Lang v Yesodei HaTorah College Inc
[2021] VCC 684
•28 May 2021
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERICAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-20-00623
| CHAYA-SARA LANG & ORS | Plaintiffs |
| v | |
| YESODEI HATORAH COLLEGE INC | Defendant |
---
JUDGE: | HIS HONOUR JUDGE COSGRAVE | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 2,3,4,5,22 and 25 March 2021 | |
DATE OF JUDGMENT: | 28 May 2021 | |
CASE MAY BE CITED AS: | Lang & Ors v Yesodei HaTorah College Inc | |
MEDIUM NEUTRAL CITATION: | [2021] VCC 684 | |
REASONS FOR JUDGMENT
---
| Subject: | CONTRACT – AUSTRALIAN CONSUMER LAW |
| Catchwords: | Formation of contract – breach of contract – privity- misleading and deceptive conduct – loss of chance - |
| Legislation Cited: | Civil Procedure Act 2010 (Vic); Limitation of Actions Act1958 (Vic); Competition and Consumer Law Act 2010 (Cth); Trade Practices Act 1974 (Cth) |
Cases Cited: | Amos v Citibank Limited [1996] QCA 129; Amos v Monsour Pty Ltd [2010] FCA 741; Equuscorp Pty Ltd & Anor v Glengallan Investments Pty Ltd & Ors [2006] QCA 194; Foakes v Beer (1884) 9 Apps Cas 605; Gate Gourmet Australia Pty Ltd v Gate Gourmet Holding AG [2004] NSWSC 149; Hennessey v Architectus Group Holdings Pty Ltd [2010] NSWSC 1390; Jackson v Horizon Holiday Ltd [1975] 1 WLR 1468; Kelen v Vitamin Pty Ltd [2010] NSWSC 328; Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd [1994] 1 AC 85; Lloyd’s v Harper (1880) 16 Ch D 290; Lyndel Nominees Pty Ltd v Mobil Oil Australia (1997) 37 IPR 599; Martech International Pty Ltd v Energy World Corporation Ltd [2006] FCA 1004; [2007] FCAFC 35; Medcalf v Crimeguard International Security Systems Sydney Pty Limited [2011] FCA 963; Mobil Oil Australia Ltd v Lyndel Nominees Pty Ltd (1998) 153 ALR 198; MP Investments Nominees Pty Ltd v Bank of Western Australia Ltd [2012] VSC 43; Musumeci v Winadell Pty Ltd (1994) 34 NSWLR; N Ray v Deputy Commissioner of Taxation [2005] FMCA 1893; Re Selectmove [1995] WLR 474; Shepparton Projects Pty Ltd v Cave Investments Pty Ltd [2013] VSCA 152; Stilk v Myrick (1809) 170 ER 1168; Trident General Insurance Co. Limited v McNiece Bros Proprietary Limited (1988) 165 CLR 107; Vanbergen v St. Edmunds Properties Ltd [1993] 1 KB 223; Walton Stores (Interstate) Ltd v Maher & anor (1998) 164 CLR 387; Wigan v Edwards (1973) 1 ALR 497; Williams v Roffey Bros. & Nicholls (Contractors) Ltd [1991] 1 QB 1; Wolfe v Permanent Custodians Limited [2012] VSC 275; Woodar Investment Development Ltd v Wimpey Construction UK Ltd [1980] 1 WLR 277. |
---
APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D Williams | White & Mason Lawyers |
| For the Defendant | Ms G Gray | Sparke Helmore Lawyers |
HIS HONOUR:
Summary
1The first plaintiff (“Mrs Lang”) and the second plaintiff (“Mr Lang”) are the parents of the third plaintiff (“Yaakov”) and the fourth plaintiff (“Binyomin”). They are members of an Orthodox Jewish family which includes seven older siblings all of whom are girls.
2The defendant (“the College”) operates a school offering a private education to fee paying students. The mission of the school is to provide an excellent education both in Jewish religious studies and secular subjects up to and including Year 12. The College has two campuses. The Elwood campus houses the early learning centre and primary school up to Year 6. The high school campus is in Brighton. The College operates as a single sex establishment accepting only boys from Orthodox Jewish families who share the cultural and religious values of the College.
3The plaintiffs claim that in late 2017 and 2018, the College breached an agreement to consider the re-enrolment of Yaakov and Binyomin into the high school. Further or alternatively, they claim that the College contravened section 18 of the Competition and Consumer Law Act 2010 (Cth) schedule 2 (Australian Consumer Law) (“the ACL”) by falsely representing to the parents that, subject to payment of some outstanding fees, the College would consider the re‑enrolment of the boys at the school.
