Donaldson v Nolan [No 5]
[2017] WASC 44
•23 FEBRUARY 2017
DONALDSON -v- NOLAN [No 5] [2017] WASC 44
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2017] WASC 44 | |
| Case No: | CIV:2867/2013 | 18 JANUARY 2017 | |
| Coram: | CHANEY J | 23/02/17 | |
| 14 | Judgment Part: | 1 of 1 | |
| Result: | Application for removal of next friend refused Compromise approved | ||
| B | |||
| PDF Version |
| Parties: | JOHN RAWSON DONALDSON by his next friend THE PUBLIC TRUSTEE JEFFREY RAYMOND NOLAN as Executor of the Estate of JOHN WAYNE DONALDSON JEMMA LOUISE DONALDSON THOMAS DEREK DONALDSON ROSANNE DONALDSON GREGORY BRENT DONALDSON VANESSA DONALDSON JACQUELINE DONALDSON VALERIE DOREEN DONALDSON MAITLAND GERALD DONALDSON DAVID TAYLOR SILVER CHAIN NURSING ASSOCIATION INC ROBIN BRAZIL DONALDSON JENNIFER LOUISE BROWNING JEFFREY RAYMOND NOLAN as executor of the estate of JOHN WAYNE DONALDSON THOMAS DERK DONALDSON ROSEANNE DONALDSON VALERIE DOREEN ROBERTS SILVER CHAIN NURSING ASSOCIATION (INC) |
Catchwords: | Practice and procedure Incapable plaintiff Compromise of actions Removal of next friend Turns on own facts |
Legislation: | Nil |
Case References: | Dalle-Molle v Manos [2004] SASC 102; (2004) 88 SASR 193 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CIVIL
- Plaintiff
AND
JEFFREY RAYMOND NOLAN as Executor of the Estate of JOHN WAYNE DONALDSON
First Defendant
JEMMA LOUISE DONALDSON
Second Defendant
THOMAS DEREK DONALDSON
Third Defendant
ROSANNE DONALDSON
Fourth Defendant
GREGORY BRENT DONALDSON
Fifth Defendant
VANESSA DONALDSON
Sixth Defendant
JACQUELINE DONALDSON
Seventh Defendant
VALERIE DOREEN DONALDSON
Eighth Defendant
MAITLAND GERALD DONALDSON
Ninth Defendant
DAVID TAYLOR
Tenth Defendant
SILVER CHAIN NURSING ASSOCIATION INC
Eleventh Defendant
ROBIN BRAZIL DONALDSON
Twelfth Defendant
JENNIFER LOUISE BROWNING
Thirteenth Defendant
- Plaintiff
AND
JEFFREY RAYMOND NOLAN as executor of the estate of JOHN WAYNE DONALDSON
First Defendant
JEMMA LOUISE DONALDSON
Second Defendant
THOMAS DERK DONALDSON
Third Defendant
ROSEANNE DONALDSON
Fourth Defendant
GREGORY BRENT DONALDSON
Fifth Defendant
VANESSA DONALDSON
Sixth Defendant
JACQUELINE DONALDSON
Seventh Defendant
VALERIE DOREEN ROBERTS
Eighth Defendant
MAITLAND GERALD DONALDSON
Ninth Defendant
DAVID TAYLOR
Tenth Defendant
SILVER CHAIN NURSING ASSOCIATION (INC)
Eleventh Defendant
ROBIN BRAZIL DONALDSON
Twelfth Defendant
JENNIFER LOUISE BROWNING
Thirteenth Defendant
Catchwords:
Practice and procedure - Incapable plaintiff - Compromise of actions - Removal of next friend - Turns on own facts
Legislation:
Nil
Result:
Application for removal of next friend refused
Compromise approved
Category: B
Representation:
CIV 2867 of 2013
Counsel:
Plaintiff : Mr M Curwood
First Defendant : Mr P A Nevin
Second Defendant : Ms W F Gillan
Third Defendant : Ms W F Gillan
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : Ms W F Gillan
Thirteenth Defendant : Mr C E Chenu
Solicitors:
Plaintiff : Public Trustee
First Defendant : Taylor Smart Lawyers & Notaries
Second Defendant : Kershaw Legal
Third Defendant : Kershaw Legal
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : Kershaw Legal
Thirteenth Defendant : Bennett + Co
CIV 2865 of 2013
Counsel:
Plaintiff : Mr C Curwood
First Defendant : Mr P A Nevin
Second Defendant : Ms W F Gillan
Third Defendant : Ms W F Gillan
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : Ms W F Gillan
Thirteenth Defendant : Mr C E Chenu
Solicitors:
Plaintiff : Public Trustee
First Defendant : Taylor Smart Lawyers & Notaries
Second Defendant : Kershaw Legal
Third Defendant : Kershaw Legal
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : Kershaw Legal
Thirteenth Defendant : Bennett + Co
Case(s) referred to in judgment(s):
Dalle-Molle v Manos [2004] SASC 102; (2004) 88 SASR 193
- CHANEY J:
Introduction
1 On 22 February 2017, I delivered to the parties reasons in relation to two applications which were before me. No orders completing the matter were made in order to give the parties an opportunity to address, if they wished, the orders proposed. Shortly after providing reasons to the parties, I became aware that a submission made by Mr John Donaldson on 6 February 2017 had not been brought to my attention and my reasons had been written on the express understanding that those particular submissions had not been made despite an invitation from the court to make them. Having become aware of that error, I immediately withdrew the reasons on the basis that they required review in light of Mr Donaldson's submissions of 6 February 2017. I have now undertaken that review, but for reasons which I set out in these revised reasons, Mr Donaldson's submissions do not alter what I consider to be the appropriate outcome of the applications.
