Bell v de Castella
[2018] ACTSC 170
•15 June 2018
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: | Bell v de Castella |
Citation: | [2018] ACTSC 170 |
Hearing Dates: | 14 November 2014; 2 February, 30 March, 26 May 2015; 16 May, 3 November 2016; 24 February 2017 |
Last Submissions Due: | 17 March 2017 |
DecisionDate: | 15 June 2018 |
Before: | Penfold J |
Decision: | 1. The court declares that in February 2016, John Bell made an agreement with Robert de Castella (in his own right and on behalf of Rob de Castella’s SmartStart for Kids Limited) to the following effect: At a meeting between John Bell and Rob de Castella: (1) John Bell will withdraw his appeal in the Supreme Court (SCA 4 of 2014) and all other actions. (2) John Bell will sell his family home and pay Rob de Castella’s lawyers the $88,000 that they are asking. (3) John Bell and Rob de Castella will shake hands and John Bell will walk away. 2. The Court refuses to order specific performance of the agreement. 3. The Court orders that John Bell pay half the costs, as agreed or assessed, of the application made on 16 May 2016, by Robert de Castella and Rob de Castella’s SmartStart for Kids Limited, for a declaration and an order for specific performance. |
Catchwords: | APPEAL – Appeal from decision of ACT Civil and Administrative Tribunal – offer of settlement allegedly made and accepted after judgment reserved – application for declaration that agreement was made and order for specific performance of agreement – whether appellant was of sound mind when agreement offered – setting aside of agreement where party of unsound mind – denial that agreement made but no refusal to perform agreement – application for specific performance premature. |
Cases Cited: | Dougan v Ley (1946) 71 CLR 142 Gibbons v Wright (1954) 91 CLR 423 Turner v Bladin (1951) 82 CLR 463 |
Parties: | William John Bell (Appellant) Robert de Castella (First Respondent) Rob de Castella’s SmartStart for Kids Limited (Second Respondent) |
Representation: | Counsel Self-represented (Appellant) Ms S Mulherin (First and Second Respondents) |
| Solicitors Self-represented (Appellant) McInnes Wilson Lawyers (First and Second Respondents) | |
File Number: | SCA 4 of 2014 |
Decision under appeal: | Court/Tribunal: ACAT Before: Senior Member Lennard Date of Decision: 26 April 2013; 27 September 2013 Case Title: Bell & de Castella Citation: [2013] ACAT 27; [2013] ACAT 65 |
Introduction
These appeals, which have a long and tortuous history referred to at [6] below, have now become a dispute about an alleged agreement between the parties to settle the matter. That alleged agreement is the subject of an application by the respondents for:
(a)a declaration that the agreement was made; and
(b)an order for specific performance of the agreement.
I have concluded that the declaration should be made but, in effect, that the application for an order for specific performance is premature and should be refused.
Procedural background
John Bell, who has represented himself throughout the proceedings, took action in the ACT Civil and Administrative Tribunal (ACAT) against Robert de Castella and Rob de Castella’s SmartStart for Kids Limited (the respondents), claiming employment discrimination by Mr de Castella on the grounds of race, profession and political conviction. On 26 April 2013, ACAT delivered its substantive decision (Bell & de Castella [2013] ACAT 27), dismissing Mr Bell’s claims, and on 27 September 2013, ACAT made a costs order in favour of the respondents in relation to the employment discrimination claim (Bell & de Castella [2013] ACAT 65).
On 8 May 2013, Mr Bell appealed from the substantive decision of ACAT, and on 22 October 2013, Mr Bell appealed against the costs order.
Mr Bell’s appeal documents indicated that he wanted the appeal heard in the Appeal Division of ACAT, but the respondents sought, and on 16 December 2013 were granted, an order removing the appeal into the Supreme Court.
Substantive background
The substantive ACAT decision set out the general background to the dispute at [10] to [13] as follows:
10. Rob de Castella’s SmartStart for Kids Limited (SmartStart) is a not-for-profit, public company limited by guarantee. As well as the Indigenous Marathon Project, SmartStart delivers primary school based health programs funded by the ACT government. Mr de Castella is one of three directors of SmartStart and the project director for the Indigenous Marathon Project. The Indigenous Marathon Project commenced in early 2009. The ultimate publicised aim of the project was to train indigenous athletes to run in the New York Marathon in November 2010. The project had other aims: film production company GoodOil Films produced a one-hour documentary following the project in its first year (the notion of producing the documentary was the catalyst for the development of the project); and to promote running and walking within indigenous communities, and healthier lifestyles. Workshops and courses in health and fitness education and assessment were developed specifically for indigenous people, including indigenous marathon runners.
11. The applicant gave evidence that he was an internationally qualified coach with specialist skills and experience over forty-five years. Mr Bell is an inductee into the Central Australian Desert Foundation League of Champions Sports Hall of Fame in relation to his AFL team coaching, individual athlete coaching and marathon running feats in remote communities. Mr Bell worked extensively with athletes with special needs, including paralympic athletes; at every level of indigenous sport from desert to elite at the Australian Institute of Sport over a period of forty-five years and has international team-leading skills and experience as head coach and team manager for numerous world athletic championships. Mr Bell gave evidence of a long association with Mr de Castella and his family including, but not limited to, Mr Bell coaching Mr de Castella’s daughter in marathon running. The applicant’s evidence as to his coaching qualifications and experience within indigenous sporting communities was accepted by the respondents and the tribunal.
12. From 1 April 2009 to 15 November 2010, the applicant was engaged as coach of the marathon runners. The applicant was not paid a salary or wages, however, he was provided with expenses, a laptop computer and mobile phone. The alleged discrimination arises from the nature of that engagement, the alleged conduct of Mr de Castella during the course of that engagement, and, the termination of that engagement.
13. The parties have been in dispute since the end of 2010. Apart from the 2 matters currently before the ACAT, similar issues have been ventilated before the Fair Work Commission and in a civil dispute contract application before ACAT. There have also been proceedings in the ACT Magistrates Court between Mr de Castella and Mr Bell.
The respondents
As already mentioned, there are two respondents in the original matter (Mr Bell’s appeal), being Mr de Castella and a company that bears his name (the company). In the ACAT substantive decision quoted at [6] above, the company is described as “a not-for-profit, public company limited by guarantee”. In this judgment I shall refer to these parties as the respondents despite the fact that they are the applicants in the application now needing to be determined.
The relationship between Mr de Castella and the company, and in particular the basis on which the company bears Mr de Castella’s name rather than that of either of the other two directors, has not become clear. However, with one exception this does not seem to matter, since both respondents have been represented by the same firm of lawyers throughout, and there are to my knowledge no claims made that refer to actions of the company as distinct from actions involving Mr de Castella; generally the matter seems to have proceeded on the basis that the interests of Mr de Castella and the company are identical, although I note the email referred to at [63] below which mentions the company separately.
The exception is that a third party who was involved in the alleged making of an agreement, and who may be involved in the performance of any such agreement, was at relevant times also a director of the company, and Mr Bell says that he did not become aware of this fact until some time after the alleged agreement was made. Except at [63] below, or where the role of the third party is relevant, I shall not refer to the second respondent company separately in this judgment.
History of the proceedings
The proceedings have been unduly protracted for various reasons, and the matter I now have to decide is quite different from the matter that originally came before me. That reflects various developments, mainly arising from actions taken by Mr Bell outside the normal course that the proceedings might have been expected to take, but also reflects that, at various points in the proceedings, my forward listings were too heavy to permit the matter being re-listed for further hearing within a reasonable period.
Preliminary proceedings
The matter was docketed to me on 31 October 2014, after the original docket judge had identified a conflict of interest.
On 14 November 2014, I made orders for the filing of various applications and submissions, and listed the matter for hearing in February 2015. In December 2014, Mr Bell sought to file a submission in accordance with my orders which, however, was accompanied by an affidavit attaching a large volume of documents obtained by him through requests to the Commonwealth government under Commonwealth freedom of information legislation. The respondents objected to the filing of some of these documents, and applied for suppression orders preventing their public release. The affidavit was not at that stage read.
An application for security for costs was filed by the respondent on 4 December 2014. That application was accompanied by an affidavit dated 4 December 2014 by John Buxton, one of the respondents’ solicitors, which estimated the respondents’ costs to that date as nearly $31,000; Mr Buxton estimated the respondents would be entitled to recover at least 75% of those costs on a party/party basis if a costs order were made in their favour.
Grounds of appeal
Mr Bell’s ground of appeal was, in general terms, that there was a reasonable apprehension of bias on the part of the tribunal member who heard the matter. Mr Bell refined his grounds of appeal to identify the following events as giving rise to an apprehension of bias or as demonstrating actual bias:
(a)During a break in the proceedings before the tribunal member, the tribunal member spoke to Mr de Castella about a matter involving her daughter and Mr de Castella’s daughter, being apparently the possession of a photograph of the two girls which she proposed to send to Mr de Castella (the tribunal member’s indirect relationship with Mr de Castella through their daughters had previously been disclosed to Mr Bell before the tribunal hearing began, and Mr Bell indicated that he did not wish to object to the tribunal member hearing his matter – this is dealt with at some length in an appendix to the reasons for the 26 April 2013 decision cited at [3] above).
