Jones v Jones

[2024] NSWSC 210

Supreme Court

New South Wales

Medium Neutral Citation:

Jones v Jones [2024] NSWSC 210

Hearing dates:

04 March 2024

Date of orders:

06 March 2024

Decision date:

06 March 2024

Jurisdiction:

Equity - Succession & Probate List - Probate

Before:

Elkaim AJ

Decision:

1. A declaration pursuant to s 73 of the Civil Procedure Act 2005 (NSW) that that the Succession Act proceedings have been compromised and settled on 11 May 2023.

2. I direct that within seven days of today’s date the parties bring in short minutes to give effect to these reasons for judgment.

3. If the parties are unable to agree on the short minutes, then they are each directed to provide their respective versions of the appropriate short minutes together with any written submissions in support of their respective versions.

4. Order (3) above is to be complied with within 14 days of today’s date.

Catchwords:

CIVIL PROCEDURE – notice of motion – order seeking settlement approval – settlement identified

Legislation Cited:

Civil Procedure Act 2005 (NSW), s 73

Evidence Act 2005 (NSW), s 131

Succession Act 2006 (NSW), s 59

Cases Cited:

Bobi Damcevski v Emilios Demetriou & Ors [2018] NSWSC 988

G R Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631

Gorczynski v Bendigo and Adelaide Bank Ltd [2016] NSWCA 170

Masters v Cameron (1954) 91 CLR 353; [1954] HCA 72

Narayan v Narayan [2022] NSWSC 1685

Wong v Wong [2022] FCA 78

Category:

Procedural rulings

Parties:

Leanne Jones (Plaintiff)
Darren Gilbert Jones (Defendant)

Representation:

Counsel:
Mr J Brown (Plaintiff)

Mr S Friedman (Defendant)

Solicitors:
Firths The Compensation Lawyers (Plaintiff)
Harris Friedman (Defendant)

File Number(s):

2022/184841

JUDGMENT

1. The proceedings started with the filing of a summons on 24 June 2022. The orders sought in the summons were to the effect that probate should not be granted to the will of the plaintiff’s deceased mother or, alternatively, that the plaintiff should receive adequate provision from the estate of her late mother pursuant to s 59 of the Succession Act 2006 (NSW).

2. The summons was countered by a cross-claim filed on 19 September 2022 which requests a declaration that the will of the plaintiff’s late mother (Ms Josephine May Jones) be declared as a valid testamentary instrument. On 3 November 2022, the plaintiff filed an amended statement of claim, essentially seeking the same orders as the summons.

Background

3. Ms Josephine May Jones (the deceased) died on 26 June 2021. The will at issue was executed on 29 June 2019. The parties are brother and sister and are the children of the deceased.

4. On 6 October 2023, the plaintiff filed a notice of motion, which is the matter that I am dealing with in these reasons.

5. The purpose of the motion is to obtain orders under s 73 of the Civil Procedure Act 2005 (NSW) to the effect that the substantive proceedings have been resolved. Settlement is asserted to have occurred on 11 May 2023 and then confirmed in a deed exchanged between the parties on 17 August 2023 or, in the alternative, in a deed exchanged on 8 September 2023.

6. The notice of motion is supported by affidavits of Ms Jessica Pinkus affirmed on 11 October 2023 and 29 February 2024 respectively.

7. The defendant says the proceedings have not been resolved. He relies on the affidavits of Mr Jonathan Harris affirmed on 31 October 2023 and the affidavit of Ms Priscilla Sidey also affirmed on 31 October 2023.

8. Ms Pinkus is a solicitor with the day-to-day carriage of the matter on behalf of the plaintiff. Mr Harris and Ms Sidey are, or were, the solicitors acting for the defendant.

9. A matter in Mr Harris’s affidavit which arises frequently is his objection to various paragraphs in Ms Pinkus’s affidavit on the basis that she refers to, and attaches to her affidavit, conversations and items of correspondence which would normally be inadmissible because they were made on a “without prejudice” basis.

10. These objections were withdrawn at the commencement of the hearing. I note however that the objections would have been rejected in any event as falling within the bounds of s 131(2)(f) of the Evidence Act 1995 (NSW).