The applications
2 Both of these actions were commenced on 12 December 2013. In CIV 2865/2014 (family provision action), the plaintiff sought further provision from the estate of his late father, pursuant to s 6 and s 7 of the Family Provision Act 1972 (WA), for his proper maintenance, support, education and advancement in life. In his affidavit in support, he quantified his financial needs at between $2.6 million and $2.9 million being an amount sufficient to provide himself with a home in the western suburbs, private school fees for his children, a fishing boat to enable him to run a business and miscellaneous expenses.
3 In CIV 2867/2013 (revocation action), the plaintiff sought revocation of his late father's will, in respect of which there had been a grant of probate to Mr Nolan, the first defendant in each action.
4 Because the family provision action was based upon the allegedly inadequate provision in favour of the plaintiff under the father's will, the original case manager determined that the revocation action should be dealt with first. That was because, if the proceedings were successful, the father's will would be ineffective and the plaintiff's entitlement to a share of the estate would be governed by any prior will admitted to probate, or on the rules of intestacy. It was thus practical that the family provision action be deferred pending the outcome of the revocation action.
5 The interlocutory steps in the revocation proceedings were characterised by ongoing and constant applications by Mr Donaldson for access to documents. Those applications were generally rejected on the basis that the documents to which access was being sought were irrelevant to the revocation proceedings. The matter was listed for trial initially in May 2016, but was subsequently adjourned to early October 2016 by reason of the plaintiff's un-readiness for trial. In the course of a further application for adjournment of the October trial, Mr Donaldson asserted that he was not mentally fit to conduct the proceedings. He subsequently provided a medical report confirming that he lacked capacity to conduct the proceedings. In the circumstances, and with the concurrence of the plaintiff, I made orders on 25 May 2016 that, pursuant to O 70 r 2 of the Rules of the Supreme Court 1971 (WA), the Public Trustee be appointed as next friend of the plaintiff in respect to both the family provision action and the revocation action. As a result of that appointment, the Public Trustee reviewed the files, and sought referral of both matters to mediation. That application was successful, although the matter remained listed. The mediation proceeded in early September 2016, and resulted in heads of agreement being signed by the parties which effectively settled the matter subject to execution of a formal deed of settlement and the approval of the compromise as required by O 70 r 10 of the Rules of the Supreme Court. Accordingly, the October trial dates were vacated, and an appointment was listed to deal with the application for leave to compromise the action.
6 Mr Donaldson then informed the court that he had 'sacked the Public Trustee' and asked that orders be made for disclosure of documents and various other relief. I treated that as an application for removal of the next friend. The basis for the application was, essentially, an assertion that the Public Trustee had failed to follow Mr Donaldson's instructions to obtain documents and otherwise progress the matter to trial, and had reached a compromise which Mr Donaldson found unacceptable.
7 Directions were made that the parties file materials in relation to the issues of removal of the next friend and approval of the proposed compromise. It is those issues which now fall for determination.
Removal of the next friend
8 Mr Donaldson does not put his case for removal of the Trustee on the basis that he is no longer a person under a disability. There is no reason to conclude that there has been any change in Mr Donaldson's capacity to conduct the litigation than was the case when the order was made in May 2016. Indeed, it is fair to say that Mr Donaldson's conduct of his application for removal of the Trustee continues to demonstrate his inability to understand the nature of the litigation, its purpose and its possible outcomes (as to which see Dalle-Molle v Manos [2004] SASC 102; (2004) 88 SASR 193 [23], [26].
