidavit on 17 August 2012. 

JUSTIN TAEDE VMITSTRA 

L&M 21, 333 COON 811W Before me: 

An Anafl Legal Pracdboner wlthi *ie 

meet*ig of the Legal Profession Act 3)04 

Exhibit "JCS-l" 

Plaintiffs’ Outline of Submisions on Costs dated 9 

May 2012 filed in SCI 2011 6762 and SCI 2011 6818

IN THE SUPREME COURT OF VICTORIA AT MELBOURNE 

COMMERCIAL AND EQUITY DIVISION - 

COMMERCIAL COURT 

CORPORATIONS LIST 

S Cl 2011 6816 

SCI 2011 6762 




LIQUIDATION) (ACN 063 263 650) IN ITS CAPACITY AS RESPONSIBLE ENTITY OF THE 

MANAGED INVESTMENT SCHEMES LISTED IN SCHEDULE 2 AND IN ITS CAPACITY 

AS MANAGER OF THE UNREGISTERED SCHEMES LISTED IN SCHEDULE 3 

Plaintiffs 

A INTRODUCTION 

PLAINTIFFS’ OUTLINE OF SUBMISSIONS ON COSTS 

On 4 April 2012, Davies J ordered inter a/ia that: 

(a) the Second and Third Plaintiffs (the Liquidators) were justified and otherwise 

acting properly and reasonably in procuring the First Plaintiff (WFL) as 

responsible entity or manager of Registered Managed Investment Schemes’ and 

Professional Investor Schemes 2 to terminate each of the Project Documents of 

those schemes and surrender the rights of the Growers in the Trees the subject of 

the Amended Sale Contracts, on the basis that the net proceeds of the trees were 

allocated and distributed in accordance with exhibit CDC-50, subject to the 

determination of any questions concerning the quantum and allocation of costs 

referrable to the schemes described in CDC-50; 

(b) the Liquidators were justified in procuring WFL, as responsible entity of the HVP 

Registered Schemes and as manager of the HVP Unregistered Schemes, to hold 

the Liquidators’ Consideration (less any expenses incurred by the Second and 

Third Plaintiffs in realising the HVP Assets) on trust until it could be pooled and 

distributed with the proceeds of sale from the realisation of other assets of the 

respective HVP Registered Schemes and the HVP Unregistered Schemes. 4 

2 By this application, the Liquidators seek an order that they are justified and are otherwise 

acting properly and reasonably in deducting the costs identified in CDC-61 from the 

proceeds of the sale of the trees derived from the Amended Sale Contracts and from the 

Liquidators’ Consideration under the Final Implementation Deed. 

See Schedule 2. 

2 See Schedule 3. 

Paragraph 3 of the orders made in SC 12011 6816 on 4Apr11 2012. 

Paragraph 3 of the orders made in SC I 2011 6762 on 4 April 2012. 

ABLII 966234v3

2 

3 The Liquidators consent to the payment of the WAG and the WGG’s costs of the 

proceedings out of the proceeds of sale of the Amended Sale Contracts and the HVP 

Final Implementation Deed, on a solicitor and own client basis. 

4 The Liquidators rely upon the following: 

(a) affidavit of Craig David Crosbie sworn on 27 April 2012 (First Crosbie Costs 

Affidavit); and 

(b) affidavit of Craig David Crosbie sworn on 2 May 2012 (Second Crosble Costs 

Affidavit). 

5 The First Crosbie Costs Affidavit exhibits five summaries 5 prepared from approximately 

nine lever arch folders of documents. 6 Those voluminous documents have been made 

available for inspection. 7 The Second Crosbie Costs Affidavit exhibits an additional 

summary’ prepared from voluminous bank statements, which will also be made available 

for inspection.’ 

B APPLICABLE PRINCIPLES 

6 The Plaintiffs are entitled to the expenses identified in CDC-61 as expenses which were 

fairly and reasonably incurred in caring for, preserving and realising the Trees the subject 

of the Amended Sale Contracts and Final Implementation Deed. 

7 In Re Universal Distributing Co Ltd (in liquidation) 10 Dixon J (as he then was) enunciated 

the "salvage principle" - that a person who works and incurs expenses to care for, 

preserve or realise property to create a fund is entitled to a charge against that the fund or 

the property in priority to any other claimant. 11 As Davies J held in Thackray 12 : 

"the underlying principle in reach case is that it would be inequitable for the 

person who has created or realised a valuable asset, in which others claim an 

interest, not to have his or her costs, expenses and fees incurred in producing the 

asset paid out of the fund or property created". 

8 As a matter of principle, the fact that liquidators remuneration and expenses relate to the 

administration of more than one scheme does not disentitle the liquidators from recouping 

13 

that remuneration or its expenses from the proceeds of the sale of the Trees. However, 

First Crosbie Costs Affidavit, CDC-61 CDC-62, CDC-64, CDC-65 and CDC-66. 

6 Second Crosbie Costs Affidavit at [7]. 

’ Second Crosbie Costs Affidavit at [61, and CDC-68. 

8 Second Crosbie Costs Affidavit, CDC-69. 

Second Crosbie Costs Affidavit at [24]. 

10 (1933) 48 CLR 171. 

’ At 174-175. See In the Matter of Great Southern Managers Australia Limited: Thackray & Ors V 

Gunns Plantations Limited [2011] VSC 380 at [40]. 

12 At [41]. Citing Shirlaw v Taylor (1991) 31 FCR 222, 228, 230. 

13 Thackray at [47]. 

ABL/1 966234v3

3 

the Liquidators are required to apportion the remuneration and their expenses amongst 

the various schemes and ultimately the individual woodlots.’ 4 Furthermore, where 

expenditure has two or more purposes, one of which is for salvage purposes and one or 

more of which is not, an apportionment of the expenses will be necessary. 15 

9 The WAG contend that the Liquidators cannot have recourse to the proceeds from the 

sale of the Trees to meet the costs incurred in relation to preservation, maintenance or 

realisation because the trees are not "scheme property" but instead the property of third 

party Growers. 16 However, this submission fails to recognise both the breadth of the 

principle identified in Re Universal Distributing and the fact that in selling the trees, WFL 

is dealing as agent, representative and attorney 17 of the Growers and would accordingly 

be entitled to an equitable lien over the fund to the extent necessary to meet the 

expenses incurred in generating the fund. 18 The position of WFL acting as agent and 

attorney is analogous to Re Berkely Applegate 19 where the issue was whether a liquidator 

was entitled to an order for the payment to him of remuneration, costs and expenses out 

of the assets of the company held on trust. Mr Nugee QC held that: 20 

"[W]here a person seeks to enforce a claim to an equitable interest in 

property, the court has a discretion to require as a condition of giving effect to 

that equitable interest that an allowance be made for costs incurred and for 

skill and labour expended in connection with the administration of property. It 

is a discretion which will be sparingly exercised; but factors which will operate 

in favour of its being exercised include the fact that, if the work had not been 

done by the person to whom the allowance is sought to be made, it would 

have had to be done either by the person entitled to the equitable interest 

[citation omitted] or by a receiver appointed by the court whose fees would 

have been borne by the trust property [citation omitted]; and the fact that the 

work has been of substantial benefit to the trust property and to the persons 

interested in it in equity [citation omitted]. In my judgment this is a case in 

which the jurisdiction can properly be exercised. 

