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Federal Court of Australia |
Last Updated: 2 March 2000
Cheers v El Davo Pty Ltd (in liq) [2000] FCA 144
PRACTICE & PROCEDURE - right to cross-examine - parties "in the same interest" - sequence of cross-examination.
Evidence Act 1995 (Cth) s 26(c), 42(2)(b) & (c)
GPI Leisure Corp Ltd v Herdsman Investments Pty Ltd (No 3) (1990) 20 NSWLR 15 at 22-3 referred to
NMFM Property Pty Ltd v Citibank Ltd (No 8) (1999) 161 ALR 581 at 584 referred to
ALAN FRANCIS CHEERS & ORS v EL DAVO PTY LTD (In Liquidation) (formerly known as ENTERCORP FINANCE PTY LTD) (ACN 060 214 502) & ORS
No VG 106 of 1997
WEINBERG J
21 FEBRUARY 2000
MELBOURNE
IN THE FEDERAL COURT OF AUSTRALIA |
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VICTORIA DISTRICT REGISTRY |
Ruling on right to cross-examine and sequence of cross-examination
1 At the conclusion of the opening address by Mr North, counsel for the applicants, both Mr Martindale, counsel for the eighth, eleventh, fifteenth and seventeenth respondents, and Mr Magee QC, senior counsel for the tenth and sixteenth respondents, have sought from me a ruling to the effect that Mr Herskope, counsel for the eightieth to eighty-third cross-respondents ("the Davis cross-respondents") be prevented from asking leading questions of any of the witnesses to be called by the applicants, apart from the applicants themselves. Mr Martindale and Mr Magee have further submitted that, in any event, any questioning by Mr Herskope of any of the applicants' witnesses should take place immediately after they have given their evidence in-chief.
2 It is unnecessary for me to set out in any detail the complex factual background to this proceeding. It is sufficient to say simply that the applicants are, in the main, airline pilots who invested in the 1996 David Copperfield tour of Australia. That tour was promoted as an investment scheme by certain of the respondents. The applicants claim that they were induced to enter into loan agreements with Entercorp Finance Pty Ltd (now known as El Davo Pty Ltd, and now in liquidation), a company associated with what may be termed "the Boyle respondents". The loan agreements are said to have been assigned by the Boyle respondents to the tenth respondent, a company controlled by the sixteenth respondent ("the Capital respondents"). The loan agreements required the applicants to make monthly interest payments. These payments were made for some time, but were ultimately terminated. The applicants claim that they should be relieved of any obligations which might be thought to have arisen under those agreements, and seek to have refunded to them any interest payments already made. They claim, inter alia, that they were induced by misleading or deceptive conduct to enter into the loan agreements.
3 The Capital respondents have cross-claimed against the applicants that as assignees of the loan agreements they are entitled to recover outstanding interest payments, and also in many cases the principal sums said to have been the subject of those agreements.
4 The Capital respondents have also cross-claimed against the Davis cross-respondents alleging that the Davis cross-respondents induced the applicants to breach their obligations under the loan agreements.
5 Both the applicants and the Davis cross-respondents, by their pleadings, allege that Entercorp Finance Pty Ltd never advanced any loan funds under the loan agreements to or on behalf of any of the borrowers and that, further or in the alternative, the first respondent never assigned or transferred its interests, if any, under the loan agreements to the tenth respondent.
6 In substance the ruling sought by the respondents has, as its underlying premise, the obvious fact that the interests of the Davis cross-respondents are closely aligned to those of the applicants. This can be demonstrated by even the most cursory perusal of the amended defence filed by the Davis cross-respondents in answer to the tenth respondent's cross-claim. That amended defence picks up and relies upon a number of the same contentions as are relied upon by the applicants in their pleadings against the respondents. Both Mr Martindale and Mr Magee submitted that it would be unfair, in those circumstances, to allow Mr Herskope to cross-examine the witnesses upon whose evidence his clients seek to rely in support of their own defence to the cross-claim brought by the Capital respondents. It would also be unfair, they submitted, to allow Mr Herskope the opportunity to seek to rehabilitate those witnesses after they had been cross-examined by the respondents.
