Bialosowski Administrator of Est of P Bialosowski v Bialosowski - [2023] WASC 173

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
IN CHAMBERS

CITATION:   BIALOSOWSKI ADMINISTRATOR OF EST OF P BIALOSOWSKI -v- BIALOSOWSKI [2023] WASC 173
CORAM:   MASTER SANDERSON
HEARD:   6 APRIL 2023
DELIVERED          :   24 MAY 2023
PUBLISHED           :   24 MAY 2023
FILE NO/S:   CIV 1444 of 2022
BETWEEN:   JENNIFER LYN BIALOSOWSKI ADMINISTRATOR OF EST OF P BIALOSOWSKI
First Plaintiff
JENNIFER LYN BIALOSOWSKI
Second Plaintiff
AND
LEO BIALOSOWSKI
First Defendant
GREGSON EMPIRE PTY LTD ATF GREGSON FAMILY DISCRETIONARY TRUST TA GREGSON & ASSOCIATES
Second Defendant

Catchwords:

Summary judgment - Application to enforce settlement executed at mediation - Turns on own facts

Legislation:

Family Provision Act 1972 (WA)

Result:

Application granted

Category: B

Representation:

Counsel:

First Plaintiff	:	S Standing
Second Plaintiff	:	S Standing
First Defendant	:	E Hensler
Second Defendant	:	No appearance

Solicitors:

First Plaintiff	:	D'Angelo Legal
Second Plaintiff	:	D'Angelo Legal
First Defendant	:	Benz Legal
Second Defendant	:	Gilchrist Connell

Case(s) referred to in decision(s):

Pavlovic v Universal Music Australia Pty Ltd [2015] NSWCA 313

MASTER SANDERSON:

By chamber summons filed 21 November 2022 the plaintiffs sought, relevantly, the following orders:
1The plaintiffs have leave to bring this application out of time.
2Judgment be entered for the first plaintiff against the first defendant in the sum of $121,126.30;
3Judgment be entered for the second plaintiff against the first defendant in the sum of $83,839.09;
4The first defendant pay the plaintiffs' cost of this application and of this action to be taxed if not agreed.
The claim arises in this way. On 6 May 2022, the plaintiffs issued proceedings against the defendants. Paragraph 1 of the statement of claim, which was endorsed on the writ, is in the following terms:
1.The first defendant is the brother of the second plaintiff, and was a defendant in each of the following related proceedings ('related proceedings') -
a)Supreme Court of WA CIV 1407 of 2021, being a claim by the first plaintiff herein against the first defendant herein for an account of rental income received by the first defendant in respect of property at 38 Clifton St Collie ('Collie property') belonging to the estate of the late Pola Bialosowski;
b)Supreme Court of WA CIV 1064 of 2021, being a claim by the second plaintiff herein for orders for partition or sale of property jointly held by her and the first defendant herein at 6 Bosberry Close Eaton ('Eaton property') and for an account of rental income received by the first defendant in respect of the same;
c)Supreme Court of WA CIV 1753 of 2021, being a claim by the second plaintiff herein under the Family Provision Act 1972 (WA) in respect of the estate of the late Pola Bialosowski.
The Family Provision Act (FPA) action was commenced on 2 August 2021. On 27 August 2021, by consent, Registrar Hosking made the following orders:
1.The parties submit the dispute to a mediation to be conducted by a mediation registrar on a confidential basis in accordance with Part 6 of the Supreme Court Act 1935 following compliance with the following:
(a)Solicitors for the defendants shall advise the solicitors for the plaintiff no later than 7 days after the date of these orders of the dates on which their respective clients are unavailable for Mediation.
(b)Solicitors for the plaintiff shall lodge not later than 7 days after receiving the advice referred to in the preceding sub‑paragraph a request for appointment in the approved form, completed so as to show one list of the parties' available dates.
(c)Without limiting the power of the Court to make any order for costs of the action or the mediation, the plaintiff pay the fee prescribed when lodging the request for an appointment for mediation.
2.For the purposes of the Mediation the assets and liabilities of the deceased estate of Pola Bialosowski, at the time of her death and currently, shall be:
(a)as set out at paragraph 8 and annexures JLB 2 & JLB 3 of the affidavit of Jenny Bialosowski filed 5 August 2021; and
(b)as detailed in any affidavit(s) filed by the second defendant in CIV 1407 of 2021 being the proceedings filed by first defendant against the second defendant in respect to rental and costs owing to the Estate (CIV 1407 of 2021).
3.For the purposes of the Mediation, the parties have leave to refer to any affidavits filed in CIV 1407 of 2021.
4.By at least 14 days prior to the date listed for the Mediation, the solicitors for the plaintiff and defendants shall give their respective clients a memorandum setting out:
(a)The exact costs and disbursements to the date of the memorandum;
(b)The estimated future costs and disbursements up to and including a Mediation Conference lasting no more than one day;
(c)The estimated future costs and disbursements up to and including trial, and the length of trial assumed in making the estimate; and
(d)The estimated party and party costs recoverable by, or payable by, the party in the respective cases of success or failure at trial.
5.By at least 14 days prior to the Mediation conference the solicitors for the parties shall give their respective clients a copy of the Court publication 'Mediation - What you need to know'.
6.Save for unless a state of lockdown exists the following people must attend the mediation conference in person:
(a)each party who is a natural person save for the third defendant who may be appear by telephone or video conference; and
(b)the solicitor and/ or counsel, if any, representing each party.
7.At the commencement of the Mediation the memorandums provided to each party by order 4 shall be exchanged with all other parties and with the appointed mediator.
8.Within 7 days after the conclusion of the mediation conference, the second defendant shall inform the Case Manager's Associate that the conference has occurred as directed and the outcome of the conference.
9.The costs of these orders be in the cause.
The parties complied with the mediation order and a mediation was listed for 4 November 2021. The day prior to the mediation, the plaintiffs' solicitor received an email from the first defendant's solicitor. Relevantly, that email read as follows:
Due to his poor health, my client is unable to appear in person at the mediation conference. His doctor has provided the attached medical certificate.
Could you kindly confirm whether you consent to my client appearing at mediation via audio link.
Either way, I will contact the associate to the mediation registrar to request leave from the court.
Later that day, the first defendant's solicitor wrote to the registrar who was to conduct the mediation. Relevantly, that letter read as follows:
My firm acts for Mr Leo Bialosowski, the second defendant in this matter. Mr Craig Gregson will be appearing at the mediation conference tomorrow.
My client has instructed me that he is unable to attend the mediation conference due to his health conditions. His treating doctor has provided the attached medical certificate. I note the letter is dated 22 October 2021; but the letter was only just [sic] been brought to the attention of myself and Mr Gregson today.
My office has sought to confer with the other parties regarding the matter.
Could you kindly confirm if the Registrar will allow my client to attend via audiolink. Mr Bialosowski will be contactable on his mobile …
Having been provided with a copy of the email from the first defendant's solicitor to the registrar, the plaintiffs' solicitor emailed the registrar's associate. Relevantly, that email was as follows:
I confirm that Ms Bialosowski as plaintiff and in her capacity as executor of the Estate (being the first named defendant in these proceedings) has no objection to the second defendant appearing by telephone as requested.
It is common ground between the parties the mediation took place and it resulted in a handwritten agreement. A copy of that agreement appears as attachment PGJ1 to the affidavit of Patrick Gerard Gladwyn Jebb sworn 11 November 2022. Mr Jebb is the solicitor who represented the plaintiffs at the mediation. The agreement is in the following terms:
1.This settlement agreement is binding on the parties.
2.Leo Bialosowski pay the estate $91,126.30 in settlement of CIV 1407/2021.
3.Leo Bialosowski pay Jenny Bialosowski the sum of $28,839.09 in settlement of CIV 1064/2021.
4.Leo Bialosowski pay the estate's costs in CIV 1407/2021 fixed in the sum of $30,000.00 with all previous cost orders being vacated.
5.Leo Bialosowski pay Jenny Bialosowski's costs in CIV 1064/2021 fixed in the sum of $30,000.00 with all previous cost orders being vacated.
6.Leo Bialosowski pay Jenny Bialosowski the sum of $25,000.00 in full and final settlement of CIV 1753/2021.
7.Veronica Kathleen McGuigan pay Jenny Bialosowski the sum of $12,500.00 in full and final settlement of CIV 1753/2021.
8.The administrator's costs in CIV 1753/2021 be paid as a testamentary expense.
9.The other parties to CIV 1753/2021 bear their own costs.
10.The parties enter into a deed of settlement to fully particularise this agreement.