(b)The tribunal member made errors of fact in her findings about the grants Mr de Castella had received from Commonwealth departments.
Mr Bell persisted in the second claim of bias despite my advice that showing that a decision-maker has made an error establishes only that an error has been made; it does not as such establish that there has been bias by the decision-maker, or that there is a basis for a claim of apprehended bias.
Mr Bell also persisted with these grounds of appeal despite my advice that even if he were successful in establishing apprehended bias on the part of the decision-maker, this would not mean that his initial claim was upheld but only that the matter could be referred back to ACAT to be heard by a different member. He noted, however, that a finding of apprehended bias would presumably have implications for the costs order made in the first ACAT hearing.
The hearing
On 2 February 2015 the hearing began. Mr Bell was given leave to file an amended notice of appeal, and certain paragraphs were struck out of his affidavit. Further affidavits were to be served. Orders were also made for the filing of documents in relation to the application for security for costs. The matter was adjourned part-heard to 30 March 2015. On 9 February 2015, orders were made in Chambers for the exchange of submissions about the costs appeal.
On 18 March and 20 March 2015, further orders were made in Chambers in relation to submissions about the two appeals.
The hearing resumed on 30 March 2015, and further orders were made about Mr Bell’s submissions on the costs appeal. The hearing was adjourned part-heard to 26 May 2015.
On 26 May 2015, the hearing concluded and judgment was reserved.
Developments after judgment reserved
Applications by Mr Bell to adduce fresh evidence
In July 2015, only a couple of months after judgment had been reserved, Mr Bell sought to have the matter re-opened and to tender further documents that he had obtained under through freedom of information applications. In August 2015 he filed an application in proceedings seeking the admission of fresh evidence in the matter.
Attempts were made to schedule a hearing of this application. The original listing for 23 October 2015 had to be vacated, and the application was relisted for 15 December 2015. On 26 October 2015, Mr Bell sought to make a further application to adduce fresh evidence, and after a delay arising from Mr Bell’s request to file the application electronically (not at that stage available under court procedures), I ordered that this could be done as permitted by the registrar.
Offer of settlement by respondents
On 9 December 2015, Shelley Mulherin, the respondents’ solicitor, wrote to Mr Bell making an offer to resolve the matter. For obvious reasons, this offer was not brought to my attention until it was mentioned in court on 16 May 2016; the letter was subsequently annexed to Mr Bell’s affidavit dated 17 February 2017. However, it provides some background to the making of Mr Bell’s offer of settlement on which the respondents’ current application depends, and is usefully set out as part of this chronology. It also suggests that when he subsequently made his offer in February 2016, Mr Bell did not properly understand the details of the respondents’ offer made on 9 December 2015.
The offer set out in Ms Mulherin’s letter proposed the dismissal of Mr Bell’s appeals, the entry into a deed of release by the parties, and the payment by Mr Bell of either:
(a)$40,000 to “our client” in full satisfaction of “his costs”; or
(b)the payment of Mr de Castella’s costs as assessed.
The letter suggested that in either case the costs could be paid “by instalments and/or a first registered mortgage to secure our client’s costs”. The letter noted that in an earlier letter offering a resolution, the process of assessment of costs in the ACT had been explained; Ms Mulherin went on:
Since our letter dated 18 February 2015, our client’s costs have increased and we presently assess that, on a party/party basis, our client would be entitled to $77,000 - $88,000 (including the costs awarded against you by the ACAT). For this reason, we consider that our offer constitutes a genuine compromise with respect to costs and we are prepared for those costs to be assessed and to be bound by the assessed figure. Alternatively, an assessment process (ie, if you accept the offer on the basis that costs are assessed) would then take place which would generally allow you to consider the costs claimed against you and make submissions about items with which you did not agree, before the costs assessor.
The respondents’ offer was not accepted.
On 15 December 2015, the listing for that day was vacated because a jury trial before me had continued beyond its scheduled listing and I was accordingly not available to hear Mr Bell’s application. The application was re-listed for hearing on 16 May 2016. Orders were made for the exchange of affidavit evidence, objections to affidavits, and submissions.
Offer of settlement by Mr Bell
Early in 2016, an exchange of emails between Mr Bell and an associate of Mr de Castella resulted in a claim by Mr de Castella that the matter had been settled by an enforceable agreement made between the parties.
The respondents applied for a declaration that the agreement had been made, and on 15 May 2016, the respondents filed an amended application also seeking an order for specific performance of any agreement declared to have been made.
Referral to mediation
On 16 May 2016, the hearing resumed. Having regard to the possibility that the parties had moved closer to resolving the matter by agreement, I referred the matter for mediation. The mediation was scheduled for 25 October 2016, and the matter was listed for mention on 3 November 2016.
The respondents agreed to participate in mediation only after Mr Bell agreed that his demand for a written apology from Mr de Castella (which had been raised in the February 2016 email exchanges) was not in fact non-negotiable. Having regard to issues raised in relation to whether an agreement had been made, it was also necessary for Mr Bell to satisfy the respondents that he had the mental capacity to take part in mediation.
The matter did not resolve at mediation. On 3 November 2016, I made further orders for the exchange of affidavits and submissions in relation to the respondents’ application for a declaration and an order for specific performance, and listed the matter for hearing on 24 February 2017.
Assessment of ACAT costs
On 11 January 2017, Senior Member Lennard of ACAT made a costs order, by consent, for Mr Bell to pay “the respondent’s costs” in the amount of $15,750. The order was to take effect 14 days after a decision in this appeal.
This order related to an assessment of the costs payable under the ACAT costs order made on 27 September 2013, which is one of the orders subject to the current appeal; the parties agree that despite the curious form of the order, it would not take effect if I decided Mr Bell’s appeal against the costs order in his favour.
Presumably as a result of an oversight, the order referred only to the second respondent, and did not mention Mr de Castella. This fact, and the form of the order more generally, was identified by Mr Bell in the last hearing as a matter contributing to his generally confused mental state, but he conceded that the ACAT assessment order had been made nearly a year after his offer to resolve the matter, and did not play a role in the making of that offer.
Ms Mulherin explained that the estimate of the respondents’ costs as up to $88,000 included the amount assessed in the ACAT order made on 27 September 2013; that is, it represented the respondents’ total costs as at the time when the estimate was made.
The current application
The respondents’ amended application, dated 15 May 2016, sought the following orders:
1.a declaration that a binding agreement has been reached between the parties;
2.an order for specific performance;
3.in the alternative, a declaration that the Appellant is estopped from denying the existence of a binding agreement between him and the Respondents;
4.the substantive appeal proceeding SCA 4 of 2015 be dismissed;
5.the Appellant pay the Respondents’ costs of this application; and
6.any other orders that the Court considers appropriate.
I note that proposed order 2 first appeared in the amended application. I assume that what became order 3 in that application was intended to be an alternative to order 1 rather than to the new order 2.
On 7 December 2016, after the respondents issued subpoenas seeking production of certain medical records, further orders were made in Chambers about the exchange of affidavits and submissions. Those orders were further varied in Chambers on 19 December 2016.
On 24 February 2017, the respondents’ application was heard, and further orders were made, in particular:
(a)for the respondents to draft a form of order setting out the relief sought in the May 2016 application and to provide brief submissions about a legal issue that arose during the hearing (both documents to be filed and served by 3 March 2017); and
(b)for Mr Bell to respond to that material by 17 March 2017.
The hearing was completed on 24 February 2017, with orders being made for further submissions to be made on one issue that had arisen during the hearing.
The respondents filed draft orders, and brief submissions, on 2 March 2017. Mr Bell did not file anything in response.
The respondents’ application – submissions
As noted, the respondents sought both a declaration that an agreement had been made and an order for specific performance of that agreement.
Was there an agreement?
The respondents submit that, as at 9 February 2016, after Mr Bell had received and read Professor Telford’s email of that date passing on Mr de Castella’s agreement to the terms proposed by Mr Bell, an agreement had been made between Mr Bell and Mr de Castella. In the draft general form of order filed by the respondents on 2 March 2017 in accordance with orders made at the 24 February hearing, the agreement is claimed to have terms to the following effect:
1. The appellant will withdraw his appeal in the Supreme Court of the Australian Capital Territory in the proceeding known as SCA 4 of 2014.
2. The appellant will sell the property known as [redacted] Heidelberg Heights, Victoria.
3. The appellant will pay $88,000 to the respondents.
4. Following the appellant carrying out the terms at 1, 2 and 3 above, the appellant and the first respondent will meet and shake hands.
Mr Bell did not make submissions about the applicable law, or about the specific terms of any agreement that might be found to have been made, but instead denied that any agreement had been reached. The basis of Mr Bell’s denial was that, on the night concerned, his mental state had been such as to deprive him of capacity to make a real offer or to enter an enforceable agreement.
At an earlier hearing, before I ordered the parties to mediation, Mr Bell had made submissions to the effect that Mr de Castella’s response to his offer constituted a counter offer which had “nullified” his earlier offer. Mr Bell conceded that he read the “counter offer” as being better than his original offer, but said that instead of accepting it he made a new offer including the requirement of an apology from Mr de Castella.
