Galaxidis & Anor v Galaxidis

[2005] HCATrans 426

[2005] HCATrans 426

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S462 of 2004

B e t w e e n -

JOHN GALAXIDIS

First Applicant

NIKOLAOS GALAXIDIS

Second Applicant

and

ATHANASIOS GALAXIDIS

First Respondent

GEORGIA GALAXIDIS

Second Respondent

ANTONIOS GALAXIDIS

Third Respondent

Application for special leave to appeal

McHUGH J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 17 JUNE 2005, AT 12.13 PM

Copyright in the High Court of Australia

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MR D.A. SMALLBONE:   May it please your Honours, I appear with my learned friend, MS M. FRASER, for the applicant.  (instructed by M.J. Woods & Co)

MR J.E. THOMPSON:   May it please the Court, I appear with my learned friend, MR M.J. WATTS, for the respondents.  (instructed by Colin Biggers & Paisley)

McHUGH J:   Yes, Mr Smallbone.

MR SMALLBONE:   Your Honours, Lord Hardwicke, speaking of an agreement to settle a family dispute, said that a court of equity will be glad to lay hold on any just ground to carry it into execution and establish the peace of a family.

The decision of the Court of Appeal in this case leaves the parties to pursue potentially two further pieces of litigation, one being the item which their Honours referred to in paragraph 147 in Mr Justice Tobias’ judgment at pages 328 to 329, which was the claim which his Honour said was premature in respect of the ultimate destination of the Flinders Street property on the death of the first and second respondents.  The other piece of litigation which would be involved would be the claim of Nikolaos, which their Honours said would have to be pursued in fresh proceedings.

Your Honours, both of those claims would involve substantially traversing the same territory again and probably with some overlay if one or other of the parties sought to introduce any question of narrow or extended issue estoppel. The proceedings at first instance took 14 days at trial, two days on appeal, and numerous other occasions to debate short minutes and interlocutory applications and so on. It is a tragic case and, in my submission, the public obligation imposed by section 63 of the Supreme Court Act to bring the parties’ dispute to finality is one that ought to have prevailed in the ‑ ‑ ‑

McHUGH J:   Well, that depends upon - to the extent to which the court is in a position to bring it to finality.  If the facts are such that it cannot, then it cannot.  Courts have to order new trials.

MR SMALLBONE:   It was brought to finality at first instance, and the Court of Appeal itself, although disagreeing with the views of the trial judge, formed its own views on the merits at paragraph 108 of Mr Justice Tobias’ judgment at pages 315 to 316.  This is a vital factor in his Honour’s decision that his Honour interpreted certain statements as reflecting “an intention on his part”, that is the father’s part –

so understood by John and Nikolaos, that as they would ultimately receive the Flinders Street property, their use of the southern one‑third of it in the meantime was to be of unlimited duration.  In my opinion, no other interpretation of Mr Galaxidis’ assurances, in the context in which they were made, is reasonably open.

So there is a finding as to what the expectation was, but effect is not given to it in the shape of any relief in favour of Nikolaos.  He is excluded wholly and solely on the basis that he is not a plaintiff but merely a defendant, notwithstanding that the claim was squarely propounded at trial and disposed of at trial.

Now, that paragraph does have to be read with paragraph 145, where his Honour seems to reach a view that:

assurances referred to in the third conversation demonstrated that they did not generate an expectation in John and Nikolaos (that they would receive the Flinders Street property on the death of the survivor of theirs parents) upon which they relied to their detriment.

The only expectation of assurance was the one-third in the meantime.  We submit that those two paragraphs are irreconcilable because in paragraph 108 the finding of an expectation of ultimate receipt is squarely made a basis for the interpretation of the assurances to which their Honours arrive, and as the basis for their disagreement with the view of the trial judge.  Then, just to make matters even more complicated, at paragraph 147 on application book 328 his Honour suggests that the claim is in fact premature.