9 Rather, Mr Donaldson's application for removal of the next friend is based upon a contention that the next friend has not acted in his interests, and in particular has failed to obtain disclosure of documents and progress the matter to trial.
10 Although at the time the appointment was made care was taken to explain to Mr Donaldson the consequences of the appointment of a next friend, he does not appear to have understood that consequence. The role of a next friend is not simply to act on the instructions of the incapable person. It is rather to conduct the litigation efficiently and in the interests of the represented person. For reasons which I deal with below, I am of the view that the compromise achieved by the next friend is in the interests of Mr Donaldson.
11 Despite Mr Donaldson's confident assertions at almost every directions hearing that his case for revocation of the will is unanswerable, and that immediate payments should be made to him from the estate, materials filed in relation to the revocation action give little indication that the revocation action had any substantial prospect of success. To have proceeded to a four day trial would have involved considerable costs being incurred by the Public Trustee, and a likely liability of the plaintiff for significant costs of the defendants. It was very much in Mr Donaldson's interests to seek to resolve all matters through mediation as in fact occurred. There is no basis to conclude that the Public Trustee has acted otherwise than in the interests of Mr Donaldson.
12 Mr Donaldson did not suggest any other person who might act as his next friend. There is no basis upon which removal of the next friend should be ordered.
13 In the course of Mr Donaldson's communications with the court, both by way of emails prior to the hearing, and by way of submissions made in chambers, Mr Donaldson demanded that the court deal with a number of propositions. For the following reasons, there is either no substance in the propositions or they are entirely irrelevant for the present purposes.
14 The first proposition is that the will is a 'false instrument' and that proceedings 'cannot continue on a false instrument'. Presumably, this submission is made to support the proposition that discontinuance of the revocation proceedings is unjustified because the will is said to be a 'false instrument'. The will contains an explanation by the testator as to his reason for making only a minor provision in the will for Mr Donaldson, namely Mr Donaldson's behaviour towards the testator and other family members over a lengthy period of time. The behaviour is said to include 'physical assaults on me and my property'. Mr Donaldson asserts that no such events occurred, and that the statement in the will is false. He relies on the absence of any reference to physical assaults in any of the reports by medical practitioners produced in the proceedings or in any of the other documents or witness statements produced in the proceedings. Mr Donaldson's denial of physical assaults is inconsistent with the contents of some of the correspondence to him from his father that is referred to in counsel's opinion as to the appropriateness of the proposed compromise. It is not necessary in the context of the consideration of the compromise to determine whether or not Mr Donaldson physically assaulted his father or his father's property. Even if the statement was inaccurate, it would not inevitably demonstrate a lack of testamentary capacity. The question of compromise involves an assessment of the strength of the plaintiff's claim and the risks to the plaintiff of failure of the actions. A finding of whether the assertion of assaults made in the will was factually correct would turn in substantial part on Mr Donaldson's credibility. The Public Trustee was, in my view, properly entitled to assess the strength of the plaintiff's case on the basis that there was a significant risk that the assertion as to assaults would not be found to be false or delusional.
15 Whether Mr Donaldson had engaged in disentitling conduct is a matter relevant to the family provision action, but the accuracy of the testator's expressed reason for making any minimal provision for Mr Donaldson has no conclusive effect on the validity of the will, nor on the grant of probate of that will. Mr Donaldson's contention is that any inaccurate statement in his father's will has the effect of immediately invalidating the will (because it is a 'false statement'). That contention is misconceived.
16 Mr Donaldson also contends that the compromise of his actions cannot properly occur until the issue of 'disclosure' is resolved. It was a matter for the Public Trustee, advised as he was by competent counsel, to assess the need for additional documents. Mr Donaldson's attempts to obtain orders for production of documents in the course of these proceedings have been unsuccessful for reasons explained by the judges dealing with the matter at different times. There is no reason to consider that any failure by the Public Trustee to seek further documentation prior to resolving the matter was inconsistent with Mr Donaldson's interests.
17 Mr Donaldson complains about the conduct of the Public Trustee's representative, including the suggestion of 'colluding with the other parties' to his detriment. Beyond the fact that the Public Trustee properly entered into negotiations with the other parties through the mediation process, there is no evidence, and no reason to suggest, any improper collusion. Like many other allegations made by Mr Donaldson against other parties, their lawyers, and judges dealing with these matters, the allegations have never been shown to have had substance, and demonstrate Mr Donaldson's lack of capacity to conduct these proceedings on his own behalf.
