Camenzuli v Morrison [2022] NSWCA 51 (5 April 2022)
The Federal Executive of the Liberal Party resolved to exercise a power of intervention under cl 12 of the Party’s Federal Constitution. The constitution of a party authorises the Federal Executive to intervene in the management of a State Division. However, the plaintiff submitted that the internal party processes of pre-selection raised justiciable issues. The Court, in resolving this dispute, applied Cameron v Hogan (1934) 51 CLR 358; [1934] HCA 24.
Facts:
The plaintiff, who is a member of the State Council and State Executive of the NSW Division of the Liberal Party of Australia, sought to impugn the validity of steps taken by the Federal Executive which, by resolution of 4 March 2022, established a committee with power to endorse three incumbent Liberal members of the Parliament as Liberal candidates to recontest their seats.
The plaintiff challenged the validity of the resolution of Sunday, 6 March 2022 exercising the power of pre-selection. The substantive argument turned on the correct construction of the Party’s Federal Constitution and, in particular, cl 12.3. The first, second and third defendants (being the members of the committee established by the Federal Executive, the “committee defendants”) contended that the issue raised is purely one of construction of the internal rules regulating the operation of an unincorporated association, albeit a national political party, being a matter held by the High Court in Cameron v Hogan to be non-justiciable.
The plaintiff sought orders appointing persons to represent (a) members of the New South Wales Division of the Party who were not already joined, and (b) members of the Federal Executive who were not already joined. This was opposed. Further, although the statement of claim sought only declaratory relief, at the hearing the plaintiff proposed an amendment seeking injunctive relief preventing the registered officer requesting the Electoral Commissioner to print the names of the purportedly endorsed candidates on the ballot papers. On 30 March 2022, the committee defendants identified a perceived need for the service of notices under s 78B of the Judiciary Act.
On 30 March the Court directed that notices be served on the Attorneys by 2pm that day. The hearing was delayed from 31 March 2022 to 1 April 2022. The directions hearing on 30 March 2022 took place whilst the proceedings were listed in the Equity Division. A member of this Court gave directions. One involved the removal of the proceedings to the Court of Appeal, a matter which had originally been sought by the parties, but before appropriate grounds could be formulated to support the motion.
The Court had refused an earlier application for removal in a matter involving the same parties and disposed of by Ward CJ in Eq on 25 February 2022. At the directions hearing on 30 March 2022, the committee defendants submitted that the Court should stay its consideration of the matter until an application by them to remove the matter to the High Court was determined. The removal application was heard by the High Court on 31 March 2022. Chief Justice Kiefel ordered that the whole matter before this Court be removed (while noting that the constitutional issue sought to be raised might be described as “tenuous”), but proceeded immediately to remit the matter to this Court.
Issues:
I. Whether or not the party pre-selection process is justiciable.
II. Whether or not statutory provisions create an interest in members allowing the Court to enforce procedures under Party Constitution.
III. Whether or not the power to endorse candidates for election is an exercise of management function.
IV. Whether or not the power to endorse a candidate is subject to Constitution of State Division.
Applicable law:
Associations Incorporation Act 2009 (NSW), s 26 - provides that an association's constitution binds the association and its members to the same extent as if it were a contract between them under which they each agree to observe its provisions.
Civil Procedure Act 2005 (NSW), s 56 - facilitates the just, quick and cheap resolution of the real issues in the proceedings.
Commonwealth Electoral Act 1918 (Cth) s 4 - provides that a “political party” is defined to mean “an organization the object or activity, or one of the objects or activities, of which is the promotion of the election to the Senate or to the House of Representatives of a candidate or candidates endorsed by it”.
Commonwealth Electoral Act 1918 (Cth) s 123 - provides that an “eligible political party” is a political party that either has a member of Parliament as a member or has at least 1,500 members and is established “on the basis of a written constitution (however described) that sets out the aims of the party”.
Commonwealth Electoral Act 1918 (Cth) s 125 - provides that the register merely contains a list of the names of, and details concerning, registered political parties.
Commonwealth Electoral Act 1918 (Cth) s 141 - provides for a review of such decisions, by way of application to the Administrative Appeals Tribunal.
Commonwealth Electoral Act 1918 (Cth) s 163 - specifies qualifications of candidates by reference to age, citizenship and entitlement to be an elector.
Commonwealth Electoral Act 1918 (Cth) s 166 - provides the procedures for nomination.
Commonwealth Electoral Act 1918 (Cth) s Pt XI - provides for the registration of political parties for the purposes of the Act.
Commonwealth Electoral Act 1918 (Cth) s XIV - deals with nomination of candidates, and states that no person shall be capable of being elected as a Senator or Member of the House unless duly nominated.
Judiciary Act 1903 (Cth), ss 39, 40, 44, 78B - provides that where a cause pending in a State court involves a matter arising under the Constitution or involving its interpretation, the court is not to proceed unless and until notice has been given to the Attorneys General of the Commonwealth and of the States specifying the nature of the matter, and the Attorneys have had a reasonable time to consider the question of intervention in the proceedings or removal of the cause to the High Court.
Uniform Civil Procedure Rules 2005 (NSW), r 36.16 - provides that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system.
Asmar v Albanese [2022] HCASL 71 - provided that the Electoral Acts are important in determining the justiciability question to which we will turn below. But, in our view, they do not assist in determining the question of whether the Branch Rules and, if applicable, the National Constitution empower the National Executive to act as it did. ...”.
Asmar v Albanese [2022] VSCA 19 - where the High Court refused special leave to appeal this decision.
Asmar v Albanese (No 4) [2021] VSC 672 - provided that the Electoral Acts do not seek to regulate the internal affairs of political parties, for example, they do not require the Electoral Commissions to approve amendments to their Constitutions or Rules nor do they prescribe procedures for resolution of disputes between branches and members and between branches and the National Executive.
Baldwin v Everingham [1993] 1 Qd R 10 - treated the fact that the issue was one of public importance as sufficient to render all questions as to the internal processes justiciable, provides an inadequate basis for distinguishing Cameron v Hogan.
Butler v Mulholland (No 2) [2013] VSC 662 - Robson J addressed a dispute within the Democratic Labor Party as to who was the secretary of the party and the person responsible for providing details to the electoral officer for registration under the Victorian legislation.
Cameron v Hogan (1934) 51 CLR 358; [1934] HCA 24 - binding authority that disputes arising from the application of the rules of an unincorporated political party are not justiciable.
Edgar and Walker v Meade (1916) 23 CLR 29; [1916] HCA 70 - concluded that disputes concerning the rules of a voluntary organization became justiciable when the voluntary association attained (what Dowsett J described as) ‘significance in public affairs’.
Johnson v The Greens NSW [2019] NSWSC 215 - Robb J noted that s 26 of the Associations Incorporation Act 2009 (NSW) gave contractual force to that political party’s constitution and thus Cameron v Hogan was inapplicable.
LNC Industries Ltd v BMW (Australia) Ltd (1983) 151 CLR 575; [1983] HCA 31 - provides that the Court, in dealing with the Electoral Act, would be dealing with an issue arising under a federal law and would therefore be exercising federal jurisdiction.
Mulholland v Australian Electoral Commission (2004) 220 CLR 181; [2004] HCA 41 - noted that the scheme for registration was first introduced in 1983, and later amended in 2000 and 2001.
Ruddick v Commonwealth of Australia [2022] HCA 9 - explained that the other contextual factor relating to the registration of political parties was the provision of direct funding for political parties.
Setka v Carroll (2019) 58 VR 657; [2019] VSC 571 - involved a challenge to the expulsion of the plaintiff from the Australian Labor Party by resolution of the National Executive.
Analysis:
Although the Court in Cameron v Hogan made no reference to any electoral legislation, presumptions as to the nature and operation of political parties were probably influenced by that legislative context. The joint reasons in Cameron v Hogan did not conclude that no issue as to the operation and management of a voluntary association could be the subject of proceedings in a court. The joint reasons acknowledged that proceedings might be brought to enforce a proprietary interest in property held by a voluntary association and to enforce contractual rights between members (if any). There might also be an action in tort if members of the association took steps in reliance upon an attempted expulsion from membership which steps were resisted.
The plaintiff’s basis for distinguishing Cameron v Hogan was the changed statutory scheme for the regulation of political parties. The issue, however, is not whether the Electoral Act has changed significantly since 1934 (which it clearly has), but whether the changes warrant intervention in a particular case. The existence of a dispute does not enliven the jurisdiction of the Court to determine the dispute. There was a dispute in Cameron v Hogan, but the Court did not have power to determine it.
The plaintiff contended that statutory recognition of the process of endorsement gave rise to a right enforceable at the behest of an interested party member, to have the court determine the validity of the internal process by which the endorsement occurred. Statements that pre-selection disputes have a “close connection” with provisions of the Electoral Act concerning nomination, endorsement and funding fall short of explaining why a dispute between the members of an organisation whose rules lack contractual force may become justiciable.
The public interest in the operation of major political parties does not justify judicial intervention in internal party disputes generally. The provisions in the current Electoral Act providing for party registration, candidate nomination and endorsement, and public funding do not purport to affect the general internal operations of political parties.
Conclusion:
The Court ordered to dismiss the statement of claim filed on 15 March 2022 in the Equity Division, removed into this Court by order made on 30 March 2022 and remitted by the High Court of Australia on 31 March 2022.
Commissioner of Taxation v Carter [2022] HCA 10 (6 April 2022)
The parties are in dispute over a trust deed which provided that, if the trustee made no effective determination to pay, apply, set aside or accumulate any part of trust income in a given accounting period, the income was to be held on trust for specified beneficiaries.
The trustee failed to pay, apply, set aside or accumulate income in the income year. The Court, in making its final orders, assessed whether present entitlement under s 97(1) is determined immediately prior to end of the income year and whether disclaimers operated retrospectively so as to disapply s 97(1) in respect of income year.
Facts:
This appeal concerns Div 6 of Pt III of the Income Tax Assessment Act 1936 (Cth) ("the 1936 Act"), headed "Trust income" which states: "Except as provided in this Act, a trustee shall not be liable as trustee to pay income tax upon the income of the trust estate".
The Whitby Trust was settled on 27 July 2005. Mr Allen Bruce Caratti and his daughter Alisha were joint Guardians. The power to appoint income was contained in cl 3.1 of the Trust Deed for the Whitby Trust.
Clause 3.7 of the Trust Deed then provided for the default distribution of income if the Trustee failed to make a determination under cl 3.1. No income remained with the Trustee. Clause 3.7 operated "immediately prior to the end of the last day of [the] Accounting Period" and distributed all of the income of the Whitby Trust successively to the persons identified in cll 4.1 to 4.5.
The Trustee having failed to appoint or accumulate the income of the Whitby Trust in the 2014 income year, the income of the Trust was distributed to the Primary Beneficiaries of the Trust, who were Mr Caratti's children – Natalie, Alisha, Nicole, Christina and Benjamin.