14 

Ibid. 

15 

Thackray at [44-[45j. See also 13 Coromandel Place Ply Ltd v C L Custodians Pty Ltd (in liq) 

Q999) 30 ACSR 377. 

6 WAG Outline of Submissions dated 27 April 2012 at [11]. 

17 

See eg CB Al at [272], where clause 61A of the 2002 Professional Investor Deed relevantly states: 

"the Manager has irrevocable power as the agent, representative and attorney of the Grower and 

whether in the name of the Grower or the Manager or both to assign, terminate, surrender or 

otherwise deal with any Project Document and to surrender, relinquish, release or otherwise deal with 

any rights of the Growers in the Trees or arising from, under, or in connection with the Project 

Document" 

18 

See: Rolfe v Transworld Marine Agency Co NV (1998) 28 ACSR 117 at 131, together with the 

cases cited therein at 129-131; Hewett v Court (1983) 149 CLR 639; Evans v McLean (No 2) (1985) 9 

ACLR 796 at 805-806. 

19(1989) Ch. 32, 50-51. 

20 5051 . 

ABL/l 966234v3

4 

C THE EXPENSES WERE FAIRLY AND REASONABLY INCURRED IN CARING FOR, 

PRESERVING AND REALISING THE TREES 

10 The Liquidators submit that the amounts claimed in CDC-61 are fair and reasonable. The 

question of what is ’fair and reasonable" depends on the circumstances of each case. As 

Davies J held in Thackray. 21 

"[T]here is no universal approach applicable in all circumstances by which the 

’reasonableness’ of remuneration claimed or expenses incurred should be 

measured. The size, importance and complexity of the tasks performed are 

all factors to be taken into account. What is needed is sufficient information 

for the Court any objector to have a clear view about what was done so that 

an assessment can be made about the reasonableness of the claim." 

11 At the time of the Liquidators’ appointment as administrators, WFL was the RE or 

manager of 44 Willmott Projects. 22 The scheme documentation in relation to each of the 

Wiltmott Projects is voluminous, and varies between each WiIlmott Project The process 

of preserving, maintaining and realising the Sale Assets was comprehensive. 24 

12 The Liquidators have prepared detailed spreadsheets which identify, record and allocate 

their scheme-related costs on three alternate bases (the choice of which was dependant 

on the nature of the task performed), which have previously been approved by Federal 

Court of Australia :25 

(a) Specific Costs - being the costs specifically referable to a particular WilImott 

Project; 

(b) General Costs - being the costs which relate to work performed for the Willmott 

Projects; 

(C) Mixed Costs - being costs which are referrable to both the Willmott Projects and 

the unsecured Creditors of the Willmott Group. 

13 Each of the spreadsheets identifies the Liquidators’ remuneration (and expenses in the 

case of Mixed Costs) and provides a detailed explanation of the tasks performed by the 

Liquidators and the charges levied. Support for the reasonableness of Liquidators’ 

remuneration can be derived from the fact that the Committee of Inspection have 

approved those expenses for the period up to and including 31 March 2012.26 

Furthermore, the Liquidators’ received approval for 95% of their claimed remuneration for 

the period up to and including 22 March 2011 by the Federal Court of Australia. 27 

21 

At [64], citing inter ella Conlan (as liquidator of Rowena Nominees Pty Ltd) v Adams (2008) 65 

ACSR 521, at 532-33. 

22 

First Crosbie Costs Affidavit at [1 21. 

23 

First Crosbie Costs Affidavit at (13). 

24 

See for example the following paragraphs of the Seventh Crosbie Affidavit 118, 20, 22, 23, 24, 

40,48, 51, 52, 53, 54, 79, 83, 84, 87, 92. 101, 102, 104, 107, 111, 115, 118, 119, 147, 1751. 

25 

First Crosbie Costs Affidavit at [22]-[23]. 

26 

Second Crosbie Costs Affidavit at [14]. 

27 

First Crosbie Costs Affidavit at [20]. 

ABL/l 9662 34v3

14 The spreadsheets also identify and provide a detailed description for the costs incurred in 

retaining Arnold Bloch Leibler. As Mr Crosbie deposes, Arnold Bloch Leibler were the only 

"non-panel" law firm with identified managed investment scheme experience and 

resources to provide services in such a complex liquidation. 28 Having regard to the 

complexity of the issues involved in the sale process and the varying and voluminous 

constituent documents, it is submitted that the scheme-related expenses and 

disbursements referrable to Arnold Bloch Leibler are fair and reasonable. 

15 Ultimately, the reasonableness of the expenses can also be gauged by assessing their 

effect on the net return to Growers, in the context of a sale process which has involved 

complex and varying scheme arrangements and numerous legal issues. The evidence 

discloses that scheme-related costs sought by the Liquidators constitute $2,691,875.67. 

However, because certain projects will not derive any revenue from the sale of trees and 

scheme-related costs referrable to one scheme are not claimed against another, the 

actual sum to be deducted from the gross revenue arising from the sale of the trees is 

significantly less. 29 

Specific Costs 

16 Specific costs are allocated directly to the specific scheme to which they relate. 30 The 

Specific Costs for each scheme are identified in exhibit CDC-62. The types of tasks 

which have been allocated as incurring Specific Costs include: 

(a) reviewing the scheme documentation of a particular Willmott Project; 

(b) drafting scheme summaries; 

(c) responses to Growers in particular schemes (see eg 2001 Professional Investor 

Scheme and Willmott Forests 2002 Project); 

(d) drafting amendments to the constitution (see eg Willmott Forests 1999 

Prospectus); 

(e) liaising and negotiating with HVP in relation to the purchase of interests located 

on HVP Land (see eg Willmott Forests Project 2006 PDS); 

(f) reviewing notices of meetings (see 1994 Grimsey and Associates - Forestry 

Partnership No 1); and, 

(g) preparing correspondence to ASIC (eg 2005 Bioforest Wholesale Project No 2). 