18 The application for removal of the next friend will be dismissed.
Should the compromise be approved
19 The application for approval of the compromise was supported by an affidavit of the authorised delegate of the Public Trustee which annexed the heads of agreement signed following mediation on 15 September 2016, the deed of family arrangement prepared to implement the heads of agreement, and the opinion of Matthew Curwood of counsel which concluded that the proposed compromise of Mr Donaldson's claims is in his best interest. The proposed settlement involves the payment to the Public Trustee of the sum of $1.5 million, to be disbursed as to $100,000 in respect to past estimated legal fees and disbursements, $85,000 towards future trust administration expenses, $250,000 to a trust for the benefit of Mr Donaldson's children (with a provision that that amount be increased by the amount which the balance otherwise payable to Mr Donaldson exceeds $1.1 million, up to a maximum of an additional $50,000), and the balance is held by the Public Trustee for investment on behalf of Mr Donaldson to be applied for his maintenance, welfare, advancement or otherwise for his benefit.
20 The settlement is in addition to the payment of the bequest under the will to Mr Donaldson which has already been paid.
21 The opinion of counsel is comprehensive and takes into account the size of the estate, the fact that Mr Donaldson owns shares in the family company which as at 30 June 2016 were valued at $575,040, the amount of the settlement sum and counsel's estimate as to the strength of both the revocation action and the family provision action. Counsel considered that the upper limit that could be justified for Mr Donaldson's claim in the family provision action, excluding the issue of disentitling conduct, would be a figure not exceeding $2 million, but could be significantly less than that figure. Counsel observes that questions of Mr Donaldson's credibility would be significant, particularly in relation to disentitling conduct. For reasons which he explained, counsel expressed concerns about Mr Donaldson's credibility generally.
22 Counsel also concluded that the revocation proceedings had very poor prospects of success, and that the compromise had the effect of relieving Mr Donaldson of the potential liability for substantial costs in relation to that action. He also concluded that there was a risk that Mr Donaldson's claim in the family provision action could entirely fail. I accept that those conclusions are soundly based.
23 The affidavit of the Public Trustee's officer, Shaun Conlin, filed in support of the compromise and which annexed counsel's opinion, had not been provided to Mr Donaldson before the hearing of these applications. At the hearing, on Mr Donaldson's application, I directed that he be provided with a copy of the affidavit and that he have liberty to file any submissions as to the contents of the affidavit within 14 days. On 24 January 2017, Mr Donaldson sent an email to the court which I took to be his submissions on Mr Conlin's affidavit. The email asserts that the report is 'factually wrong from start to finish'. He offered to provide a detailed reply pointing out the errors if required. In view of that offer, and given that generalised and unparticularised assertions of error are of no value, Mr Donaldson was directed, if he wished to do so, to point out specific errors within 14 days. He did so by email dated 6 February 2017.
24 Most of Mr Donaldson's email of 6 February 2017 was directed to the opinion of Mr Curwood, the barrister who's opinion as to the compromise was annexed to Mr Conlin's affidavit. Mr Conlin's affidavit does no more than recite the background of the compromise agreed to at mediation, annex the heads of agreement signed at mediation and the proposed deed to give effect of the heads of agreement, annex the opinion on compromise by Mr Curwood, and indicate that in Mr Conlin's capacity as delegate of the Public Trustee as next friend of the plaintiff, he approves the proposed compromise. Mr Donaldson's criticisms of Mr Conlin's affidavit are effectively that neither Mr Conlin nor Mr Curwood have consulted him and are not therefore independent. Mr Conlin does not assert that he is independent, and his role as delegate of the next friend is not to be independent, but to act in what he considers to be the interests of the plaintiff. The fact that Mr Curwood did not meet with Mr Donaldson does not affect Mr Curwood's independence. The criticism of Mr Conlin's affidavit have no substance.