In the hearing after mediation had failed, this argument was not revived, and Mr Bell concentrated solely on his alleged incapacity to make a binding agreement.
Should the agreement be enforced, and if so how?
The respondents’ written submissions about whether specific performance should be ordered were as follows:
damages would not be an adequate remedy and would not leave [the respondents] in as favourable position [sic] in all respects as would exist if the appellant’s obligations under the agreement were specifically performed.
I accept the submission as far as it goes; while the respondents’ recovery of $88,000 in respect of costs could presumably be adequately achieved through an award of damages, it is hard to see what kind of damages award would properly compensate the respondents for a failure by Mr Bell to terminate the appeal proceedings as he had offered.
However, the submission does not address either the preliminary question whether an order for specific performance is at this stage available at all, or the further question whether there is any other obstacle to the making of such an order.
Mr Bell’s written submissions about the respondents’ application referred only to whether any agreement had been reached; nothing was said about whether, if an agreement was found to have been made, an order should be made for specific performance of the agreement.
The respondents did, after the hearing, provide draft orders including orders for specific performance, but did not address the issues mentioned above. Mr Bell was given two weeks after the draft orders were filed and served by the respondents to provide submissions in response to the draft orders prepared on behalf of the respondents, but did not provide anything.
Relevant law
Setting aside agreement where party of unsound mind
The circumstances in which an agreement can be set aside on the grounds of a party’s unsoundness of mind were considered by the High Court in Gibbons v Wright (1954) 91 CLR 423. At 441, the Court set out the relevant English law about contracts as follows:
A contract made by a person of unsound mind is not voidable at that person’s option if the other party to the contract believed at the time he made the contract that the person with whom he was dealing was of sound mind. In order to avoid a fair contract on the ground of insanity, the mental incapacity of the one must be known to the other of the contracting parties. A defendant who seeks to avoid a contract on the ground of his insanity, must plead and prove, not merely his incapacity, but also the plaintiff’s knowledge of that fact, and unless he proves these two things he cannot succeed.
The High Court was dealing with a challenge to a conveyance rather than a contract, but it began its consideration of the law relating to conveyances by implicitly adopting the English law about contracts as relevantly set out above. I do not understand there to be any dispute that the High Court’s summary of English law is also applicable in Australia.
As to the degree of unsoundness of mind or mental incapacity that would render a contract liable to be set aside, the Court said at 437:
The law does not prescribe any fixed standard of sanity as requisite for the validity of all transactions. It requires, in relation to each particular matter or piece of business transacted, that each party shall have such soundness of mind as to be capable of understanding the general nature of what he is doing by his participation.
In short, in order to avoid a declaration that an agreement had been made between Mr Bell and Mr de Castella, Mr Bell needed to establish:
(a)that when he sent the email to Professor Telford on the evening of 3 February 2016, he did not have such soundness of mind as to be capable of understanding the general nature of what he was doing, that is, making an offer to be passed on to the respondents to resolve the matter by, relevantly, withdrawing his appeal and paying the respondents’ costs; and
(b)that when the offer was accepted by Mr de Castella, he was aware that Mr Bell did not have the necessary soundness of mind.
Ordering specific performance of a contract
As noted, no submissions were made on either side about the law relating to orders for specific performance of an agreement of the kind asserted in this case, although the respondents’ submissions did assume the proposition that specific performance would not be ordered where damages would be an adequate remedy (at [48] above).
The evidence – overview
Affidavits and reports
At the hearing on 24 February 2017, the following affidavits were read:
(a)Affidavits by Mr Bell, dated 31 October 2016, 18 November 2016 and 17 February 2017 (attaching affidavits by Mr Bell dated 5 February 2017 and by Mr Grant Leslie Fry dated 5 February 2017).
(b)An affidavit by Mr de Castella, the first respondent, dated 11 May 2016.
(c)Affidavits by Ms Shelley Mulherin, solicitor for the respondents, dated 16 May 2016 and 16 January 2017.
As well, the parties tendered written material provided by:
(a)Mr Bell’s clinical psychologist, Dr Daphne Smith, to whom he was referred after the 3 February 2016 incident; and
(b)Dr John Saboisky, a psychiatrist called by the respondents.
Oral evidence
Oral evidence was given by telephone by Dr Smith and Dr Saboisky.
The emails
As at 3 February 2016, the position was that:
(a)Mr Bell’s appeals had been heard and judgment reserved;
(b)an application had been made by Mr Bell for the appeals to be re-opened and for fresh evidence to be admitted on the appeals; and
(c)the respondents had made an offer to resolve the matter.
Late in the evening of 3 February 2016, Mr Bell sent an email to Professor Dick Telford, the man who had originally introduced him and Mr de Castella. That email (the 3 February email), and several further emails exchanged between Mr Bell and Professor Telford, Professor Telford and Mr de Castella, and Mr Bell and Mr de Castella, are set out in the table below (except for the email from Professor Telford to Mr de Castella described in the table below as sent “on or about 17 February 2016”, a copy of each email is attached to at least one of the affidavits read, and the contents of the emails are not disputed). Each of Mr Bell’s emails used the subject line “An end to my dispute with Rob de Castella”.
| Date/time[1] | From | To | Text of email |
| 3 February 2016, 11:13 pm | John Bell | Dick Telford | Dear Dick I am suffering severe depressive illness and severe financial stress now over the long running issues with Rob de Castella. I also have family illness issues. It is becoming to [sic] difficult now to cope. You recommended me to Rob de Castella in 2009 for the job of Project Coach. If you agree to sit down at a meeting of the three of us at Leo’s Chocolate Shoppe in Manuka, just the three of us, I will agree to the following terms 1. I will agree to withdraw my appeal in the Supreme Court and all other actions and walk away. 2. I will agree to sell my family home and pay Rob de Castella’s lawyers the $88,000 that they are asking. 3. Rob de Castella and I will shake hands and I will walk away. 4. I will agree to the above terms if you attend the meeting, and you only. I leave it to you to pass my terms to Rob de Castella at your convenience. Kind Regards JB |
| 5 February 2016, 05:38:41 +0000 | Dick Telford | John Bell | Dear John I just noticed this email as I only occasionally check my former email address. As you requested, I rang Rob de Castella and read out your email. I will also forward it to him. I would of course do anything in my power to help end this regrettable issue. I expect Rob to get back to me and we can take it from there. With best wishes |
| 6 February 2016, 12:46 am | John Bell | Dick Telford | Dear Dick Thank you. I trust you. You are a man of integrity. I have no petrol left in the tank. This issue has taken away all my hope. Kind Regards JB |
| 8 February 2016, 3:39 pm | Robert de Castella | Dick Telford | Hi Dick Thanks for sending this through. Would you mind passing this onto John. I would be pleased to meet with him, under the terms outlined, and I would like a release confirming and agreeing to the details to be signed by Bell and myself. SSFK will also withdraw our costs actions. If Bell is prepared to sign a release, I will have it drawn up. Regards Rob |
| 9 February 2016, 1:52:30 +0000 | Dick Telford | John Bell | Dear John As promised I forwarded your email on to Rob. He has advised as follows by email to me, and asked me to pass this on: “I would be pleased to meet with him, under the terms outlined, and I would like a release confirming and agreeing to the details to be signed by Bell and myself. SSFK will also withdraw our costs actions. If Bell is prepared to sign a release, I will have it drawn up.” (the “terms outlined” refer to your email, including the designated meeting place and my presence) With best wishes Dick |
| 9 February 2016, 2:34:01 +0000 | John Bell | Dick Telford | Dear Dick Thank you. There is one further term of agreement that I require before I sign any release. 5. That Rob de Castella publicly withdraw the allegation he made during the hearing of ACAT 27 and at the appeal directions hearing on 16 December 2014 before Presidential Member Corby that I made racist remarks about Indigenous Marathon Project athletes. Mr de Castella is to provide a written apology for making the allegation. The written apology will be drawn up by me. In the stress of the moment when I sent the terms by email to you last week, I overlooked that term. Rob de Castella has destroyed my life in the Aboriginal community of Alice Springs with his public allegations against me regarding the Aboriginal athletes. He knows what I am talking about Unless de Castella signs a public apology, there is nothing in my future to support my racial integrity after a lifetime of service to Aboriginal people. Rob de Castella must agree to this term. Kind Regards JB |