One‑fifth of the income of the Trust was distributed to each of Mr Caratti's children. Thus, the combined operation of cll 3.1, 3.7 and 4.2 was such that "immediately prior to the end of the last day" of the 2014 income year, one‑fifth of the income of the Whitby Trust was held on trust for each of Mr Caratti's children.
On 27 October 2015, the Commissioner of Taxation ("the Commissioner") issued an amended assessment to each respondent for the 2014 income year which included as assessable income one‑fifth of the income of the Whitby Trust on the basis that the respondents were "presently entitled" to that income within the meaning of s 97(1) ("the 2014 Assessments"). On 3 and 4 November 2015, the respondents executed deeds of disclaimer in respect of their default distributions under cl 3.7 for the 2014 income year.
On 30 September 2016, the respondents executed further disclaimers ("the Third Disclaimers") disclaiming any and all right title and interest conferred by the Trust Deed to any income and, without limiting the generality of that disclaimer, disclaiming any and all right title and interest conferred by cl 3.7 of the Trust Deed.
The respondents objected to the 2014 Assessments, contending, among other grounds, that each had validly disclaimed the relevant cl 3.7 distribution by the Third Disclaimers.
The Administrative Appeals Tribunal held that the Third Disclaimers were ineffective because they were made after the respondents, with knowledge, had failed to disclaim and had accepted the gifts. The Full Court of the Federal Court held that the Third Disclaimers were effective and dismissed the Commissioner's notice of contention.
The Full Court held that there was nothing in s 97(1) of the 1936 Act to indicate that a beneficiary's liability was to be determined once and for all at the end of the income year by reference to the legal relationships then in existence. The Commissioner appealed to this Court on the sole ground that the Full Court erred in finding that the Third Disclaimers operated retrospectively so as to disapply s 97(1) in respect of the 2014 income year.
Issue:
Whether or not disclaimers operated retrospectively so as to disapply s 97(1) in respect of income year.
Applicable law:
Income Tax Assessment Act 1936 (Cth) ss 95A, 96 - reflects that, in Div 6, the basic income tax treatment of the net income of a trust estate is to assess the beneficiaries on a share of the net income of the trust estate based on their present entitlement to a share of the income of the trust estate.
Income Tax Assessment Act 1936 (Cth) s 97 - provides that subject to Division 6D, where a beneficiary of a trust estate who is not under any legal disability is presently entitled to a share of the income of the trust estate:
(a) the assessable income of the beneficiary shall include:(i) so much of that share of the net income of the trust estate as is attributable to a period when the beneficiary was a resident; and
(ii) so much of that share of the net income of the trust estate is attributable to a period when the beneficiary was not a resident and is also attributable to sources in Australia ..."
Union‑Fidelity Trustee Co of Australia Ltd v Federal Commissioner of Taxation [1969] HCA 36 - makes clear that a present entitlement of a beneficiary under s 97(1) does not depend upon receipt of the income.
Harmer v Federal Commissioner of Taxation (1991) 173 CLR 264 - provides that a beneficiary is presently entitled to a share of the income of a trust estate "if, but only if: (a) the beneficiary has an interest in the income which is both vested in interest and vested in possession; and (b) the beneficiary has a present legal right to demand and receive payment of the income, whether or not the precise entitlement can be ascertained before the end of the relevant year of income and whether or not the trustee has the funds available for immediate payment.
Dwight v Commissioner of Taxation [1992] FCA 178 - provides that the phrase "is presently entitled to a share of the income of the trust estate" in s 97(1) is directed to the position existing immediately before the end of the income year for the stated purpose of identifying the beneficiaries who are to be assessed with the income of the trust – namely, those beneficiaries of the trust who, as well as having an interest in the income of the trust which is vested both in interest and in possession.
Federal Commissioner of Taxation v Whiting [1943] HCA 45 - provides that the criterion for liability looks to the right to receive an amount of distributable income, not the receipt.
Union‑Fidelity Trustee Co of Australia Ltd v Federal Commissioner of Taxation [1969] HCA 36 - makes clear that a present entitlement of a beneficiary under s 97(1) does not depend upon receipt of the income.
Matthews v Matthews [1913] HCA 49 - provides that the presumption of assent – that when there is a transfer of property to a person, the donee assents even before they know of the transfer – is a "strong presumption of law".
Hill v Wilson [1873] UKLawRpCh 70 - provides that a gift "requires the assent of both minds".
Federal Commissioner of Taxation v Cornell [1946] HCA 32 - provides that the subject matter of a gift can vest in a donee before the donee actually assents.
Mansell v Mansell [1732] EngR 187 - provides that trusts can be validly declared for charitable purposes or in favour of unborn persons.
Mirzikinian v Tom & Bill Waterhouse Pty Ltd [2009] NSWCA 296 - where the irrelevance of the assent of a beneficiary to the formation of a perfect trust was the subject of the decision.
Analysis:
The respondents' contention that the phrase "is presently entitled" should be construed to mean "really is" presently entitled (emphasis added) for that income year, such that, for "a reasonable period" after the end of the income year, later events could subsequently disentitle a beneficiary who was presently entitled immediately before the end of the income year, is contrary to the text of s 97(1) and the object and purpose of Div 6 identified above.
It would give rise to uncertainty in the identification of the beneficiaries presently entitled to a share of the income of a trust estate and the subsequent assessment of those beneficiaries. The uncertainties that would arise, and which would apply with equal force to the Commissioner, trustees, beneficiaries and perhaps even settlers, would also not be fair, convenient or efficient.
The submissions of the parties concerning the operation of the Third Disclaimers, including the references in those submissions to "presumptions" and "assent", cannot be addressed without dealing with an error in an assumption of the parties about the operation of disclaimers in equity.
The parties assumed that the validity of the creation of the separate trust, or (if the separate trust already existed) the validity of the increase in the value of the subject matter of any existing trust for the Primary Beneficiaries, depended upon a "presumption", in each case, that the Primary Beneficiaries had assented to that creation or increase. The assumption that there is a "presumption" of assent in such circumstances was thought to be supported by the notion that a disclaimer operates to rebut a "presumption" of assent. The assent of a beneficiary is irrelevant to the creation of equitable rights by an unconditional declaration of trust.
Conclusion:
The appeal is allowed. The Court sets aside orders 1 and 2 made by the Full Court of the Federal Court of Australia on 10 September 2020 and, in their place, orders that the appeal be dismissed.
Tapp v Australian Bushmen's Campdraft & Rodeo Association Limited [2022] HCA 11 (6 April 2022)
The appellant was competing in a campdraft competition where the appellant's horse slipped and fell causing serious injury to appellant. It was contended that the respondent breached duty of care. The Court, in adjudicating this dispute, assessed whether breach of duty of care caused appellant's injuries.
Facts:
On 8 January 2011, the appellant ("Ms Tapp") was injured while competing in a campdrafting event organised by the respondent, the Australian Bushmen's Campdraft & Rodeo Association Ltd ("the Association"). Ms Tapp's horse slipped, causing Ms Tapp to fall and suffer a serious spinal injury. Ms Tapp brought an action in negligence for damages against the Association. Ms Tapp's claim was dismissed by the primary judge (Lonergan J) and was upheld by a majority of the New South Wales Court of Appeal (Basten and Payne JJA, McCallum JA dissenting).
It was Ms Tapp's case that her horse fell because of deterioration in the surface of the arena leading up to her ride. Ms Tapp alleged that the Association, by allowing the event to continue in these circumstances, breached its duty to Ms Tapp to take reasonable care for her safety. The Association admitted that it owed Ms Tapp a duty of care to organise, manage and provide the campdrafting event with reasonable care and skill, but it denied that it had breached that duty. The Association's Rule Book contains a reference to the surface being ploughed, in the context of a general requirement that the arena surface be safe.
An incident report prepared by the Ellerston District Sports Club and dated 12 January 2011 ("the Incident Report") noted that the surface had been "renovated" at 7 am and 6 pm on Friday, 7 January 2011. Mr Shorten, the Secretary of the Ellerston District Sports Club, in his evidence, stated that on the Friday evening, although he had not received any complaints and was not aware of any problems with the surface of the arena, he and several other organising members had decided to renovate the arena "just to keep it nice and soft and competitive". There was evidence that, besides Mr Shorten, several other riders fell off their horses on Saturday, 8 January 2011.
Prior to Ms Tapp's incident, two complaints were made by Mr Stanton, a competitor, about the surface of the arena. On two occasions, competition was suspended while the members of the Association responsible for the conduct of the competition considered Mr Stanton's suggestion that the event be cancelled. While Mr Stanton urged that course because the "ground [was] unsafe", that view was not shared by other participants who were in a position to make a responsible judgment. To the contrary, the prevailing view was that competitors should "ride to the conditions". Mr Shorten, Mr Young and Mr Smith agreed that an announcement would be made over the loudspeaker that any competitors who wished to withdraw from the event could do so and receive a full refund.
Issues:
I. Whether or not the respondent breached duty of care.
II. Whether or not the breach of duty of care caused appellant's injuries.
III. Whether or not the harm suffered by appellant is a result of materialisation of obvious risk of dangerous recreational activity.
Applicable law:
Civil Liability Act 2002 (NSW) s 5B - provides that a person is not negligent in failing to take precautions against a risk of harm unless--
(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and
(b) the risk was not insignificant, and
(c) in the circumstances, a reasonable person in the person's position would have taken those precautions.
Civil Liability Act 2002 (NSW) s 5D - provides that a determination that negligence caused particular harm comprises the following elements--
(a) that the negligence was a necessary condition of the occurrence of the harm ("factual causation" ), and
(b) that it is appropriate for the scope of the negligent person's liability to extend to the harm so caused ("scope of liability" ).
Civil Liability Act 2002 (NSW) s 5L - provides that a person ("the defendant" ) is not liable in negligence for harm suffered by another person ("the plaintiff" ) as a result of the materialisation of an obvious risk of a dangerous recreational activity engaged in by the plaintiff.
Tapp v Australian Bushmen's Campdraft & Rodeo Association Ltd [2020] NSWCA 263 - where it was observed that "there is no doubt that it was established that immediately prior to [Ms Tapp's] horse falling its legs slid. What was left unproven was the reason for that slide."
Adeels Palace Pty Ltd v Moubarak [2009] HCA 48; (2009) 239 CLR 420 at 440 [43] - where the Court has recognised that the Act does not apply a test of "common sense".
Betts v Whittingslowe [1945] HCA 31; (1945) 71 CLR 637 at 649 - where Dixon J found that the defendant's breach of duty, coupled with the occurrence of an accident of the kind that might thereby be caused, was enough to justify an inference that the breach caused the accident.