7 The principles which govern applications of this type seem to me to be relatively clear.
8 Section 26(c) of the Evidence Act 1995 (Cth) ("the Evidence Act") gives power to the court to make such orders as it considers just in relation to the order in which parties may question a witness. Section 42 of the Evidence Act gives power to the court to disallow leading questions put to a witness in cross-examination. Section 42(2) sets out certain criteria which may be taken into account in the exercise of the court's discretion. Section 42 relevantly provides:
"(1) A party may put a leading question to a witness in cross-examination unless the court disallows the question or directs the witness not to answer it.(2) Without limiting the matters that the court may take into account in deciding whether to disallow the question or give such a direction, it is to take into account the extent to which:
...
(b) the witness has an interest consistent with an interest of the cross-examiner; and
(c) the witness is sympathetic to the party conducting the cross-examination, either generally or about a particular matter;
..."
9 The manner in which these provisions are to be applied must, of course, turn upon the particular circumstances which prevail in any given case. Prior to the enactment of the Evidence Act, Young J, in GPI Leisure Corp Ltd v Herdsman Investments Pty Ltd (No 3) (1990) 20 NSWLR 15, reviewed the relevant authorities and stated his conclusions in summary form. His Honour said at 22-23:
"Drawing all these threads together, the following appears to me to be the situation.(1) The only actual "right" is the right to have a fair trial.
(2) It is the duty of the trial judge to ensure that all parties have a fair trial.
(3) In carrying out his duties the trial judge must so exercise his discretion in and about the examination and cross-examination of witnesses that a fair trial is assured.
(4) Ordinarily, a judge in carrying out his duty will see that the trial is conducted in the manner that is commonly used throughout the State, namely that witnesses are examined, cross-examined and re-examined.
(5) Where there is more than one counsel for the same party, then ordinarily the judge will not permit any more than one counsel to cross-examine the same witness.
(6) Where there are parties in the same interest, the judge will apply the same rule as stated in (5).
(7) Where the issues are complex and there is no overlapping of cross-examination and the proposal is outlined before cross-examination begins, it may be proper for the judge to permit cross-examination of one or more witnesses by more than one counsel in the same interest notwithstanding prima facie rules (5) and (6).
(8) It may be that in the interests of time or to prevent "torture" of the witness or for other good reasons, a judge may in special circumstances limit cross-examination. Such a situation would occur where, for instance, there was only a fixed amount of time before an event occurred and a decision was essential before that event occurred.
(9) It is usually not proper to indicate at the commencement of the hearing that cross-examination will be limited to X minutes subject to the right to make an application for an extension, although such a ruling might be justified if time was limited. It would, however, appear to be proper for the judge to say, at any stage during the cross-examination, that he would, unless convinced that the cross-examiner was being of more assistance to the court, curtail cross-examination in Y minutes time. This power would of necessity be used sparingly.
(10) Group cross-examination either by all counsel cross-examining the witness at one time or a group of witnesses being cross-examined by one counsel at the same time is not a procedure that should be permitted.
(11) In all proceedings, the court has a duty to prevent cross-examination purely for a collateral purpose or to "torture" the witness.
(12) In interlocutory proceedings, especially proceedings for an interlocutory injunction, the collateral purpose rules must be looked at very closely because ordinarily it is not proper to permit counsel to go on a fishing expedition and all that the plaintiff need show is a prima facie or strongly arguable case on the merits. Cross-examination on laches, balance of convenience etc is, of course, in a different plight.
(13) Ordinarily a judge should permit cross-examination of all witnesses by all counsel unless one or more of the above rules apply."
10 These observations were recently cited with approval in NMFM Property Pty Ltd v Citibank Ltd (No 8) (1999) 161 ALR 581 at 584 by Lindgren J. His Honour held that ordinarily, where two or more parties were "in the same interest", the trial judge's discretion would properly be exercised if not more than one counsel were permitted to cross-examine.
11 Lindgren J also observed that normally counsel for the respondent would cross-examine a cross-respondent first and counsel for the applicant would cross-examine second. However, the trial judge might exercise his discretion to reverse this sequence.
12 Applying the principles set out above, I am not persuaded that Mr Herskope should be prevented from asking leading questions of any of the witnesses to be called on behalf of the applicants. It may be accepted, as the pleadings demonstrate, that the interests of the applicants and the interests of the Davis cross-respondents are indeed closely aligned in a number of important respects. Those interests are not, however, identical, as may be seen from the allegation made by the Capital respondents that the Davis cross-respondents are guilty of the tort of inducing breach of contract. It cannot be said that the applicants and the Davis cross-respondents are "in precisely the same interest".
