England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Sir Raymond Jack
HQ11X03384

		Royal Courts of Justice Strand, London, WC2A 2LL
		6th February 2014

Lord Justice Patten :

Introduction

1. In 2008 the claimant, Mr Banwaitt, invested US$1.75m in a property transaction in Cambodia. He was introduced to what I will refer to as the Scheme by his next door neighbour, Dr Mohamed Dewji, who is the senior partner in a general medical practice based in Milton Keynes but who had for some time previously been involved in various property transactions. Mr Banwaitt and Dr Dewji were friends and members of the same golf club. Mr Banwaitt is a pharmacist who retired in 2002 and sold his business for a substantial sum. He had on an earlier occasion asked Dr Dewji to be kept informed of any suitable investment opportunities.
2. The Scheme involved the purchase of some 427 hectares of farm land in Koh Kong province in Cambodia. The site was on the coast and was thought to be suitable for development as a hotel. Because foreigners are not permitted to own land in Cambodia, the purchase had to be undertaken through a Cambodian national called Narong Men. Dr Dewji's evidence was that he first met Narong Men at a public health conference in Paris in April 2008 where the topic of possible investments was discussed and that a subsequent meeting took place in Cambodia on 3^rd May 2008. It was at this meeting that Narong Men discussed various possible development projects (including the one at Koh Kong) and explained to Dr Dewji that he needed a local partner to carry out the transaction.
3. Subsequently Dr Dewji was given more information about the Koh Kong land. It was owned by about 80 different people but the principal seller was someone called Tan Meng. The entire site could be purchased for about $14m and re-sold to Australian hoteliers for $20.4m. They would enter into a memorandum of understanding to buy at that price and would pay a deposit equal to 20% of the purchase price if the land was available for development.
4. What is not in dispute is that on 3^rd July 2008 $998,490.01 was transferred from Mr Banwaitt's bank account and credited to an account which Dr Dewji had opened at ANZ Royal Bank in Phnom Penh. This was followed by two further transfers of $626,798.89 and $123,923.95 made on 30^th and 31^st July respectively. The investment turned out to be a disaster because although some kind of contract dated 5^th July 2008 appears to have been drawn up with Tan Meng for the purchase of the Koh Kong land at a price of $14m, Narong Men was later discovered to be a fraudster who (unbeknown to Dr Dewji) had in fact contracted to purchase the land from Tan Meng for $7.5m on 3^rd July. Narong Men was arrested on 16^th March 2009 and subsequently tried and convicted of fraud. Not only had he entered into the false contract at $14m, he had also forged certificates relating to the planning status of the land. Narong Men was charged with and convicted of breach of trust, an offence under Article 46 of the Cambodian Criminal law, and sentenced to 3 years' imprisonment. As part of the judgment in the criminal proceedings relating to the fraudulent purchase, he was also ordered to make restitution to Dr Dewji in the sum of $9.045m plus a further amount of compensation in the sum of $2m. The latter sum was reduced to $1m on appeal. The $9.045m represents the amount which Mr Banwaitt and other investors put into the Scheme. In separate criminal proceedings relating to the forged planning certificates, he was sentenced to 7 years' imprisonment and his wife (who had left Cambodia and was tried in her absence) received a sentence of 5 years' imprisonment. They were ordered to pay Dr Dewji damages of $1m.
5. It is unclear whether the purchase of the Koh Kong land by Narong Men has been completed. Tan Meng claimed in the criminal proceedings that he had only been paid $4.1m for the land but the court found that Narong Men had in fact paid $4.7m. The balance of the investors' money appears to have been used by Narong Men to purchase other properties in Cambodia and to pay various agents employed by him. The Cambodian court has made freezing orders in respect of these other properties belonging to Narong Men which, when sold, may satisfy some part of the judgments which Dr Dewji has obtained against him. But the outlook for Mr Banwaitt and the other investors in the Scheme continues to look bleak. The value of these properties (apart from the Koh Kong land) is said to be in the region of $6.5m but whether they are all recoverable and realisable remains uncertain.
6. Against this background, on 12^th September 2011, Mr Banwaitt commenced proceedings against Dr Dewji seeking the recovery of his $1.75m investment on a number of different bases. The primary claim was that the payment of the money had been procured by a number of fraudulent misrepresentations made orally in June and July 2008. But it was also pleaded that Dr Dewji had acted in breach of fiduciary duty or in breach of contract by paying away the $1.75m without a back-to-back sale on to a purchaser being in place or at least a memorandum of understanding coupled with a 10% deposit. It was also alleged that Dr Dewji had acted negligently in parting with the money without taking reasonable care to ensure that the above safeguards were in place.
7. The action came on for trial before Sir Raymond Jack (sitting as a judge of the High Court) in March 2013. He found that Dr Dewji was a dishonest witness and had made a number of false statements both during his evidence and in various communications with the investors following the discovery of Narong Men's fraud. He also found that Mr Banwaitt's investment had been induced by a number of representations which Dr Dewji knew at the time were false. In these circumstances, the judge ordered the agreement between the claimant and the defendant for the investment to be rescinded and for the sum of $1,749,212.85 to be repaid by Dr Dewji with interest. It was not therefore necessary for him to consider the alternative bases upon which the claim was made.

The appeal

8. Dr Dewji appeals against the order with the leave of Longmore LJ. Mr Millett QC, in opening the appeal, recognised the difficulties which any appeal against the trial judge's findings of fact necessarily encounters. The advantages enjoyed by the trial judge in assessing the credibility of the witnesses and making findings of primary fact have been repeatedly recognised in the judgments of this court, the House of Lords and now the Supreme Court. I refer (without quotation) to the speech of Lord Hoffmann in Piglowska v. Piglowski [1999] 1 WLR 1360 at p. 1372; and to what Lord Neuberger of Abbotsbury said in Re B (a Child) [2013] UKSC 33 at [52]-[53]. The function of the appellate court when considering a challenge to the judge's findings of primary fact is not, so to speak, to re-hear the evidence but to review the decision in the light of the evidence presented at the trial. It will be entitled (indeed obliged) to interfere with the findings which have been made if it becomes clear that there was no evidence to support them; that the judge misunderstood the evidence; or that the findings were ones which no reasonable judge could have made. Within this spectrum much may depend upon the nature of the raw material which the judge had to assess. In a case where it was largely documentary, the argument that the trial judge was best placed to determine the matter may carry less weight in terms of the advantages which he enjoyed over the appellate tribunal considering the same material. But where the documents require to be interpreted by the witnesses of fact who were shown them at the relevant time or whose conduct is referred to in them, the weight to be attached to that oral evidence is a matter for the judge: see Assicurazioni Generali SpA v Arab Insurance Group [2003] 1 WLR 577 at [15].
9. Over and above these considerations, it is also important to bear in mind that the trial process is intended to provide a final resolution of the claim. An appeal to this court lies to correct an error of fact or law in the trial process which results in a wrong and therefore unjust outcome. It is not intended to give the disappointed party a second opportunity to make good his case before a different tribunal. In this connection, I would repeat what the United States Supreme Court said in Anderson v City of Bessemer (1985) 470 US 564, 574-575 which was referred to recently by Lord Reed JSC in McGraddie v McGraddie [2013] UKSC 58:

"The rationale for deference to the original finder of fact is not limited to the superiority of the trial judge's position to make determinations of credibility. The trial judge's major role is the determination of fact, and with experience in fulfilling that role comes expertise. Duplication of the trial judge's efforts in the court of appeals would very likely contribute only negligibly to the accuracy of fact determination at a huge cost in diversion of judicial resources. In addition, the parties to a case on appeal have already been forced to concentrate their energies and resources on persuading the trial judge that their account of the facts is the correct one: requiring them to persuade three more judges at the appellate level is requiring too much. As the court has stated in a different context, the trial on the merits should be 'the "main event" … rather than a "tryout on the road." … For these reasons, review of factual findings under the clearly erroneous standard - with its deference to the trier of fact - is the rule, not the exception."