25 Mr Donaldson provided extensive commentary and criticism in relation to a large number of paragraphs of Mr Curwood's opinion. A significant number of the criticisms are directed to the correctness of facts referred to by Mr Curwood. Mr Donaldson asserts that those facts are incorrect. The criticisms appear to assume that Mr Curwood has treated the evidence of the factual matters to which he refers as being established and true. That is not what he has done. Mr Curwood has simply recited what he considers to be relevant aspects of the evidentiary material which was provided to him. That is an appropriate course in the context of an assessment of the strength of Mr Donaldson's claim. In the course of that analysis, Mr Curwood makes frequent reference to Mr Donaldson's responses to those factual matters found in various affidavits, statements and pleadings provided in Mr Curwood's brief. The substance of Mr Donaldson's criticisms of Mr Curwood's opinion is that Mr Curwood should simply reject any (or at least a significant proportion of) evidence that is unfavourable to the plaintiff's claims. That is consistent with Mr Donaldson's repeated contentions throughout the history of these proceedings that what he asserts to be fact should be accepted as true and that facts contrary to his interests should be ignored. That approach demonstrates Mr Donaldson's incapacity to understand the nature of the proceedings. What Mr Curwood does, appropriately, is to assess the evidence before him, and form an opinion as to the likelihood of success in the proceedings and of the risks involved in the proceedings. That does not involve any unquestioning acceptance of evidence contrary to Mr Donaldson's position, but rather an acknowledgement that that evidence, if accepted, could give rise to a significant risk that Mr Donaldson's actions might entirely fail.
26 In relation to the family provision action, Mr Curwood assesses the risk that disentitling conduct might be established and might thereby eliminate or reduce any award in favour of Mr Donaldson. He acknowledges that the extent to which disentitling conduct might be found to have occurred will turn to a significant extent on Mr Donaldson's credibility. He identifies and acknowledges available material that might adversely impact on Mr Donaldson's credibility. One such matter relates to reliance Mr Donaldson has placed in other proceedings on the contents of a letter from the Chief Justice. Mr Donaldson's construction of that letter has been found to be misconceived. That finding was plainly correct. I note that, in his submissions of 6 February, Mr Donaldson continues to assert that misconceived construction.
27 It needs to be borne in mind that the proposed settlement results in a significant award to Mr Donaldson, and therefore assumes in Mr Donaldson's favour that he has not engaged in disentitling conduct such as to completely deprive him of an award under the Family Provision Act. It is not implicit in Mr Curwood's opinion that he has assumed that the factual matters to which he refers would be established against Mr Donaldson.
28 In Mr Donaldson's submissions a number of criticisms are made against Mr Curwood on the basis that he is biased and lacks any qualification or 'legal right' to express the opinion. Those criticisms are misconceived. Mr Curwood's function was to express an opinion as to whether, in all the circumstances, the settlement was in the plaintiff's best interests. He has done that in a thorough and careful way. He is an experienced counsel. There is no basis to question his independence or impartiality.
29 Having carefully considered Mr Donaldson's objections to counsel's opinion, I reject his submission that the opinion should be rejected.
30 The proposed compromise has the capacity to remove the considerable uncertainty in relation to the plaintiff's prospects of success, and to provide a substantial capital sum to enable him to meet his needs. I accept counsel's opinion that the proposed compromise is in the plaintiff's interest. In the circumstances, I have no hesitation in approving the compromise pursuant to O 70 r 10 of the Rules of the Supreme Court.
31 The orders sought on the application for compromise are as follows:
(1) the plaintiff do have leave to compromise the proceedings pursuant to O 70 r 10 of the Rules of the Supreme Court on the terms set out in the Heads of Agreement dated 15 September 2016 and the Deed of Family Arrangement attached to these orders;
(2) the Public Trustee be appointed the trustee of such money as is payable to the plaintiff pursuant to the terms of the Deed (the Court Trustee);
(3) the Court Trustee be empowered at its discretion to invest the monies (the Court Trust) on behalf of the plaintiff, such investment not be limited to the Common Account and the Court Trustee have the power to apply the income and capital of the Court Trust for the maintenance, welfare and advancement or otherwise for the benefit of the plaintiff;
(4) there be liberty to apply with respect to the first, second and third defendants' payment obligations under the Deed;
(5) there be liberty to apply with respect to the Court Trust;
(6) the Public Trustee have liberty to apply with respect to the payment of the Public Trustee's costs by the plaintiff;
(7) the materials provided to the court in support of the proposed compromise and appointment of the Public Trustee (being the affidavit of Shaun William Conlin sworn in support of the proposed compromise) be sealed and are not to be opened without the leave of a judge of this court;
(8) save for the operation of these orders, the proceedings otherwise be dismissed with no order as to costs save and except to the right of the Public Trustee to receive costs from the plaintiff in accordance with order 6;
to be made within 10 days of publication of these reasons.
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