Robinson Helicopter Co Inc v McDermott [2016] HCA 22 - relied upon in holding that the Court of Appeal had no sufficient basis for setting aside the findings of the primary judge.
New South Wales v Fahy [2007] HCA 20 - focused on how the particular injury happened may be misleading in attempting to determine issues of duty and its breach.
Jones v Bartlett (2000) 205 CLR 166 - relied upon in holding that judgments of this Court is posed by hindsight reasoning – the failure to take account of the context in which a risk was to be evaluated at the time the evaluation was made.
Fox v Percy [2003] HCA 22 - held that the appellate court is obliged to 'give the judgment which in its opinion ought to have been given in the first instance'.
Maynard v West Midlands Regional Health Authority [1984] 1 WLR 634 at 637 - provides that 'natural limitations' that exist in the case of any appellate court proceeding include the disadvantage that the appellate court has when compared with the trial judge in respect of the evaluation of witnesses' credibility and of the 'feeling' of a case which an appellate court, reading the transcript, cannot always fully share.
Travel Compensation Fund v Tambree [2005] HCA 69 - provides that "it is doubtful whether there is any 'common sense' notion of causation which can provide a useful, still less universal, legal norm".
Fallas v Mourlas [2006] NSWCA 32 - provides that division 5 of Pt 1A of the Civil Liability Act is concerned with "Recreational activities". Within Div 5, s 5L expresses a defence, the onus of which lies on the defendant.
Perisher Blue Pty Ltd v Nair‑Smith [2015] NSWCA 90 - provides that the enquiry is concerned with determining what person, thing or set of circumstances gave rise to the potential for the harm for which the plaintiff seeks damages.
Analysis:
Mr Gallagher was a judge of the campdrafting event and Mr Callinan was the President of the Ellerston District Sports Club. Neither Mr Gillis nor Mr Sadler suggested that the state of the surface of the arena had anything to do with their falls. It may also be noted that there was evidence that Mr Young himself competed again on the arena surface after these discussions and immediately before Ms Tapp's injury. The primary judge concluded that the Association was not liable for Ms Tapp's injuries on the basis that her injuries were the materialisation of an obvious risk of a dangerous recreational activity.
In the Court of Appeal, his Honour concluded that Ms Tapp could not demonstrate that her horse fell because of deterioration in the surface of the arena, as distinct from some other cause. However, McCallum JA held that the primary judge ought to have found that the Association breached its duty by failing to suspend the competition at the very latest when the announcement was made, but probably earlier. At trial, Ms Tapp had sought to establish specific reasons for inferring that the surface of the arena had deteriorated to the point where it was unsafe, and this attempt failed. The failure of an attempt to establish by expert evidence specific identified defects in the surface of the arena does not negate, as a matter of strict logic, the possibility that there was some other, unidentified defect in the surface of the arena that contributed to Ms Tapp's fall.
The risk of a horse slipping as a result of losing its footing during a manoeuvre performed at speed is part and parcel of competitive campdrafting on even the most benign of surfaces. The information available to the Association at the time the competition was suspended included statements from Mr Shorten and Mr Gillis, each of whom blamed his own management of his horse for his fall. None of the information on which the Association's decision‑makers acted suggested that deterioration in the surface was the cause of those falls.
Conclusion:
The appeal is allowed with costs. The Court sets aside the orders made by the Court of Appeal of the Supreme Court of New South Wales on 23 October 2020 and, in their place, order that:
(a) the appeal be allowed with costs; and
(b) the orders made by the Supreme Court of New South Wales on 4 November 2019 be set aside and, in their place, it be ordered that:
(i) there be verdict and judgment for the plaintiff in the agreed amount of $6,750,000; and
(ii) the defendant pays the plaintiff's costs.
#CivilLaw#TortsandCivilWrongs#Appeals#COSTS#CostsOrders#Recovery#Damages#Negligence
LWW (Guardianship) [2022] VCAT 221 (2 March 2022)
WQE filed an application about an enduring power of attorney. Orders were made for Public Advocate (OPA) to be appointed as guardian for LWW with power to make decisions in relation to access to persons and that BXT be appointed administrator. The Court, in making its orders, assessed whether an administrator and guardian is needed.
Facts:
WQE applied to the Tribunal for orders about an enduring power of attorney (EPA) made by his mother LWW on 21 December 2017. Under the EPA, LWW appointed her daughter BXT to be her attorney for personal and financial matters. WQE said that BXT was not acting in their mother’s best interests and she was socially isolating their mother. On 21 December 2017, at the same time as LWW made the EPA which is the subject of these proceedings she also made an Appointment of Supportive Attorney in relation to personal and financial matters and an EPA (medical treatment) appointing BXT as attorney.
The application was first heard by VCAT on 6 March 2020. It was adjourned for the Public Advocate (OPA) to complete an investigation and report to the Tribunal. BXT was directed to submit to VCAT a statement of accounts in respect of her operation as attorney. OPA provided a report on 26 October 2021. BXT also provided accounts as directed.
The OPA investigator Aimee Gordon in her report to VCAT recommended that the Tribunal consider appointing BXT as administrator and either suspend the personal powers under the EPA or appoint an independent guardian with authority to make decisions about the persons with whom LWW associates.
During the investigation Ms Gordon spoke with LWW, WQE, BXT and the care manager and facility manager at the aged care facility where LWW lives. Ms Gordon also had access to written statements filed with the Tribunal from BXT, from two nurses at the aged care facility where LWW lived previously, a friend of LWW and her late husband, her granddaughter VHS, and CGL and CGL’s wife and daughter.
Ms Gordon noted in her report that WQE, VHS and those who had provided written statements were concerned that in 2019, BXT was suddenly removed LWW from the previous facility where she lived to the current facility without communication or notification to them, that BXT had prevented access to LWW, and that BXT had isolated LWW and instructed facility staff not to transfer any of their calls to LWW. Ms Gordon said that BXT told her that WQE and others were motivated by financial interest in contacting LWW. Orders were made for OPA to be appointed guardian for LWW with power to make decisions in relation to access to persons and that BXT be appointed administrator with a direction that BXT provide copies of the Accounts by Administrator and supporting documents to WQE.
Issue:
Whether or not an administrator and guardian is needed.
Applicable law:
Powers of Attorney Act 2014 s 83 - where the effect of these orders is that the EPA remains in place but by virtue of this section, cannot be exercised in relation to financial matters and access to persons by LWW unless authorised by VCAT to do so.
Guardianship and Administration Act 2019 s 8 - provides that a person with a disability should be given practicable and appropriate support to make and participate in decisions, express their will and preferences and develop their decision-making capacity.
Guardianship and Administration Act 2019 s 30 - says VCAT may only appoint a guardian or administrator for a person if satisfied that the order will promote the person’s personal and social wellbeing.
Victorian Civil and Administrative Tribunal Act 1998 - provides that unless VCAT orders otherwise, a person must not publish or broadcast any report of a proceeding under the Guardianship and Administration Act 2019 that identifies or could lead to the identification of a party to the proceeding.
Charter of Human Rights and Responsibilities Act 2006 s 13 - provides that a person has the right not to have his or her privacy, family, home or correspondence unlawfully or arbitrarily interfered with.
Analysis:
As stated in Ms Gordan’s report dated 26 October 2021, the appointment of [BXT] as administrator will provide greater accountability and more assurance that [LWW’s] finances are being appropriately managed. It is hoped that this will remove [LWW’s] finances as a source of disagreement and tension between [WQE] and [BXT], which would promote [LWW’s] personal and social well being. Very serious allegations have been raised that LWW’s relationships with her family and her access to correspondence have been arbitrarily interfered with. In light of these allegations and the primary purpose of the GA Act, safeguarding her human rights by the appointment of a guardian is an important aspect of promoting her personal and social wellbeing.
The appointment of [BXT] as administrator will provide greater accountability and more assurance that [LWW’s] finances are being appropriately managed. It is hoped that this will remove [LWW’s] finances as a source of disagreement and tension between [WQE] and [BXT], which would promote [LWW’s] personal and social wellbeing. There is a need for an administrator to allay family members’ concerns about the management of the funds and to provide greater accountability. The appointment of BXT as administrator accords with LWW’s will and preferences that BXT make decisions for her.
Conclusion:
The enduring power of attorney made by the represented person on 21 December 2017 appointing [BXT] as attorney for personal and financial matters is suspended so far as it relates to financial matters. The enduring power of attorney (medical treatment) made by the represented person on 21 December 2017 appointing [BXT] as agent remains in place. [BXT] is directed to immediately notify [WQE] in the event there is any significant change in the represented person's medical condition or if she is hospitalised. The Public Advocate, Office of The Public Advocate 1/204 Lygon St, CARLTON VIC 3053 is appointed guardian for [LWW].
DPP (Cth) v Amarasinghe [2022] VCC 200 (2 March 2022)
Ranpati Dewage Shavindu Nimanthana Amarasinghe was charged with using a carriage service to cause child pornography material to be transmitted to self and many more related charges. The Court, in determining the sentence to be imposed, considered how there were false identities used in offending and how the offending conduct was objectively very serious.
Facts:
The Commonwealth Director of Public Prosecutions (CDPP) tendered a Prosecution Opening Upon Plea dated 17 January 2022, which Ranpati Dewage Shavindu Nimanthana Amarasinghe's counsel told the Court it could treat as a statement of agreed facts. In April 2020, the Australian Federal Police (AFP) Victorian Joint Anti-Child Exploitation Team (JACET) commenced an investigation after receiving referrals from the United States of America (USA) and the United Kingdom (UK). Each referral was in relation to separate female victims under the age of 16, who had engaged with him online. The offending occurred between 1 November 2018 and 11 June 2020 ( a period of some 19 months) and involved you using various social media platforms, including Kik, Instagram, Omegle, Chat For Strangers and Snapchat with the usernames I will refer to as ‘JL’, ‘JH’, ‘EL’ and ‘SL’.
During the period of your offending, you encouraged your victims to send images and videos of themselves naked and performing sex acts via these social media platforms. The images and videos are classified as child abuse material. During the period of offending, you told the victims to send further child abuse material with the threat that you would disseminate their other images and videos to friends and family if they did not comply. You followed through with these threats, transmitting child abuse material to the friends and family of the victims that did not comply.
On 11 June 2020, you were arrested and charged. On this day, you were found in possession of child abuse material. On 20 November 2020, one of your victims, gave a statement that you made use of a carriage service to cause child pornography material to be transmitted to self (Charge 1). On 26 May 2020, one of your victims, ‘LB’, gave evidence that you also made use of a carriage service to cause child pornography material to be transmitted to self (Charge 2). On 6 November 2019, participated in a VARE and gave evidence that in November 2018, that you likewise made use of a carriage service to cause child pornography material to be transmitted to self.