10. The focus must therefore be on whether the findings which the judge made were properly open to him on the evidence. In making that assessment proper allowance must be given for any failure on the part of the judge expressly to address every single piece of evidence in his judgment or to recite every criticism advanced by the parties' representatives during the course of their submissions. A judge is entitled to concentrate on the evidence which he or she considers most relevant to the facts in dispute and only where it can be shown that silence in respect of the omitted material indicates that something has gone wrong will this court be required to intervene.
11. Mr Millett began the appeal by reminding us that his client, Dr Dewji, is a senior medical practitioner of some standing with a hitherto unblemished reputation. The judge's findings of fraud will inevitably have a serious impact upon him. Those findings are contained in a judgment which, Mr Millett says, fails to state the evidential basis for the findings, inadequately assesses or in some instances misunderstands the evidence or is based on no evidence at all. In addition to this outright attack on the judge's treatment of the allegations of fraud, he also challenges as separate grounds of appeal the judge's finding that Dr Dewji was under a duty to disclose all material facts to Mr Banwaitt and the judge's order for the repayment of Mr Banwaitt's investment in dollars. Instead of ordering a single payment in US dollars the judge, he submits, should have distinguished between the initial payment of $998,490 and the subsequent payments (totalling £318,650 before conversion) which originated from a sterling account. The argument stems from the fact that the US dollar has since 2008 strengthened against sterling with the result that, under the judge's order, Mr Banwaitt will receive the profit from the change in exchange rates. It is said that he should not be entitled to receive back more than the original balances in the currency in which they were maintained.
12. The first issue therefore to consider is the judge's finding that the case based on fraudulent misrepresentation had been made out. The judge approached this by first setting out his findings on the history of the Scheme and Mr Banwaitt's involvement in it and then considering one by one the representations upon which the claim was based and their alleged falsity. This had the consequence that the judge's conclusions in relation to each of the representations are quite briefly expressed in a condensed form which requires reference back to his earlier findings of fact.
13. What I therefore propose to do is summarise the pleaded claim and then to consider Mr Millett's criticisms of the judge's conclusions in relation to each of the representations relied upon. I will then deal with the two other grounds of appeal.

Fraudulent Misrepresentation

14. Mr Banwaitt's pleaded case was that he was induced to join in the Scheme as a result of two conversations with Dr Dewji in June 2008. The first was said to have occurred on or about 13^th June when he was on the drive outside his house washing his car; the second was alleged to have taken place at their golf club on or about 22^nd June. Both were undocumented conversations and there was a dispute as to where they took place. Dr Dewji's pleaded case was that the first discussion about the Scheme took place during a round of golf.
15. Mr Banwaitt alleged that during their first conversation Dr Dewji said that he had got some rich investors together to buy the land for $14m; that full planning permission had been granted; that the land was to be sold on to a French hotel chain for $21m and that the French company had paid a 20% non-refundable deposit and was locked in to complete on either 16^th or 17^th December; that the onward sale would take 6 months with a profit of 39%; that the purchase of the land had to be completed by the end of June or the deposit on the purchase would be forfeited; that one investor had dropped out so that they were short of the total to complete; that Dr Dewji would be investing $1m in the Scheme; and that the Cambodian prime minister and other ministers were involved in the project.
16. Mr Banwaitt's case is that at the golf club meeting on 22^nd June he stressed to Dr Dewji that he was using his retirement savings for the investment which he could not afford to lose and obtained confirmation that there was an onward sale. The claimant says he (Mr Banwaitt) referred to a back-to-back sale and that Dr Dewji did not demur. Subsequently on 2^nd July (after Mr Banwaitt had given his bank instructions to transfer the initial $1m to Dr Dewji) he received an e-mail from the defendant, attached to which was a sheet of calculations confirming the purchase at $14m; the sale on at $20.4m and a net profit on the Scheme of $5.42m or 38.71%.
17. The e-mail does, however, also contain a more detailed outline of the proposed development which was obviously prepared at an earlier stage to introduce the Scheme to potential investors. It refers to the land being acquired for $3.50 per square metre (equating to a total purchase price of $14m) and to it then being sold on to "an Australian agency that sources land for hotel chains". It says that a group has been identified and has agreed to purchase the land for $20.4m:

"The group has agreed to complete the MOU with a 10% deposit on being presented with the land papers certified for development in the month of July. Completion of the sale would then take place at the end of November 2008. The original purchase would not be completed until this MOU and deposit has been received.

The total purchase price would be $14 million and the total sale price $20.4 million. This represents a gross return within 6 months in excess of 45%. After expenses (available on request) the nett return is projected to be 39%.

Mechanics: The land will be purchased by Al-Baraqa Investments. The company is incorporated within Cambodia and has Dr M Dewji and Mrs T Dewji as its directors. Also named within the company (without an[y] rights to the assets of the company) is Mr Narong Men. Mr Men is recorded within the Who's Who of Cambodia as one [of] the senior advisors to the present Prime Minister of Cambodia. The company will then conduct on behalf of all the investors with reference to the original purchase and subsequent sale of the land. All the assets with respect to the Koh Kong project will be returned back to the investors prior to any further projects being considered by the company."

18. Later in the same document under the heading FAQ's, it states:

"2) What are the chances that development at Koh Kong will be refused?

We have already received the land titles that have all the four signatories required for future tourist development.

3) What happens if the buyers drop out?

The buyers are to enter a MOU with a 10% deposit prior to our purchase. Were they to drop out after then we already have other offers including one from a French consortium who are willing to enter the same terms as the Australians. No other party is aware of the stamped deed papers which would automatically raise the interest within other buyers….."

19. Mr Banwaitt's pleaded case was that the statements contained in the proposal document I have quoted from did not purport to nor were intended to correct the representations made by Dr Dewji in the June conversations. It was taken for what it was: an earlier outline of the proposed Scheme containing the expected purchase and sale prices and the likely profit but not an up-to-date account of how matters stood on 2^nd July. Mr Banwaitt said that he relied on the defendant's oral representations for this. But it was relied on by Mr Banwaitt as confirming that no further consents were required for the development of the land and that his money would be safeguarded because the land would not be purchased until a memorandum of understanding had been signed and a deposit paid by the prospective purchaser.
20. Dr Dewji, in his defence, accepted that the proposal document and the statements it contained were not intended to correct any representations already made. His case was that Mr Banwaitt had already decided to invest by the time he received the e-mail on 2^nd July and that its contents could not therefore have been relied on as the basis of that decision. Over and above this, he denied having made the representations attributed to him at the first June meeting. His case was that he had a conversation with Mr Banwaitt in mid June during a round of golf during which he told Mr Banwaitt that he was trying to form a consortium of investors to buy the Koh Kong land; that a non-refundable deposit of $50,000 had been paid via Narong Men; that he was aiming to get planning permission; that one option was to sell the land on with planning permission and that amongst interested purchasers was a French group; and that the aim was to sell the land on in 6 months. He also told Mr Banwaitt that he was investing $1m in the purchase.
21. Mr Banwaitt's case is that in July 2008 he was told by Dr Dewji that completion had been put off until 28^th July; that completion of the sale on had been deferred until either 18^th or 19^th January 2009; and that the Scheme still required about $3m in order for the purchase of the land to be completed. He pleads that he was asked to provide further monies and that in reliance on the original and subsequent representations about the status of the purchase and the onward sale, he provided a further £318,650 (designed to provide $750,000 after conversion) on 28^th July which, because of currency fluctuations, had to be topped up with a further £63,000 on 30^th July to bring his total investment to $1.75m.
22. A number of representations were relied upon at the trial to found the case based on misrepresentation and non-disclosure. In relation to the June meetings, they were:

(1) that subject to the shortfall leading to the introduction of Mr Banwaitt, Dr Dewji had gathered investors to buy the land for $14m;

(2) that a French hotel chain had paid a 20% deposit to purchase for $21m and was locked in to the purchase;

(3) that the purchase and sale would be back-to-back;

(4) that the purchase monies were urgently needed, failing which a deposit of $50,000 already paid in connection with the purchase would be forfeited; and

(5) that full planning permission for the land had been granted.

23. In respect of the further payments in July, Mr Banwaitt relied on the continuing effect of the uncorrected representations above together with Dr Dewji's statement that he was still short of some $3m in order to complete the purchase.
24. The judge found that each of these representations had been made; was materially false when made and had induced Mr Banwaitt to invest the $1.75m in the Scheme. At the time of the June meeting or meetings, Dr Dewji had not put together a syndicate of investors to buy the land for $14m (one of whom had dropped out); no hotel chain had paid a deposit of 20% of the $21m sale price or had even agreed to purchase the land at that price; there was therefore no back-to-back transaction in place; no deposit of $50,000 had yet been paid; and there was no planning permission for the development of the land.
25. The judge also said that it was uncertain how far Mr Banwaitt relied on the information contained in the 2^nd July e-mail but that it did not correct the false representations made earlier to him orally.
26. The only qualification which the judge made to the allegations of misrepresentation was in respect of the second alleged representation that a French hotel chain had paid a 20% deposit and was locked in. Sir Raymond Jack said that he thought that Mr Banwaitt had become confused in his recollection that he had been told it was a French hotel chain but accepted that he had been told that a hotel chain had agreed to buy the land and had paid a 20% deposit so as to be locked in.
27. In relation to the July payments amounting to $750,000, the judge found that Dr Dewji did tell Mr Banwaitt falsely that the Scheme was still short of $2m or $3m to complete when in fact at that point the gap in funding was much greater. Dr Dewji had by then received only the original $1m from Mr Banwaitt and an investment of his own of $506,816. A further $3m was received from another investor (Jardines) in August.
28. The judge concluded by saying that:

"Overall I am satisfied that Dr Dewji materially misrepresented in the ways which I have set out the investments which he was inviting Mr Banwaitt to make. He did so intentionally with the aim of making the investments seem safe when they were far from safe. Mr Banwaitt was induced to pay over his moneys by reason of them. Had he known the truth in late June – the first payments, or in the latter part of July – the second payments, he would not have paid. Mr Banwaitt may have a right to rescission. He has, alternatively, an undoubted right to damages for the tort of deceit."

29. Mr Millett QC invites us to set these findings aside. When considering the evidence of a person of unblemished reputation the judge should, he submits, have started from the position that it was more likely that Dr Dewji would have behaved honestly rather than fraudulently and that any findings of dishonesty should be based on proven facts rather than inferences. The judge should have asked himself whether there was an innocent explanation for the conduct complained of and, where driven to conclude that Dr Dewji had lied, should still have gone on to consider whether the lie was material. In particular, he should have reminded himself that evidence of a lack of truthfulness in relation to one or more particular matters did not necessarily indicate a propensity to lie on all occasions.
30. He submits that the judge failed to adopt this approach in his assessment of Dr Dewji as a "man who would lie when it suited him and was ready to think of dishonest explanations for things adverse to his case": see [58] of the judgment. The judge did not ask himself or explain why Dr Dewji would risk destroying his professional reputation by lying to his friend and neighbour and, more particularly, why he should do so on the very first occasion when the Scheme was discussed in June 2008. An inference of dishonesty cannot properly be inferred from what happened later in very different circumstances.
31. The judge also, he says, failed to give proper weight to the claimant's changing evidence about dates and his one admission that some aspects of his memory may have been affected by the medication he was taking. The judgment is also said to be muddled and inconsistent. In [58] the judge refers to Dr Dewji's untruthfulness which he says is apparent from certain e-mails sent to investors in 2009 which gave a wholly misleading picture of the then state of the Scheme. But he goes on to say that it is difficult to know why Dr Dewji so conducted matters in June and early July 2008. Mr Millett says that the inaccuracies in the e-mails could have been explained by Dr Dewji having a misplaced sense of confidence in the Scheme and therefore having over-sold it. It also does not follow, he says, from any failure by Dr Dewji to be candid about the way things had turned out by 2009 that he set out in 2008 to induce Mr Banwaitt to invest by making a series of fraudulent misrepresentations. When Mr Banwaitt was finally told by Dr Dewji on 19^th June 2009 that Narong Men had been arrested, his reaction was not to say that the truth had been kept from him but in fact to say in his e-mail of 21^st June that:

"Of course I don't think that YOU are being dishonest but I suspect that the financial pressures of all these projects are going to take a toll on you, even to make bad judgements."

32. Mr Cullen QC for Mr Banwaitt responds to these general criticisms of the judgment by pointing out that the judge disbelieved much of Dr Dewji's evidence in relation to the history of the investment. He asks rhetorically why Mr Banwaitt would have committed his life savings to the Scheme without being given the assurances he says he relied on. He is also someone with an unblemished reputation whose honesty is not in doubt. It was apparent that Dr Dewji was seeking to attract investment in a Scheme in which he himself proposed to invest and which could not go ahead unless the $14m purchase price could be raised. The potential gains were enough to make him careless with the truth of what he told potential investors. In any event, the clear instances of deception practised on investors in 2009 by withholding information about Narong Men's arrest and fraud, coupled with his untruthful evidence at the trial, did entitle the judge to prefer Mr Banwaitt's evidence to that of Dr Dewji; to find that the representations relied on had been made; and to find that they had been made fraudulently.
33. He cites as an example, as the judge did, the e-mail sent to investors on 25^th March 2009 after Dr Dewji had returned from Cambodia and when he knew of the possible fraud by Narong Men. He said in his witness statement that he had become convinced of impropriety on the part of Narong Men and had reported the matter to the police. But in his e-mail no mention was made of these discoveries. Instead, he wrote:

"Dear Investor,

As most of you have been aware I have been in Cambodia for the past couple of weeks trying to bring forth the completion of the project.

I got back yesterday early morning and wanted to drop a note that we have made a lot of progress but as at present I haven't been able to complete everything and we still [have] a few steps to follow.

I will be going back there within the next 10 days to 2 weeks to work on our exit strategy – I will keep everyone informed as and when I have some concrete details."