11. There is a property at the centre of the dispute between the parties. It is situated in the Sydney suburb of Lansvale. It is registered in the joint names of Bert Jones and Louise Kathleen Jones. They both died intestate and no application for Letters of Administration were ever made.

12. Bert Jones and Louise Jones had two children, Louise Barbara Jones (nee Decker) and Gilbert Raymond Jones.

13. Louise Barbara Jones married Richard Dekker in 1964. They have both since died intestate. They had one child, Michelle Louise Wilson (nee Decker).

14. Gilbert Jones married the deceased in 1962. They had three children, being the parties plus Suzanne Honour. Ms Honour has taken no part in the proceedings and has not made any claim.

15. Gilbert Jones and the deceased moved into the Lansvale property following their marriage. Gilbert Jones died intestate in 2018. The deceased remained in the property until she died in 2021. She left a will dated 29 June 2019.

16. Under the will the entire estate is left to the defendant.

17. The estate of the deceased has only one asset, the Lansvale property. However, because this property remains in the names of Bert Jones and Louise Kathleen Jones, the asset is described as a chose in action, referring to the right of the estate to obtain and deal with the property.

18. Under ‘normal’ rules of survivorship, title to the property would have passed to Gilbert Jones and Louise Dekker as tenants in common. Then, on the death of Louise Dekker in 1995 her interest would have passed to her husband, Richard Dekker.

19. In September 2001 Richard Dekker and Gilbert Jones executed a deed in which Richard Dekker waved any entitlement he may have had to the property. Arguably therefore, after the death of Gilbert Jones in 2018, Josephine Jones was entitled to the ownership of the whole of the Lansvale property.

20. The basis for negotiations between the parties was the plaintiff’s objective of obtaining a share of the value of the property. Normally, if the property had been owned by the deceased, there would have been little complication in agreeing to a split of this value. However, the need for the property to make its way to the estate has presented some difficulties. The defendant has filed an application for a grant of Letters of Administration in the estate of his late father, Gilbert Jones.

21. In addition, there is the possibility of Michelle Dekker challenging the deed signed by her father in 2001 and asserting an interest in the property.

22. I think it fairly clear that the burden of the negotiations was to work out the percentage of the disposable estate that the plaintiff would ultimately be entitled to receive. The balance of the discussion between the parties would then be to agree upon the mechanics of giving effect to the agreement concerning the percentage.

23. The percentage (27% to the plaintiff) was agreed between the parties and confirmed in an exchange of emails culminating in an email from Ms Pinkus to a Mr Rundle on 11 May 2023. In this email Ms Pinkus states:

“I can confirm that the offer 27% of the net assets of Josephine’s Estate for your client is accepted, (in addition to the points already agreed including, plus costs from the gross estate).”

24. The confirmation of the agreement as to the 27% was submitted to be an enforceable agreement under s 73 of the Civil Procedure Act. Originally the agreement said to have been reached on 11 May 2023 was put as the plaintiff’s primary position. It was stated that the agreement reflected resolution of the plaintiff’s action pursuant to s 59 of the Succession Act and that any ancillary matters, such as the mechanics of arriving at a net estate for distribution, were, if necessary, to be the subject of separate proceedings.

25. During the course of the hearing learned counsel for the plaintiff switched his primary case to the deed that had been exchanged between the parties on 8 September 2023, which encompassed all of the ancillary matters referred to above. The plaintiff sought specific performance of this deed. The change in priorities occurred when learned counsel for the plaintiff was informed of the following notation made by the court (Meek J) on 13 October 2023:

“THE COURT:

1.   Notes that the Court has been informed that there is seemingly no dispute over the terms of the counterpart forms of deed exchanged between the parties on 8 September 2023 but that the defendant has resiled from the resolution of the matter and declines to sign the deed.

… ”

26. Armed with this notation, the plaintiff said that the 8 September 2023 deed confirmed an entire agreement between the parties (both as to the Succession Act claim and the ancillary matters), entitling the plaintiff to an enforcement order under s 73 of the Civil Procedure Act. I note that it was common ground that the use of the word “exchanged” did not refer to an inter-partes dispatch of signed deeds but rather to a ‘swapping’ of unsigned but identical documents.