These instances were repeated with BW, SL, AJ, KR, DM, TK, CT, BT, CC, JL, MR, an unknown and unidentified Instagram user, KM, KY, AB, IR, AH, JG, and MS (Charges 3-22). Another two charges relates to you committing an aggravated offence involving private sexual material – use a carriage service to menace and cause offence (Charge 23 & 24). Lastly, on 11 June 2020, a search warrant was executed at your residence pursuant to your possession of child abuse material (Charge 25).
Issue:
The appropriate sentence for the offending.
Applicable law:
Crimes Act 1914 (Cth) (‘the Act’) s 20(1)(b)(ii) - provides that the Act requires a court to be satisfied that exceptional circumstances exist before a person being sentenced for a Commonwealth child sex offence can be released immediately on a recognizance release order.
Crimes Act 1914 (Cth) s 16A(1) - where the Commonwealth Director correctly observed, that section does not displace the requirement that the sentence must be of a severity appropriate in all the circumstances of the offending.
Sentencing Act 1991 (Vic) ss 5(3) - provides that the Court shall not pass a sentence of imprisonment on you for these offences unless, having considered all of the available sentences.
Rodriguez v DPP (Cth) [2013] VSCA 216; (2013) 40 VR 436 - provides that delay is normally relevant in two ways. First, it is relevant to rehabilitation that has occurred during the delay and the effect that has in turn on specific deterrence. Secondly, delay is relevant in the sense that the anxiety and uncertainty of having the prospect of a sentence hanging over one’s head during the period of delay is akin to punishment in itself.
R v Miller [1995] VicRp 60; [1995] 2 VR 348 - provides that where no victim impact statement is relied upon, a sentence may draw reasonable inferences from the known circumstances regarding the likely impact of an offence upon any victim and their immediate family.
Clarkson v The Queen [2011] VSCA 157; (2011) 32 VR 361 - provides that the law presumes harm to child victims in circumstances such as the present, and consent, or ostensible consent, of a child to such conduct with an adult is not a mitigating factor.
R v Richard [2011] NSWSC 866 - relied upon in holding that the criminality involved in each of these charges is greater than with a charge involving only one episode of criminal conduct.
R v Oliver [2003] 1 Cr App R 28 - provides that wide-scale distribution, even without financial profit, is intrinsically more harmful than a transaction limited to two or three individuals, both by reference to the potential use of the images by active paedophiles, and by reference to the shame and degradation to the original victims.
The Queen v Madex [2020] VSC 145 - where it was held that an offender is at a higher risk of contracting COVID–19 if they are incarcerated (presuming an outbreak in custody).
DPP v Bourke [2020] VSC 130 - provides that the inherent utilitarian value of a guilty plea is greater during the pandemic.
Brown v The Queen [2020] VSCA 60 - provides that the pandemic is causing additional stress and concern for those incarcerated and their families, as it is for every member of the community.
D’Alessandro; Smith; DPP (Cth) v Guest [2014] VSCA 29 - provides that a person being sentenced for the present offences can expect a term of imprisonment to be imposed.
Analysis:
Your offending conduct is objectively very serious. You fall to be sentenced for 25 discrete offences. The overall offending involved five distinct and separate offence types, namely transmitting, publishing, and possessing child abuse/child pornography material, using a carriage service to menace and cause offence by transmitting private sexual material and causing child pornography material to be transmitted to yourself. There are six female victims of the overall offending, five of whom were children.
You used four false identities to conceal your identity when communicating with victims, including using two female usernames. It is not relevant that a child may be seeking to explore their sexuality or enjoys the attention of the offender via the internet. This is no reason to relax any protection for children in that sphere. Your offending was protracted, planned, organised, prolific and involved threats.
This is a particularly cruel example of your offending conduct and demonstrates the depths of depravity into which you had fallen. The impact of this obscene conduct on your young innocent victim is beyond imagining.
Conclusion:
The Court is of the opinion that the only appropriate sentences necessary to achieve the purposes for which these sentences are imposed are immediate sentences of imprisonment and a total effective sentence involving a period of immediate imprisonment with a non-parole period. The Court sentenced a total effective sentence of 13 years’ and six months’ imprisonment for the defendant.
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Hume Plasterboard Pty Ltd v Yi Hao Pty Ltd [2022] NSWSC 183 (1 March 2022)
The first defendant defaulted on financial obligations to the plaintiff. The plaintiff brought proceedings against the second defendant and other defendants. The Court, in making its orders, assessed whether it was necessary to consider the second defendant’s pleaded defences.
Facts:
The plaintiff, Hume Plasterboard Pty Ltd ABN 70 101 562 270 (“Hume Plasterboard”), applies for judgment upon a guarantee signed by the second defendant, Mr Jinbiao Xu guaranteeing the financial obligations of the first defendant, Yi Hao Pty Ltd ABN 84 636 111 325 (“Yi Hao”) to the plaintiff. The other defendants were legally represented and they settled with the plaintiff on the first hearing day. But the second defendant did not appear, so Hume Plasterboard sought to proceed in his absence. The first defendant, Yi Hao, is in liquidation.
The second defendant, Mr Jinbiao Xu, and the third defendant, another guarantor, Chujun Su, filed a cross-claim against Hume Plasterboard on 13 May 2020, seeking to set aside their respective guarantees. At the hearing on 28 February 2022 the third and fourth defendants were legally represented and reached a settlement with the plaintiff on the principal claim. At the same time the cross claim brought by the third defendant, as second cross claimant, was discontinued and dismissed by consent, with costs. The plaintiff also discontinued proceedings against the first, third and fourth defendant on 28 February 2022.
In an Amended Statement of Claim filed on 22 December 2021 the plaintiff claims: that the second defendant guaranteed the first defendant’s financial obligations to the plaintiff; that the first defendant defaulted on payments to the plaintiff for the supply of goods, materials and associated services between the months of December 2019 and February 2020; and that consequently $219,213.14 is due to the plaintiff under the terms of an executed Guarantee and Indemnity dated 28 October 2019 (“the Guarantee”). The plaintiff claims interest under Civil Procedure Act 2005, s 100 in the sum of $219,213.14 together with interest and costs. The second defendant/first cross claimant did not appear at the hearing on 28 February 2022. Mr I. Kammoun, the solicitor who represented the third and fourth defendants, had also acted for the second defendant between 22 April 2020 and 15 May 2021, when he filed a Notice of Ceasing to Act.
On 28 October 2019, a representative of Yi Hao signed Hume Plasterboard’s ‘Confidential Credit Application Form’, which contained a form of Guarantee that was signed by the second and third defendants. On 4 November 2019 the plaintiff established an account to permit the first defendant to obtain goods and materials from the plaintiff on credit. Hume Plasterboard sent a letter to the second defendant on 4 November 2019, confirming that the account (account number ‘YH07’) had been opened with the plaintiff with a credit limit of $300,000.00. The first defendant commenced receiving goods and materials from the plaintiff on credit, on 30-day payment terms from the statement issue date.
Monthly statements were issued as and from December 2019. On 24 February 2020, Zac Wang, an account manager for the plaintiff company, met with Mr Binbin Xu on behalf of the first defendant. Mr Binbin Xu is the second defendant’s cousin. At the time of the meeting, the first defendant’s account had already reached an outstanding amount of approximately $265,000, without the plaintiff receiving any substantial repayment. Mr Binbin Xu proposed a payment plan for the first defendant company involving the payment of between $32,000 and $50,000 within the week, and $50,000 to $70,000 before the end of March.
On 2 March, the second defendant sent a letter to Ms Williams proposing a further repayment plan. The 2 March payment plan was not honoured. On 18 March 2020, a third payment plan was proposed on behalf of the first defendant, under which it would make payments of $50,000 on 24 March 2020 and 31 March 2020, a payment of $70,000 on 15 April 2020 and a payment of $100,000 on 30 April 2020. This plan was also not honoured. On 20 March 2020 a Final Notice was sent by Ms Williams on behalf of the plaintiff to the first defendant, as well as the second and third defendants as guarantors, demanding payment of the balance of the first defendant’s outstanding account as at 31 March 2020, in a total amount of $219,213.14.
Issues:
I. Whether or not the second defendant is liable as surety.
II. Whether or not adequate notice of hearing was given to the second defendant.
III. Whether or not it is necessary to consider the second defendant’s pleaded defences.
Applicable law:
Civil Procedure Act 2005, s 100 - pursuant to which judgment for interest against the Second Defendant is calculated from 31 March 2020 to 28 February 2022.
Analysis:
The plaintiff’s statement of account dated 1 April 2020 shows that as of 31 January 2020, the day after the December monthly account of $158,718.19 had fallen due, none of the outstanding money had been repaid. The second defendant therefore was in default under Hume Plasterboard’s Account Terms, clause 1(a) on 31 January 2020 and the account was due and payable from that day. As of 31 March 2020, an account statement shows that $219,213.14 remained as the net balance outstanding on the account. The first defendant has remained in default to the plaintiff in this sum.
After Mr Kammoun’s retainer was terminated, the second defendant did not appoint new solicitors to represent him. Nor has he appeared personally and any directions hearing since then. The second defendant was notified by mail of the 28 February 2022 hearing of these proceedings. The plaintiff’s solicitor, Mr Giles Finney sent by express post a letter to two of the second defendant’s known addresses in Auburn and Merrylands. These letters notified the second defendant that these proceedings were listed for hearing in this Court on 28 February 2022 and warned that the plaintiff would seek to proceed in the second defendant’s absence.
Conclusion:
The Court is satisfied that the second defendant was served with notice of the hearing and the Court heard the plaintiff’s evidence in the second defendant’s absence. The Court is satisfied that Hume Plasterboard has made out its claim on the guarantee and this judgment gives the Court’s reasons for entering judgment with interest and costs against the second defendant. Judgment is entered against the second defendant for $219,213.14 plus interest of $17,741.67. The Second Defendant is ordered to pay the Plaintiff’s costs of the proceedings.
Victorian Legal Services Commissioner v Logan [2022] VSC 97 (28 February 2022)
An application was made by the Commissioner for the removal of the defendant's name from the Roll of persons admitted to the legal profession. The defendant did not appear or take any step in this proceeding. The Court, in making its orders, assessed the defendant's plea of guilty and failure to comply with orders.
Facts:
The Commissioner applied pursuant to s 23(1)(c) of the Legal Profession Uniform Law, on the recommendation of the designated tribunal, for the name and other particulars of the defendant, NICHOLAS PATRICK LOGAN, to be removed from the Roll of persons admitted to the legal profession. Ms Richardson is a senior investigator in the Discipline and Suitability Team of the Commissioner. The defendant did not appear or take any step in this proceeding. Initially, a process server was unable to effect service but he deposed to the efforts made to track the defendant down to effect service at a number of different residential and commercial premises.