34. As the judge said, the reality was that the Scheme had met with disaster. There was no purchase to complete; the money so far invested was probably lost; and the best that the investors could hope for was to enforce some kind of monetary claim against Narong Men. Mr Banwaitt responded on 27^th March indicating that he understood that the sale on was to have been completed by 16^th December and querying what was being done in relation to the Scheme. In response to him and other investors, Dr Dewji continued to suggest that he was taking steps to put the documentation in place so that the sale on of the land could go ahead. On 19^th June he wrote to all the investors informing them that there had been difficulties completing the purchase of the land due to initial funding delays and "the failure of our local partner to deliver as per our agreements with him". Dr Dewji said that legal proceedings had been commenced against Narong Men resulting in the freezing of most of his assets and his detention in custody. But again, as the judge found, this was a considerable understatement of the position. It makes no mention of the fraud or of Narong Men's arrest for it and suggests that only civil proceedings were involved.
35. The correspondence between Dr Dewji and Mr Banwaitt continued right through to 2011. In a letter of 9^th August (drafted by his son), Mr Banwaitt set out the basis on which he had invested and asked to see the banking trail of his funds; details of any assets purchased including the title deeds and copies of all legal correspondence. No reply was received nor any of the information. Dr Dewji was quick to counter the suggestion made by Mr Banwaitt in some of this correspondence that the $1.75m was simply a personal loan to him but no attempt was made to explain what had in fact happened in Cambodia.
36. Dr Dewji said in his evidence that he had always kept investors fully informed. The attempts by Mr Banwaitt to discover what had happened to his money show that this was untrue. It was also a feature of the correspondence that Mr Banwaitt (uncontradicted by Dr Dewji except in relation to the allegation about the loans) constantly re-emphasised that he had been told that a hotel group had put down a 20% non-refundable deposit and that planning permission existed for the development. In March 2011, by which time he was living in Thailand, Mr Banwaitt met Dr Dewji and recorded their conversation. The judge listened to the recording and was shown a transcript in which Mr Banwaitt repeated his request to see bank statements (if necessary with the names of the other investors blanked out) showing what had happened to the $14m collected from investors and the 20% deposit from the hotel chain, all of which should be in the account. Dr Dewji's response was not to say that he had never collected $14m or a 20% deposit. Instead, he told Mr Banwaitt that the deposit had gone into the account for the purchase of the land.
37. The judge concluded that Dr Dewji lied about the 20% deposit at the 2011 meeting and had refused to produce any documents because of what they would show. Mr Cullen submits that Dr Dewji's persistent failure to answer Mr Banwaitt's questions with anything but half-truths or out and out lies in the period from 2009 to 2011 shows that he could be dishonest when it suited him and amply justified the judge's conclusions in [58] of his judgment. This lack of candour was also evident, he says, in the trial process. As the judge records in [3] of his judgment, Dr Dewji's pre-trial disclosure was extremely limited. There was no disclosure of any written communications with Narong Men or Mr Ban (the Cambodian lawyer who was acting for Narong Men) nor with the other investors. There is only a partial copy of the $14m contract (the first and last pages) so that, even now, its full terms are unknown even though Dr Dewji has a copy of the full document in a safety deposit box in Phnom Penh. He did disclose a copy of a notebook which he had kept for the project but he had edited out all the entries relating to other investors and said in cross-examination that he did not think the notebook contained notes of his discussions with those investors. He was ordered to produce copies of the full document, from which it became apparent that this was not the case. With the benefit of the notebook entries, Dr Dewji was cross-examined about the various stages of the Scheme and, in particular, about what he did and did not know about the number and value of the investors from time to time and the progress of the land purchase and sale on. These matters are, of course, highly material to the judge's consideration of whether the alleged representations were false and also, in terms of credibility, to whether the representations alleged by Mr Banwaitt, but denied by Dr Dewji, were in fact made.

The Representations

(1) $14m of investors

38. As I explained earlier in this judgment, the judge set out his findings of fact chronologically and then considered each of the alleged representations in turn by reference to the findings he had made. The first of the representations which Mr Banwaitt relied on was the alleged statement by Dr Dewji during their initial discussion in June 2008 that "he had got some rich people together to buy the land for US$14m" and that "one investor had dropped out and they were short of the total to complete". Mr Banwaitt said in his witness statement that Dr Dewji said he had already invested $1m but that, as a result of the investor dropping out, he was still $3-$4m short. The judge found that Dr Dewji did not then (or at any time) have investors to the tune of $14m; that no-one had dropped out so as to create the funding gap; and that Dr Dewji had not himself invested $1m in the Scheme.
39. Mr Millett made some general criticisms about these findings. He said that the judge did not in terms find that the representations had been made and that in [62] of his judgment, which sets out his conclusions, he refers only to Mr Banwaitt's evidence in his witness statement. The judge gives no details of when, where or how the representations were made and does not try to resolve the uncertainties created by Mr Banwaitt's witness statement in which he said that he thought that the representation about investors totalling $14m was made on 13^th June during the car washing conversation but that the statements about an investor dropping out and a funding gap of $3-$4m were made later. In cross-examination Mr Banwaitt said that the statement about someone dropping out and the $3m shortfall was made during the conversation on 13^th June.
40. Mr Millett submits that the timing does matter because in July (as recorded in the notebook for 16^th July) one of the investors did drop out leaving a $4m shortfall and in an e-mail of 1^st October to Mr Banwaitt, Dr Dewji wrote:

"The investors: The present opportunity has arisen due to the withdrawal of some of the original investors. These were made up as follows:

Party 1: $1.75 million

Party 2: $1.75 million

Party 3: $7.00 million

Party 4: $3.00 million

Party 5: $0.50 million

Party 3 has now reduced its stake to $3.00 million and this has raised the opportunity for new investors to enter for the $4.00 million. As at today commitments have been received from newer parties to the value of $2.25 million. This leaves a possible opportunity of $1.75 million – however it must be stressed that no investor will be guaranteed entry until funds have been received within the company's bank account."