27. The defendant’s position was twofold:

1. the agreement reached on 11 May 2023 was but a part of the overall resolution of the matter that was necessary before the proceedings could be viewed as ‘settled’. Accordingly, the ancillary matters were as much a part of the settlement for s 73 purposes as the percentage that had been agreed; and

2. the ancillary matters were never agreed. There were 11 draft deeds before the 8 September 2023 document, emphasising that there had not been overall resolution.

28. In respect of the notation made by the court on 13 October 2023 I pointed out to the parties that the wording included the phrase “seemingly no dispute”, suggesting that the court had not been informed that there had been no dispute at all as to the terms of the deed.

29. There is no evidence of any agreed notation being put to the court by the parties, so that I do not think the plaintiff is entitled to draw the conclusion from the note that she seeks to achieve.

30. It would be a more cost-effective and productive result if I were to find that the 8 September 2023 deed was enforceable under s 73 of the Civil Procedure Act as opposed to the 11 May 2023 agreement. This is because the latter still requires the completion of the ancillary matters which, absent agreement, could take a lot of time and money to resolve.

31. For reasons which appear below, I think the 11 May 2023 agreement is the only enforceable agreement under s 73. I do not think I can make s 73 orders arising from the 8 September 2023 deed, primarily for two reasons:

1. the notation made on 13 October 2023, without more, is not sufficient to reach a finding that the 8 September 2023 deed had, in its entirety, been agreed upon between the parties. This conclusion arises from the word “seemingly”; and

2. section 73 is concerned with “any question in dispute between the parties to the proceedings as to whether, and on what terms, the proceedings have been compromised or settled between them … ” In other words, a court applying the section is concerned with the resolution of the proceedings, which in this case refers to the Succession Act proceedings, but not to the ancillary matters.

Legal principles

32. In Bobi Damcevski v Emilios Demetriou & Ors [2018] NSWSC 988, from [72]-[77], Sackar J said the following about s 73 of the Civil Procedure Act and intentions to put agreements in writing:

“Section 73 of the Civil Procedure Act 2005 (NSW)

In Gorczynski v Bendigo and Adelaide Bank Ltd [2016] NSWCA 170 Basten JA observed (at [6]) (citations omitted):

Section 73 (and its analogues in other jurisdictions) has been understood to confer power on the court to deal with settlements in the proceedings to which they relate, rather than leaving the parties to commence separate proceedings to enforce a settlement. Accepting that to be the primary purpose of the provision, it is nevertheless expressed in broad terms as to the scope of the power conferred, terms which should not be read down by implied constraints. Rather, the breadth of the power as it operates in the Supreme Court is confirmed when it is read in the context of other powers conferred on the Court. Thus, s 56 of the Civil Procedure Act, to which the primary judge referred, states that the court must give effect to the overriding purpose of facilitating “the just, quick and cheap resolution of the real issues in the proceedings.” In order to undertake that function, the court must have the necessary powers to assist it to identify what are the “real issues” in the proceedings. In order to determine what are the real issues in the proceedings it is necessary for the court to seek to ascertain the extent to which the parties can or have narrowed their dispute, so as to limit the proceedings to that part, if any, which remains unresolved. That was the course which the primary judge undertook. If any express power were required for the judge to act on her own initiative, the court had power to act “of its own motion” pursuant to s 86(3) of the Civil Procedure Act, subject always to according procedural fairness to each party.

Likewise in Ahmed v Chowdhury [2011] NSWSC 893 Slattery J said (at [4]):

Before the enactment of Civil Procedure Act, s 73 there were different judicial views as to whether an alleged settlement of proceedings could be enforced by motion in the proceedings or whether a separate action needed to be commenced: Phillips v Walsh (1990) 20 NSWLR 206 at 210 and Roberts v Gippsland Agriculture & Earth Moving Contracting Co Pty Ltd [1956] VLR 555 at 557-562-7 and Darling Downs Investments Pty Ltd v Ellwood (1988) 18 FCR 510. Now Civil Procedure Act , s 73 resolves these different views and makes clear that the Court has jurisdiction to determine any dispute between the parties to the proceedings as to whether and on what terms the proceedings have been compromised: Civil Procedure Act, s 73(1)(a). Civil Procedure Act, s 73 probably preserves a discretion to require the enforcement of settlement claims to be brought in separate proceedings. Neither party advanced that procedure here.”