What is left open is a situation where there is a finding of an expectation of ultimate receipt.  How it can be said it was not relied on or is mysterious because one would think that this deal was either a package deal – whatever the deal was it was a package deal, and the parties are then left in the situation where a claim in equitable estoppel has been dealt with by giving effect to part of the expectation and leaving some other part of it for future disputation and, secondly, by leaving out of the equation one of the parties to the arrangement.

That, in my submission, is a question which at a number of levels would attract your Honours’ interests. It would attract your Honours’ interests in respect of the public obligation under section 63 of the Supreme Court Act.  It would attract your Honours’ interests in terms of the proper approach of a court of equity asked to adjudicate on a claim for an equitable estoppel and to vindicate claims of that – expectations of that character, because that always requires consideration of the expectation in the round and making proper relief to adjust the parties’ rights to overcome the unconscionable conduct.

Thirdly, it does raise an Abalos point, in that this is at the heart of their Honours’ disagreement with the view of the trial judge on the facts.  Their Honours seem to have interpreted a passage from an affidavit in a particular way which his Honour the trial judge did not, and at paragraph 108 they say “no other interpretation . . . is reasonably open”, notwithstanding that there were four days of cross‑examination of the plaintiff and his brother notwithstanding that in paragraph 102 on page 313 his Honour Justice Tobias says that on one reading of John’s evidence, it does “contemplate an interest extending to the whole property” and notwithstanding, just by way of one example, a passage from Nikolaos’ evidence in cross‑examination, which was extracted in our submissions in‑chief at page 359, where Nikolaos said:

“He promised that one day the car yard would belong to us.  He’s retiring, it’s yours, take it, do what you like with it.  That was a promise.  And he broke it twice.  Twice he broke that promise . . . I truly believe we had all those rights.”

So we submit that what has happened is that their Honours have interpreted a particular passage of an affidavit and seen all the evidence through that lens and failed to pay due regard to the evidence as a whole, and that when one tries to understand the basis of their reasoning one is confronted with the passages which I have referred to, which contain matters which appear to be not readily reconcilable, one with another, even internally.

The other problem about the way that that issue was approached was that it was not the subject of developed written submissions in advance of the trial, and it was – in the advance of the hearing of the appeal, that is – and it was dealt with in a fairly impressionistic manner on the run, cherry‑picking pieces of evidence here and there, but no proper comprehensive attack on the relevant finding of the trial judge had been developed and was simply a matter of you can send us up some transcript references and so on, but there are references to transcript in some of the passages in the judgment, which were not the subject of particular attention at the hearing of the appeal.

Really, if one was to develop a disagreement with the trial judge in the assessment of witnesses, in the assessment of cultural factors where there are issues of credit, where there were people whose first language was not English, where there were people who were of not a high standard of education, where there were a number of issues involved and one had to carefully review each piece of evidence ‑ ‑ ‑

HEYDON J:   On this procedural unfairness point, was it not the case, or was the respondent wrong, but it was raised in written submissions to the Court of Appeal in advance.  There was a protest about it, as it were, going beyond the notice of appeal.  The notice of appeal was then amended a fortnight – or application was made, a notice was given that it was desired to amend the notice of appeal a fortnight before the hearing of the appeal.  What is unfair about that?

MR SMALLBONE:   The particular ground on which they succeeded never made it into the notice of appeal.  There was something that was subtly different ‑ ‑ ‑

HEYDON J:   Not go beyond permitting the partnership to use one‑third of the Flinders Street property?

MR SMALLBONE:   Yes, the ground that they rely on is ground 1(c) which is you have a licence to use it for so long as the partnership there, but then at the hearing of the appeal – and that ground is pressed – but then at the hearing of the appeal the fall‑back position is put that actually the promise is of an indefinite irrevocable licence of one‑third, irrespective of how long the partnership goes on for.  So it is ‑ ‑ ‑

HEYDON J:   That is better for you than the narrower ground they were agitating.