13 I am not prepared to prevent Mr Herskope from putting leading questions to witnesses called by the applicants in circumstances where I cannot, at least at this stage, be satisfied that any particular witness to be called "has an interest consistent with an interest of the cross-examiner" (s 42(2)(b)), or is "sympathetic to the party conducting the cross-examination" (s 42(2)(c)). I can discern no other considerations which would warrant a departure from the ordinary practice to which Young J referred in GPI Leisure Corp Ltd (supra) of permitting cross-examination of all witnesses by all counsel.
14 That is not to say that should Mr Herskope choose to ask leading questions when cross-examining witnesses called by the applicant that will not affect the weight which I would attach to the answers elicited. That is a matter which Mr Herskope will no doubt bear in mind.
15 As regards the order in which witnesses should be cross-examined, I am satisfied that the interests of justice require that Mr Herskope cross-examine all the witnesses to be called by the applicants, including the applicants themselves, immediately after they have been examined in-chief by counsel for the applicants. That course is calculated to ensure that the cross-examination of the applicants' witnesses serves best to elicit the truth of what occurred. At the same time, it ensures that any party significantly and adversely affected by the evidence of a particular witness is able to confront that witness effectively.
16 As between the Boyle respondents and the Capital respondents, it seems to me to be logical that each witness to be called by the applicants should first be cross-examined by counsel for the Boyle respondents, and then by counsel for the Capital respondents. I am prepared to relax that order if there is agreement among the respondents that a different order should be followed.
17 I have not yet formed a definite view as to whether or not each of "the Boyle respondents" (including Mr Peter Boyle and Mr Sam Mancuso, who represent themselves) should be permitted to cross-examine each of the witnesses to be called by the applicants. I will defer final consideration of that matter for the moment.
18 I should stress that my ruling concerning the order of cross-examination of witnesses applies only to the cross-examination of witnesses called by the applicants. I will consider the order of cross-examination of other witnesses at the conclusion of the applicants' case.
19 I should also stress that nothing in this ruling should be taken as a licence to engage in repetitive or prolix cross-examination.
I certify that the preceding nineteen (19) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Weinberg. |
Associate:
Dated:
Counsel for the Pryles Applicants: |
Mr T North |
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Solicitors for the Pryles Applicants: |
Pryles and Defteros |
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Counsel for the Tenth and Sixteenth Respondents: |
Mr N Magee QC, with Mr AA Monichino and Mr RS Hay |
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Solicitors for the Tenth and Sixteenth Respondents: |
Cornwall Stodart |