41. It was therefore important for the judge to have considered the possibility that the statements about the shortfall were made much later after Mr Banwaitt had already made his investment in the Scheme. Mr Millett submits that there is no reason why Dr Dewji should have lied about an investor pulling out in June 2008. He could simply have told Mr Banwaitt that he was still short of the $14m needed to complete.
42. The judge found (based on entries in the notebook) that as of 4^th June 2008 Dr Dewji had identified 13 possible investors, although there was nothing to indicate whether he had spoken to any of them nor (in most cases) of the amounts which they might be able to invest. The notebook does refer to Jardines as a possible investor for "up to $3m" and on 7^th June there is a reference to "Co" with a figure of $7m and "MH" who might invest up to a maximum of $0.5m. Dr Dewji then took advice from Mr Ban and accepted in evidence that he realised that unless the whole of the purchase price was paid, any sums made in part payment would be irrecoverable.
43. Dr Dewji also said in his evidence that by about 12^th June he had commitments from investors totalling $13.75m but the judge in [11] of his judgment rejected this. He said that he was satisfied that the most which Dr Dewji had at that stage was a promise of $7m from Co and $3m from Jardines. Even if one added to this the $1m he was to invest and the $1m which was to come from Mr Banwaitt, he was still $2m short of the $14m. As for the list contained in the 1^st October e-mail quoted above, the judge said that parties 1 and 2 were Dr Dewji and Mr Banwaitt; party 3 was Co; party 4 was Jardines; and party 5 was a Mr Dhanji. Since Dr Dewji never intended to contribute more than $1m and Mr Dhanji did not enter the Scheme until much later, this e-mail was treated by the judge as confirmation of the fact that in June 2008 there were not investors for $14m.
44. Mr Millett makes a number of points about these findings. First he says that the judge misunderstood Mr Banwaitt's case on this point which was never that Dr Dewji represented that he had investors who were committed to provide $14m. The pleaded case was simply that "he had got some rich people together to buy some land for US$14m". There was no evidence that Dr Dewji had spoken in terms of commitments nor was the point put to him in cross-examination. The judge was therefore asking himself the wrong question in [11] of his judgment.
45. Secondly, he says that the judge proceeded on the assumption that the notebook was an accurate and complete record of events ignoring in the process Dr Dewji's evidence that it was not. His evidence had been that others had expressed interest but were not referred to. These included Mr Banwaitt himself.
46. Thirdly, he submitted that the judge did not properly consider alternative possible constructions of what Dr Dewji is alleged to have said. The reference to $14m could easily have been one to the price rather than to the level of potential investment.
47. Finally, in relation to Dr Dewji's statement that he was to invest $1m in the Scheme, he made the point that Mr Banwaitt's evidence on this varied during the trial. In his pleading, Dr Dewji is alleged to have said that he was intending to invest $1m but in his witness statement he refers to Dr Dewji saying that he had already invested the money. But the judge made nothing of these inconsistencies.
48. It is clear to me that the judge did find that the representation about the $14m of investors had been made and did not misunderstand Mr Banwaitt's case. The finding is set out in [71] of his judgment quoted earlier insofar as it is not implicit in what he says elsewhere. Although much of Dr Dewji's cross-examination was in terms of whether he told Mr Banwaitt that he had commitments and, although Dr Dewji in fact said in answer that he thought he did have commitments for up to $13.5m, it is clear from [62] of the judgment that the judge addressed the representation as pleaded. On that basis, he had to consider the rival accounts of the conversation or conversations which took place in June 2008 and to decide whom he believed. The judge refers in [62] to Mr Banwaitt's recollection of being told that someone had dropped out being supported by his e-mail of 25^th March 2009 which is incorrect; but such support can be found in an e-mail of 12^th May 2009. It is not suggested that Mr Banwaitt paid over his $1.75m or the first $1m of that without some details being given to him by Dr Dewji of the Scheme so the judge had to decide what passed between them. The judge formed the view that Dr Dewji's motive in approaching Mr Banwaitt is explicable by his own belief that the Scheme was likely to be a highly profitable one but could not take place unless the $14m could be raised. That does provide an explanation of why Dr Dewji should try to give Mr Banwaitt the impression that the Scheme was already fully subscribed but for the unexpected withdrawal of an investor. This was likely to be a much greater incentive to Mr Banwaitt to participate than being told that there was still plenty of room for further investors. The judge was also, I think, entitled to find on the evidence that Dr Dewji was capable of lying when it suited him and that his enthusiasm for the Scheme overrode any qualms he may have had in that respect. Although Mr Millett queried why Dr Dewji should have told Mr Banwaitt in June that he had investors willing to provide $14m, it is worth observing that in [30] of his own witness statement Dr Dewji says that he did receive confirmation of this from investors during June 2008. The evidence based on the notebook indicated that there were never investors who had expressed a willingness (let alone were committed) to provide up to $14m and the judge was entitled to rely on that evidence in preference to Dr Dewji's uncorroborated evidence in the witness box to the effect that other (unrecorded) investors had also expressed interest in the Scheme. Of particular relevance in this context is the text of the e-mail of 1^st October 2008 quoted earlier which lists none of the other persons as original investors.
49. I am equally unpersuaded by Mr Millett's other criticisms of the judge on this point. The issue of timing was for the judge to decide. It is not suggested that he overlooked any relevant evidence and there is no basis for us to interfere with his finding. Similarly, discrepancies or variations in Mr Banwaitt's recollection of events were simply matters for the judge to take into account in making his findings of fact. I am not persuaded that the judge's failure to mention each and every one of these instances should be treated as an omission by him to do so. As for the point taken about the proper construction of what was said, this seems to me to be no more than conjecture and was never explored in the evidence.

(2) The hotel chain disposal

50. The second alleged representation considered by the judge was that a French hotel chain had paid a non-refundable deposit of 20% of the $21m purchase price and was locked in to purchase on either 16^th or 17^th December. As mentioned earlier, the judge found that Mr Banwaitt was confused about the identity of the purchasers. He said:

"Mme Dominique and the French did not surface until 30 June 2008. The information provided on 2 July relates to the Australians. It was they who were considering a deposit. The information provided by Dr Dewji stated that the group had agreed to purchase at $5.10 per square metre and to complete a memorandum of understanding ('MOU') with a 10% deposit on being presented with land papers certified for development in July. Completion would be at the end of November. The original purchase would not be completed until this MOU and deposit had been received. Mr Banwaitt did not know what an MOU was. It may have legal effect but it is often a half-way house not intended to be legally binding. Mr Banwaitt said that he read the information as relating to an earlier time and thought that Dr Dewji had since managed to increase the deposit which had been paid. I find that Mr Banwaitt was told that a hotel chain had agreed to buy the land and that a deposit had been paid of 20% and so was locked in. That was untrue. Neither was it true as stated in the emailed information that the intention was not to complete the purchase until the MOU had been received: that was never the intention. Mr Banwaitt referred to the buyers being committed with a 20% deposit in his email of 12 May 2009, and was not contradicted. At the recorded meeting in 2011 Dr Dewji lied about the payment of the 20% deposit, saying that it had been paid."