| 9 February 2016, 6:05:20 +0000 | John Bell | Dick Telford | Dear Dick You may be wondering why I am insisting on Rob de Castella’s agreement to term No.5. I went from West Heidelberg in 1967 as a 20 yr old to work with Aboriginal people in remote communities in the outback. I made a career of indigenous sports administration and coaching that took me eventually to Canberra. I was at the forefront of Indigenous sport in this country and I was respected by the Indigenous community for my expertise and my racial integrity. This was my life until a High Court decision in 1995. That unique High Court case left a fallout of damage to my racial integrity that I have never been able to address. In 2009 Rob de Castella offered me a chance to return to the communities that I have known and loved since 1967. It was an opportunity for me to address the fallout. Now it is on the public record in a Tribunal decision ACAT 27 of 2013, based on Rob de Castella AM’s allegations, that I am a racist who made racist remarks about the Indigenous Marathon Project. This was reported in The Australian, The Canberra Times, The Herald Sun, The Centralian Advocate, the NT News, The Daily Telegraph, the Sydney Morning Heralds and the Brisbane Courier Mail. In all my offers to settle the matters between Rob de Castella and me since the Tribunal decision in 2013, I have included an apology from Rob De Castella as a non-negotiable term of settlement. As stressful as my family issues are with the prospect of losing my family home, my sister and I have agreed on family arrangements to ensure her wellbeing in the event of losing our home. However, I cannot continue in the knowledge that I have allowed Rob de Castella and his lawyers to brand me a racist on the permanent public record without an apology. No response to this email is asked or needed, Dick. It is simply background information for you. I thank you sincerely for your contacting Rob de Castella with my terms of settlement. Kind regards John Bell |
| 9 February 2016, 10:07:33 +0000; 9:08 pm | Dick Telford | John Bell | Dear John I said I’d convey your email to Rob de Castella. I did that, agreed to meet with you and Rob, and in turn conveyed his reply to you. I will not be part of any communications from you or Rob related to settling of additional terms. So please deal directly with Rob with any modifications you wish to make to those of your initial email. I will then consider, but do not promise, to meet with you both once terms are agreed. I wish you well Dick |
| 10 February 2016, 7:21 am | John Bell | Dick Telford | Dear Dick Thank you for your help. I am greatly appreciative. My intention has never been to muck you around or involve you in any terms of settlement. I ask you to believe me. I have been very ill with depression and I have family ilness [sic]. The omission of the term of apology was simply an oversight under extreme stress late at night after a family issue. An apology was always a part of my position with Rob de Castella. I accept that you may not believe me. But it is, the truth. Rob de Castella continually accused me of bad things which the Tribunal accepted Above all, Rob de Castella has accused me of racism. Publicly. In the Tribunal and in remote communities. For Rob, money is everything. I accept that you are a good friend of Rob and also a friend I trust and a fair man. I will approach Rob de Castella directly. I am very sorry to have offended you. Kind Regards JB |
| On or about 17 February 2016 | Dick Telford | Robert de Castella | Re Bell, he wrote again to me and stated that he wanted to add another condition concerning some sort of public apology to him for alleged inferences he was racist ….. This annoyed me and I didn’t read it properly but just emailed back telling him I’m not a messenger in his dealings that if he wanted to make further requests of you on top of those in the original email to which I agreed to follow up, he can make these directly with you. [no copy of the email was produced – the text is quoted in Mr de Castella’s affidavit] |
| 23 February 2016, 2:41 pm | Dick Telford | Robert de Castella | Rob, this is my most recent communication to John Bell. regards Dick [The email forwarded Professor Telford’s email of 9 February, 2016, 9:08 pm] |
| 2 March 2016, 2:41 pm (AEDT); 3:40 am (GMT) | Robert de Castella | John Bell | Dear John Please find attached a letter accepting your teams [sic] as outlined below. Please let me know when you want to meet in Canberra. Yours sincerely Rob [The attached letter from the respondents’ solicitors quoted Mr Bell’s initial email and went on: Your offer dated 3 February 2016 was accepted by Mr de Castella and that acceptance was communicated to you, by Mr Telford. In our view, an agreement resolving the matters has been reached. We understand however that after Mr de Castella’s acceptance was communicated to you, that you then sought to vary the terms of the agreement reached between you and Mr de Castella. Mr de Castella remains ready, willing and able to perform the agreement reached (and as recorded by your email) to resolve the matter. In our view, the agreement reached is enforceable. It should be formally recorded by way of deed between the parties, your signing a notice to withdraw the appeal proceedings, and a caveat being lodged over your property to secure the agreed payment. Can you please advise your position in this regard. Specifically, do you propose to honour the above agreement, or will you now seek to avoid the agreement reached? Please provide your response within seven days from the date of this letter. We have matters of court preparation and enforcement of costs orders to attend to, among other things, if the matter is to be ongoing.] |
| 3 March 2016, 11:32 am | John Bell | Robert de Castella | Dear Rob You have jumped the gun, mate. Dick Telford is well aware that no agreement has been reached between you and me. Regards JB [emphasis in original] |
| 3 March 2016, 2:09 pm | Robert de Castella | John Bell | JB You made me an offer to resolve these matters, in writing and via Mr Telford. Your offer was accepted and my acceptance was communicated to you by Mr Telford. Sincerely Rob |
In summary, Mr Bell’s first email set out the terms of a proposed settlement. Professor Telford’s email of 9 February 2016 set out Mr de Castella’s agreement to those terms, and his wish that the agreement be set out in a “release” to be signed by him and Mr Bell. The email also reported the company’s willingness to withdraw “our costs actions”, and Mr de Castella’s offer to have the release drawn up for signature.
Only after receiving the email reporting Mr de Castella’s agreement to the offer did Mr Bell identify a further term that he wanted included in the agreement, being that Mr de Castella would publicly and in writing apologise (in terms drafted by Mr Bell) for allegations made by Mr de Castella before ACAT. This was apparently not acceptable, and negotiations seem to have broken down from that point.
Mr Bell’s evidence
Affidavit dated 31 October 2016
Mr Bell’s affidavit dated 31 October 2016 contains much material that might have been relevant to the course of the appeal proceedings, and some material that might have been relevant in minor respects to the current issue.
First, Mr Bell notes that when he approached Professor Telford to act as his agent in negotiating terms of settlement with Mr de Castella on 3 February 2016, he had no idea that Professor Telford was one of the three directors of the company. He had only discovered this on 18 May 2016, and was shocked and distraught at this discovery.
Mr Bell subsequently saw Mr de Castella’s affidavit dated 12 May 2016, which included a quote from a communication from Professor Telford to Mr de Castella that referred to Mr Bell’s email seeking to add an apology from Mr de Castella as a further term of the settlement agreement. Professor Telford had gone on:
This annoyed me and I didn’t read it properly but just emailed back telling him I’m not a messenger in his dealings and if he wanted to make further requests of you on top of those in the original email to which I agreed to follow up, he can make these directly to you.
Mr Bell was shocked and deeply hurt by Professor Telford’s words and the tone of his message. He reported that he and Professor Telford had been friends and associates for a long time and outlined their various dealings, including in particular Professor Telford’s role:
(a)in recommending Mr Bell to Mr de Castella in connection with his Indigenous Marathon Project; and
(b)in Mr Bell’s agreement to a “handshake employment agreement” with Mr de Castella, described by Mr Bell as “a verbal agreement based on mutual trust between three old friends and distance running associates”.
Mr Bell concludes this part of the affidavit:
35. I remain shocked and struggle with long bouts of depression and a deep sense of betrayal by two longstanding friends and associates, Professor Telford and Robert de Castella.
At the end of Mr Bell’s affidavit, he says:
37. I have struggled to cope with the shame and humiliation of the findings in ACAT 27 and Rob de Castella’s allegations during proceedings ACAT 27 that my motive in going to ACAT was to damage his Indigenous Marathon Project. Together with my family issues in Melbourne, after five years of dispute, it was becoming very hard to cope.
38. In 2015 I was desperately hoping that the appeal proceeding in SCA 4 scheduled to be heard 15 December 2015 would at least bring to an end the stress and pain associated with the process.
39. However when Her Honour re-scheduled the hearing for 16 May 2016, I began to be overwhelmed during the Christmas and New Year period
40. I am receiving ongoing medical treatment by Dr Smith and struggle with depressive illness in these matters with Mr de Castella. I am also suffering long bouts of depression because of a deep sense of betrayal by Mr de Castella and Professor Richard Telford.
It is indeed unfortunate that the 15 December 2015 hearing had to be rescheduled because a jury trial before me, expected to conclude earlier, was still running (it concluded in the afternoon of 16 December 2015). However, one of the applications by Mr Bell to be addressed at that hearing had been filed only a week earlier (on 7 December 2015), and of course the 15 December hearing had only been required at all because Mr Bell had sought to re-open the appeals and tender fresh evidence.
Affidavit dated 18 November 2016
In the affidavit dated 18 November 2016, Mr Bell said:
Following my psychological breakdown on 3 February 2016 … I am receiving ongoing treatment by Dr Smith to help me prioritise my mental and physical health.
My family illness issues which contributed significantly to my breakdown on 3 February 2016 have stabilised. The extremely stressful incident which occurred on that night was an age-related, gender-based medical issue which caused me great distress, panic and very deep depression.
…
Another issue which contributed to my breakdown was the pain and humiliation of the decision of Senior Member Lennard in DT 11/27 on 26 April 2013 which was given a particularly hurtful personal focus for me by ABC National Radio journalist Elizabeth Byrne in her report of the decision on national radio on 1 April 2013
The affidavit attaches a letter from Dr Daphne Smith, Mr Bell’s treating clinical psychologist, dated 14 November 2016 and advising that, as at that date, it is her professional opinion that Mr Bell “is entirely capable of negotiating on his own behalf and engaging in thoughtful decision-making”.