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Counsel for the Eighth, Eleventh, Fifteenth and Seventeenth Respondents: |
Mr ID Martindale |
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Solicitors for the Eighth, Eleventh, Fifteenth and Seventeenth Respondents: |
Fetter Gdanski |
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Counsel for the Eightieth, Eighty-First, Eighty-Second and Eighty-Third Respondents: |
Mr A Herskope with Mr JL Evans |
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Solicitors for the Eightieth, Eighty-First, Eighty-Second and Eighty-Third Respondents: |
Kalus Kenny Solicitors |
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Solicitors for the Thirteenth Respondent: |
Mr P Boyle appeared in person and sought leave to appear on behalf of the Second to Ninth and Twelfth Respondents |
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Solicitors for the Fourteenth Respondent: |
Mr S Mancuso appeared in person |
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Mr R Gonn appeared with leave on behalf of the applicant Monsu Pty Ltd in the related proceeding (No VG 405 of 1997) |
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Date of Hearing: |
18 February 2000 |
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Date of Judgment: |
21 February 2000 |
SCHEDULE OF PARTIES
ALLAN FRANCIS CHEERS
First Applicant
PETER MICHAEL ABRAHAMSON
Second Applicant
JAMES AYLWARD BOLAND
Third Applicant
RODNEY JOHN BOND
Fourth Applicant
MICHAEL THOMAS BODSWORTH
Fifth Applicant
RICHARD THOMAS BOWDEN
Sixth Applicant
ALAN NOEL BROWN
Seventh Applicant
EDWARD BULLOCK
Eight Applicant
PERRY RAYMOND BURNS
Ninth Applicant
IAN JAMES CARKEEK
Tenth Applicant
GREGORY WILLIAM CHISHOLM
Eleventh Applicant
LAWRENCE RAYMOND COLE
Twelfth Applicant
RONNIE JOE COLEMAN
Thirteenth Applicant
ALLAN ARCHIBALD COLLINS
Fourteenth Applicant
DARRYL ROSS COLLISTER
Fifteenth Applicant
CHRISTOPHER PAUL COLTON
Sixteenth Applicant
GARY GORDON COOPER
Seventeenth Applicant
RUSSELL CRAIG DINNING
Eighteenth Applicant
ROGER LEE DUNCAN
Nineteenth Applicant
TREVOR ALLAN DOUGLAS
Twentieth Applicant
STEPHEN JOHN EATON
Twenty First Applicant
MALCOLM JOHN ELLIS
Twenty Second Applicant
ROBERT GAM
Twenty Third Applicant
ASHLEY GARLAND
Twenty Fourth Applicant
ANTHEA ELIZABETH MORGAN GEDGE
Twenty Fifth Applicant
EDWARD JOHN GODEK
Twenty Sixth Applicant
STEWART JOHN GOW
Twenty Seventh Applicant
JASON ANDREW HAMMOND
Twenty Eighth Applicant
GARY WILLIAM HANRAHAN
Twenty Ninth Applicant
JOHN GARY HERBERT
Thirtieth Applicant
VINCENTKEIR HINSCHEN
Thirty First Applicant
JOHN PETER HOLGATE
Thirty Second Applicant
ROGER HOPPER
Thirty Third Applicant
WILLIAM JAMES HUGHES
Thirty Fourth Applicant
KRISTAN PETER KRAWINKEL
Thirty Fifth Applicant
TERRENCE ARTHUR LAWSON
Thirty Sixth Applicant
ADAM EDWARD LEE
Thirty Seventh Applicant
PETER VERNON LIDDELL
Thirty Eighth Applicant
GARY MAJOR
Thirty Ninth Applicant
JUDITH ANNE MARTIN
Fortieth Applicant
MARK McWHINNIE
Forty First Applicant
JONATHAN PAUL MERRITT
Forty Second Applicant
ROBERT LEONARD MILLER
Forty Third Applicant
JOHN MAXWELL MORRIS
Forty Fourth Applicant
PETER JOHN MOWSON
Forty Fifth Applicant
DEREK ANTHONY MURRAY
Forty Sixth Applicant
PHILIP RAYMOND OAKES
Forty Seventh Applicant
STEPHEN JOHN O'ROURKE