51. Dr Dewji recorded in his notebook on 12^th May that the Koh Kong land could be sold for development for $20m or more and that among interested buyers were a group of Australian hotel chains. He said in his witness statement that as of June 2008 there was a willingness for an Australian group to enter into a memorandum of understanding (MOU) with a 10% deposit on a sale price of $20.4m. A company called Al-Baraqa Investments was to be formed by Narong Men to act as a vehicle for the investors in the purchase and sale on. The judge found that on 1^st July Dr Dewji and Narong Men met Mr Rattana Hout, the representative of the Australian hotel group, who confirmed that his clients would be happy to sign an MOU and pay a 20% deposit but would want an early completion. Planning permission was also important.
52. In cross-examination Dr Dewji said that he was prepared to go ahead with the purchase of the land without the MOU being in place if he felt the Australians were genuine. And the judge found that this is what he did. Due to problems with the bank, the first $1m of Mr Banwaitt's money was not transferred to the ANZ account until 3^rd July. It was then used to make two payments of $500,000 and $470,000 on 3^rd and 8^th July respectively to an account in the name of Narong Men's wife. On 3^rd July Dr Dewji and Narong Men also met again with Rattana Hout and, according to the notebook, the deposit was to be paid once the necessary paperwork was provided to the purchasers. On the same day, they also met for the first time a Mme Dominique who represented the French hotel chain.
53. The notebook also recorded at this time that the investor referred to as Co had suffered losses which meant that it would only be able to contribute $4m instead of $7m to the Scheme. But notwithstanding the problems this created for the investors, Narong Men (to Dr Dewji's knowledge) went ahead and signed the $14m contract with Tan Meng on 5^th July. The contract was said by Dr Dewji to have provisions for stage payments but, as explained earlier, those parts of the contract have never been disclosed to the claimant. The judge was understandably critical of this evidence but, for present purposes, what matters is his finding that Dr Dewji authorised Narong Men to sign a contract for the purchase at $14m and that the only money used to make a payment against the purchase price was the $1m provided by Mr Banwaitt. This was notwithstanding the fact that Dr Dewji had been told by Mr Ban that, absent payment of the full $14m, any part payments would be at risk.
54. On 19^th July the Australians pulled out without having signed an MOU or paid a deposit. On 22^nd July Dr Dewji transferred $506,816 to his ANZ account and this money was also then transferred on to Narong Men's wife. On 30^th and 31^st July the remaining $750,000 from Mr Banwaitt was paid into the ANZ account. The statements for the account show that this was followed by further payments from Jardines ($750,000 on 31^st July and $2.252m on 29^th August); transfers from Dr Dewji of $211,822, $989,813 and $141,262 on 23^rd September, 20^th October and 3^rd November; a transfer of $750,372 from Zaamin Investments on 6^th October; $300,248 from Dr Dhanji on 7^th October; and a series of transfers from Canadian investors and a Mr Alloo in October and November. Virtually all this money (amounting to some $8.845m) was transferred to the account in the name of Narong Men's wife. None of these late investors were referred to in the notebook or the e-mail of 1^st October as original investors and the judge found that Dr Dewji had not made contact with them before September 2008.
55. In his e-mail of 1^st October 2008 Dr Dewji stated that the French group had already paid an unconditional deposit in order to be considered first as purchasers for the Koh Kong land. The plan was to progress matters with them with a view to a completion date in the first quarter of 2009. The judge said that there was no record or other evidence of a deposit having been paid and that the reason for the delay in completion was that Dr Dewji had still not raised the $14m necessary to complete the purchase. Mr Banwaitt said that in October 2008 Dr Dewji visited him at home and told him that he had lost all his money. Later he gave him two share certificates relating to Al-Baraqa Investments which had been incorporated on 16^th July 2008. The judge thought they were probably worthless. Thereafter, as is evident from the e-mails I referred to earlier, Dr Dewji continued to re-assure Mr Banwaitt but failed to spell out the true position. In November 2008 he was still accepting further monies from other investors. The judge accepted Mr Banwaitt's evidence that the visit had occurred but it has no real relevance to the claims which he had to consider.
56. The judge accepted, based on these findings of fact, that Mr Banwaitt cannot have been told in mid-June that a French consortium had entered into an MOU and paid a 20% deposit. Mr Millett submits that the judge should have stopped there and rejected the claim based on the alleged representation as pleaded. He should not have re-formulated it to refer to a hotel chain generally. His confusion about the identity of the hotel chain made it unsafe for the judge to accept his evidence that the representation about the 20% deposit was made as early as 13^th June or at any time prior to 2^nd July. The judge also failed to take into account that the 2^nd July e-mail (quoted at [18] above), which refers to an MOU and 10% deposit being in place before the purchase of the Koh Kong land, was transmitted at 3.31 am and could not have been received by him on the golf course as he said in evidence. But it would have been seen by him before he authorised his bank at 9.50 am that morning to transfer the money to the ANZ account and from it he would have seen that the MOU had not yet been signed; that the buyers might pull out; that the proposed deposit was 10% rather than 20%; and that the French buyers were no more than interested parties and had so far paid nothing.
57. Mr Millett accepts that in cross-examination Mr Banwaitt said that he treated the enclosure as an earlier proposal which had been superseded by the details given to him by Dr Dewji orally on 13^th June. But that does not explain, he says, the changed position of the French hotel chain. Entries in the notebook indicate that the French were not around until after 30^th June and the reference to them in the 2^nd July e-mail was not therefore a much earlier proposal as Mr Banwaitt alleges. The judge therefore had no reason to accept that the contents of the e-mail were out of date. The judge also, he said, ignored the fact that in cross-examination Mr Banwaitt said that he did have a quick read of the 2^nd July e-mail when he received it but thought the details were historic whereas, in an earlier witness statement made on 12^th September 2011 in support of an application for a freezing order, he said (in [23]) that at the time he did not notice the factual inconsistencies between the contents of the e-mail and what he had been told by Dr Dewji on 13^th June. Dr Dewji's evidence in cross-examination was that at the time of the 2^nd July e-mail there was a proposal that an Australian group should enter into an MOU and that he may have said to Mr Banwaitt that it might be willing to pay a deposit of 20%. He denied, however, saying that anyone had paid a 20% deposit. No one had.
58. Mr Cullen says that there is clear evidence in the notebook to indicate that a deposit of 20% was being discussed in June 2008 and not merely the 10% deposit referred to in the e-mail of 2^nd July. Dr Dewji's case had been that the only discussion was of a 10% deposit before he was ordered to produce the full version of the notebook. Thereafter he accepted he may have told Mr Banwaitt about a 20% deposit but denies having said that it had been paid. The difficulty, however, for Dr Dewji is that the e-mail of 2^nd July does say that the purchase of the Koh Kong land will not be completed without the MOU and deposit being in place and later documents show that Dr Dewji did then assert untruthfully that a 20% deposit had been paid. It was therefore open to the judge to find that a similar representation had been made to Mr Banwaitt in June.
59. So far as the 2^nd July e-mail is relied on to correct the effect of the June conversation, Mr Cullen reminds us that this was disavowed in Dr Dewji's defence. In relation to the point taken about the date of the reference to French interest in the notebook, he submits that the note for 30^th June about a suggested meeting with Dominique has to be read in conjunction with a later entry for 3^rd July which records that the French chain was interested in becoming the preferential bidder and for this privilege was willing to pay a deposit of $250k. This shows, says Mr Cullen, that the reference in the 2^nd July e-mail to offers from a French consortium "who are willing to enter the same terms as the Australians" cannot be a reference to the group represented by Mme. Dominique.
60. It seems to me that the difference between the accounts given by Mr Banwaitt and Dr Dewji (including inconsistencies in their own evidence) were matters which the judge needed to and could resolve on the evidence he heard. It is hardly surprising that there were inaccuracies in Mr Banwaitt's recollection of what hotel group was mentioned to him and when, and the judge was obviously obliged to take those into account in considering his findings of fact. But I do not accept that their existence or the inconsistency between Mr Banwaitt's oral evidence and his pleading required the judge to refuse to consider this part of his case any further. Provided that Dr Dewji and his counsel had the opportunity to deal with these matters in their evidence and submissions, the judge had an undoubted discretion to allow some re-formulation in the form of the alleged misrepresentation. The substance of the complaint was that a hotel chain had paid the deposit and was locked in to the purchase. Its identity was not material to the substance of the representation or its intended effect.
61. It was also, I think, open to the judge on the evidence to find that the payment of a deposit of 20% was discussed in June as having been paid prior to any purchase by the Scheme. Something was made of the distinction between contract and completion in relation to the e-mail of 2^nd July but this seems to me to be largely immaterial. The e-mail of 2^nd July talks about a deposit being paid before the purchase and to there being no completion until it was received. It is not suggested that those promises were kept and a representation in the form alleged would also have been both false and misleading. I therefore reject Dr Dewji's challenge to the judge's conclusions in [63] of his judgment.