Dr Smith’s 14 November letter also refers to Mr Bell’s “psychological breakdown on 3rd February 2016”, which had been mentioned in an earlier letter from Dr Smith dated 11 September 2016. That earlier letter had been prepared in response to the respondents’ indication that evidence of Mr Bell’s capacity to mediate was a precondition to their participation in the mediation ordered on 16 May 2016. That precondition was an unsurprising response to Mr Bell’s claim that in February 2016 he had not been competent to make legal decisions.
Affidavit dated 17 February 2017
In his 17 February 2017 affidavit, to which is attached a further affidavit sworn on 5 February 2017, Mr Bell describes his condition on the night of 3 February 2016 as involving “a mental state of fear, confusion and severe depression”, and goes on to explain that he was:
(a)confused about the estimate that the respondents’ costs had reached around $88,000; and
(b)distressed about various things, including that he was “deeply distressed about [his] sister’s distressing medical condition” and distressed by the costs estimate and by other aspects of his dispute with Mr de Castella and the circumstances giving rise to it.
Further details are then given in the affidavit about his sister’s health, and about matters of detail concerning procedural and other aspects of earlier stages of the proceedings and the costs estimate.
It is apparent that, since the early 1990s, Mr Bell’s sister has suffered a number of health challenges which she has largely overcome, but that in 2012 she suffered a fall, heart problems and acute renal failure. After this, an earlier frontal lobe dysfunction appears to have again become problematic, and she was assessed as needing considerable care to enable her to stay in her own home. Mr Bell’s evidence is that his sister’s health deteriorated in 2015 and 2016, and that she was admitted to hospital in late June 2016, discharged to an aged care centre in August 2016, and subsequently returned to live in Mr Bell’s home, with some transitional support from Austin Health, on 7 December 2016.
However, not all of the material provided by attachments to the 17 February 2017 affidavit, and not all of the circumstances that Mr Bell describes in the affidavit, were relevant or current before he made his offer to resolve the matter on 3 February 2016. To that extent the contents of that affidavit are of limited or no relevance in assessing Mr Bell’s state of mind when he made that offer.
Mr Fry’s evidence
Grant Fry, a friend of Mr Bell, provided an affidavit dated 5 February 2017 which was attached to Mr Bell’s 17 February 2017 affidavit and admitted without objection from the respondents. Mr Fry had known Mr Bell since the 1970s, and the affidavit outlines Mr Bell’s character and career history, and his attitude to the “aboriginal community”. Mr Fry refers to various matters that he believes caused stress to Mr Bell from the end of 2013, including:
(a)the ill-health of his sister;
(b)the letters from Mr de Castella’s lawyers, including in particular the letter assessing the costs incurred by their clients at $88,000; and
(c)Mr Bell’s struggles to obtain material, through freedom of information requests, from government departments which Mr Bell felt were obstructive.
Mr Fry says that Mr Bell was noticeably more distressed after receiving the letter mentioning $88,000.
Mr Bell had told Mr Fry about his email to Professor Telford two or three days after he sent it, and was “extremely disappointed” when Professor Telford had removed himself from the negotiations. He had tried to contact Mr de Castella through “the IMP website” (“IMP” is presumably a reference to the Indigenous Marathon Project), but without success. Mr Fry reports Mr Bell’s view that at that stage he “had no other choice but to continue with the court proceedings”. Mr Fry continues:
At this stage Mr Bell was not talking about an agreement but was talking about proceeding with the court case and the new evidence. I did not think that any agreement had been reached either. I would have expected that if Mr de Castella believed he had he would have taken steps to formalise it.
Mr Fry also refers to the fact that Mr Bell had discovered some time after the May 2016 mention that Professor Telford was and had been for a couple of years a paid director of the company.
Mr de Castella’s evidence
Mr de Castella’s affidavit dated 11 May 2016 was made by him as the named first respondent but also in his capacity as a director of the company authorised to make the affidavit on behalf of the company.
The affidavit attaches several emails involving Professor Telford, Mr de Castella and Mr Bell. It records that when Mr de Castella received Professor Telford’s email on or about 17 February 2016, he was surprised, as he had understood that he and Mr Bell had reached an agreement to resolve the matter.
Ms Mulherin’s evidence
Ms Mulherin is Mr de Castella’s solicitor. In an affidavit dated 16 May 2016, she documents the process by which it became apparent to Mr de Castella’s lawyers that Mr Bell rejected the proposition that any agreement had been reached between him and Mr de Castella to settle the appeal.
On 1 March 2016, Ms Mulherin wrote to Mr Bell as follows:
Your email of 3 February 2016 contained an offer to our client Mr de Castella [to] resolve the matters between you and he [sic] on the following terms:
… If you agree to sit down at a meeting of the three of us at Leo’s Chocolate Shoppe in Manuka, just the three of us, I will agree to the following terms
1.I will agree to withdraw my appeal in the Supreme Court and all other actions and walk away.
2.I will agree to sell my family home and pay Rob de Castella’s lawyers the $88,000 that they are asking.
3.Rob de Castella and I will shake hands and I will walk away.
4.I will agree to the above terms if you attend the meeting, and you only.
I leave it to you to pass my terms to Rob de Castella at your convenience.
Kind regards
JB
Your offer dated 3 February 2016 was accepted by Mr de Castella and that acceptance was communicated to you, by Mr Telford. In our view, an agreement resolving the matters has been reached.
We understand however that after Mr de Castella’s acceptance was communicated to you, that you then sought to vary the terms of the agreement reached between you and Mr de Castella.
Mr de Castella remains ready, willing and able to perform the agreement reached (and as recorded by your email) to resolve the matter. In our view, the agreement reached is enforceable. It should be formally recorded by way of deed between the parties, your signing a notice to withdraw the appeal proceedings, and a caveat being lodged over your property to secure the agreed payment.
Can you please advise your position in this regard.
Specifically, do you propose to honour the above agreement, or will you now seek to avoid the agreement reached? Please provide your response within seven days from the date of this letter. We have matters of court preparation and enforcement of costs orders to attend to, among other things, if the matter is to be ongoing.
On 3 March 2016, Mr Bell emailed the Supreme Court registry seeking clarification of orders that had been made in December 2015 when the listing had to be vacated and rescheduled for May 2016. Shortly thereafter, Ms Mulherin emailed Mr Bell and the court querying why Mr Bell was seeking clarification as to earlier directions “in circumstances where the parties have reached private agreement about the matter”.
Mr Bell replied, also promptly, assuring Ms Mulherin that “there has been no agreement between Mr de Castella and [him] on the issues that are now on appeal before the Court”. Ms Mulherin responded almost immediately, outlining the making of the agreement alleged and relied on by the respondents (referring to emails set out at [62] above).
Mr Bell replied to Mr de Castella, copied to Ms Mulherin and various court staff, on 7 March 2016 as follows:
Dear Rob
On Friday afternoon I received in my letter box at home in Melbourne a threatening letter from your Dibbs Barker lawyer, presumably on your instruction.
Something does not add up in all this, Rob.
I do not know why you have now instructed your lawyer to approach the Court over a settlement attempt I initiated on 3 February 2016 in an email to you through Dick, expressly excluding lawyers, unless it was by presenting an inaccurate picture of the current state of negotiations you are trying to make me look bad.
Over the past 5 years your lawyers have done nothing but escalate costs, blocking all my attempts to settle the issues with you, man to man.
It is easy to see why your lawyer and her law firm would now want to force me to be bound by the settlement proposal of 3 February.
However, you and I and Dick have correspondence which clearly shows that negotiations have gone well beyond that original proposal, and have now stalled.
Consequently, the position you appear to have now taken in your email of 3 March 2016 really surprises and really puzzles me.
You well know why I wanted no lawyer involvement in this negotiation.
Just you, me and Dick, three longstanding old friends, meeting over coffee at Leo's Chocolate Shop in Manuka, where it all began in 2009.
Over coffee between you and Dick, when Dick recommended my expert coaching services and extensive knowledge of Indigenous sporting communities around Australia to initiate your Indigenous Marathon Project in remote communities.
As you know, Dick and I have been associated since 1982 at the AIS, where we pursued the interests of Aboriginal and Torres Strait Islander athletes.
You know that I took Dick and Sue to Alice in 1988 where I introduced them to the Aboriginal community.
Consequently, I agreed to work for you as the Project Coach in the Indigenous Marathon Program on a handshake employment agreement, because I trusted you as a long-time family friend of you, Gayelene and Krista.
That is why I worked for you for 505 working days as Project Coach, with limited personal financial means, waiting in vain for you to remunerate me for my services which you promised, until you sacked me without payment in very hurtful circumstances.
I remain committed to the ideals of the Indigenous Marathon Project. My submission, number 56, on the parliamentary website of the House of Representatives Standing Committee on Aboriginal and Torres Strait Islander Affairs in the 2012–2013 Inquiry into sporting wellbeing and mentoring of Indigenous people, is testimony to my ongoing personal commitment.
As you are well aware, the fresh evidence that I have discovered under FOI and which is now before the Court has potentially serious implications for you and your charity in the Indigenous Marathon Project.