Forty Eighth Applicant
IAN ROBERT PAIGE
Forty Ninth Applicant
PETER PATERSON
Fiftieth Applicant
CHRISTOPHER JAMES PENNYCUICK
Fifty First Applicant
DARRYL MARCELLUS PETERSON
Fifty Second Applicant
PAUL PROSSER
Fifty Third Applicant
THOMAS JOSEPH RANIERE
Fifty Fourth Applicant
ANDREW JOHN ROBERTS
Fifty Fifth Applicant
WAYNE BARRY SANDERSON
Fifty Sixth Applicant
NOEL MALCOLM SEMLER
Fifty Seventh Applicant
FELICE SIRIO
Fifty Eighth Applicant
FRANCESCA SIRIO
Fifty Ninth Applicant
BRENDAN MURRAY SMITH
Sixtieth Applicant
THOMAS BRUCE SMITH
Sixty First Applicant
ROBERT PAUL STEPHENS
Sixty Second Applicant
ANDREW GORDON STEWART
Sixty Third Applicant
JAMES DAVID SUTHERLAND
Sixty Fourth Applicant
JOHN TASHOUNIDIS
Sixty Fifth Applicant
GORDON CLYDE TERRIL
Sixty Sixth Applicant
GREGOR JAMES THOMSON
Sixty Seventh Applicant
CHRISTOPHER DALE THORESEN
Sixty Eighth Applicant
MAURICE JOSEPH TRAUGOTT
Sixty Ninth Applicant
GERALD GORDON VENABLES
Seventieth Applicant
WALTER WAIT
Seventy First Applicant
TREVOR FREDERICK WARK
Seventy Second Applicant
PETER ROBERT WATERWORTH
Seventy Third Applicant
ANTHONY GEORGE WILSON
Seventy Fourth Applicant
ELIZABETH ANNE WILSON
Seventy Fifth Applicant
DESMOND ATHOL WRIGHT
Seventy Sixth Applicant
AND
EL DAVO PTY LTD (In liq)
(formerly known as ENTERCORP FINANCE PTY LTD
(ACN 060 214 502)
First Respondent
SKH MANAGEMENT PTY LTD
(ACN 060 155 688)
Second Respondent
GRIFFIN ENTERTAINMENT AUSTRALIA PTY LTD
(ACN 060 155 679)
Third Respondent
BOYMAN MANAGEMENT PTY LTD
(ACN 063 902 182)
Fourth Respondent
BARNETT BOYLE CONCERTS PTY LTD
(ACN 070 092 376)
Fifth Respondent
RETRAK PTY LTD
(ACN 071 999 481)
Sixth Respondent
SUMSKERRY HOLDINGS PTY LTD
(ACN 007 413 229)
Seventh Respondent
WEINGARTEN NESVEDA INVESTMENT
SERVICES PTY LTD
(ACN 063 779 939)
Eighth Respondent
ENTERCORP HOLDINGS PTY LTD
(ACN 030 544 968)
Ninth Respondent
CAPITAL INVESTMENTS CORPORATION PTY LTD
(ACN 072 988 946)
Tenth Respondent
ROCK EAGLE PTY LTD
(ACN 007 298 991)
Eleventh Respondent
ENTERCORP PTY LTD
(ACN 061 212 913)
Twelfth Respondent
PETER LINDSAY BOYLE
Thirteenth Respondent
SALVATORE MANCUSO
Fourteenth Respondent
LOUIS WEINGARTEN
Fifteenth Respondent
KERROD GRANT PARK
Sixteenth Respondent
KERRIE ANNE BOYLE
Seventeenth Respondent
AND
CAPITAL INVESTMENTS CORPORATIONS
PTY LTD
(ACN 072 988 946)
Cross Claimant
AND
ALLAN FRANCIS CHEERS
First Cross Respondent
PETER MICHAEL ABRAHAMSON
Second Cross Respondent
JAMES AYLWARD BOLAND
Third Cross Respondent
RODNEY JOHN BOND
Fourth Cross Respondent
MICHAEL THOMAS BODSWORTH
Fifth Cross Respondent
RICHARD THOMAS BOWDEN
Sixth Cross Respondent
ALAN NOEL BROWN
Seventh Cross Respondent
EDWARD BULLOCK
Eight Cross Respondent
PERRY RAYMOND BURNS
Ninth Cross Respondent
IAN JAMES CARKEEK
Tenth Cross Respondent
GREGORY WILLIAM CHISHOLM
Eleventh Cross Respondent
LAWRENCE RAYMOND COLE
Twelfth Cross Respondent
RONNIE JOE COLEMAN
Thirteenth Cross Respondent
ALLAN ARCHIBALD COLLINS
Fourteenth Cross Respondent
DARRYL ROSS COLLISTER
Fifteenth Cross Respondent
CHRISTOPHER PAUL COLTON
Sixteenth Cross Respondent
GARY GORDON COOPER
Seventeenth Cross Respondent
RUSSELL CRAIG DINNING
Eighteenth Cross Respondent
ROGER LEE DUNCAN
Nineteenth Cross Respondent
TREVOR ALLAN DOUGLAS
Twentieth Cross Respondent