28 Second Crosbie Costs Affidavit at [11]. 

29 Second Crosbie Costs Affidavit, =Confidential CDC-70. 

First Crosbie Costs Affidavit at [22] and [26]-[29]. 

31 First Crosbie Costs Affidavit, CDC-62. 

ABL/1 966234v3

Genera! Costs 

17 General costs are those which relate to the Willmott Projects, but are not specifically 

referable to any one Willmott Project. 32 General Costs are allocated using one of two 

methodologies. 

(a) Method One - apportions costs equally across the Willmott Projects; 33 and, 

(b) Method Two - apportions costs between the Willmott Projects pro rata according 

to the number of Growers in each Willmott Project. 

18 The Method One General Costs for each scheme are identified in exhibit CDC-64. . The 

types of tasks which have been allocated as Method One General Costs include: 

(a) ascertaining the viability of each scheme ( see eg, November 2010, CDC-64); 

(b) sending out expression of interest packs and liaising with potential bidders in 

relation to the replacement of WFL as RE (see eg, November 2010, CDC-64); 

(C) reviewing fire prevention, maintenance and other statutory obligations of WFL 

under relevant state laws (see eg, November 2010, CDC-64); 

(d) attending to expression of interest responses and further queries (see eg, January 

2011, CDC-64); 

(e) reviewing first round, indicative, non-binding proposals (see eg, January 2011, 

CDC-64); 

(f) evaluating bids and proposals (see eg, February 2011, CDC-64); 

(g) liaising with Willmott Management regarding remaining interested party questions 

(February 2011, CDC-64); and, 

(h) meetings to discuss the sale of asset process for the Trees (see eg, June 2011). 

19 The Method Two General Costs for each scheme are identified in exhibit CDC-65. Those 

costs have been allocated using Method Two as are generally correlative to the number 

32 First Crosbie Costs Affidavit at [29]. 

First Crosbie Costs Affidavit at [29]. As noted at [34] and exhibit CDC-63 of the First Crosbie Costs 

Affidavit, the number of projects in which tasks were undertaken has changed from time to time. From 

the Liquidators appointment until 22 December 2011, General Costs were divided between 44 

projects. After Primary Securities Ltd replaced WFL as RE of the 95-99 scheme, General Costs were 

divided between 39 Projects during the period 23 December 2011 to 31 January 2012. After the 

determination of the separate question on 9 February 2012, General Costs were divided between the 

23 Projects the subject of the Amended Sale Contracts. 

Exhibit CDC-64, First Crosbie Costs Affidavit at [36]. 

ABLII 966234v3

7 

of Growers in a Project - rather than the number of Projects The types of tasks which 

have been allocated as Method Two General Costs include: 

(a) dealing with Growers’ queries regarding estimated returns, status of insurance 

and the confirmation of Grower holdings (see eg, March 2012, CDC-65): 

(b) meeting with Marie Birmingham of the WAG to discuss the restructuring of the 

schemes (see eg January 2011, CDC-65); 

(c) preparing a memorandum outlining possible options to maximise returns to 

Growers (see eg, February 2011, CDC-65); 

(d) obtaining a viability report from Poyry (see eg February 2011, CDC-65); and, 

(e) discussions with Growers to update them on the sate process (see eg, October 

Mixed Costs 

2011, CDC-65). 

20 The Liquidators have incurred certain costs which are referrable to both the Willmott 

Schemes and the liquidation of the WilImott Group. Those "mixed" costs were incurred in 

continuing to operate the Willmott Schemes and Willmott Group until the future operation 

of WFL could be determined and the sale of the assets effected (once WFL’s future was 

determined). 36 Incurring the mixed costs enabled the Liquidators to preserve and 

.37 

maintain the Trees together with the unsecured land until sale Mixed costs have been 

allocated pail passu based upon the comparative return under the Amended Sale 

Contracts to unsecured land (68%) and Trees (32%).38 As the Mixed Costs have been 

apportioned by reference to the value of the Trees and the Trees themselves are valued 

on a per-hectare basis, Method 2 has been employed in allocating Mixed Costs as 

between the Projects. 

21 Throughout the administration and liquidation of the Willmott Group, the type of tasks that 

have been allocated as Mixed Costs have included: 

(a) 32% of the staff costs - staff members were retained and performed the following 

services: 39 

(i) liaising with Growers; 

(ii) obtaining and preparing information relating to insurance; 

Exhibit CDC-65, First Crosbie Costs Affidavit at [40]. 



Thackray at [45]. See also: 13 Coromandel Place Pty Ltd v C L Custodians Pty Ltd (in liq) (1999) 30 

ACSR 377 at 386. 

See First Crosbie Costs Affidavit at [511 and exhibit CDC-66. 

ABL/1 9662 34v3

(iii) maintaining plantations; 

(iv) overseeing thinning operations; and, 

(v) meeting interested parties. 

(b) 32% of the overhead costs - comprising: 

(I) rent for a head office from which two WFL employees worked and to 

which correspondence was sent; 40 

(ii) utility costs for a Bombala office from which three WFL employees worked 

and which was used for the purpose of dealing with local authorities and 

hosting site visits during the Expression of Interest campaign ;41; 

(iii) lease and fuel costs for three motor vehicles retained by WFL for the 

purpose of visiting and inspecting plantations together with being on 

standby in the event of a fire outbreak; 42 

(iv) mail out costs incurred in printing and mailing out communications with 

creditors and growers; 43 

(c) 44%44 of the bank interest on $2.5 million borrowed by the Liquidators personally 

and used to pay: 45 

(i) essential services, including electricity and communications; 

(ii) essential works (including slashing and removal of noxious weeds); 

(iii) some of the Liquidators’ remuneration; 

(iv) some legal fees and costs (ABL and Counsel); 

(v) certain other professional fees (including Poyry); 

(d) 32% of sale costs - comprising: 46 

(i) seeking directions from the Federal Court of Australia that the Liquidators 

would be justified in undertaking the Sale Campaign; 

See First Crosbie Costs Affidavit at [52(a)] and exhibit CDC-66. 

41 See First Crosbie Costs Affidavit at [52(b)] and exhibit CDC-66. 

42 See First Crosbie Costs Affidavit at [52(c)] and exhibit CDC-66. 

See First Crosbie Costs Affidavit at [52(d)] and exhibit CDC-66. 