A second process server deposed that he ‘served’ the defendant on 23 December 2021 by handing the relevant documents to the defendant’s father, Mr Logan (first name withheld), a male person, apparently above the age of 16 years, at an address in Indented Head. In these circumstances, service had not been strictly effected. Service was perfected by the order of Efthim AsJ, made 14 February 2022, pursuant to r 6.11 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic), that service of the documents was effected on 23 December 2021.
On 14 March 2018, VCAT handed down its penalty decision. Senior Member Butcher ordered that: the defendant is ineligible to apply for or be granted a new practising certificate before 1 May 2024; the defendant is to pay compensation in the sum of $32,863.86 to one of the complainants; and the defendant is referred to the Supreme Court of Victoria with a recommendation that his name be struck off the Roll of Practitioners.
Issue:
Whether or not it is necessary to remove the defendant from the Roll.
Applicable law:
Legal Profession Uniform Law Application Act 2014 (Vic) sch 1 - pursuant to which the Commissioner applied for the removal of NICHOLAS PATRICK LOGAN from the Roll of persons admitted to the legal profession.
Bolitho v Banksia Securities (No 18) [2021] VSC 666 - set out the relevant principles for striking a practitioner from the Roll.
Hughes & Vale Pty Ltd v NSW (No 2) [1955] HCA 28; (1955) 93 CLR 127 - provides that to be fit and proper, a legal practitioner must be honest, independent, able to judge what ethical conduct is required of them, and then be capable of diligently discharging the responsibilities of their office.
Sobey v Commercial and Private Agents Board (1979) 22 SASR 70 - provides that a legal practitioner must be ‘possessed of sufficient moral integrity and rectitude of character as to permit him to be safely accredited to the public, without further inquiry, as a person to be entrusted with the sort of work which the licence entails.
Victorian Legal Services Board v Gobbo [2020] VSC 692 - provides that whether a practitioner fails to meet these criteria is a fact-sensitive inquiry.
A Solicitor v Law Society (NSW) [2004] HCA 1; (2004) 216 CLR 253 - provides that the court must also inquire into whether the practitioner has insight into, and fully appreciates, the gravity of his wrongdoing and has demonstrated effective rehabilitation.
MN Legal and Management Consultants Pty Ltd v The Council of the Law Society of New South Wales [2018] NSWSC 1410 - Davies J identified the inherent requirements for assessing the fitness and propriety of a legal practitioner.
Guss v The Law Institute of Victoria [2006] VSCA 88 - provides that it is difficult to overstate the importance in the administration of justice of the paramount duty of a legal practitioner not to mislead the court.
Legal Services Commissioner v Logan (Legal Practice) [2014] VCAT 345 - VCAT Senior Member Butcher found the defendant guilty of misconduct at common law for sending a letter containing a threat which would reasonably be regarded as disgraceful or dishonourable.
Victorian Legal Services Commissioner v Logan (Legal Practice) [2016] VCAT 544 - VCAT Senior Member Butcher found the defendant guilty of two charges of misconduct at common law for acting, issuing and maintaining proceedings without instructions and conducting litigation without seeking instructions or properly advising the client, and one charge of professional misconduct for allowing dishonest letters to be sent.
Victorian Legal Services Commissioner v Logan (Legal Practice) [2016] VCAT 1193 - VCAT accepted an undertaking from the defendant as to the manner in which he would practice in the future and ordered that the defendant’s local practising certificate be suspended with effect from 1 September 2016 until 30 June 2017 and that he pay the Commissioner’s costs.
Victorian Legal Services Commissioner v Logan (Legal Practice) [2016] VCAT 1963 - VCAT Member Wentworth found the defendant guilty of two charges of professional misconduct and one charge of unsatisfactory professional conduct for making trust account payments to a repairer without notice to a third party factorer/financier.
Victorian Legal Services Commissioner v Logan (Legal Practice) [2017] VCAT 189 - where it was held that in failing to act upon the opportunity extended to him in the form of the Undertaking and the leniency of the prior reprimands, the Respondent has demonstrated a flagrant disregard for the most basic obligations placed upon a solicitor towards his clients.
Analysis:
Mr Logan has pleaded guilty to all charges. However, in doing so he stated that he did so in order to 'save costs'. This indicates a lack of insight into and acceptance of the wrongfulness of his conduct and although it has shortened the proceedings for which credit is given, it deprives him of the full benefit/credit which might otherwise be given to a plea of guilty. Mr Logan has at no time expressed any remorse or offered any apology for his conduct either to the Commissioner, the Tribunal or the complainants. Mr Logan has not paid or offered any compensation to Mr Palmieri.
Mr Logan has not co-operated with the Commissioner during the Commissioner's investigation of complaints and indeed has attempted to mislead the Commissioner. The defendant’s failure to comply with orders of the Tribunal to pay costs ordered and, more significantly, to pay the compensation of $32,863.86 ordered on 14 March 2018 in favour of a complainant, is ongoing. This, the Commissioner submitted, is indicative of a lack of respect for the orders and a lack of insight as to the seriousness of his conduct.
Conclusion:
The Court ordered that the name and other particulars of the defendant, NICHOLAS PATRICK LOGAN, be removed from the Roll of persons admitted to the legal profession kept by this Court on the application of the plaintiff, the Victorian Legal Services Commissioner (‘Commissioner’). The defendant is to pay the Commissioner’s costs.
Chen v Blockchain Global Ltd; Abel v Blockchain Global Ltd [2022] VSC 92 (28 February 2022)
The plaintiff applied for preservation of property. If the seed phrase of Mr Chen or Mr Guo is lost, forgotten or corrupted, the Bitcoins will become inaccessible. The Court, in making its orders, assessed whether destruction of the Bitcoin will vitiate the ultimate determination of the proceeding and whether an order preserving the Bitcoin will cause prejudice to the parties.
Facts:
Mr Chen seeks relief under r 37.01(1) of the Rules. He is the fifth defendant in proceeding no S ECI 2021 03329 (‘the Abel proceeding’) and the plaintiff in proceeding no S ECI 2020 03554 (‘the Chen proceeding’). By a summons filed 15 November 2021 in the Chen proceeding, Mr Chen sought a mandatory injunction and/or an order under rule 37.01(1) of the Supreme Court (General Civil Procedure) Rules 2015 (“Rules”) that the Plaintiff and Second Defendant place their seed phrase in respect of the Security Wallet (as defined in the Plaintiff’s Amended Statement of Claim of 23 March 2021) into separate sealed envelopes (“Envelopes”) (the seed phrase will be verified by a member of the Court) and the Envelopes will be held in the custody of the Court pending the hearing and determination of this dispute or further order.
Mr Chen also filed a summons on 15 November 2021 in the Abel proceeding in substantially the same terms. Mr Chen does not, at this stage, seek relief in the Abel proceeding and seeks that the summons in the Abel proceeding be adjourned. Mr Chen provided a proposed form of order in the Chen proceeding in which he sought that the Plaintiff and Second Defendant each place (and do all things necessary to place) their seed phrase in respect of the Security Wallet (as defined in the Plaintiff’s Amended Statement of Claim of 23 March 2021) into separate sealed envelopes (“Envelopes”) (each seed phrase will be verified by a member of the Court or by an affidavit from the that party’s solicitor confirming the veracity of the seed phrase) and the Envelopes will be held in the custody of the Court pending the hearing and determination of this dispute or until further order.
As at 10 September 2021, the value of the Bitcoins was approximately $10,344,904.30 AUD. The price of Bitcoin is extremely volatile. It has lost 30% of its value since November 2021. On 13 September 2021, the Court made a freezing order, upon the application by the plaintiffs in the Abel proceeding, in respect of the Bitcoins.
On 16 September 2021, the Court extended the freezing order until trial or further order. The plaintiffs in the Abel proceeding relied upon an article published in the Australian Financial Review (the Article) outlining the existence of 117.33 Bitcoins which are the central focus of ongoing litigation. The Security Wallet is a ‘2 of 2’ wallet which means that 2 out of 2 signatories need to authorise a transaction to make a transfer out of it. As a result, the Bitcoins are accessible only by Mr Chen and Mr Guo entering their respective seed phrases into certain software.
In the event that the seed phrase of Mr Chen or Mr Guo is lost, forgotten or corrupted, the Bitcoins will become inaccessible. All the Defendants claim ownership of the 117.33 Bitcoins, and therefore there is a possibility of either removing, disposing or dealing with the 117.33 Bitcoins to avoid any payment to the Plaintiffs. The disposal of the 117.33 Bitcoins may result in a judgement which cannot be satisfied.
Issues:
I. Whether an order preserving the Bitcoin is relevant to the cause of action.
II. Whether destruction of the Bitcoin will vitiate the ultimate determination of the proceeding.
III. Whether an order preserving the Bitcoin will cause prejudice to the parties.
Applicable law:
Supreme Court (General Civil Procedure) Rules 2015 (Vic) s 37.01(1) - expressly grants the Court broad power to make an order for the interim preservation of any property in specie, whether or not in the possession, custody or power of any party.
Greenberger v State of Victoria [2008] VSC 357 - provides that rule 37.01 or its various predecessors has been considered on several occasions by judges of this court. Each of those cases demonstrate that on such an application a court would not investigate the merits of a particular claim.
Pizzey Properties Pty Ltd v Edelstein [1977] VicRp 19; [1977] VR 161 - provides that orders should not be made for the purpose of giving security for the satisfaction of a money judgment or in lieu of other orders restraining a party from behaving in a particular way which may be available in other circumstances under the rules.
Johnson v Tobacco Leaf Marketing Board [1967] VicRp 45; [1967] VR 427 - provides that when an application is based upon the provisions of that rule, an inquiry into the merits is not required.
Analysis:
The Court’s proposed orders do not involve Mr Guo disturbing the safe storage of the single piece of paper that presently records his seed phrase. That seed phrase may be readily copied in situ by photographing it or recording the seed phrase. Mr Guo’s present single piece of paper concerning his seed phrase may remain where it is presently stored. The Court’s proposed orders do not require Mr Guo to provide a record of the seed phrase ‘forthwith’ but gives him a reasonable time to arrange this.
In the event that Mr Guo cannot comply with the orders of the Court, he will have the opportunity to provide that explanation to the Court. The Court’s proposed orders allow the issue of verification to be properly addressed by the parties and considered by the Court. Mr Chen’s proposed course of verification is, at present, based upon a step-by-step guide created by Mr Chen. The Court is not in a position, upon the present material, to evaluate that process. Further, there is no prejudice in the issue of verification being considered once the seed phrases are obtained.
Conclusion:
The Court adjourns Mr Chen’s summons in the Abel proceeding and reserves the costs. Relief is granted in the Chen proceeding substantially in the form of the Court’s proposed orders. It is the court's preliminary view that the issue of costs should be adjourned together with the further hearing of Mr Chen’s summons. The parties are directed to confer and provide a form of orders to the Court by no later than 10:00am tomorrow or provide their form of order to the Court by that time and the matter will then be listed tomorrow. The Court will shortly circulate a draft form of order to facilitate that conferral.