4The College denies that it:
(a) made any binding agreement with the parents or the boys. Accordingly, the College denies there was any breach of contract or damages resulting from any alleged breach; and
(b) acted towards any of the plaintiffs in a manner which could be characterised as misleading or deceptive.
5The essence of the case is whether the plaintiffs have any contractual or statutory claim against the College and whether the plaintiffs have established an entitlement to any, and what amount of, damages.
6In my view, the plaintiffs’ claim should be dismissed.
Background
7Yaakov was born on 25 March 2002 and Binyomin on 9 March 2004.
8The boys initially attended Adass Israel School before commencing at the College in July 2009. Yaakov was in Year 1 and Binyomin in the year below.
9In about April 2012, Adam Segal (“Segal”) was appointed principal of the College. There was a clear division of responsibility within the College. One person was the principal responsible for general or secular studies. A rabbi was the principal or Menahel of Jewish religious studies. The evidence disclosed that, during his time at the College, Binyomin in particular presented a challenge to the College authorities. For example, there were records from October 2010 indicating that Binyomin’s behaviour was inappropriate, immature, attention-seeking and deceitful. He was disruptive in class and completed his homework only spasmodically.
10In 2011, the College sought to arrange a meeting with Mr and Mrs Lang to discuss the situation regarding Binyomin. The school psychologist, Vicki Lopow, noted that Binyomin was unsettled at school, had noticeable mood swings and erratic levels of motivation and engagement. She said that he appeared to be troubled and his behaviour was concerning. Later in 2011, the College was concerned about Binyomin’s violent behaviour at school where he allegedly struck other boys.
11The parents, primarily Mrs Lang,[1] responded to the College noting that at home, he was cooperative, caring and considerate. They intimated that Binyomin required positive reinforcement and not criticism. When told of Binyomin’s defiant and uncooperative behaviour at school, Mrs Lang advised the psychologist that his tutor at home had no similar complaints about him.
[1]Mr Lang has suffered heart trouble and the family often protects him from matters which might stress him and adversely affect his health.
12In late 2011, the situation reached a point where the school recommended family therapy as a means to address Binyomin’s behaviour at school and the issues underlying it. Around April 2012, an incident occurred in which Binyomin struck a teacher on the face and said that he would kill her. The teacher had taken an umbrella from Binyomin because he was poking other boys. The College sent Binyomin home.
13The following month, the College suspended Binyomin due to his behaviour in class. The College stated that he refused to perform his maths work and walked around the room snapping rulers together. It was said that because he had not attempted to work, he was not given a computer to use when computer work commenced. Binyomin at one point came to the teacher’s table and removed a computer without permission. It was alleged that he later approached another student and took his computer from his desk. He later grabbed another student around the neck and jumped on his back. When told to stand at the classroom door, Binyomin apparently called out and annoyed other students before getting on the floor under his desk and refusing to move.
14Mrs Lang met with representatives of the school in May 2012 to discuss Binyomin’s behaviour and what might assist him to overcome his behavioural issues.
15Subsequent to the meeting with Mrs Lang, the College through the principal, Mr Segal, and the Menahel, Rabbi Strajcher, wrote to Mr and Mrs Lang expressing deep concern about Binyomin’s behaviour. In their letter, they said that the College was seeing a disturbing pattern of behaviour including refusal to do schoolwork, use of inappropriate language, physical violence towards staff and students, defiance and not telling the truth. The College repeated its recommendation that Mr and Mrs Lang seek professional assistance for Binyomin. The College said that it preferred to follow guidelines provided by an expert rather than constantly responding to his behaviour in accordance with the College’s discipline policy.
16On 23 May 2012, Mr Segal and Rabbi Strajcher sent a follow-up letter to Mr and Mrs Lang. They noted that since the recent meeting, there had been a number of new incidences of unsatisfactory behaviour. The College said that because it had expressed its serious concerns and required advice to be provided by a mental health practitioner, until such time as it received that advice, the College would respond to inappropriate behaviour in a manner consistent with its behaviour management policy. The letter asked that Mr and Mrs Lang cease texting staff on a daily basis. It said that staff were happy to provide a weekly update. Mr and Mrs Lang were not disposed to seek professional help for Binyomin or to undertake any family therapy which might assist him. Because of the parents’ unwillingness to engage an expert, the College said that it was forced to take the non-preferred option of following its behaviour management policy.
17Mrs Lang agreed that there were some challenges with Binyomin in particular – he was small, a year younger than his cohort (which was physically and possibly emotionally hard for him) and he had required some occupational therapy to assist with his writing. However, Mrs Lang did not accept that issues raised about Binyomin in 2012 were similar to issues which had been drawn to her attention by rabbis, teachers and the school psychologist in earlier years.