See First Crosbie Costs Affidavit at [55] and Second Crosbie Costs Affidavit, exhibit CDC-69. 

See First Crosbie Costs Affidavit at [54]. 

See First Crosbie Costs Affidavit at (59]. 

ABL/1 9662 34v3

D CONCLUSION 

ri 

(ii) advertising the Sale Assets (see Seventh Crosbie Affidavit at [85]); 

(iii) preparing information relating to the Sale Assets, including drafting the 

information overview, information memorandum for each region, individual 

property summaries for each plantation and compiling the information 

packs (see Seventh Crosbie Affidavit at [891-[941); 

(iv) setting up and managing the online data room (see Seventh Crosbie 

Affidavit at [921-[98]); 

(v) conducting site visits, including travel, accommodation and hospitality 

expenses (see Seventh Crosbie Affidavit at [99]); 

(vi) negotiating with potential purchasers as well as with the Receivers and 

drafting the necessary contracts; 

(vii) seeking Court approval for the Amended Sale Contracts and the Final 

Implementation Deed in these proceedings. 

22 As the foregoing analysis demonstrates, the process adopted by the Liquidators has fairly 

allocated: specific and general costs across the Projects; and, mixed costs between (and 

across) the Projects and the unsecured creditors. Moreover, the summary spreadsheets 

and accompanying affidavit evidence have provided the WAG and WGG with a clear view 

as to justification for and the reasonableness of, the claims made. 

Dated: 9 May 2012 

ABL/1 9662343 

PAUL ANASTASS1QU 

ROBERT G CRAIG 

ARNOLD BLOCH LEIBLER



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 


This is the exhibit marked "JCS-2" now produced and shown to JANE CHALMERS 


JUSTIN TAEDE VAATSThA 

L_ 

Uwd 21, 333 COMM SUSO Before me: 

MeP* 3000 

An /Waan Legal PrdIIansr vAft to 

meing of the Legal Profession Act 2004 

Exhibit "JCS-2" 

Page 4 of the Transcript of Heating in Proceedings 

SCI 2011 6762 and SCI 2011 6818 dated 15 May 2012

SUPREME COURT OF VICTORIA 

COMMERCIAL DIVISION 

S CI 2011 06762 

IN THE MATTER OF AN APPLICATION WILLMOTT FORESTS LIMITED 

(RECIEVERS AND MANAGERS APPOINTED) 

(IN LIQUIDATION) (IN IT’S CAPACITY AS RESPONSIBLE ENTITY OF THE 

MANAGED INVESTMENTS SCHEMES LISTED (schedule in case log))& ORS 

uI 

S CI 2011 06816 

IN THE MATTER OF AN APPLICATION WILLMOTT FORESTS LIMITED 

(RECIEVERS AND MANAGERS APPOINTED) 

(IN LIQUIDATION) (IN ITS CAPACITY AS RESPONSIBLE ENTITY OF THE 

MANAGEMENT INVESTMENTS SCHEMES LISTED IN SCHEDULE 2 AND IN ITS 


SCHEDULES 3 & ORS 

JUDGE: Davies J 

WHERE HELD: Melbourne 

DATE OF HEARING: 15 May 2012 

APPEARANCES 

MR P. ANASTASSIOU SC with MR R.G. CRAIG appeared on behalf of 

the Plaintiff. 

MR D. H. DENTON RFD SC with MR A.P. DOWNIE appeared on behalf 

of Willmott Action Group. 

LEGAL TRANSCRIPTS PTY LTD 

Suite 18, 600 Lonsdale Street, Melbourne - Telephone 9642 0322

MR G. BIGMORE QC with MR KENNEDY appeared on behalf of Willmott 

Growers Group. 

MR H. AUSTIN appeared on behalf of the receivers. 

LEGAL TRANSCRIPTS PTY LTD 

Suite 18, 600 Lonsdale Street, Melbourne - Telephone 9642 0322

1 assets. That would result, Your Honour, if that approach 

2 were taken, in the costs of the WGG and the WAG being 

3 borne proportionate to the return to the three interests 

4 that had benefited from the sale, namely the secured 

5 creditors, the unsecured creditors and the growers. And 

6 the percentages are that 68 per cent to the unsecured 

7 creditors - sorry, I’ve - it’s 63 per cent to the secured 

8 creditors, 24.6 per cent to the unsecured creditors and 

9 12.4 per cent to the growers. 

10 And what the methodology in Paragraph 4 is intended 

11 to achieve is the allocation in those proportions of the 

12 WAG and the WGG’s costs from the gross proceeds of the 

13 sale and that, of course, involves treating as a matter 

14 of principle the WAG and WGG’s costs as captured by the 

15 salvage principle. In other words, the argument is that 

16 the WGG and WAG - I’m going to get sick, Your Honour, of 

17 reciting those acronyms. Perhaps I should just call them 

18 the intervenors. The intervenors were necessary and 

19 in - and an intrinsic part of the steps that were taken 

20 to realise the assets and, in our submission, can 

21 therefore be properly treated. 

22 In a situation where there is a mixture of 

23 assets - some of the assets being assets belonging to the 

24 company and other assets not being assets of the company, 

25 being assets of the growers - in those circumstances the 

26 liquidator submits that that is a - an equitable way of 

27 treating the interests that have benefited as a result of 

28 the efforts that have been undertaken and importantly of 

29 course, Your Honour, that approach could only be taken 

30 with the consent of the receivers because the receivers 

31 under the contracts that have been entered into have 

.MN:CW 15/05/12 FTR:1-10A 4 DISCUSSION 

Willmott Forests Limited



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 




JUSTIN TAEDE VAATSTRA 

Mm 

Level 21,333 Collins Sb Before me 

mabourne 3000 

An PaUan Legal Pvalboner wift lie 

meaning of the Legal Profession k* 2004 


Letter from Lloyd & Lloyd Solici rs to Arnold Bloch 

Leibler dated 10 July 2012

Our Ref: PS:NR:10500 

Your Ref: Meagan Grose 

10 July 2012 

Arnold Bloch Leibler 

Lawyers 

Level 21/333 ColIlins Street 

MELBOURNE VIC 3000 

Dear Partners 

Without Piejudice except as to Costs 

LLOYD & LLOYD SOLICITORS 

ESTABLISHED 1927 

Level 5, 131 Clarence Street 

Sydney NSW 2000 

Australia 

Telephone 612 8014 5225 

Facsimile 612 9279 3792 

www.Iloyd-lloyd.com 

Our Client: Willmott Action Group Inc (WAG) 

Supreme Court of Victoria Proceedings SCI 2011 6816 and SCI 2011 6762 in 

relation to costs 

We refer to the Orders made by Justice Davies dated 23 May 2012. 