This was cited with approval by Campbell JA in Grave v Blazevic Holdings Pty Ltd [2012] NSWCA 329 at [5].

The “four” categories of agreement

In Masters v Cameron (1954) 91 CLR 353 at 360-1; [1954] HCA 72, Dixon CJ, McTiernan and Kitto JJ said (citations omitted):

Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.

In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. Of these two cases the first is the more common …

Cases of the third class are fundamentally different. They are cases in which the terms of agreement are not intended to have, and therefore do not have, any binding effect of their own …

The Courts have subsequently recognised a fourth category of agreements to contract, where the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms: Sir Kim Lewison and David Hughes (eds), The Interpretation of Contracts in Australia (Thomson Reuters, 1st ed, 2012) [8.16.1].

In relation to the fourth category, in Baulkham Hills Private Hospital Pty Ltd v GR Securities Pty Ltd (1986) 40 NSWLR 622 at 628, McLelland J observed:

There is in reality a fourth class of case additional to the three mentioned in Masters v Cameron, as recognised by Knox CJ, Rich J and Dixon J, in Sinclair, Scott & Co v Naughton (1929) 43 CLR 310 at 317, namely, “… one in which the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms”. Their Honours refer to the speech of Lord Loreburn, in Love & Stewart v S Instone & Co (1917) 33 TLR 475 at 476, where his Lordship said that:

‘It was quite lawful to make a bargain containing certain terms which one was content with, dealing with what one regarded as essentials, and at the same time to say that one would have a formal document drawn up with the full expectation that one would by consent insert in it a number of further terms. If that were the intention of the parties, then a bargain had been made, none the less that both parties felt quite sure that the formal document could comprise more than was contained in the preliminary bargain.’

It seems to me that subject to the matters yet to be considered the present case falls into this fourth class as described in Sinclair, Scott & Co v Naughton.”

33. A similar statement of principles is to be found in Wong v Wong [2022] FCA 78 and confirmed in this court by Kunc J in Narayan v Narayan [2022] NSWSC 1685 at [9].

34. The plaintiff submitted that there had been an agreement which included a condition to have the terms enshrined in a deed. The plaintiff asserted that the current facts fell within the first and second categories in Masters v Cameron (1954) 91 CLR 353; [1954] HCA 72 or, alternatively within the fourth category as described above by Basten JA in Gorczynski v Bendigo and Adelaide Bank Ltd [2016] NSWCA 170. Whichever was the case, the agreement was binding from 11 May 2023.

Some salient events and correspondence

35. The defendant pointed out the following:

1. the email from the defendant’s solicitor to the plaintiff’s solicitor on 20 April 2023 refers to a proposal for settlement and then to matters requiring “further discussions about which I do not yet have instructions”;

2. the consent orders sent to the court on 12 May 2023 (Exhibit 1) state, “… in the event that the matter is resolved … ”;

3. an email from the defendant’s solicitor on 2 June 2023 states: “The agreement is fairly complex and as such the parties continue in the process of incorporating those terms of settlement into the drafted Deed”. Accordingly, all of the terms of settlement had not yet been agreed;

4. the letter from the plaintiff’s solicitors of 25 July 2023 specifically refers to matters that have and have not been agreed;

5. there were 11 draft deeds exchanged between 11 May 2023 and 8 September 2023. This reflected the continuing negotiation, inconsistent with an agreement on 11 May 2023;

6. an email from the defendant’s solicitor on 10 August 2023 indicates continuing changes to the draft deeds, on this occasion to the fifth draft;

7. an email from the plaintiff’s solicitor on 11 August 2023 refers to further amendments and also states “Aside from the above, and once they have been settled, we believe we are at the stage of execution …” again indicating continuing negotiation;

1. in an email on 25 August 2023 the plaintiff’s solicitor tells her opposing colleague that she will be meeting with her client “next week to obtain instructions and arrange signing.” (Emphasis added.); and

2. the draft deed of family arrangement that had been prepared by the plaintiff’s solicitor went well beyond the 11 May 2023 agreement and left many matters for resolution.