STEPHEN JOHN EATON
Twenty First Cross Respondent
MALCOLM JOHN ELLIS
Twenty Second Cross Respondent
ROBERT GAM
Twenty Third Cross Respondent
ASHLEY GARLAND
Twenty Fourth Cross Respondent
ANTHEA ELIZABETH MORGAN GEDGE
Twenty Fifth Cross Respondent
EDWARD JOHN GODEK
Twenty Sixth Cross Respondent
STEWART JOHN GOW
Twenty Seventh Cross Respondent
JASON ANDREW HAMMOND
Twenty Eighth Cross Respondent
GARY WILLIAM HANRAHAN
Twenty Ninth Cross Respondent
JOHN GARY HERBERT
Thirtieth Cross Respondent
VINCENTKEIR HINSCHEN
Thirty First Cross Respondent
JOHN PETER HOLGATE
Thirty Second Cross Respondent
ROGER HOPPER
Thirty Third Cross Respondent
WILLIAM JAMES HUGHES
Thirty Fourth Cross Respondent
KRISTAN PETER KRAWINKEL
Thirty Fifth Cross Respondent
TERRENCE ARTHUR LAWSON
Thirty Sixth Cross Respondent
ADAM EDWARD LEE
Thirty Seventh Cross Respondent
PETER VERNON LIDDELL
Thirty Eighth Cross Respondent
GARY MAJOR
Thirty Ninth Cross Respondent
JUDITH ANNE MARTIN
Forutieth Cross Respondent
MARK McWHINNIE
Forty First Cross Respondent
JONATHAN PAUL MERRITT
Forty Second Cross Respondent
ROBERT LEONARD MILLER
Forty Third Cross Respondent
JOHN MAXWELL MORRIS
Forty Fourth Cross Respondent
PETER JOHN MOWSON
Forty Fifth Cross Respondent
DEREK ANTHONY MURRAY
Forty Sixth Cross Respondent
PHILIP RAYMOND OAKES
Forty Seventh Cross Respondent
STEPHEN JOHN O'ROURKE
Forty Eighth Cross Respondent
IAN ROBERT PAIGE
Forty Ninth Cross Respondent
PETER PATERSON
Fiftieth Cross Respondent
CHRISTOPHER JAMES PENNYCUICK
Fifty First Cross Respondent
DARRYL MARCELLUS PETERSON
Fifty Second Cross Respondent
PAUL PROSSER
Fifty Third Cross Respondent
THOMAS JOSEPH RANIERE
Fifty Fourth Cross Respondent
ANDREW JOHN ROBERTS
Fifty Fifth Cross Respondent
WAYNE BARRY SANDERSON
Fifty Sixth Cross Respondent
NOEL MALCOLM SEMLER
Fifty Seventh Cross Respondent
FELICE SIRIO
Fifty Eighth Cross Respondent
FRANCESCA SIRIO
Fifty Ninth Cross Respondent
BRENDAN MURRAY SMITH
Sixtieth Cross Respondent
THOMAS BRUCE SMITH
Sixty First Cross Respondent
ROBERT PAUL STEPHENS
Sixty Second Cross Respondent
ANDREW GORDON STEWART
Sixty Third Cross Respondent
JAMES DAVID SUTHERLAND
Sixty Fourth Cross Respondent
JOHN TASHOUNIDIS
Sixty Fifth Cross Respondent
GORDON CLYDE TERRIL
Sixty Sixth Cross Respondent
GREGOR JAMES THOMSON
Sixty Seventh Cross Respondent
CHRISTOPHER DALE THORESEN
Sixty Eighth Cross Respondent
MAURICE JOSEPH TRAUGOTT
Sixty Ninth Cross Respondent
GERALD GORDON VENABLES
Seventieth Cross Respondent
WALTER WAIT
Seventy First Cross Respondent
TREVOR FREDERICK WARK
Seventy Second Cross Respondent
PETER ROBERT WATERWORTH
Seventy Third Cross Respondent
ANTHONY GEORGE WILSON
Seventy Fourth Cross Respondent
ELIZABETH ANNE WILSON
Seventy Fifth Cross Respondent
DESMOND ATHOL WRIGHT
Seventy Sixth Cross Respondent
ENTERCORP FINANCE PTY LTD
(ACN 060 214 502)
Seventy Seventh Cross Respondent
PETER LINDSAY BOYLE
Seventy Eighth Cross Respondent
LOUIS WEINGARTEN
Seventy Ninth Cross Respondent
CLASSIC TRADING PTY LTD
(ACN 006 792 249)
Eightieth Cross Respondent
ELLIOTT DAVIS
Eighty First Cross Respondent
FRANK CROMBIE
Eighty Second Cross Respondent
NATIONAL FINANCE GROUP PTY LTD
(ACN 006 372 041)
Eighty Third Cross Respondent
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