Consequently, when I initiated this negotiation, I thought it would be good for everyone to try settle our matters out-of-court, through one last effort.
However, you have now involved your lawyers and have issued a negotiation threat to me in your surprise approach to the Court.
I cannot now trust you in this negotiation, Rob, so I am withdrawing from it.
All you have done is cause me and my family deep trauma, pain and humiliation in these matters over a long period.
This email is being cc'd to your lawyer and to the officers of the Court whom you instructed your lawyer to contact.
Below is a copy of the email correspondence in this matter between your lawyer and the Court
Sincerely
JB
On 9 March 2016, Ms Mulherin emailed Mr Bell asking for copies of the correspondence referred to in Mr Bell’s email of 7 March “which clearly shows that negotiations have gone well beyond that original proposal, and have now stalled”.
Dr Smith’s evidence
Dr Daphne Smith produced Mr Bell’s medical records on subpoena.
Referral
Dr Claire Owen referred Mr Bell to Dr Smith on 15 March 2016, initially for six sessions of counselling under a Mental Health Treatment Plan. The records show Mr Bell attending 11 one-hour sessions, and indicate that there was a second referral.
The treatment plan prepared for Mr Bell and dated 16 March 2016 notes:
Discrimination case in 1992, racial discrimination whilst working in an Aboriginal organisation. Was working in public service and lost career. Comcare payments until aged 65.
Worked in Aboriginal sport – track and field coach.
Marathon runner.
Coached paraolympians.
Depression since 1992.
Tried to get better with antidepressants and extensive physical exercise.
Financial stress. Paying some costs for a recent court case – started 2011. Worked with an aboriginal sports organisation and felt he was underpayed [sic]. Unable to afford lawyer so representing self. Court case on 16th May – will lose house if he does not win.
…
Poor sleep due to stress.
The Mental State Examination results set out in the treatment plan show most indicators as “Normal”, but contain the following assessments:
(a)Attention/Concentration: Subjectively impaired
(b)Mood (Depressed/Labile): Low
(c)Sleep: Poor sleep
(d)Appetite: Reduced
(e)Anxiety Symptoms: Significant.
Mr Bell’s diagnosis as set out in the treatment plan was:
69 year old man suffering from depression since traumatic anti-discrimination case in 1992. Worsening depression and anxiety recently due to upcoming court case and financial strain.
Medical records made by Dr Smith
Dr Smith’s consultation notes include the following:
21 March 2016: PTSD – email 3rd Feb, family issues, erratic ↓ [reduced?] sleep.
31 March 2016: That day Feb 3rd around midnight I had that breakdown and said I would pay him everything. My sister’s health issues, my financial [illegible – possibly “position”, “problems” or “pressures”]
Opinions provided by Dr Smith
On 11 September 2016, Dr Smith provided an opinion that included the following:
John presented for initial consult on 23.3.2016 at an extreme low point in his mental health. John was significantly distressed and worried about the upcoming court case and described losing all will to fight on February 3rd 2016 and sending an email to Mr de Castella while in an erratic mental state due to lack of sleep and severe mental strain. It is my professional opinion that, whatever the contents of that email, John was clearly not of sound mind when it was written and sent. John described a number of distressing symptoms including exhaustion, shaking, decreased ability to focus and concentrate, decreased motivation, constant worrying, avoidance, rumination, decreased sense of self-worth, and low mood. These symptoms are characteristic of severe anxiety, depression and PTSD.
On 25 October 2016 (the day of the mediation referred to at [30] above), Dr Smith provided an opinion to the mediator as follows:
This is to certify that Mr William John Bell … is of sound mind and capable to mediate today as required.
Oral evidence – in chief
Dr Smith saw Mr Bell six weeks after he sent the 3 February email. The assessment she made at that point, quoted at [97] above, was based on Mr Bell’s report of his situation and circumstances at the time the email was sent, and on her observations of his presentation when he was describing the events of that night, especially his distress in re-telling the story of the events of 3 February.
Dr Smith noted that any form of mental distress, or lack of sleep, as well as other things, can lead to cognitive impairment, and that cognitive impairment can emerge from conditions other than psychosis.
Oral evidence – cross-examination
In concluding he was not “the master of his own actions” on 3 February 2016, Dr Smith had relied on Mr Bell’s self-report and his hyper-arousal when giving the report mentioned at [99] above.
She said that hyper-arousal might also have been caused by intervening regrets about the earlier actions that were being reported on, but she thought that:
the actual trauma is pretty clear to see the effects of the actual trauma versus the effect of … things that have happened post-trauma. … [S]ometimes that could get a bit blurred.
When counsel directed her to the terms of the agreement proposed in Mr Bell’s email sent on 3 February, Dr Smith agreed that Mr Bell had drawn up an agreement to settle his dispute, but she indicated some uncertainty about what was behind his offer. When pressed, she said that “[i]f you read that out to me and I knew nothing else about it, it would sound like … an attempt to settle a case, yes.”
Dr Smith also agreed that:
on its face [the email] sounds like it’s written by somebody with the capacity to understand the central issue of the problem that they’re seeking to resolve
However, she said, the fact that it sounds that way “doesn’t mean that it was sent by someone who is capable of [looking after their own actions]”.
Dr Smith agreed that as Mr Bell’s treating psychologist, with a therapeutic relationship with him, it would not have been good for Mr Bell if she had said that he was actually “the master of his own actions” when he sent the email.
Dr Smith mentioned Mr Bell reporting distressing symptoms, being:
exhaustion, shaking, decreased ability to focus and concentrate, decreased motivation, constant worrying, avoidance, rumination, decreased sense of self worth and low mood.
She conceded that a person with all those symptoms could still be “a master of his own actions”, but said that she didn’t know if Mr Bell was the master of his own actions when he sent the email.
Oral evidence – re-examination
In re-examination, the following exchange took place between Mr Bell and Dr Smith (the last question being answered over objection):
MR BELL: Between the incident - in other words, is it possible that someone who experiences a psychological breakdown on, say, in this instance, at 11 o'clock on 3 February, would that person instantly go and seek medical attention and help? Would they ever do it or, you know, do they do it immediately, or can they - - -?
DR SMITH: Again, I'd have to - there's individual differences. Some people would present a week later, some people, like yourself, six weeks later, some people would never present and some people would commit suicide. It's just individual differences. There's no actual time frame where a person would present at a particular time.
MR BELL: So in other words, the time lapse that occurred in this instance, issues of stress and anxiety, could they lead to memory loss, lack of concentration? Could that memory loss - could there be a memory loss and could that have affected the number of items in the email that was sent that you've read? In other words, could there have been - could the stress that you described that you saw me suffering from, could that have affected my ability to include everything in an email that I was seeking to do?
…
DR SMITH: Yes. No, I guess when somebody is under a lot of pressure and stress, then, yes, they entirely could leave out something that they had wanted to include. I suppose it's similar to the GP example I gave where people go to their GP with a certain list of things they want to cover and they don't cover it. I mean that's - yes, that's something that could happen.
Dr Saboisky’s evidence
Report
Dr Saboisky, in a letter dated 22 February 2017, outlines Mr Bell’s emails, and says:
He said he overlooked this term because of stress that he was feeling at the time. On the email evidence he clearly has capacity to understand the central issues of the problem and he seeks what appears to be a solution. As an afterthought he seeks a written apology from Robert De Castella which refers later to a non-negotiable form of settlement. He later apologises on 10 February in another email that the omission of the apology was simply an oversight under extreme stress, late at night after a family issue. The exchange of emails suggests to me that he was under enormous pressure to settle the matter but was vacillating about whether or not he could extract an apology from Robert de Castella. The evidence of the emails suggests that he was under a certain degree of perturbation but that the content is entirely logical and internally consistent.
He concludes that Mr Bell had the capacity to enter into an agreement to resolve the matter because “it [presumably the 3 February email] is a very straightforward and logical email”.
Dr Saboisky notes that when Dr Owen referred Mr Bell to Dr Smith on 15 March 2016, she recorded “increased hyper arousal, anxiety, low mood, decreased attention and concentration”, and “jittery, dizzy, light headed, agitation, diminished sleep, ruminations, tears, cannot focus, need repetition”. He says that if Mr Bell had been either psychotic or obviously cognitively impaired at the time he saw Dr Owen, she would have been likely to recommend an antidepressant, and concludes that:
the evidence supports that he was significantly depressed but not psychotic or significantly cognitively impaired and therefore lacked capacity.
Oral evidence – cross-examination
Dr Saboisky had seen Mr Bell for depression at least 17 or 18 years previously, perhaps even earlier than that, but all his files from that period have been destroyed. However, he said, his recollection of Mr Bell’s earlier consultations had not coloured his current assessment, because all he remembered was Mr Bell’s name and that he sought treatment for depression; Mr Bell’s suffering of depression going back to 1992 is confirmed by the current medical history provided to Dr Saboisky.
Dr Saboisky said that the 3 February email was logical, internally consistent and straightforward. It provided no evidence of psychosis or of significant cognitive impairment. He accepted that Mr Bell was depressed but what he had written made perfect sense.