Kassam v Hazzard; Henry v Hazzard [2021] NSWSC 1320 (15 October 2021)
In light of the Delta variant of COVID-19, the Minister for Health and Medical Research made orders affecting freedoms of the citizens and imposing burdens on those unvaccinated. The plaintiffs contend that the orders were violative of s 51(xxiiiA) of the Constitution and that the differential treatment of unvaccinated persons were inconsistent with objects of Public Health Act. The Court, in deciding whether or not to grant the grounds raised by the plaintiffs, assessed the impugned orders on the rights and freedoms of those persons who chose not be vaccinated.
Facts:
The highly contagious variant of COVID-19 known as the Delta variant was first detected in the community in New South Wales in June 2021. In response to its rapid spreading and the threat to public health, the Minister for Health and Medical Research, the Honourable Bradley Hazzard, (the “Minister”), made various orders which affected freedoms of the citizens and imposed burdens on those unvaccinated. It prevented so-called “authorised workers” from leaving an affected “area of concern” that they resided in, and prevent some people from working in the construction, aged care and education sectors, unless they have been vaccinated with one of the approved COVID-19 vaccines.
The Kassam plaintiffs brought the proceedings who contend that the Public Health (COVID‑19 Additional Restrictions for Delta Outbreak) Order (No 2) 2021 (NSW) (“Order (No 2)”), and s 7 of the PHA, are invalid. They are suing the Minister, the Chief Medical Officer, Dr Kerry Chant, the State of NSW (the “State parties”) and the Commonwealth of Australia as they made an informed choice to not get vaccinated. The grounds for establishing the invalidity of (Order No 2) are the following: the Minister did not undertake any real exercise of power in making the order (Ground A); that Order (No 2) is either outside of the power conferred by s 7 or represents an unreasonable exercise of the power because of its effect on fundamental rights and freedoms (Ground B); and the manner in which Order (No 2) was made was unreasonable (Ground C).
The Kassam plaintiffs further contend that the order confers powers on police officers that are inconsistent with the Law Enforcement (Powers and Responsibilities) Act 2002 (NSW) (“LEPRA”) (Ground D). The order, along with s 7 of the PHA, are submitted by the Kassam plaintiffs as rendered invalid by s 51(xxiiiA) of the Constitution (Ground E) and otherwise inconsistent with the Australian Immunisation Register Act 2015 (Constitution, s 109) (Ground F).
Proceedings were also brought by the Henry plaintiffs as they too refuse to be vaccinated. They sue the Minister, seeking declarations that Order (No 2) is invalid along with the Public Health (COVID‑19 Aged Care Facilities) Order 2021 (NSW) (the “Aged Care Order”) and the Public Health (COVID-19 Vaccination of Education and Care Workers) Order 2021 (NSW) (the “Education Order”; and collectively the “impugned orders”). They allege that the impugned orders are beyond the scope of s 7(2) of the PHA (Ground 1); that they were made for an improper purpose (Ground 2), that in making them the Minister failed to have regard to various relevant considerations (Ground 3); asked the wrong question or took into account irrelevant considerations (Ground 4); was obliged to but failed to afford them natural justice (Ground 5) and acted unreasonably (Ground 6).
On the evening of 3 October 2021, pending completion of the hearings, the Minister made Public Health (COVID-19 General) Order 2021, repealing Order (No 2) with effect from the beginning of 11 October 2021. Both plaintiffs confirmed that they sought declaratory relief concerning its invalidity (or least parts of it). Further, the Aged Care Order and the Education Order continue to have effect.
Issues:
I. Whether or not the orders and section 7 of the Public Health Act rendered invalid by s 51(xxiiiA) of the Constitution.
II. Whether or not the power limited by reference to other powers conferred by the Public Health Act as a whole.
III. Whether or not the principle of legality engaged by impugned orders.
IV. Whether or not differential treatment of unvaccinated persons is consistent with objects of Public Health Act.
Applicable law:
Australian Immunisation Register Act 2015 (Cth) - establishes and provides for an immunisation register.
Constitution - provides the individual's implied right not to be conscripted to take part in a vaccination program amounting to a medical service provided to the public.
Constitution Alteration (Social Services) Act 1946 - conferred upon the Federal Parliament legislative power to make laws for the peace, order and good government of the Commonwealth.
Disability Discrimination Act 1992 (Cth) - the definition of “disability” in s 4 of the DDA includes having present in a person’s body a disease and includes a disease that “may exist in the future” as well as a disability that may be “imputed to a person”.
Education Act 1990 (NSW) - where an Education Order only applies in respect of persons physically attending “at” the places listed in subparagraphs (a), (b), (c) and (e) of the definition of relevant work.
Education Standards Authority Act 2013 - provides assessments of application for registration for home schooling which are carried out by authorized persons which include "inspectors" appointed pursuant to this Act.
Evidence Act 1995 (Cth) - wherein evidence that was given about COVID-19 vaccines, and reasons for rejecting them, was only allowed to be used to establish beliefs and opinions.
Health Insurance Act 1973 (Cth) - where the practical effect of the scheme for the payment of medical benefits does not amount to civil conscription in that it did not compel a medical practitioner, legally or practically, to provide a service on behalf of the Commonwealth or at all to treat any patient or particular patient.
Health Records and Information Privacy Act 2002 (NSW) - specifies that the Act applies to, inter alia, an “organisation that ... collects, holds or uses health information”.
Interpretation Act 1987 - supports material presumably on the basis that it confirms that the meaning of s 7(2) is “the ordinary meaning conveyed by the text of the provision”.
Personal Information Protection Act 1998 (NSW) - provides for the individual’s rights to anonymity and privacy.
Privacy Act 1988 (Cth) - precludes an “APP entity” that holds personal information that was collected for a particular purpose from using or disclosing that information to another person unless the individual has consented to the disclosure.
Public Health Act 2010 (NSW) s 3(1) - includes “promot[ing], protect[ing] and improv[ing] public health”, “control[ling] the risks to public health” and “prevent[ing] the spread of infectious diseases” as objects of the Act.
State Emergency and Rescue Management Act 1989 (NSW) - provides that action may not be taken, and an order has no effect, in relation to any part of the State for which a state of emergency exists under this Act.
Public Health (COVID‑19 Additional Restrictions for Delta Outbreak) Order (No 2) 2021 (NSW) - provides the grounds for concluding that there is a risk to public health.
Public Health (COVID‑19 Aged Care Facilities) Order 2021 (NSW) - provides that unvaccinated workers not enter residential aged care facilities.
Public Health (COVID-19 Vaccination of Education and Care Workers) Order 2021 (NSW) - where the Minister directs that an education and care worker must not carry out relevant work on or after 8 November 2021 unless the worker has—
(a) had 2 doses of a COVID-19 vaccine, or
(b) been issued with a medical contraindication certificate.
Public Health (COVID-19 General) Order 2021 - made on the evening of 3 October 2021 by the Minister which repealed Order (No 2) with effect from the beginning of 11 October 2021.
Abebe v Commonwealth (1999) 197 CLR 510; [1999] HCA 14 - where it was held that a contention about the supposed lack of scientific certainty about the safety and efficacy of the vaccines is a factual assertion not a relevant consideration.
Alexandra Private Geriatric Hospital Pty Ltd v Commonwealth (1987) 162 CLR 271; [1987] HCA 6- provided that the reference in s 51(xxiiiA) to the provision of the benefits is confined to the provision of those benefits by the Commonwealth.
Anthony Hordern & Sons Ltd v Amalgamated Clothing and Allied Trades Union of Australia (1932) 47 CLR 1; [1932] HCA 9 - held that when the Legislature explicitly gives a power by a particular provision which prescribes the mode in which it shall be exercised and the conditions and restrictions which must be observed, it excludes the operation of general expressions in the same instrument which might otherwise have been relied upon for the same power.
ASIC v Hellicar (2012) 247 CLR 345; [2012] HCA 17 - provided that a Jones v Dunkel inference entitles a court to, inter alia, draw an inference unfavourable to a party from their failure to call a witness whom that party would have expected to call.
Associated Province Picture Houses Ltd v Wednesbury Corporation [1947] EWCA Civ 1; [1948] 1 KB 223 - provided for a classic example of unreasonableness where a teacher have been dismissed because they had red hair and how such decision does not reflect a common law right, privilege or entitlement not to be discriminated against but instead are a reflection of the courts’ jurisdiction to supervise the proper exercise of public powers.
Athavle v State of New South Wales [2021] FCA 1075 - where the basis of challenge was the effect of lockdowns on freedom of religion.
Attorney-General (SA) v Corporation of the City of Adelaide (2013) 249 CLR 1; [2013] HCA 3 - where if the impugned orders were found to have a legislative character, then the threshold for demonstrating that they were unreasonable is especially high.
Australian Conservation Foundation Inc v Commonwealth (1980) 146 CLR 493; [1980] HCA 53 - provided that the limitation on their freedom of movement imposed by provisions was sufficient to give a “special interest” in their validity and thus standing to challenge them.
Australian Securities and Investments Commission v DB Management Pty Ltd (2000) 199 CLR 321; [2000] HCA 7 - provided that so far as the abrogation of particular rights are concerned, the presumption is of little assistance in construing a statutory scheme when abrogation is the “very thing which the legislation sets out to achieve”.
Baldwin v State of New South Wales [2020] NSWCA 112 - provides the contention that clauses 4.3(3A)(b) and 5.8(3)(b) of Order (No 2) which in some circumstances require a person to produce evidence of their identity, residence and vaccination status, violate their privilege against self-incrimination.
Blatch v Archer [1774] EngR 2; (1774) 1 Cowp 63; 98 ER 969 - enunciated the maxim that all evidence is to be weighed according to the proof which it was in the power of one side to have produced.
Botany Bay City Council and Others v Minister of State for Transport and Regional Development [1996] FCA 1507; (1996) 66 FCR 537 - where the obligation to afford natural justice in relation to the impugned orders is not synonymous with someone having standing to challenge them.
Bread Manufacturers of New South Wales v Evans (1981) 180 CLR 404; [1981] HCA 69 - where if the impugned orders were classified as legislative acts, then no duty to afford procedural fairness arose, although the classification of the power as legislative is not necessarily determinative.
British Medical Authority v The Commonwealth (1949) 79 CLR 201; [1949] HCA 44 - observed that one of the “most successful means of compulsion of services is to be found in the deprivation of means of subsistence”.
Castle v Director General, State Emergency Service [2008] NSWCA 231 - stated that one limitation on the operation of the duty to accord procedural fairness arises from the need to identify the obligation by reference to an individual or class of persons.