The Orders provide that the Liquidators pay the costs, including reserved costs, of WAG 

of and incidental to the proceeding on a solicitor client basis, such costs to be taxed in 

default of agreement. 

Please find attached a schedule of costs of WAG and copies of invoices outlining the 

individual charges. 

On the attachedinvoices, we have redacted the entries in the Uoyd & Lloyd invoices so 

as not to display those items which are either unrelated to this claim and proceedings or 

are being claimed separately. 

The Barrister fees claimed are set out separately. Items of barrister work unrelated to 

this claim have been crossed through. 

We formally advise that WAG will accept the total amount as set out in the Schedule of 

$903,839.75 in full and final discharge of the Liquidators’ liability pursuant to the costs 

order. 

Please give us your response to this offer within 7 days of this letter. 

Liability limited by a scheme approved under Professional Standards Legislation


Lawyers 2 10 July 2012 

If the Liquidators do not accept this offer and WAG commences proceedings for a 

taxation of its costs, in the event WAG achieves a costs award in its favour near to or 

exceeding the amount of WAG’S offer, WAG will tender this letter of offer to the Court in 

support of an order that the Liquidators pay WAG’S costs proceedings for taxation on an 

indemnity basis. 

Yours faithfully 


PATIICK SEE 

psee@lloyd-lloyd.com



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 

(Justin Vaatstra - jvaatstraabI.com.au ) 



JUSTIN TAEOE VMTSTRA 

AwdW Bloch 

LOM 21.333 Co" Sbeea Before me 

Wme ZOO 

An Miaen Legal Pmctltlon& n ft 

of Ihe L.egal PIVfeS&On Act 2004 


Letter from Arnold Bloch Leibler to Lloyd & Lloyd 

Solicitors dated 12 July 2012


12 July 2012 


By E-mail Your Ref PS:NR:10500 

Our Ref MLG JCS 

File No. 011565243 

Patrick See Contact 

Partner 

LLoyd & Lloyd Solicitors 

pseelloyd-lloyd .com 

Meagan Grose 

Direct 61 3 9229 9657 

Facsimile 61 3 9916 9531 

mgroseabI.com.au 

Partner 

Jane Sheridan 

Direct 61 3 9229 9815 

jsheridan@abl.com.au 

Level 21 


Melbourne 

Victoria 3000 

Australia 

DX38455 Melbourne 

www.abl.com.au 

Telephone 

613 9229 9999 

Facsimile 

613 9229 9900 

Dear Mr See Without Prejudice save as MELBOURNE 

to costs 

SYDNEY 

In the matter of Willmott Forests Ltd (recs and managers appt’d) (in liq) 

Supreme Court of Victoria proceeding nos SCI 2011 6762 and SCI 2011 

6861 ("Proceedings") 

We refer to your letter dated 10 July 2012 and the attachments to that 

letter, which relate to the order of the Honourable Justice Davies in the 

Proceedings made on 23 May 2012 ("Order"). 

2 We have conducted a preliminary perusal of your letter and the 

attachments to it and have identified a number of serious deficiencies 

with your client’s claim. 

Partneri 

Mark MLAbAIAC 

eneyDLarrer 

Leon Zuler 

PlahpChezlar 

Ross A Paterson 

Stephen L Sharp 

Kererell’ A Grey 

Kevin FFraule 

hOcheelS Dodge 

JamCSae 

Leorae S Thorrrpenn 

Jonesrari N Wang 

Paul Sollolowahi 

Paul Ruhenslain 

Peer MStedel 

Alec Ilog 

Jolvillftball 

lAssie Cordon 

BenMahoney 

Sam Dollied 

Ily Tall 

Henry Skene 

Mdnsw Stearbe,g 

LroaMelWweathor 

ne5,ae Mine, 

John litnt iolian 

Carolina Gntdden 

3 In your letter, you state that the Order provides that "the Liquidators pay 

the costs, including reserved costs, of WAG of and incidental to the 

proceeding on a solicitor client basis, such costs to be taxed in default of 

MaMew Loos 

agreement". Your letter misrepresents the Order. Paragraph 1 of the Gerreniav, 

Jere" Lolwer 

Order provides that Willmott Forests Ltd (res and managers apptd) (in 

Rich Saxon 

liq) ("WFL") (as opposed to the Liquidators) is to pay your client’s costs 

of the Proceedings on a solicitor client basis. 

4 On the basis of the information provided to us under cover of your letter 

of 10 July 2012, it is apparent that your client’s claim as set out in that 

letter and its attachments cannot form the basis of a claim for costs 

within the terms of paragraph 1 of the Order for, inter alia, the reasons 

set out below. 

Sexton 

JonalDanCan 

Clint Hard" 

James Shrrpson 

Sen ior Litigation 

Counsel 

Senior Anonciaten 

Sue Kee 

Jn,iaclethend 

Beriarnin Mershon 

KneTnuVerowy 

Teresa Ward 

Jason Blanklleld 

Chnisllne Floor 

Discrepancy as to amount of legal costs 

NarcyCoens 

Sueanna Ford 

Kkrtorloy MaSlay 

Carp Segal 

5 The total amount of costs claimed by your client is unclear. reTaaylacae 

clara Vargirose 

6 In your letter, you state that "WAG will accept the total amount as set out 

in the Schedule of $903,839.75 in full and final discharge of the 

Liquidators’ liability pursuant to the costs order." This is at odds with the 

total figure set out in the schedule to the letter, which is $900,862.37. 

AB LJ222 16 18 Vi 

Andrea lawson 

Jernder CoRros 

UzaLane 

Dario] Mole 

DOVolSPAS5V 

Kate Log al 

Elizabeth Steer 

Alinto Bradley 

SheIla CurSoroct 

Darien Caddihy 

Dal" Snyder 

David Robbins 

Kryalid Bedggsed 

Geoffrey Kotminoky 

Jeremy Lancer 

Consultants 

Allan Polo Al)

Patrick See Arnold Bloch Leibler 

LLoyd & Lloyd Solicitors Page: 2 

Date: 12 July 2012 

Costs prior to the commencement of the proceeding 

7 Proceeding no SC, 2011 6762 was commenced on 13 December 2011. 

Proceeding no SCI 2011 6616 was commenced on 14 December 2011. 