18On 31 January 2013, Mr and Mrs Lang notified the College that they were withdrawing both Yaakov and Binyomin from the school and that the boys would not be attending in the new academic year. A document produced by the Langs[2] indicated that the withdrawal was predominantly due to the unethical pressure foisted upon the family during the past year.[3] They said that there was no due process and that Mr Segal’s abusive actions, behaviour, emails and lack of sincere support were highly unprofessional. They claimed that Mr Segal had aggressively and adversely affected the social status of Yaakov and Binyomin and the family. Mr and Mrs Lang said that Mr Segal had not only rejected their requests to be positive rather than negative to the children and to desist from directing blame towards them, but he had influenced the staff and students negatively against them as well.
[2] Court Book, 687.
[3] The defendant claimed not to have seen the document prior to trial.
19By letter dated 11 February 2013, Mr Segal acknowledged receipt of the parents’ email withdrawing the boys from the school. He said the College was sorry to see both boys leave the school and repeated the College’s serious concerns for Binyomin and again recommended that he be provided with appropriate support from a mental health practitioner.
20When Yaakov and Binyomin left the College, they then enrolled at Yeshivah College. While this school also caters for children with an Orthodox Jewish background, it is a Chabad school. As a result, it emphasises the writings of its chosen Grand Rabbi to a level of reverence which would not be acceptable to any non-Chabad Orthodox Jewish person. The Chabad strain of Orthodox Jewish belief is reflected in the structure and contents of the Jewish religious education offered by the school.
21Around the middle of 2016, Mr Segal resigned as principal of the College. When Mr and Mrs Lang heard about this, they approached the school with a view to re‑enrolling Yaakov and Binyomin as students at the College.
22By letter dated 25 July 2016, the Board of the College wrote to Mr and Mrs Lang in the following terms:
“We acknowledge receipt of your expression of interest to reenrol your sons Binyomin and Yaakov Yisrael.
Please note that we cannot consider any application for re-enrolment of either or both of your sons until your outstanding debt of $50,010 from the year(s) 2010/2011/2012 as per the attached statement is paid in full in immediately available funds.
Once that amount has been paid into the YHT account (account details are on the attached invoice), we will contact you regarding further consideration of, and the conditions applicable to, your re-enrolment applications.”[4]
[4] Court Book, 168.
23On about 26 January 2017, Mr and Mrs Lang forwarded a cheque to the College in the sum of $61,300. On the rear of the cheque, they had written the following note:
“This is a payment of goodwill on condition of our 2 sons returning to YHT & treated with mutual respect.
That we should work together to achieve our children’s happiness & success in their studies & yiddishkeit.
This is our maaser money.
Please ensure things will be done in a timely fashion.”[5]
[5] Ibid, 170.
24By letter dated 2 February 2017, the Board of the College wrote to Mr and Mrs Lang as follows:
“We acknowledge receipt of your cheque of $61,300 received last Thursday, 26 January 2017. We are returning your cheque herewith unbanked, because the following aspects are unacceptable:
1.Tender of the cheque does not comply with the terms of our letter to you dated 25 July 2016, including that payment by any means other than direct credit of immediately available funds to Yesodei Ha Torah’s designated bank account is unacceptable.
2.The amount of the cheque substantially exceeds the debt you owe to Yesodei Ha Torah, which is $50,010.00 for school fees for the years 2010/2011/2012 as per previous statements. Yesodei Ha Torah has no interest in the excess funds and declines to accept them.
3.The material written on the reverse of the cheque is unacceptable.
If you deposit $50,010.00 in immediately available funds by direct credit to Yesodei Ha Torah College account BSB 033-047 Account No. 272434 within 7 days of the date of this letter, we will continue to honour the terms of our letter to you dated 25 July 2016, otherwise we will cease to regard it as binding after 9 February 2017.” [6]
[6] Ibid, 171.
25Within the 7 day period specified by the College, Mr and Mrs Lang paid $50,010 by electronic funds transfer into the College’s bank account.
26By email sent on 13 February 2017, the Deputy Menahel, Rabbi Friedman, thanked Mr and Mrs Lang for their expression of interest for Yaakov and Binyomin and said that the College had started the enrolment process and would be in contact with them as soon as possible.[7]
[7] Ibid, 172.
27On the same day, Mr and Mrs Lang acknowledged receipt of the email from Rabbi Friedman. On 17 February 2017, Mr and Mrs Lang sought an update from Rabbi Friedman.
28By email sent on 19 February 2017 at 11.13am, Rabbi Friedman advised Mr and Mrs Lang that the College was in the phase of collecting information about the boys. He asked if they could please write a letter to Yeshivah College to give permission to provide the defendant with information.[8]
[8] Ibid, 172.