Coco v The Queen (1994) 179 CLR 427; [1994] HCA 15 - provided that absence of a clear indication to the contrary, it is presumed that statutes are not intended to modify or abrogate fundamental rights.
Commonwealth v Progress Advertising & Press Agency Co Pty Ltd (1910) 10 CLR 457; [1910] HCA 28 - where in the context of the exercise of a power that deals with a “risk” and “its possible consequences”, “necessary” does not mean “absolutely or essentially necessary” but instead means “appropriate and adapted”.
Corporation of the City of Enfield v Development Assessment Commission (2000) 199 CLR 135; [2000] HCA 5 - where the exercise of a statutory power is conditioned on the existence of a subjective state of mind of a public official the provision conferring the power is usually construed as though that state of mind was formed reasonably.
Electrolux Home Products Pty Ltd v Australian Workers Union (2004) 221 CLR 309; [2004] HCA 40 - provided that “the assistance to be gained from [the] presumption will vary with the context in which it is applied”.
Environment Protection Authority v Caltex Refining Co Pty Ltd (1993) 178 CLR 477; [1993] HCA 74 - held that the privilege against self-incrimination protects an accused person who is required by process of law to produce documents which tend to implicate that person in the commission of the offence charged.
Fairfax Media Publications Pty Ltd v Kermode (2011) 81 NSWLR 157; [2011] NSWCA 174 - considered it highly doubtful that an internal Department report not shown to have been laid before a House of Parliament can be relied upon.
G v H (1994) 181 CLR 387; [1994] HCA 48 - provided that Jones v Dunkel is but an example of the maxim enunciated in Blatch v Archer that all evidence is to be weighed according to the proof which it was in the power of one side to have produced.
Gorman v McKnight [2020] NSWCA 20 - the High Court has not considered the judgment of La Forest, Gonthier and Cory JJ in Norberg and nor has the Court of Appeal (other than on the issue of whether consent is a defence or an element of the offence.
Griffith University v Tang (2005) 221 CLR 99; [2005] HCA 7 - provided that Professor Bhattacharya did not directly address the terms or substance of any of the impugned instruments in that case.
Henry & Ors v Hazzard (No 2) [2021] NSWSC 1235 - Cavanagh J upheld a claim that they should be withheld from production under ss 130 and 131A of the Evidence Act.
Hepples v Federal Commissioner of Taxation [1992] HCA 3; (1992) 173 CLR 492 - provided that common law struck down unreasonable contractual restraints of trade, but that has nothing to do with provisions such as s 7 of the PHA.
Hunter and New England Area Health Service v A (2009) 74 NSWLR 88; [2009] NSWSC 761 - provided that what appears to be a valid consent given by a capable adult may be ineffective if it does not represent the independent exercise of persons volition: if, by some means, the person’s will has been overborne or the decision is the result of undue influence, or of some other vitiating circumstance.
Jones v Dunkel (1959) 101 CLR 298; [1959] HCA 8 - an example of the maxim enunciated in Blatch v Archer that all evidence is to be weighed according to the proof which it was in the power of one side to have produced.
Kimber v Sapphire Coast Community Aged Care Ltd [2021] FWCB 6015 - an unfair dismissal case that addressed whether an employee who objected to being vaccinated could be reinstated to work at an aged care centre.
Kioa v West (1985) 159 CLR 550; [1985] HCA 81 - where if the impugned orders were classified as legislative acts, then no duty to afford procedural fairness arose, although the classification of the power as legislative is not necessarily determinative.
Lebanese Moslem Association v Minister for Immigration and Ethnic Affairs (1986) 11 FCR 543; [1986] FCA 290 - where Pincus J described the various burdens on the time of Ministers which would be imposed by giving evidence in Court proceedings.
Lee v New South Wales Crime Commission (2013) 251 CLR 196; [2013] HCA 39 - Gageler and Keane JJ stated that the “[a]pplication of the principle of construction is not confined to the protection of rights, freedoms or immunities that are hard-edged, of long standing or recognised and enforceable or otherwise protected at common law” but “extends to the protection of fundamental principles and systemic values”.
McWilliam v Civil Aviation Safety Authority (2004) 142 FCR 474; [2004] FCA 1701 - provided that orders made under s 7(2) could, depending on their content, be either an administrative act or have a legislative quality.
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24; [1986] HCA 40 - where the ground of a failure to take into account a relevant consideration can only be made out if the Minister failed to take into account a consideration which he was bound by the statute to take into account in making that decision.
Minister for Immigration and Border Protection v Stretton [2016] FCAFC 11 - where it was held that Wednesbury, and decisions like it, do not reflect a common law right, privilege or entitlement not to be discriminated against but instead are a reflection of the courts’ jurisdiction to supervise the proper exercise of public powers.
Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507; [2001] HCA 17 - Callian J observed that it is unnecessary to decide in this case whether the rule [in Jones v Dunkel] should have application to a Minister in modern times. But on any view it cannot be applied in any unqualified way to a modern Minister of State, and not just for the reasons that Pincus J described as cogent.
Minister for Immigration and Multicultural and Indigenous Affairs v Nystrom (2006) 228 CLR 566; [2006] HCA 50 - provided that the principle in Anthony Hordern is not engaged where the two powers do not deal with the same subject matter.
Norberg v Wynrib [1992] 2 SCR 226 - their Honours held that not only could consent to an assault be vitiated by force, threats of force, fraud or deceit as to the nature of the defendant’s conduct (at 246) but, based on principles of “unconscionability”, found it is also vitiated where there exists proven inequality between the parties and proven “exploitation”.
P J Magennis Pty Ltd v Commonwealth (1949) 80 CLR 382; [1949] HCA 66 - a majority of the High Court held the Commonwealth exceeded its powers by entering into an intergovernmental agreement with NSW that provided for an infringement of the just terms guarantee in s 51(xxxi).
Pye v Renshaw (1951) 84 CLR 58; [1951[ HCA 8 - where the express words of s 51(xxiiiA) suggests to the contrary as do the cases just noted. If s 51(xxxi) does not bind the States.
Reid v Sinderberry (1944) 68 CLR 504; [1944] HCA 15 - provided that the phrase “civil conscription” has its origins in the debate about whether “industrial conscription”, that is, the use of compulsory civilian labour, would or would not be deployed in the war effort, as it eventually was.
RG Capital Radio Ltd v Australian Broadcasting Authority (2001) FCR 185; [2001] FCA 855 - pointed to the fact that s 7 contemplates that the making of rules that may be expressed in wide terms and which attract a criminal sanction under s 10 such that in that case they would have a legislative character.
Rogers v Whitaker (1992) 175 CLR 479; [1992] HCA 58 - provided that so far as batteries occasioned by medical treatment are concerned, “the consent necessary to negative the offence of battery is satisfied by the patient being advised in broad terms of the nature of the procedure to be performed”.
Secretary, Department of Family and Community Services v Hayward (a pseudonym) (2018) 98 NSWLR 599; [2018] NSWCA 209 - Payne JJA held that in order to apply the principle of legality, it is necessary to identify with a degree of precision that fundamental right, freedom or immunity which is said to be curtailed or abrogated, or that specific element of the general system of law which is similarly affected. Any presumption of non-interference by general words will carry greater or lesser weight according to the precise issues identified.
Sidaway v Bethlehem Royal Hospital Governors [1984] QB 493 - provided that consent can be vitiated by such matters as fraud or misrepresentation although that has been limited to the nature of what has been proposed to be done.
Spencer v Commonwealth (2018) 262 FCR 344; [2018] FCAFC 17 - where it is alleged that the State has affected an acquisition of property, s 51(xxxi) will not apply unless the State is required under an intergovernmental agreement with the Commonwealth to acquire the property on other than just terms.
State of New South Wales v Public Transport Ticketing Corporation [2011] NSWCA 60 - where the Crisis Policy Committee is to be treated as a Cabinet committee.
Transport Action Group Against Motorways Inc v Roads and Traffic Authority (1996) 44 NSWLR 598; [1996] HCA 196 - an instance of the contention that decisions affecting a very wide class of persons will not normally attract a duty to afford procedural fairness
Work Health Authority v Outback Ballooning Pty Ltd (2019) 266 CLR 428; [2019] HCA 2 - set out the test for applying s 109 binding on this Court.
X7 v Australian Crime Commission (2013) 248 CLR 92; [2013] HCA 29 - provided that one of the principles and systemic values which covered the principle of construction is the accusatorial nature of the criminal justice system.
Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 - it is not the Court’s function to determine the merits of the exercise of the power by the Minister to make the impugned orders, much less for the Court to choose between plausible responses to the risks to the public health posed by the Delta variant.
Analysis:
Order (No 2) does not effect any form of civil conscription as referred to in s 51(xxiiiA) of the Constitution and, even if it did, the prohibition on civil conscription does not apply to laws made by the State of NSW. One of the main grounds of challenge in both cases concerns the effect of the impugned orders on the rights and freedoms of those persons who chose not be vaccinated, especially their “freedom” or “right” to their own bodily integrity. The Court’s only function is to determine the legal validity of the impugned orders which includes considering whether it has been shown that no Minister acting reasonably could have considered them necessary to deal with the identified risk to public health and its possible consequences. The impugned orders do not authorise the involuntary vaccination of anyone.
Curtailing the free movement of persons including their movement to and at work are the very type of restrictions that the PHA clearly authorises. The differential treatment of people according to their vaccination status is not arbitrary. Instead, it applies a discrimen, namely vaccination status, that on the evidence and the approach taken by the Minister is very much consistent with the objectives of the PHA. It was not demonstrated that the making of Order (No 2) was not a genuine exercise of power or that it involved any failure to ask the right question or any failure to take into account relevant considerations much less that it was undertaken for an improper purpose.
The Minister was not obliged to afford the plaintiffs or anyone else procedural fairness in making the impugned orders. The orders were also not demonstrated to be unreasonable or that its effects could be considered unreasonable.
Conclusion:
The Court concluded that the orders do not violate the right to body integrity. Order (No 2) does not effect any form of civil conscription as referred to in s 51(xxiiiA) of the Constitution. The principle of legality does not justify the reading down of s 7(2) of the PHA to preclude limitations on the freedom of movement. No aspect of Order (No 2) was shown to be inconsistent with LEPRA.
The Court dismissed the proceedings. On or before 22 October 2021, the parties should confer in relation to the appropriate orders as to costs. In the event that agreement is reached on the appropriate orders as to costs, the parties should file the proposed orders on or before 5.00pm on 25 October 2021. In the event that no agreement is reached on the appropriate orders as to costs, each party file and serve:
(i) their proposed orders as to costs and any submissions in support of the proposed orders that are not to exceed four pages on or before 5.00pm on 29 October 2021;
(ii) any submissions in reply that do not exceed four pages on or before 5.00pm on 5 November 2021.