8 Under cover of Lloyd & Lloyd invoice no 1977, your client claims for 

costs from November and December 2011 prior to the commencement 

of either of the Proceedings. Such costs are not costs ’of the 

Proceedings". 

9 Your client has also claimed for services rendered by David Smith in 

June 2011, some six months prior to the commencement of the 

Proceedings. These are not costs "of the Proceedings". 

Costs in relation to Supreme Court of Victoria proceeding no SC, 2012 

1652 

10 It is evident that a number of costs claimed by your client are costs that 

do not relate to the Proceedings, but instead relate to Supreme Court of 

Victoria proceeding no SCI 2012 1652 ("Hoddinott Application"). 

11 Invoice no INVAPD46 of Mr Downie, which your client claims as a cost 

of the Proceedings, was rendered by Mr Downie in respect of the 

Hoddinott Application. 

12 In addition, there are a number of line items in Lloyd & Lloyd invoice no 

2050 that appear to directly relate to the Hoddinott Application. For 

example, 02/05/2012: "P See attending to telephone attendances with 

JWS lawyer re future of litigation generally and costs". 

13 We understand references to JWS and Johnson Winter Slattery to be to 

the solicitors for Messrs Sheahan and Lock, the proposed receivers 

under the Hoddinott Application. 

14 Similarly, the invoices of Eales & Mackenzie contain items which appear 

to relate directly to the Hoddinott Application. For example 22/3/2012: 

"Attendance at Supreme Court to file Originating Process". 

15 We remind you that costs in respect of the Hoddinott Application are the 

subject of a separate order in that proceeding dated 27 June 2012. 

Costs in relation to Court of Appeal proceeding nos SAPCI 2012 0068 and 

SAPCI 2012 0069 ("WAG Appeals") 

16 In addition, there appear to be a number of items claimed in respect of 

the WAG Appeals. 

17 For example, in Lloyd & Lloyd invoice 2050, a number of costs are 

claimed in respect of the WAG Appeals. They include: 

ABLI22216180 

(a) 02/05/2012: "letter to ABL re WAG appeals - costs security and 

consent to leave - P See occupied from 8.40 am to 11.1 5am".




(b) 10/05/2012: "P See .. correspondence from ABL re Leave to 

Appeal of WAG and advising re same (30 mins)" 

18 Costs incurred by your client in respect of the WAG Appeals are not 

costs incurred in the Proceedings and, as such, are not claimable under 

the Order. 

Other unexplained items claimed 

19 There are a number of references to Mr Glen Miller QC and Mr D 

Eardley (including the preparation of a brief to Mr Eardley and an invoice 

rendered by Mr Eardley). We are unaware of any work performed by 

Messrs Miller or Eardley in respect of either of the Proceedings. 

20 Your client claims for services rendered by Smart Strategy, in respect of 

website and email provision services. Those invoices cannot be 

considered to be legal costs of the Proceedings. In addition, the majority 

of those invoices relate to work prior to the commencement of the 

Proceedings, from as early as October 2010. 

21 Your client also claims for services rendered by White Dog Marketing, in 

respect of compilation of lists and mail outs. Again, these are not legal 

costs of the Proceedings. 

Costs claimed on an improper basis 

22 As set out above, paragraph I of the Order provides for the payment of 

your client’s costs of the Proceedings on a solicitor client basis. 

23 Solicitor client costs are all those "reasonably incurred and of reasonable 

amount" (r 63.03, Supreme Court (Genera! Civil Procedure) Rules 2005 

(Vic)). 

24 From our preliminary perusal of the costs claimed by your client, it 

appears that it claims its costs of the Proceedings (and of other 

proceedings) on an indemnity basis. 

Future steps 

25 We request that, if your client intends to seeks its costs of the 

Proceeding pursuant to paragraph I of the Order, it provide WFL with 

proper documentation to fulfil its obligation under that Order. 

26 For the avoidance of doubt, those invoices should relate to costs: 

(a) incurred only in respect of either of the Proceedings; 

(b) on a solicitor client basis (that is, "reasonably incurred and of 

reasonable amount"). 

27 Prior to the receipt of such documentation, WFL is not able to review 

your client’s claim, let alone accept the "offer" set out in your letter of 10 

July 2012. 

ABLI22216180




28 As we have only conduc ted a preliminary perusal of the material, this 

letter does not purport to, and does not, address all of the deficiencies 

with your client’s claim IS currently drafted. We reserve our client’s 

rights to object to all or any part of your client’s claim, once properly 

documented, including on the basis that it does not come within the 

Order. 



Jane Sheridan 

Partner 

ABL/22216180



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 

(Justin Vaatstra - jvaatstraabI.com.au ) 



JUSTIN TAEDE VAATSTR 

_______ ___ 

ii:: 

M hoalanLeg& Pracdboner we* 

moer*ig of the Legal PmMalon Mt 2004 

Before me: 


Letter from Lloyd & Lloyd Solicitotf)s to Arnold Bloch 

Leibler dated 24 July 2012 

II

Our Ref: PS:NR:10500 

Your Ref: MLG JCS 

24 July 2012 


Lawyers 

Level 21/333 CoUlins Street 

MELBOURNE VIC 3000 

Dear Partners 


ESTABLISHED 1927 


Sydney NSW 20D0 

Australia 

Telephone 612 8014 5225 

Facsimile 612 9279 3792 

www.11oyd -Iloyd.com 

Our Client: Willmott Action Group Inc (WAG) 

Supreme Court of Victoria Proceedings SCI 2011. 6816 and SCI 2011 6762 in 

relation to costs. 

We refer to your letter dated 12 July 2012. 

We respond to the numbered paragraphs of your letter to the extent necessary, as 

follows: 

Costs prior to the commencement of the proceedings. 

8 Our client had notice of the proposal to commence proceedings well prior to the 

first hearing date as its Committee members were advised of the Liquidators’ 

intentions to immediately return to the Court for approval of the sales in the 

meeting with Mr Crosbie and others on 29 November 2011. Further in early 

communications with the growers, the Liquidators had indicated their intentions to 

return to the Court for further orders. For this reason we press the claim for 

charges incurred from 22 November 2011. 

9 We press the claims in relation to work completed by David Smith as his reports 

were relied upon in the proceedings by our client in order to provide evidence to 

support their position in the proceedings. This reliance is demonstrated by 

reference to the meetings and attendances with Mr Smith, indicated in the Lloyd 

& Uoyd invoices. 