11.Leo Bialosowski indemnify the estate for any tax liabilities or penalties or municipal council rates or adjustments to be repaid by the estate incidental to CIV 1407/2021.
12.CIV 1407, 1064 and 1753 be adjourned sine die.
It is this agreement which the plaintiffs seek to enforce through the summary judgment application. Before dealing with the application, I should make some general comments about the mediation process and some comments which are specific to this case.
Mediation is ordered in almost all cases which come before this court. There are exceptions - mortgagee actions and actions seeking to set aside a statutory demand are perhaps the most common proceedings in which mediation is not ordered. Otherwise it is virtually obligatory. Solicitors these days accept mediation will be ordered and generally it is ordered by consent. There are cases which arise in Master's Chambers where one party seeks a mediation order but it is opposed by the other party or parties. Almost without exception, a mediation order will be made. There are those rare cases which all the parties are opposed to mediation. This only occurs if the parties have already attempted mediation and resolution of the dispute has not proved possible. In other words, the point has been reached where further mediation will be a waste of time and money. There are also those cases where the issue between the parties cannot be resolved by mediation - cases for instance where statutory interpretation is involved. But it is a rare case indeed which progresses without mediation having taken place.
The reason why that is the case is quite simple - mediation has proved to be a highly successful form of dispute resolution. The savings to the parties and to the court in resolving a dispute through mediation are obvious. The fact that so many cases are settled at mediation is a testament both to the skill of the registrars who conduct the mediation and the intent of the parties who attend the mediation. There are many instances where the degree of animosity between the parties is such that, to the uninitiated, settlement seems unlikely. But settlement is often achieved. That is why in Master's Chambers it is very difficult for the parties to avoid the making of a mediation order.
Turning then to this case, the mediation was ordered in CIV 1753 of 2021. The parties purported to settle all three actions at the one mediation. It follows, therefore, that the order for mediation related only to the one action, but when the parties convened, they clearly intended if possible to settle all three actions. No point was taken by the defendants on this issue. Parties who decide at a mediation convened pursuant to an order made in one action to settle a multitude of actions can have no complaint that only one order was made.
Second, order 6 of the orders made by Registrar Hosking required the first defendant to attend in person. What appears to have happened was that there was a variation of this order. Whether that variation was by consent or whether the order was varied at least implicitly by the mediation registrar, is neither here nor there. It would have been open to the plaintiffs to object to the absence of the first defendant from the mediation. Presumably if that objection was taken, it would have been necessary to refer the matter back to the registrar for a variation of the order. Alternatively, the first defendant could have applied to adjourn the matter until he was able to attend the mediation in person. But the fact that neither course was adopted by the parties does not make any difference to the fact the mediation occurred and was validly convened. In fairness to the first defendant, no argument to the contrary was raised.
The basis upon which the first defendant opposed summary judgment was vary narrow. It was submitted the agreement reached went beyond the scope of the instructions provided by the first defendant to his solicitors. In particular, counsel focused on cl 11 of the handwritten agreement. She submitted that the reference to tax liabilities stood outside the matters in dispute between the parties. That being so, the plaintiffs' solicitors were put on enquiry as to the scope of the authority of the first defendant's solicitors to settle the actions. If enquiry had been made by the plaintiffs' solicitors of the first defendant's solicitors directly, they would have found the first defendant's solicitors were not authorised to settle the proceedings on the terms eventually agreed. On that basis, it was said the settlement agreement could arguably be set aside and summary judgment ought not be granted.
For present purposes, it can be assumed the first defendant did not authorise his solicitors to attend the mediation conference and settle the actions on the terms eventually agreed. I need to make it clear I am making no findings in that regard. For the purposes of summary judgment, it is necessary to accept that version of the facts most favourable to the first defendant. So, it can be assumed the first defendant's solicitors were acting outside the scope of their actual authority. The question then is whether the solicitors, in reaching this agreement, were acting within the scope of their ostensible or implied authority.
The cases are a little confusing as to how 'authority' arises. Actual authority poses no difficulty. There is then implied actual authority which appears to stand apart from ostensible or apparent authority. These differences have been discussed in a number of cases including Pavlovic v Universal Music Australia Pty Ltd [2015] NSWCA 313. There are many nice distinctions which can be made. But it is clear that however the authority may arise, a solicitor who appears at a mediation for a party is to be seen as having authority to settle any and all disputes between the parties represented at the mediation. That necessarily involves being able to settle on terms which deal with matters ancillary to the main dispute. It was prudent of the solicitors involved in this mediation to include reference to tax liabilities. That does not go beyond the scope of settling these disputes. It is something which is to be expected of competent solicitors. As to the actual authority of a solicitor, that is a matter between solicitor and client. If the client takes the view the solicitor has acted beyond their authority, then proceedings might follow. But those proceedings are of no concern to the party who has attended the mediation and reached a settlement. That settlement is binding.
The first defendant also raised an argument that because he may have a claim against his solicitors, that provides some other reason why summary judgment should not be granted. With respect, there is no substance in that submission. Any issues between the first defendant and his solicitors can be ventilated in another forum.
The position of the plaintiffs in this matter is overwhelming. They are entitled to judgment and there is no defence to the claim. In the circumstances then, given the strength of the plaintiffs' claim, it is appropriate to extend time to bring this application. I accept, as was submitted by counsel for the first defendant, there is no real explanation for why this application was not brought within time. But this is one of those cases where the interests of justice require an extension of time because the plaintiffs' case is so strong to allow the matter to proceed would not be in the interests of justice.
There will be judgment for the plaintiffs in terms of the chamber summons. As to costs, given an indulgence was sought from the court, I will allow the parties to make brief submissions with respect to costs. Those submissions should be filed within seven days of the publication of these reasons.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Supreme Court of Western Australia.
MM
Associate
24 MAY 2023