(3) Back-to-Back

62. The judge said at [64]:

"The sale and purchase would be back-to-back. Mr Cullen listed this separately, no doubt because it arose from what was particularly said. It is however closely linked to what was said about the hotel group buyers. Mr Banwaitt said in his witness statement that during the second meeting he told Dr Dewji that it was his life savings which he could not afford to lose. He said Dr Dewji responded that it was a back-to-back deal. Mr Banwaitt had said the same in his affidavit of 12 September 2011. In the particulars of claim it was alleged that Mr Banwaitt used the expression a back-to-back deal and Dr Dewji did not demur. I find that Dr Dewji did represent that it was a back-to-back deal and I think it likely that it happened as said in Mr Banwaitt's witness statement and affidavit. Mr Banwaitt was normally a cautious investor, as Dr Dewji knew. Mr Banwaitt had given Dr Dewji his view that Cambodia was a 'dodgy country' and great care was needed. Mr Banwaitt needed the reassurance that nothing could go wrong. It might be debated quite exactly what a back-to-back deal meant. But there was no way that it was going to be back-to-back here. The Australian group had not paid a deposit nor entered an MOU, and were not about to. The investors would be buying without any kind of certainty as to a purchaser."

63. Mr Millett submitted that the case based on this alleged representation was obscure and the judge's conclusions unintelligible. Originally in his affidavit of 12^th September 2011, Mr Banwaitt said that he had used the expression at the 13^th June meeting by asking if it was a safe and sure back-to-back sale. Dr Dewji replied that it was. But later in the same affidavit he also says that Dr Dewji said it was a back-to-back deal at the second June meeting. In the particulars of claim served the following day, it was not pleaded as one of the 13^th June representations but as something which Mr Banwaitt said at the second meeting and which Dr Dewji did not dispute. This version of events remained unchanged in the amended particulars of claim served on 10^th July 2012 but in his witness statement of 21^st December 2012 Mr Banwaitt reverts back to saying that it was Dr Dewji at the second meeting who described the Scheme as involving a back-to-back deal.
64. The judge, he says, should have grappled with these inconsistencies. He found that Dr Dewji made the statement at the second meeting as described in the affidavit and witness statement but this was an impossible finding given the very different version in the pleading. The judge should have given much more weight to Dr Dewji's denial in cross-examination that he ever made the statement given the inconsistencies in Mr Banwaitt's own account of the matter.
65. It was also made clear, he says, by the 2^nd July e-mail that the Australians had agreed to provide an MOU and deposit and would not do so until later in July. The contract to purchase the Koh Kong land was scheduled for 30^th June and would therefore come first but would not be completed before the MOU and deposit were in place. The MOU was not, however, a contract and, even with a 20% deposit, there would be no guarantee that the buyers would go ahead and purchase. It is unlikely that Dr Dewji would have told Mr Banwaitt anything different from the position set out in the e-mail.
66. Mr Cullen says that the difference in Mr Banwaitt's account of this matter as between the pleading and his witness statement is trivial and was not even put to Mr Banwaitt in cross-examination. Of much more significance is the fact that, despite the terms of the 2^nd July e-mail, Dr Dewji accepted in cross-examination that the willingness of the Australians to provide the MOU and a deposit depended upon their being satisfied there was planning permission for a development. Its timing was unrelated to either exchange or completion of the contract of purchase. He therefore had to concede that the statement in the 2^nd July e-mail that the MOU and deposit would be in place prior to the (completed) purchase was incorrect.
67. I would reject Mr Millett's criticisms of the judgment on this point. Points about inconsistencies in the evidence of a witness and whose account to prefer are points for the trial judge; not for an appeal. The judge recognised in the passage quoted the difference between Mr Banwaitt's pleading and the witness statement and was entitled to form a view about the matter. Although, as the judge himself recognised, the MOU and deposit were not what everyone would regard as a back-to-back deal, it was consistent with the contents of the 2^nd July e-mail for Dr Dewji to have described the arrangements in those terms. As it was, even the less than perfect security provided by these arrangements was illusory. There was no commitment or intention by the Australians or anyone else to provide an MOU and deposit before completion unless that happened to coincide with the confirmation of planning permission. Even if Dr Dewji said no more than was later set out in the e-mail, it was materially false.

(4) The purchase moneys were needed urgently or the deposit paid by the purchasers would be forfeited

68. The pleaded representation was that Mr Banwaitt was told at the 13^th June meeting that the purchase had to be completed by the end of the month or under Cambodian law the purchasers would forfeit their deposit. Dr Dewji admitted in his witness statement that during their discussion on the golf course in June 2008 he told Mr Banwaitt that a deposit of $50,000 had been paid in connection with the purchase of the Koh Kong land. The judge said that he was satisfied that the alleged representation had been made in order to provide a sense of urgency and that it was untrue. No deposit had been paid by June 2008 and none was ever paid. In relation to Dr Dewji's evidence that he had paid the deposit, the judge said:

"Dr Dewji gave confusing evidence about the payment of a deposit. He said it was to be $50,000. He said at first that he could not remember if it was paid. He then said that it was paid by means of a cheque drawn to Sunil Gohil, who was assisting with the transaction, for $200,000. He said he did not use the account he had opened with the ANZ Royal Bank in Phnom Penh because he did not know the state of the account. That would not have prevented him transferring money to the account. He said he made out the cheque for $200,000 and not $50,000 because he knew that more money would soon be needed. He subsequently produced a statement for his bank account in England. This showed that a cheque for £100,000 had been debited on 29 July 2008. Dr Dewji said that this was the cheque in question, being the then equivalent of $200,000. When asked about the statement he first said that the payee was Gohil, then he said he was pretty sure that it was not Gohil. He said that he had had to post the cheque to an address in the UK. The court in Cambodia was satisfied that in addition to the sums which went through Dr Dewji's Cambodian bank account a further $200,000 was paid to Narong Men. How far that was proven before the court by documentary evidence is unclear. I do not find the evidence Dr Dewji gave to me about the $200,000 cheque credible."

69. Mr Millett says that the judge did not identify the evidence he was relying on to support his finding that the representation was made. But Mr Banwaitt's evidence that it was said at the 13th June meeting is contained in [76] of his witness statement so that there was evidence before the judge on which he could base his finding. It is not in any event denied by Dr Dewji that he told Mr Banwaitt that a $50,000 deposit had been paid.
70. Most of the argument on this representation centred on whether it was false. Mr Millett relied on the fact that the Cambodian Court found that Dr Dewji had paid a cheque for $200,000 to Narong Men through Sunil Gohil. It was wrong therefore for the judge to have reached a different conclusion and the judge does not really explain why Dr Dewji's evidence on this point was not credible. He produced bank statements during the trial for the month of July 2008 which show a payment by cheque for £100,000 (the equivalent of $200,000) on 29^th July.
71. Dr Dewji said in cross-examination that he made the payment to Mr Gohil who passed it on to Narong Men. He thought it was paid soon after 23^rd June. He was then asked to produce the relevant bank statement. Once this was done he was re-called in chief and identified the payment. He said that he posted the cheque to Mr Gohil at an address in the UK and that it did not clear until several weeks later. It was put to him by Mr Cullen that this was untrue because the payment to Mr Gohil depended upon the prior receipt on 23^rd July of a credit for £96,151. Dr Dewji said that this was not necessary because the particular account enabled him to borrow up to the value of the equity in his house which was then worth up to £1m. The payment of £100,000 was not dependent upon the receipt.
72. The judge then raised a different point about timing which was that cheques numbered 275, 276 and 277 had all been cleared in July. Assuming that they were presented for clearance soon after being written, it must follow that the cheque for £100,000 which is cheque number 281 cannot have been written and sent to Mr Gohil before about mid-July. Dr Dewji's answer to this was that these cheques were written before he went to Cambodia and were presented in July while he was still away. But this assumes that the presentation of each of those cheques was delayed for which Dr Dewji provided no real explanation.
73. The judge was in my view entitled to reject Dr Dewji's evidence as not credible. These points have to be looked at in the context of his evidence as a whole and the view which the judge formed of his credibility. Even if the judge was wrong to find that the deposit was never paid, his conclusion that it was not paid by June was plainly open to him on the evidence. The findings of the Cambodian Court were not specific as to dates and there is no inconsistency with them on this point.