Costs in relation to Supreme Court of Victoria Proceedings Sa 2012 1652 

11 Tax Invoice INVAPD46 of Mr Downie was incorrectly included within the claim and 

we do not press the amount provided in the invoice. 

12 In relation to the attendances for Receiver Application proceedings in Lloyd & 

Lloyd Tax Invoice 2050 we do not press the entries of WAG’S original claim to 

which you refer as follows: 

Date Amount 

24 April 2012 $210.00 + GST 

26 April 2012 $120.00 + GST 

2 May 2012 $490.00 + GST 

13 In regard to references in our client’s claim to JWS and Johnson Winter Slattery 

we do not press claims for that work as follows: 

Date Amount 

9 March 2012 $210.00 + GST 

4 April 2012 $420.00 + GST 

12 April 2012 $420.00 + GST 

23 April 2012 $210.00 + GST 

10 May 2012 $140.00 + GST 

14 In relation to the invoices of Eales & Mackenzie we do not press the following 

amounts: 

Date Description Amount 

30 March 2012 Tax Invoice 885367 $1,071.40(half) 

attendances from 21 March 

2012 to 30 March 2012 

30 April 2012 Tax Invoice 885445 1 $2,407.25 

Cost in relation to Court of Appeal Proceedings S APCI 2012 0068 and S APCI 

2012 0069 (WAG Appeals) 

17 In relation to the Lloyd & Lloyd Tax Invoice 2050 we do not press the following 

entries and amounts in the claim: 

Date Description Amount 

2 May 2012 "Letter to ABL re WAG $1,050.00 + GST 

Appeals - costs security and 

consent to leave. P See 

occupied from 8.40am to 

11.15am" 

10 May 2012 "Correspondence from ABL $ 206.18 + GST 

re Leave to Appeal of WAG



Other Items Claimed 

and advising re same (30 

minutes)" 

19 In relation to attendances with Mr Miller QC, WAG had sought Mr Miller’s advice in 

the event of the potential non-availability of Mr Denton Sc. 

In relation to the attendances with Mr Eardley and Mr Eardley’s fees, Mr Eardley 

was junior counsel and briefed in the proceedings prior to Mr Downie’s 

involvement. 

On this basis and given that the Court Orders provide for costs on a solicitor and 

Client basis we press for Lloyd & Lloyd attendances with these banisters and the 

fees charged by Mr Eardley as claimed. 

20 Claims for the charges for services rendered by Smart Strategy and White Dog 

Marketing are properly claimable as necessary disbursements in the proceedings. 

If it were not for the proceedings these services would not have been required in 

order to give Information to members of the Schemes and to receive information 

and communications from members. These are necessary disbursements in view 

of the nature of our client and the grower interests which it endeavoured to 

promote and protect. 

Accordingly, we are instructed to reduce our client’s claim for costs to take into account 

the above concessions and attached is an amended Schedule of Claim for Costs on a 

Solicitor and Client basis in the total amount of $892,444.18 

No offer in relation as to this claim for costs has yet been made by the Liquidators. You 

have been provided with full details of the claim and the Liquidators have more than 

adequate information and particulars of the claim to allow an offer to be made and 

should have already made an offer if they are bona fide in relation to this matter. 

Lastly, if the Liquidators do not accept this amended offer and WAG commences 

proceedings for a taxation of its costs, in the event WAG achieves a costs award in its 

favour near to or exceeding the amount of WAG’S offer, WAG will tender this letter to the 

Court in support of an order that the Liquidators pay WAG’S costs of the proceedings for 

taxation on an indemnity basis. 

We look forward to your response 



L/tOA 

PATRICK SEE 

psee@lloyd-lloyd.com



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 

(Justin Vaatstra - jvaatstra@abl.corn.au ) 



JUSTIN TAEDE VAATSTRA 

Level 21, 333 Caft skw 

An MdraW Legal Practitioner *e*i lie 

moiiig Of the Legal Profession Act 2004 

Before me: 


Letter from Arnold Bloch LeiL1er to Lloyd & Lloyd 

Solicitors dated 31 July 2012 

S


31 July 2012 

Level 21 

333 Collins Sheet 

Lawyers and Advisers Melbourne 

Victoria 3000 

Australia 

0X38455 Melbourne 

way.abhco,mau 

Telephone 

613 9229 9999 

Your Ref PS:NR:10500 Facsimile 

By E-mail Our Ref MLO JCS 613 9229 9900 

File No. 011565243 

Patrick See Contact 

Partner 

Lloyd & Lloyd Solicitors 

psee@lloyd-floyd.com 

Meagan Grose 

Direct 613 9229 9657 

Facsimile 613 9916 9531 

rngrose'abl.com.au 

Dear Mr See 

Partner 

Jane Sheridan 

Direct 613 9229 9815 

jsheriUanlabl.com.au 

in the matter of WiiImott Forests Ltd (recs and managers appt’d) (in iiq) 

(WFL) 

Supreme Court of Victoria proceeding nos SCI 2011 6762 and 6861 Partners 

We refer to your letter of 24 July 2012 and to our letter of 12 July 2012 

(Previous Letter). We adopt the defined terms from our Previous Letter in this 

letter, 

You appear to have misconstrued our Previous Letter, it was not, and did not 

purport to be, a comprehensive list of the issues with your client’s claim for 

costs. Our Previous Letter expressly stated that it only sought to provide 

examples of some of the issues that are inherent in your client’s claim for costs. 

We are surprised, therefore, that you have treated as if it were a comprehensive 

list of the defects in your client’s claim for costs. 

MELBOURNE 

SYDNEY 

Mote M Witter AG 

henry 0 Loge, 

Joseph Bars"Z4n 

Lane Sale, 

PNhlpChxeler 

RyssAPatwann 

Stephen L Sharp 

KermeilrAG,ay 

Kevin FFrawley 

Michael N Dodge 

ecsueviiex 

Loom R Theanoon 

Jonathan M Wevig 

PautRubenstain 

Peter MSONeI 

Non King 

.101,11 Mochall 

Idnole Gordon 

Beniedonney 

San, Dolton! 

Lily Teb 

Hen,y$kene 

Meow Sdberberg 

uneMoryoneSrer 

Jonathan Mikxai 

Your attempt to resolve the many issues with your client’s claim for costs by 

addressing only the highlighted examples, rather than undertaking a full and 

idmMeagolm 

proper review and reworking of your client’s claim, serves no purpose. Unless Cn,of,ne Gouleen 

and until you provide us with a bill of costs, in a proper form with the usual 

detail, of only those costs which are covered by the Order, our clients cannot Rick 50,0,, 

Nathan fter 

consider your client’s claim. Our clients are not required to, and will not, incur 

JanoTha,Crhon 

unnecessary costs in reviewing a claim that is clearly outside the ambit of the 

cont Harding 

James Simpson 

Order. 