Dr Saboisky said that apart from psychosis, cognitive impairment can also be caused by dementia, delirium caused by drugs, alcohol or medication, impaired concentration, impaired attention or impaired short-term memory caused by depression, acute/long-term confusional states caused by chronic infections, or degenerative diseases, of the brain. Severe cognitive impairment is caused by a derangement of the brain. Cognitive impairment can be mild, moderate or severe.
Dr Saboisky said he could only speculate about why the request for an apology was omitted from the first email, but said that his “gut feeling” was that Mr Bell had probably worked on the email for “quite some time”. He did not think the apology term was omitted because Mr Bell was “severely cognitively impaired”.
Dr Saboisky told Mr Bell that “listening to you today, you don’t have any serious impairment, and I don’t believe you [had any] serious impairment back then”.
Consideration – was an agreement made?
Mr Bell’s mental state
I do not doubt that Mr Bell was genuinely stressed, and distressed, when he sent the 3 February 2016 email. The email specifies that he is “suffering severe depressive illness” and that it is “becoming to [sic] difficult now to cope”. On the other hand, the email is clearly and logically constructed, there is nothing in it which suggests a writer so cognitively impaired that he was not capable of understanding the general nature of what he was doing, and its contents make sense: not only is the email itself rational and coherent, but the contents of the email are rational and coherent given the external circumstances.
Furthermore, Mr Bell only sought to add a further condition to the offer, specifically that Mr de Castella would apologise for accusing him of racism, on 9 February 2016, several days after he sent the first email but less than an hour after he had received a positive answer to his offer from Professor Telford (at [62] above).
In that and other emails, and in submissions before me, Mr Bell said, and repeated, that his demand for an apology had always been a condition of any settlement. He explained his failure to specify it in the 3 February email as reflecting his mental distress at the time. However, Mr Bell did not, at any time before he received the favourable reply from Professor Telford on 9 February, seek to withdraw (or add to) the offer made in his first email.
Mr Bell made submissions, and examined the two doctors, to the effect that his failure to include the apology condition could be attributed to his mental distress at the time of the first email.
Mr Bell’s second email, sent to Professor Telford three days after the 3 February email, says “I have no petrol left in the tank”. I take this to suggest that Mr Bell feels he does not have the energy to keep fighting, but it does not suggest that his offer of a resolution in his earlier email was the product of immediate distress and was not capable of being accepted. Rather, it appears to confirm Mr Bell’s wish to resolve the matter on the stated terms. Nor does his third email, after he is told of Mr de Castella’s acceptance, suggest that the offer he has made is not maintained – to the contrary, he wishes to hold Mr de Castella to his agreement, but with the addition of an extra term that he had overlooked “in the stress of the moment”.
Dr Smith’s evidence provided no useful support for the proposition that on 3 February 2016 Mr Bell was not capable of making an offer that could be accepted. Except for Mr Bell’s immediate presentation when he told her about the sending of the email, described by Dr Smith as a state of hyper-arousal, she was entirely reliant on his claims about his mental state at the time. Even on that basis, Dr Smith’s evidence did not effectively go beyond propositions to the effect:
(a)that the accuracy of Mr Bell’s report of his condition when he sent the email was not excluded by his subsequent behaviour as observed by Dr Smith; and
(b)that a person suffering stress and anxiety could also suffer memory problems and loss of concentration, and could in that state have overlooked a condition that he had intended to include in an email.
Neither Mr Bell’s evidence nor Dr Smith’s evidence, nor the medical records she produced, establish that on 3 February 2016 Mr Bell was suffering any form of cognitive impairment. In particular, the repeated references by Mr Bell and Dr Smith to Mr Bell’s “psychological breakdown on 3 February” (at [72] and [74] above) do not lend any weight to the evidence consisting of Mr Bell’s direct claims about his mental state, and Dr Smith’s reports of those claims and his presentation when making them. The other evidence, in particular the 3 February email itself but also Dr Saboisky’s evidence, is inconsistent with any such finding.
Furthermore, Mr Bell’s subsequent emails, although they do assert depression, do not claim any kind of cognitive impairment, and nor do the emails themselves suggest relevant cognitive impairment.
Finally, I note that on 5 February Professor Telford replied to the 3 February email, and on 6 February Mr Bell replied to Professor Telford’s email. Neither of those emails repeats the terms of Mr Bell’s original offer, and nor did Professor Telford’s email of 9 February, so Mr Bell would at each point have had to go back to the original email (possibly but not necessarily set out as part of the email trail with which he was immediately dealing) if he wished to review those terms. However, it is only in Mr Bell’s reply to the 9 February email that he identifies that in the “stress of the moment” he had overlooked what appears to him to be the non-negotiable term of the agreement, namely the apology from Mr de Castella. This may not be surprising – the tone of Mr Bell’s 9 February email is quite different from the tone of the 3 February and 6 February emails, which may reflect some improvement in his mental state that permitted a more careful review of his original offer. On the other hand, there is no suggestion in Mr Bell’s 9 February email that he has only at that point realised his omission, and there is no apology, to Professor Telford or to Mr de Castella, for failing to recognise, or advise of, this omission earlier. While I have no doubt that Mr Bell was suffering stress and depression when he composed and sent the 3 February email, I could not exclude the possibility that his failure to mention the apology until after Mr de Castella had agreed to the other terms of the offer was not a stress-related oversight but a negotiating tactic.
There is no evidence on which I could be satisfied that at the time when Mr Bell made his offer in the 3 February email, he was so cognitively impaired that he was not capable of understanding the general nature of what he was doing in that email.
Professor Telford’s involvement
Mr Bell also made submissions relating to his discovery that Professor Telford was on the board of the company. This is a matter that clearly distressed Mr Bell, but it is not apparent to me how it could affect the question whether an enforceable agreement emerged from the exchange of emails, and Mr Bell has not identified any such effect. Nor has he explained how Professor Telford’s position affected Mr Bell’s dealings with Mr de Castella, except to say that if he had known about Professor Telford’s role on the board of the company, he would never have asked Professor Telford for his help in making the offer to Mr de Castella.
It is true that the company, of whose board Professor Telford was a member, had an interest in the settlement of the matter, but Professor Telford’s interest was considerably more indirect than Mr de Castella’s personal interest in the settlement.
Mr Bell did know that Professor Telford was a friend of Mr de Castella – indeed, it was Professor Telford’s position as a mutual friend of Mr Bell and Mr de Castella that made him an obvious intermediary.
The emails indicate that Mr Bell did not seek to involve Professor Telford in the possible agreement as anything more than, first, a delivery service to ensure that the offer reached Mr de Castella (without going through his lawyers) and, secondly, a witness to the performance of the agreement if made. The emails do not show that, at any point:
(a)Mr Bell indicated that he expected Professor Telford, in passing on the offer, to do anything more than forward the email;
(b)Mr Bell sought advice from Professor Telford or asked Professor Telford to intercede on his behalf with Mr de Castella; or
(c)Mr Bell gave Professor Telford any information, or any indication of his negotiating position, believing or expecting that it would not be passed on to Mr de Castella (the material in Mr Bell’s emails to Professor Telford sent on 9 February 2016 at 2.34 am and 6.05 am respectively is intended to explain Mr Bell’s attempt to add an additional term to the agreement, and does not indicate an expectation that Professor Telford will advocate on his behalf with Mr de Castella; in any case, both emails were sent after Mr de Castella’s response to Mr Bell’s original email had been passed on to Mr Bell, so have no impact on the ostensible formation of the agreement under consideration).
Mr Bell has not suggested that any such communications with Professor Telford took place separately from the email communications.
I cannot see any basis on which to conclude that Mr Bell’s ignorance of Professor Telford’s role on the board of the company vitiated the original offer passed on to Mr de Castella by Professor Telford in such a way that the offer was not able to be accepted.
Conclusion – an agreement was made
The core provisions of Mr Bell’s 3 February offer were clear and coherent. Mr de Castella’s acceptance of that offer was also clear – it specified that Mr de Castella accepted “the terms outlined”. I am satisfied that the terms offered by Mr Bell to Mr de Castella were sufficient, once accepted, to constitute an agreement.
So far, no submissions have been made, and I see no need to express a view, about the significance of Professor Telford’s role in the performance of the agreement that came into being when Mr de Castella accepted Mr Bell’s offer to resolve and conclude the dispute between them (although see [156] below).
Mr Bell’s offer was expressed to be conditional on Professor Telford also agreeing to attend the meeting at the specified venue, and on Professor Telford being the only person present (presumably, apart from Mr Bell and Mr de Castella).
However, I do not consider that these “conditions” can meaningfully be seen as part of the agreement between Mr Bell and Mr de Castella. First, they do not seem to have any impact on whether the terms of the agreement are meaningful or whether they can be performed by the parties. Secondly, it does not seem that either party to that agreement has any role in implementing the requirements implicit in the “conditions”. There is no basis on which I could assume that either party has any ability to compel Professor Telford’s presence at any meeting between the parties, and there is also no basis on which I can assume that “Leo’s Chocolate Shoppe” in Manuka still exists as a possible venue for such a meeting.
For the reasons set out above, I shall make a declaration as sought (although not in exactly the terms sought) about the existence of an agreement between Mr Bell and the respondents to the appeal.