(5) Full Planning Permission had been Granted

74. This is the last of the representations alleged to have been made at the June meeting. Mr Banwaitt's evidence in his witness statement was that he was told that "full planning permission had been granted for development of the land and the title deeds were stamped with four signatories of the government planning authorities" but the judge in [66] thought it likely that Dr Dewji said little more than that the land was available for development and they had deeds with the necessary four signatures: not in terms that there was full planning permission. What was said was, however, intended to give and did, he found, give Mr Banwaitt the impression that all that was required for the development of the land had been obtained.
75. Mr Millett submitted that the judge's rejection of Mr Banwaitt's evidence as to what was said should have been the end of his case on this point. But in any event there was, on his findings, no misrepresentation. Dr Dewji's statement that they had land available for development was correct. It does not imply that no planning permission was necessary and there is no evidence that Mr Banwaitt relied on what the judge found had been said as containing such an implication. His case is that Dr Dewji had expressly stated that planning permission existed. It was in any event made clear by the 2^nd July e-mail that no planning consent as such had yet been granted.
76. I think that Mr Millett is probably right about this. The pleaded case was not made out and (unlike in relation to some of the other misrepresentations) the false statement which the judge found to have been made depends upon an implication which Mr Banwaitt himself does not of course deal with. If one assumes (as I think the judge probably did) that what Dr Dewji in fact said was not very different from the contents of the 2^nd July e-mail quoted at [18] above, then it is clearly arguable that it carried the implication that all that was necessary for the development had already been obtained. But given Mr Banwaitt's recollection of what was said, there is no real evidence that he understood it in that way. Given my conclusions on the other June representations, this is not, however, sufficient to alter the outcome of the appeal.

The Second Investment

77. In these circumstances, I can take the points made about the July payments quite shortly. It needs to be remembered that, on the judge's findings, the further payments made in July to bridge an alleged funding gap of $2 or $3m were also made in reliance on the June representations which remained operative. The further conversation in July in which Dr Dewji was found to have told Mr Banwaitt that completion of the purchase had been put back to 28 July; that completion of the sale on was deferred to 18^th or 19^th July 2008; and that he was still short of $3m may have been the trigger for further investment but was not the sole matter relied on for the investment decision. The judge's conclusion that all of Mr Banwaitt's investment had been induced by fraud was therefore open to him on his findings in respect of the June conversations alone.
78. The judge held that the statement by Dr Dewji that he was $2 or $3m short in July was a lie because by then (as explained earlier) the only money which had actually been received from investors was his own $506,816 and Mr Banwaitt's $1m. Jardines' $3m was not received until August. Mr Millett made a number of points to the effect that Mr Banwaitt must have realised the difference between contract and completion; knew that contracts for the purchase of the land had been exchanged; and realised that any deposit paid by the Scheme would be forfeited if completion of the purchase did not go ahead.
79. But these matters have to be considered in the light of the judge's earlier findings about the June misrepresentations and, in particular, his finding that Mr Banwaitt had been told that the MOU and deposit by the hotel chain was in place and that the funding gap was limited. The significance of what was said in July was that the funding gap was not $2 or $3m as stated but $6m with a real risk that the $14m target would not be reached. Mr Banwaitt was therefore, on the judge's findings, induced to make a substantial increase in his investment on a false basis. Whether this would have been an operative form of deception had it been the only lie which Dr Dewji told is not something which the judge had to decide.
80. For these reasons, I would reject Dr Dewji's appeal against the judge's order rescinding the investment agreement and ordering repayment. It is not therefore necessary to consider the case based on non-disclosure or the other causes of action relied on to support the claim for the recovery of what was paid. That leaves the discrete issue of whether, in relation to the July payments of £318,650 made from Mr Banwaitt's sterling account and then converted to US dollars, the judge should have ordered repayment of the £318,650 or (as he did) of the $750,000 into which it was converted prior to payment into Dr Dewji's ANZ account.

The Currency Issue

81. Mr Millett's argument is that in order to have made what amounted to restitutio in integrum in respect of the July payments, the judge should have ordered Dr Dewji to repay the £318,650 which Mr Banwaitt paid out and not the $750,000 which Dr Dewji received. By making an order for the repayment of the $750,000, Mr Banwaitt received a windfall in the form of the increase in value of the US dollar since July 2008. As a consequence, Dr Dewji is said to be required to pay back at current rates of exchange far more than the value of what he received. The difference in terms of sterling is £262,334.
82. Much of the argument centres on what the Court's order for repayment following rescission is intended to achieve. This is not an award of damages in tort for deceit but an order in equity for repayment following rescission.
83. Had the judge been asked to award damages for deceit, the issue would have centred on what should be taken to be the chosen currency of the transaction: see Eleftherotria (Owners) v Despina R (Owners) [1979] AC 685. But that is not an issue on this appeal.
84. The appellant's argument is that the Court is not concerned in these circumstances with recovering from the defendant what he has received as a result of the fraud but rather with restoring the claimant to his status quo ante. On this basis, he should receive no more than he actually paid out even though the amount of sterling which he was required to pay was dictated by his agreement to provide $750,000 which was the currency of payment. In support of his argument, Mr Millett relied on a passage in the speech of Lord Wright in Spence v Crawford [1939] 3 AER 271 at 288-9 in which he said:

"if a plaintiff who has been defrauded seeks to have the contract annulled and his money or property restored to him, it would be inequitable if he did not also restore what he had got under the contract from the defendant. Though the defendant has been fraudulent, he must not be robbed nor must the plaintiff be unjustly enriched, as he would be if he both got back what he had parted with and kept what he had received in return."

85. In my view this is of limited assistance. The issue which Lord Wright was dealing with in the passage quoted was whether the defrauded party could obtain restitution from the fraudster without making counter-restitution of the benefits he had received under the contract. In this case the only issue is whether the order for restitution should require Dr Dewji to disgorge the benefits he in fact obtained in the form of the $750,000 or should be limited to restoring to Mr Banwaitt what he paid out in the currency in which the payment was made. There is no doubt that an order in that limited form would restore Mr Banwaitt to the position he was in before the July payments were withdrawn from his sterling account. But it would also leave Dr Dewji with the benefit of the change in exchange rate by requiring him to pay back less than he actually received.
86. It seems to me important not to lose sight of the fact that an order for restitutio in integrum, even though not technically an award of restitution in the common law sense, should be capable in principle of preventing the defendant from being unjustly enriched at the claimant's expense. The purpose of the equitable order made by the judge is to require the fraudulent defendant to repay not simply what would be enough to restore the original balance in the sterling account but every benefit which he received under the contract which the court has set aside. Any benefits which result from the fact that Mr Banwaitt converted his money into US dollars prior to making the payment to Dr Dewji should in my view be restored to Mr Banwaitt whose money it continued to be until the moment it passed into Dr Dewji's dollar account. The order which Mr Millett seeks would give Dr Dewji a benefit acquired by his own fraud and would not restore Mr Banwaitt to the position he was in immediately before the dollar payment to Dr Dewji was made.

Conclusion

87. For these reasons, I would dismiss the appeal.

Lady Justice Sharp :

88. I agree.

Lord Justice Maurice Kay :

89. I also agree.