Our clients are willing to attempt to resolve your client’s claim for costs without 

requiring your client’s costs to be taxed (noting that the consent of the Receivers 

and Managers will also be required). However, any resolution will require your 

client to identify the costs the subject of the Order in clear and sufficient detail. 



Jane Sheridan 

Partner 

A131-122697490 

MaterewLess 

Genevieve Sexton 

Senior Utigation 

Coueul 

Robert JHee 

SernorAe*octats 

JoiloClxdiand 

Baniainirimalshall 

KsiohnaVoc,rey 

Tn,aWid 

Jason illoakileld 

CMSdne neon 

NanyCothxe 

Sueonna Ford 

Kimberley MacKay 

Gary Segal 

lOony L0000 

Clara Varginen. 

dothea Iowan,, 

oneS., CaSe,, 

Lisa lane 

DenteUdole 

David Spiese 

Kale Logan 

Lab Do Maio 

EOzabeVx 5Cc, 

PJtelaBneS’rey 

MeSa Cn,mcaercz 

DxnipnCrxddihy 

Daniel Sinyder 

Dodd Robbins 

KryddBedggood 

Geoffrey Kondnsky 

Jeferq Lam 

Neil Bnydgen 

Consultants 

Man Fete SO



AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 




JUSTIN TAEDE VAATSmA 

Mn &Ach Latier 

Level 21 , 333 Calm 811W 

m* OO 

Before me: 


Letter from Arnold Bloch Leibler to Lloyd & Lloyd 

Solicitors dated 27 July 2012

Our Ref: PS:RH:10500 

27 July 2012 


ESTA5LISHED 1927 

Level 6,131 Clarence Street 


Australia 


Lawyers 

Level 21/333 CoIllins Street 

MELBOURNE VIC 3000 Attention: Mr J Vaatstra and Ms 3 Sheridan 

By email: jvaatstra@abl.com.au; isheridan@abl.com.au ; mgrose@abl.com.au 

Dear Partners 

Our client: Wilimottactiongroup Inc ("Willmott Action Group") 

In the matter of Willmott Forests Limited (In Liquidation) 

Court of Appeal Supreme Court of Victoria 

Proceedings numbers S APCI 2012 0068 and S APCI 2012 0069 

We refer to the Orders of the Court of Appeal made on 8 June 2012. 

Telephone 612 8014 5225 

Facsimile 612 9279 3792 

www.11oyd-lloycLcom 

Our client has filed and served Notices of Appeal in these proceedings in accordance with 

those Orders. 

Pursuant to the Orders, our client must provide a draft summary of each proceeding on 

or before 4:00pm today. We will not be able to provide the draft summaries by this time 

due to other pressing commitments of Counsel who have been briefed in this matter. 

Based on Counsel’s availability, we expect that the draft summaries will be provided to 

the Liquidators in just over a week’s time by close of business on Tuesday 7 August 

2012. 

The timetable made by the Court provides that the Liquidators must notify our client of 

any amendment to the draft summaries by 10 August 2012 and the agreed summaries 

must be filed by Friday 31 August 2012. 

Our client will not object to an extension of time for your clients’ response of equivalent 

length to the delay in provision of the draft summaries. 

Please do not hesitate to contact the writer to discuss should it be necessary. 



PXTRICK SEE 

psee@lloyd-iloyd.com 




AT MELBOURNE 

S APCI 2012 0069 



BETWEEN 


and 












Prepared by: 



Level 21 








Tel: 9229 9999 

Fax: 9229 9900 

Ref: 01-1722259 




JUSTIN TAEDE VMTSThA 

AffKAd Bloch Labor 

L" 21, 333 CoMm Skeet Before me: 

2000 

M Maaen Leo Pmctllaner the 

m=ft d the Legal PiofeesiOn Mt 2004 


Letter from Arnold Bloch LŁibler to Lloyd & Lloyd 

Solicitors dated 13 August 2012



Level 21 


Melbourne 

Victoria 3000 

Australia 

DX38455 Melbourne 

wew.abl.comau 

13 August 2012 Telephone 

613 9229 9999 

By email 

Your Ref 

Our Ref JCS 

File No. 011722259 

Patrick See 

contact 

Partner 

Lloyd & Lloyd Solicitors 

Jane Sheridan 

Direct 61 3 9229 9815 

Facsimile 61 3 9229 9944 



jsheridanabl.com.au 

Dear Mr See 

Facsimile 

613 9229 9900 

MELBOURNE 

SYDNEY 

Paolneoa 

Mark idLetherAC 

HenayDLanzer 

In the matter of Willmott Forests Ltd (receivers and managers Leon Zryiea 

appointed)(in liquidation) Ross A Pule,aen 

Supreme Court of Victoria Court of Appeal Proceeding Numbers S APCI 

StebenLSbartr 

Kenoreth A Gray 

2012 0068 and S APCI 2012 0069 ("the Proceedings") 

KsethFFraedey 

bkchaul N Dodge 

Jane C Sheridan 

LeordeR Thoreposo 

ZavenMordeoss,ao 

We refer to the Orders made in the Proceedings on 8 June 2012 and your letter 

Jonathan M Wenie 

dated 27 July 2012. 

PaulSokolewskr 

Ford Rubenstein 

Paler M Seldel 

Was King 

John Knoll 

Fycole Gordon 

In your letter, you stated that you would not be able to provide the draft 

summary of each proceeding by 27 July 2012 due to Counsel’s unavailability. 

Ben May 

Sam Dolwd 

Instead, we were told that we could expect the draft summaries by 7 August 

Lity Tell 

2012. To date, we have not received the draft summaries. 

Please let us know when we will receive a draft summary for each proceeding. 

Your client’s continued non-compliance with the Court ordered timetable is 

prejudicing our clients’ ability to prepare for the appeals. If the draft summaries 

are not provided to us by close of business on 15 August 2012, our clients will 

consider relisting the appeals to deal with your client’s non-compliance. 

Yours sincerely 

Jane Sheridan 

Partner 

Henry Shene 

AardrewSdbe:berg 

Lisa Melryweathen 

Jonathan Fylnar 

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Allan Fats AD

JCS-6 - Arnold Bloch Leibler

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