36. In broad answer to the documents referred to by the defendant, the plaintiff pointed out that there was no document in which it was stated that there would not be an agreement until a deed was executed.

37. The plaintiff, sometimes referring to the same correspondence, referred me to the following:

1. the email of 20 April 2023 refers to six “principal terms of the proposal”, all of which were subsequently resolved by agreement. The email states “If these matters can be agreed, we can then attempt to reach agreement on the additional matters noted above which, as noted, I do not yet have instructions about.” The plaintiff’s point is that the agreement as to the six matters resulted in the conclusion of an agreement (and with it the proceedings), leaving the ancillary matters to be agreed or decided later. This is emphasised in the third proposal put by the plaintiff which refers to the parties, or one of them, pursuing “proceedings to have the Lansvale property transmitted to Josephine’s estate”;

2. by agreement, the plaintiff’s solicitor wrote to the court on 2 June 2023, stating “As previously (indicated) by the Parties, this matter has resolved”;

3. on 26 June 2023, at a directions hearing, the Court noted that “the matter remains resolved.”;

4. on 27 July 2023 the defendant’s solicitor wrote an email proposing a consent letter to the court which included: “The matter has resolved and the parties are in the process of formalising the resolution”; and

5. on 11 September 2023, the respective solicitors had a conversation in which the plaintiff’s solicitor said: “There needs to be available funds to run the [ancillary] further proceedings and the only asset is the property.” This conversation is said to confirm the distinction between the Succession Act proceedings and the other matters that could be attendant upon giving effect to those proceedings.

38. In G R Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631 at 634 McHugh JA stated:

“…. the decisive issue is always the intention of the parties which must be objectively ascertained from the terms of the document when read in the light of the surrounding circumstances … ”

39. I think the starting point for an objective assessment is the pleadings, in particular the purpose of obtaining “an Order pursuant to s 59 of the Succession Act 2006 (NSW) from the Estate and/or notional estate of the Late Josephine May Jones.”

40. This purpose is achieved by the email from the defendant’s solicitor on 10 May 2023 together with the reply the following day from the plaintiff’s solicitor. The reply, confirming “that the offer 27% of the net assets of Josephine’s Estate for your client is accepted, (in addition to the points already agreed including, plus costs from the gross estate),” objectively confirms the reaching of an agreement in respect of the s 59 Succession Act proceedings.

41. While I do not think it necessary to specifically nominate a category from Masters v Cameron into which my conclusion falls, if I were so compelled I would place it within the first category, or probably more appropriately within the so-called fourth category, it being an agreement with the expectation that a number of further items would be added by consent, the whole to be in the form of a deed.

42. I asked the plaintiff’s counsel to forward me a precise statement of the orders that he requests. Counsel for the plaintiff did so in respect of both the 8 September 2023 deed and the 11 May 2023 agreement. The former fall away with my conclusions about the deed. However, in respect of the 11 May 2023 agreement I think there are a number of the orders sought which the defendant may wish to consider. This specifically includes the plaintiff’s request that the defendant personally pay the costs of this motion. I propose to give the defendant that opportunity in writing with a decision on final orders to be made on the papers.

Orders

43. I make the following orders:

1. A declaration pursuant to s 73 of the Civil Procedure Act 2005 (NSW) that the Succession Act proceedings have been compromised and settled on 11 May 2023.

2. I direct that within seven days of today’s date the parties bring in short minutes to give effect to these reasons for judgment.

3. If the parties are unable to agree on the short minutes, then they are each directed to provide their respective versions of the appropriate short minutes together with any written submissions in support of their respective versions.

4. Order (3) above is to be complied with within 14 days of today’s date.

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Decision last updated: 06 March 2024