That declaration will be that in February 2016, John Bell made an agreement with Robert de Castella (in his own right and on behalf of Rob de Castella’s SmartStart for Kids Limited), as follows:
If there is a meeting between John Bell and Rob de Castella:
(a) John Bell will withdraw his appeal in the Supreme Court (SCA 4 of 2014) and all other actions.
(b) John Bell will sell his family home in Heidelberg and pay Rob de Castella’s lawyers the $88,000 that they are asking.
(c) John Bell and Rob de Castella will shake hands and John Bell will walk away.
Consideration – should specific performance be ordered?
Specific performance order not currently appropriate
As already noted at [48] – [52] above, no useful submissions were made by either party about most of the issues relevant to whether this is a case in which an order for specific performance would be appropriate.
In the absence of any such submissions, I do not propose to make any such order at this stage. However, I note the following, apparently uncontroversial, propositions about when specific performance should or can properly be ordered, and make some comments that may indicate a way forward for the parties.
Refusal or threatened refusal to perform contract
First, an order for specific performance would not normally be made until a party has refused, or threatened, to perform the contract. In Turner v Bladin (1951) 82 CLR 463 at 472, the High Court said:
In our opinion proceedings for the specific performance of a contract which is of such a kind that it can be specifically enforced can be commenced as soon as one party threatens to refuse to perform the contract or any part thereof or actually refuses to perform any promise for which the time of performance has arrived. The court can then make a decree that the contract ought to be specifically performed and carried into execution, and can so mould its decree and order such inquiries, accounts and other proceedings under the decree as may be necessary to carry into effect all the promises of both parties whether they are presently performable or are only performable in the future.
It is true that Mr Bell has so far refused to perform any of the actions that he offered in his 3 February email. However, he has not refused to perform his part of an agreement with Mr de Castella; rather, he has rejected Mr de Castella’s claim that any agreement was made. After I make the declaration that an agreement between the two men was made, a refusal by Mr Bell to perform his side of that agreement might provide a basis for an order for specific performance, but obviously that is not yet the position.
Where damages would be adequate remedy
Next I note that specific performance would not usually be ordered where damages would be an adequate remedy. In Dougan v Ley (1946) 71 CLR 142, Dixon J said at 150:
Though in earlier times the absence of an adequate theory of simple contract had led to the interposition of chancery on wider grounds, by the seventeenth century, if not before, it had come to be "taken for a good cause of dismission" of a bill "in most causes, to say that he" the plaintiff "hath remedy at the common law". So it became the received doctrine that the foundation of decrees for specific performance was "that damages at law would not give the party the compensation to which he was entitled; that is, would not put him in a situation as beneficial to him as if the agreement were specifically performed" (per Lord Redesdale, Harnett v. Yeilding).
"The Court gives specific performance instead of damages, only when it can by that means do more perfect and complete justice" (per Lord Selborne, Wilson v. Northampton and Banbury Junction Railway Co.).
(citations omitted)
In the same case, Williams J said at 153:
It is clear that the Court of Equity will not decree specific performance of a contract where a money payment, or in other words damages, will afford an adequate remedy for the breach, and that this is the position in the case of most forms of personal property, such as goods which can be readily purchased in the market and Government stock and shares in listed companies which can be readily purchased on the Stock Exchange. But it is equally clear that the Court of Equity will decree specific performance of contracts for the sale of chattels which are unique or have for some other reason a special or peculiar value. The contract of 2nd November was not a mere contract for the purchase of a chattel. It was a contract for the purchase of a chattel adapted to carry on a particular business, and of the registration and licence without which that business could not be carried on. It was therefore a contract of a composite character.
This issue was briefly addressed by the respondents, and at [49] above I accepted their submission that damages would not be an adequate way to compensate the respondents for a refusal by Mr Bell to terminate the appeal proceedings as he had offered.
Hardship
Next, I note that specific performance might be refused if it would inflict undue hardship on a party to an agreement, although generally this applies only to hardship existing at the time the agreement was made, because the issue is the nature of the bargain rather than the effect of enforcing it (Ready Construction Pty Ltd v Jenno [1984] 2 Qd R 78, 79–81, but see also Patel v Ali [1984] 2 WLR 960).
Longtom Pty Ltd v Oberon Shire Council (1996) 7 BPR 14,799, 14,808–14,809, discusses cases in which ordering specific performance might impose a heavy burden on a defendant without conferring any, or any worthwhile, benefit on the plaintiff. This issue might be relevant to the question whether Mr Bell should be required to sell his house if he can make the $88,000 costs payment without doing so (at [155] below).
Position of volunteers
Finally I note the equitable maxim that “equity will not assist a volunteer” (in this context, a person who has not provided valuable consideration for a claimed entitlement): see Redman v Permanent Trustee Co of New South Wales Ltd (1916) 22 CLR 84, 96.
Draft order – comments
The draft general form of order provided by the respondents in response to a question from me about what an order for specific performance might look like in this case set out the steps for performance of the agreement as follows:
1. The appellant will withdraw his appeal in the Supreme Court of the Australian Capital Territory in the proceeding known as SCA 4 of 2014.
2. The appellant will sell the property known as [redacted] Heidelberg Heights Victoria.
3. The appellant will pay $88,000 to the respondents.
4. Following the appellant carrying out the terms [at 1, 2 and 3 above], the appellant and the first respondent will meet and shake hands.
Several comments can be made about the draft order.
Although the 3 February offer made by Mr Bell included, as a single term, that he would sell his house and pay the $88,000 costs, the respondents’ draft order identifies these as two separate aspects of the offer.
In the absence of any submissions about this issue, I cannot see that the sale of Mr Bell’s house is of any interest to Mr de Castella except to the extent that it would provide funds enabling Mr Bell to pay the costs amount. If it emerges that Mr Bell can pay the costs amount without selling his house (whether he does that by using the house as security for a loan, or by finding the money in some other way), there does not seem to be any reason why the house sale should be subject to any order for specific performance that is separate from the requirement for Mr Bell to pay the $88,000 in costs.
In my view, separating the house sale from the costs payment would involve a misreading of Mr Bell’s offer, which should probably be read as an offer to pay the costs amount, if necessary by selling the house.
Requiring the house to be sold even if Mr Bell can find the $88,000 elsewhere might also raise questions of undue hardship; in that context, however, I note that, although the evidence before me suggests that the sale of Mr Bell’s house might cause hardship to him, that evidence does not purport to provide a complete picture of Mr Bell’s financial position and his personal circumstances.
Next, I note that the respondents’ draft requires that Mr Bell perform all his obligations under the agreement (withdrawing the appeal, selling the house and paying the costs) before Mr de Castella is to meet him and shake hands. In the circumstances of this case, I would not frame a specific performance order in that way, but would instead be inclined to order that the meeting incorporate the performance of the obligations of both parties. That is, there should be a meeting between Mr Bell and Mr de Castella at which Mr Bell would hand over, or sign, documents terminating his legal proceedings, and would provide the $88,000, probably in the form of a bank cheque, after which the two men would shake hands. It is probably desirable that there be a witness or witnesses to the meeting, perhaps Professor Telford and a friend of Mr Bell’s, or it may be that the meeting would be better held at the Supreme Court registry (especially if the café mentioned in Mr Bell’s original offer no longer exists), but in the absence of relevant submissions I express no view about whether any such recommendation could properly form part of a specific performance order.
Finally, it is worth mentioning that, absent the apology from Mr de Castella that Mr Bell says (perhaps accurately but to no particular effect) was always intended to be part of the agreement, Mr de Castella’s obligations under the agreement are apparently minor: they consist of an obligation to turn up to a meeting with Mr Bell and to shake Mr Bell’s hand at the end of the meeting. That the consideration to be provided by Mr de Castella seems to be minor and of no monetary value, compared with Mr Bell’s obligations under the agreement, has not been raised as excluding the existence of an enforceable agreement. What that may mean, however, is that in any application for specific performance, there might need to be further consideration of whether in equity Mr de Castella might be considered a “volunteer” (see [149] above). This in turn suggests that Mr de Castella’s proper performance of his obligations under the agreement, or his willingness to perform those obligations properly, may be vital if this very unfortunate saga is finally to be brought to an end by the agreement that I have found was made in February 2016.
In summary, there are in my view real uncertainties for both parties in relation to any court-ordered enforcement of the agreement that I have found to have been made. Both parties should keep that firmly in mind in considering how they might cooperate in giving effect to the agreement.
Costs
It is unfortunate that the agreement made between Mr Bell and Mr de Castella has had to be the subject of further litigation and has therefore generated further costs. However, since I have refused the respondents’ application for specific performance as premature, Mr Bell is to pay only half the respondents’ costs of this application, as agreed or assessed.
| I certify that the preceding one hundred and fifty-nine [159] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Justice Penfold. Associate: Date: 15 June 2018 |
[1] The versions of some of the quoted emails annexed to different affidavits show different time stamps using different formats. It seems that the different versions might reflect different settings on the devices from which they have been printed, or possibly that the email concerned was sent and received in different time zones. However, no issue was taken about the different time stamps, or about the order in which the emails were sent and received.