MR SMALLBONE:   It is better for us, but that ground 1(c) was one which really was so remote from any real view of the case that it did not receive very much attention and there were eight pages of grounds of appeal with major thrusts on questions of law and so on, a lot of which rapidly fell away at the hearing of the appeal, but which in the submissions were regarded as the main thrust of the case and were dealt with.

This fall‑back position about the indefinite licence of one‑third was something that was not dealt with in my submissions in reply and just came out on the run.  It was something that was a really minor side point relating to the partnership and then it blew up into becoming really the main issue in the appeal at the hearing.

So, in my submission, that really does not answer the point because to deal with this properly there had to be a thorough review, a thorough opportunity to confront what the appellants were going to say was the evidence which would show, firstly, to have identified the evidence that they were relying on as making the trial judge’s view unavailable; secondly, their case as to how that evidence was to be interpreted; and thirdly, their case as to how that interpretation would fit into the case as a whole, and that should have been properly developed and there should have been a proper opportunity to respond to it otherwise than on the run and with the transcript references.

The second aspect of the procedural fairness point is the not allowing us to run our fall‑back point about we get the property when we die.  That was pleaded as an alternative.  The trial judge was not attracted to it because he found our primary case, but the Court of Appeal, although they were allowed the one fall‑back point, that is, the one‑third of the land instead of the whole land, did not allow another fall‑back point, namely, whether now or later to be raised, and notwithstanding that the second fall‑back point really arises squarely from introducing the upset of the trial judge’s view and entering into these other questions about what was promised.

An example of that is that in the court below, in the appellant’s own submissions in‑chief, at application book page 171, line 21, Mr Justice Giles, speaking to my learned friend, said:

Your point to start with remains, as I understand your submission, namely, it would have meant and would have been understood as only on death because the parents needed the income from at least the other two‑thirds.

That is just an example where this other alternative that we get the land on death is introduced in the course of argument because it has been opened up by this attack on the trial judge’s view.  Now, surely, what is sauce for one side is sauce for the other side.  If one fall‑back position can be entertained, why not the other, and particularly when it is going to lead to further litigation if it is not dealt with.

Can I return to the section 63 point and refer your Honours to the decision of Adamopoulos to which reference has been made in both parties’ written submissions. In that case, Mr Justice Handley, who wrote the leading decision, said that relief could be granted to a defendant notwithstanding that the defendant was not a plaintiff or cross‑claimant because of section 78 of the Supreme Court Act which is extracted at the

bottom of page 84 of the report at G, and his Honour goes over onto 85A to say:

While this provision ordinarily applies to relief granted to a defendant on the application of that defendant it is not in terms limited to such cases and I see no reason for implying any restriction to that effect.

There will be many cases in which a plaintiff will lack the standing –

and the respondent here says that there was a lack of standing but, in my submission, that is clearly incorrect.  Then his Honour goes on to give some examples of cases where this may occur, and your Honours will see that they are at B and C.  They are disparate in character.  It is no narrowly confined proposition, and then Mr Justice Hodgson in his dissent in this case gave other examples.

Your Honours, I see that my time is up and I would just urge your Honours to act on that dissent of Mr Justice Hodgson in relation to this point.  His reasons were persuasive.  I commend the application.

McHUGH J:   Thank you.  The Court need not hear you, Mr Thompson.

The Court of Appeal, as it was entitled to do, took a view of the facts of this case different from that of the trial judge.  Nothing about the Court of Appeal’s treatment of the facts gives rise to any question which would warrant the grant of special leave to appeal, nor do the applicants’ complaints about lack of procedural fairness or the making of orders by or in the Court of Appeal raise any issue that would warrant the grant of special leave in this matter.  Accordingly, the application for special leave to appeal is refused with costs.

AT 12.32 PM THE MATTER WAS CONCLUDED