Pearl v Nannegari & Ors [2021] VSC 468 (5 August 2021)
The parties entered into a contract of sale of real property with the contract being subject to the purchaser obtaining finance. The date for obtaining finance was extended however the parties' discussion regarding further extension did not result in an agreement for further extension. The Court, in deciding whether or not the termination of contract was effected, relied on Property Law Act 1958.
Facts:
The plaintiff, Marcus Wilmot Pearl (‘Mr Pearl’), and the first defendant, Abhishek Nannegari (‘Mr Nannegari’), entered into a contract of sale for the purchase of a property at 185 Danks Street, Albert Park (‘the property’) on 26 March 2020.
A handwritten notation on the contract, accepted by both parties as being written by the real estate agent, specified that an initial deposit of $10,000 was paid and the remaining balance of the deposit was to be due ‘once finance [was] approved’.
Settlement was due to occur on 12 June 2020 but the defendants were still unable to obtain finance, they were granted an extension of time to do so until 20 April 2020. The defendants sought an additional extension of the finance approval date to 4 May 2020 but was not granted.
The defendants’ solicitors sent a letter to the plaintiff’s solicitors stating that the contract was terminated, and indicating the defendant's’ intention to lodge a caveat on the title to the property should the $10,000 advanced as part of the deposit not be refunded by 5 May 2020.
The plaintiff seeks that the $10,000 deposit money paid by the defendants be forfeited to the plaintiff and that the remaining balance of $158,000 be paid. The contract of sale is sought to be declared as validly terminated by reason of a material breach of the contract on the part of the first defendant.
Issues:
I. Whether or not notice served by defendant terminating the contract was out of time.
II. Whether or not the plaintiff is estopped from treating notice as out of time.
III. Whether notice of default served by plaintiff terminated contract
IV. Whether contract terminated by plaintiff’s acceptance of first defendant’s repudiation of contract
Applicable law:
Property Law Act 1958 s 49(1) - provides that a vendor or purchaser of any interest in land, or their representatives respectively, may apply to the Court, in respect of any requisitions or objections, or any claim for compensation, or any other question arising out of or connected with the contract (not being a question affecting the existence or validity of the contract), and the Court may make such order upon the application as to the Court may appear just, and may order how and by whom all or any of the costs of and incident to the application are to be borne and paid.
Legione v Hateley [1983] HCA 11; (1983) 152 CLR 406 - held that a representation must be clear before it can found an estoppel, and the party acting in reliance on the representation must be in a position of material disadvantage if the departure from the representation is permitted.
Aussie Invest Corp Pty Ltd v Pulcesia Pty Ltd [2005] VSC 362; (2005) 13 VR 168 - where Dodds-Streeton J held that although the discretion conferred by s 49(2) was ‘unfettered, its exercise is “the exception rather than the rule” and will not be justified merely because the vendor will obtain a windfall’.
Shepherd v Felt and Textiles of Australia Ltd (1931) 45 CLR 359, 378 - provided that a contracting party who, after he has become entitled to refuse performance of his contractual obligations, gives a wrong reason for his refusal, does not thereby deprive himself of a justification which in fact existed, whether he was aware of it or not.
Havyn Pty Ltd v Webster [2005] NSWCA 182; (2005) 12 BPR 22,837 - provided that in defending an application for the repayment of a deposit pursuant to s 49(2) PLA, purchasers must do more than establish that forfeiture of the deposit would result in a financial ‘windfall’ to the vendor, as will usually be the case.
Simcevski v Dixon (No 2) (2017) 53 VR 357, 383 [93] - where Riordan J held that the discretion under s 49(2) to order the return of a deposit was conditioned by recognition of the critical function of a deposit being an earnest for contractual performance.
Analysis:
The first defendant believed that the finance approval date would not be strictly enforced and therefore did not rescind the contract within two clear business days of the approval date pursuant to general condition 14.2.
The plaintiff submits that the email dated 28 April 2020 sent by Happy Conveyancing, on behalf of the first defendant, to the plaintiff’s solicitors was ineffective to validly terminate the contract pursuant to general condition 14.2 because the necessary preconditions outlined in the sub-clause had not been satisfied. Unless the plaintiff is estopped from treating the email of 28 April 2020 as being out of time, the defendants were not entitled to terminate the contract of sale.
Conclusion:
The court concluded that the notice served by the defendant terminating the contract was not out of time. The plaintiff was not estopped from treating notice as out of time. The notice of default served by the plaintiff terminated the contract. The contract of sale having become unconditional by 20 May 2020, the plaintiff is entitled to retain the $10,000 deposit paid and to recover the balance of the deposit of $158,000 as a debt.
R v Macdonald; R v Edward Obeid; R v Moses Obeid (No 17) [2021] NSWSC 858 (19 July 2021)
The accused were charged of conspiracy to commit the common law offence of wilful misconduct in public office. In disputing their charge, they alleged that their indictment did not disclose and offence known to law. A joint trial of the three co-accused was commenced, discussing the elements of conspiracy and the overt acts of the accused.
Facts:
Ian Michael Macdonald (Macdonald) in the course of or connected to his public office as Minister for Mineral Resources was doing acts in connection with the granting of an exploration licence at Mount Penny without impartiality and in breach of Macdonald's duties of proper confidentiality. The Crown notified its intention to seek a grant of leave to amend the indictment dated 13 July 2017 and to have the accused re-arraigned on a reformulated charge of conspiracy to commit the common law offence of wilful misconduct in public office.
The application for leave to amend the indictment was opposed by each of the accused alleging it was defective for latent duplicity and/or a lack of particularity in the identification of what the Crown alleged to be the acts of wilful misconduct.
On 3 - 9 April and 6 May - 6 June 2019, a draft indictment dated 8 April 2019 was served on the parties. It contained a minor amendment to the indictment dated 13 July 2017 upon which the accused were originally arraigned on 6 October 2017. The accused were not re-arraigned on the amended indictment. The accused did not oppose leave being granted to file the further amended indictment. On 12 February 2020, the Crown formally presented an indictment. On their arraignment each of the accused entered a plea of not guilty.
Issue:
Whether or not the indictment disclosed an offence known to law.
Applicable law:
Ahern v The Queen (1988) 165 CLR 87; [1988] HCA 39 - provides that the offence of misconduct in public office and a conspiracy to commit that offence are common law offences.
Evidence Act 1995 (NSW) s 87(1)(c) - provides for the co-conspirators rule and evidence which may be used to prove the participation of each of the accused in the conspiracy beyond reasonable doubt.
Analysis:
In any trial where a conspiracy is alleged, a clear distinction must be made and maintained between the existence of the conspiracy that is alleged and the participation of each of the alleged conspirators in it. Proof of both facts, to the criminal standard, is essential to proof of guilt.
The Crown stated that Edward Obeid and Moses Obeid had the hope or expectation, however fervently held, that Mr Macdonald would misconduct himself as the Minister for Mineral Resources in connection with the granting of an exploration licence (EL) at Mount Penny in a way that would be to their ultimate benefit.
Each of the accused knew that Mr Macdonald was subject to a duty of confidentiality and a duty of impartiality in the discharge of the public office he held as the Minister for Mineral Resources, and that they each knew that what he agreed that he would do in that public office would constitute a breach of either or both of those duties and obligations.
Conclusion:
The Court held that each of the accused are guilty on the charges of conspiracy to commit misconduct in public office 2020. An entry of conviction against each of them is directed.
Nenna (a pseudonym) v The Queen [2021] VSCA 183 (24 June 2021)
Applicant was convicted of sexual offending against child. The Applicant, seeking leave to appeal against conviction and sentence, alleges that the judge made comments which gave rise to a substantial miscarriage of justice.
Facts:
On 25 July 2019, the applicant was found guilty of one charge of committing an indecent act with or in the presence of a child under 16 (charge 1) and three charges of incest (charges 2, 3 and 4). On 13 September 2019, the applicant was sentenced to a total effective sentence of 18 years, with a non-parole period of 14 years. The applicant, alleging substantial miscarriage of justice, seeks leave to appeal against conviction and sentence.
The complainant is the applicant’s daughter. When the complainant was about nine, and after a woman with whom the applicant had been living moved out, the applicant began to indecently touch and then sexually penetrate the complainant. The applicant and the complainant lived with the applicant’s then partner, Linda Sefu in Australia in March 2008, when the complainant was 15. The complainant told Ms Sefu that the applicant had been having sex with her since she was a child, and that he was responsible for pregnancy. The applicant arranged for the complainant to have the pregnancy terminated. After the termination, the applicant discovered that the complainant had told Ms Sefu that he had been sexually abusing her. This went on until 2012 when the applicant told the complainant to leave home. The complainant made a statement to the police detailing the abuse.
In the course of the cross-examination, it was repeatedly put to the complainant that she was lying. Defence counsel identified a number of examples of what he submitted were lies told by the complainant. For instance, the complainant's statement in the fertility control clinic notes that the complainant had given a history of ‘losing her mum.' In the course of summarising the evidence given at trial, the judge identified a topic which she described as ‘the evidence of the disclosures made by [the complainant] over the years that her father had been sexually abusing her’.
Issue:
Whether or not the Judge's comments gave rise to substantial miscarriage of justice.
Applicable law:
McKell v The Queen [2019] HCA 5; (2019) 264 CLR 307 - provides for the ‘right’ of a trial judge to comment on disputed questions of fact.
Jury Directions Act 2015, ss 52 and 53 - provides that a victim of sexual assault may delay or hesitate in complaining about such an offence due to ignorance about the nature, quality and character of the act performed; feelings of powerlessness; fear of family dissolution or punishment for the offender; having been sworn to secrecy, or feeling compelled to secrecy by threats of harm to themselves or to other people; having feelings of responsibility, guilt or blame for the acts that occurred; having feelings of shame or embarrassment; having a fear of bringing disgrace to the family; and having a fear of not being believed.
Analysis:
The defence case at trial was that the complainant was a liar, motivated by her hatred for her father. The Honour's reference to the complainant's trigger and her remark that the jury ‘might think’ the complainant courageous for having made her disclosures, is claimed by the applicant to have conveyed emotive language to the jury. Such language of an advocate which was specifically disparaged by the High Court.
However, the cases decided before the High Court’s decision in McKell involve charges that were subject to different statutory regimes from the one given in the present case.
Conclusion:
The Court concluded that the her Honour’s use of the terms ‘disclose’ and ‘disclosure’ did not amount to a substantial miscarriage of justice. However, they added to the unfairness which we have already found was created by her comment that the lack of eyewitnesses was not particularly remarkable or unusual in this case. Usage of ‘disclose’ and ‘disclosure’ is discouraged in future cases.
The Court granted the applicant's leave to appeal, allowing the appeal, setting aside the convictions and sentences imposed, and ordering a retrial. The application for leave to appeal against sentence was held to be not necessary to be dealt with.