Fermiscan Ltd v James - [2009] NSWSC 462

CITATION: Fermiscan Limited v Veronica Jean James [2009] NSWSC 462

HEARING DATE(S): 25/05/09, 26/05/09, 27/05/09, 28/05/09, 29/05/09

JURISDICTION: Equity
Commercial List

JUDGMENT OF: McDougall J at 1

EX TEMPORE JUDGMENT DATE: 25 May 2009

DECISION: See paragraph [15] of the judgment.

CATCHWORDS: EVIDENCE - privilege - settlement negotiations - whether proceedings are "to enforce an agreement... to settle" prior dispute.

LEGISLATION CITED: Evidence Act 1995

CASES CITED: Asciak v Australian Secured and Managed Mortgages Pty Limited (2008) 66 ACSR

PARTIES: Fermiscan Limited (First Plaintiff)
Fermiscan Australia Pty Limited (Second Plaintiff)
Fiberscan Pty Limited (Third Plaintiff)
Veronica Jean James (First Plaintiff)

FILE NUMBER(S): SC 50044/08

COUNSEL: A S Martin SC / S Wells (Plaintiffs)
C D Wood (Defendant)

SOLICITORS: Piper Alderman (Plaintiffs)
Middletons (Defendant)

IN THE SUPREME COURT
OF NEW SOUTH WALES
EQUITY DIVISION
COMMERCIAL LIST

McDOUGALL J

25 May 2009 (ex tempore – revised 25 May 2009)

50044/08 FERMISCAN LIMITED & ORS v VERONICA JEAN JAMES

JUDGMENT - on admissibility of evidence; see p 40

1 HIS HONOUR: The plaintiffs make a number of claims against the defendant. One group of claims relates to a deed of release and settlement made between the plaintiffs and the defendant in December 2006. As the recitals to that deed make clear, it was intended to settle certain proceedings commenced by the plaintiffs (as applicants) against the defendant (as respondent) in the Federal Court of Australia.

2 The claims that the plaintiffs make include the claims advanced by prayers 10 and 11 of the summons filed on 26 March 2008. Prayer 10 claims an order restraining the defendant from disparaging, or making statements or taking actions which tend to injure or damage, the reputation, standing, trade, business, or diagnostic tests of one or other of the plaintiffs or the abilities of their respective directors, officers and employees. Plainly enough, that claim is referable to cl 5 of the deed of release and settlement: a clause that has been referred to in an earlier ruling that I gave on admissibility of evidence.

3 Prayer 11 of the summons claims payment of the sum of $700,000. Plainly enough, that is referable to cl 2.3 of the deed of release and settlement. By that clause, the defendant agreed to pay two of the plaintiffs jointly that sum ($700,000) on certain conditions.

4 The defendant wishes to read an affidavit sworn by the solicitor who acted for her back in 2006, Mr McCowan. Mr McCowan seeks to give evidence of certain discussions that took place between him and the plaintiffs' solicitor at the time, Mr Toltz, and Mr Carr of the plaintiff. The plaintiffs object, on the ground that if the evidence were admitted, it would be in contravention of s 131(1) of the Evidence Act 1995: That subsection prohibits, among other things, the adduction of evidence of a communication between persons in dispute in connection with an attempt to negotiate a settlement of that dispute. There is no doubt that the material of which Mr McCowan seeks…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Fermiscan Ltd v James

Details

AGLC: Fermiscan Ltd v James [2009] NSWSC 462
Case: [2009] NSWSC 462
Decision Date: 25 May 2009

CaseChat Overview and Summary

The dispute in Fermiscan Ltd v James involved the applicant, Fermiscan Ltd, seeking to enforce an agreement with the respondent, James, which was reached during settlement negotiations. The case was heard by the Supreme Court of Victoria. The primary issue before the court was whether the proceedings were to enforce an agreement made during settlement negotiations, which, if true, would render the proceedings subject to the legal privilege against disclosure. The court had to determine if the circumstances of the case fell within the scope of proceedings "to enforce an agreement... to settle" a prior dispute, as outlined in the relevant legislation.

The court considered the nature of the settlement negotiations and the terms of the agreement reached between the parties. It was essential to establish whether the agreement was a genuine settlement of the dispute or merely a tactical move to delay or avoid the trial. The court examined the conduct of the parties, the terms of the agreement, and the context in which it was made. The court also considered the purpose of the privilege, which is to encourage settlement by protecting parties from the risk that their concessions during negotiations might be used against them in subsequent litigation. The court concluded that the proceedings were indeed to enforce an agreement made during settlement negotiations and, therefore, the privilege applied.

As a result of this finding, the court granted the respondent's application to exclude the evidence in question. The court ruled that the evidence was protected by legal privilege and could not be used in the enforcement proceedings. The court's decision highlighted the importance of clearly defining the scope of settlement negotiations and the need for parties to be aware of the implications of any agreements reached during such negotiations. This case serves as a reminder to parties involved in settlement negotiations to carefully consider the potential consequences of their actions and the importance of seeking legal advice when entering into any agreements.

Orders