29I infer that later the same day, Mr or Mrs Lang contacted Rabbi Friedman to see if they could meet. At 4.39pm that day, Rabbi Friedman sent Mr and Mrs Lang another email in which he said that he could not meet with them at the moment. He said that the College had an enrolment process to follow. The next step was to collect information. He also said that the Langs’ daughter had been in contact with the school and the process had begun.[9] This reference to the Langs’ daughter was a reference to an application which she and her husband made to have their three children enrolled at the College. The family had recently moved to Melbourne after being in Manchester for about ten years.
[9] Ibid, 268.
30In June 2017, the Board of the College adopted a new enrolment policy. One feature of the policy was that, other than in exceptional circumstances as determined by the Board, there would be no lateral admissions permitted to the high school within the College.
31By email on 11 December 2017, the Menahel, Rabbi Goldblatt, wrote to Mr and Mrs Lang in the following terms:
“Thank you for contacting our office with regard to your son Yaakov Israel.
The school currently is not accepting transfers from other local schools into the secondary school.
This is a generic decision that the school has taken for a variety of cogent reasons.
Therefore I regret to inform you that we are unable to take this application any further.”[10]
[10] Ibid, 270.
32By email dated 16 February 2018, Mr Lang wrote to Rabbi Goldblatt asking that the College reconsider its decision so that his boys could obtain “a proper Jewish education and secular education in a respectful environment.”[11] Mr Lang expressly reserved the family’s rights arising from the physical and emotional bashings they received at the hands of Mr Segal.
[11] Ibid, 271.
33Rabbi Goldblatt responded on 22 February 2018 to confirm that the College had a policy of not accepting transfers at high school level and that it would not act contrary to its policy to permit the enrolment of the boys.[12] The Rabbi also commented upon the allegations made against Mr Segal, noting that this was the first time such allegations had been raised – five years after the boys had left the College and nearly two years after Mr Segal had left.
[12] Ibid, 274.
34By letter dated 23 March 2018, the plaintiffs’ solicitors sent a letter of demand to Rabbi Goldblatt. The solicitors sent further correspondence to the College on 27 March and 29 March 2018.
Issues
35During the course of the proceeding, the parties identified the following issues to be determined by the court:
(a)Did Mr and Mrs Lang desire a specific kind of education for their sons Yaakov and Binyomin? If so, what was it?
(b)Was the defendant College the only school in Melbourne which provided the education desired by Mr and Mrs Lang for the boys?
(c)Did Mr Adam Segal, when principal of the College in 2012, physically and verbally abuse the boys as alleged?
(d)Did Mr and Mrs Lang withdraw the boys from the College because of abuse by Mr Segal?
(e)Was the education that the boys received away from the College between 2013 and 2016 deficient in any and if so what ways?
(f)Did the College represent to Mr and Mrs Lang in or about 2016 and 2017 that if they paid the sum of $50,010 in past tuition and other fees, the College’s position was that it would genuinely consider any subsequent application for re-enrolment of the boys?
(g)If such a representation was made, was it made in trade or commerce?
(h)If such a representation was made, did Mr and Mrs Lang rely on it as alleged?
(i)If such a representation was made, did it constitute misleading or deceptive conduct by the College?
(j)If there was misleading or deceptive conduct by the College, have each of the plaintiffs suffered any and if so what loss and damage as a result of the breach?
(k)Did the Segal abuse, if it occurred, give rise to any claims which the Langs may have had against the College, the giving up of which was capable of amounting to valuable consideration in contract?
(l)Did College staff convey to Mr and Mrs Lang in 2016 and/or early 2017 that if, but only if, the sum of $50,010 in respect of past tuition and other fees was paid to it, then the College would consider an application for re-enrolment of the boys?
(m) Was there an enforceable agreement made in early 2007 requiring the College to genuinely consider an application which Mr and Mrs Lang may thereafter make to re-enrol the boys at the College?
(n)If there was such an agreement are the boys able to sue on it, or only the parents? If the latter, what are the consequences for the claims in this proceeding?
(o)Did the College breach the alleged agreement by enforcing its policy not to accept ‘lateral enrolment’ of students during years 7 to 12?
(p)If there was a breach by the College of an enforceable agreement, have each of the plaintiffs suffered any, and if so what, loss and damage as a result of that breach?
(q)Have each of the plaintiffs failed to mitigate their loss?
36While at the conclusion of the evidence, the parties remained steadfast in insisting that all the above issues had to be addressed, I do not consider that all of them are equally important. Accordingly, I have focussed on those which will more likely affect the outcome of the case.
37The purpose of identifying the issues is to focus the attention of the parties and the court upon the important points which the court will need to decide in order to dispose of the case. A consequence of this approach is that the court expects the parties’ submissions to address these issues as agreed. It is helpful when the court can readily examine and compare the respective positions of the parties on each issue.
38While the plaintiffs adopted this methodology in their submissions, the defendant, for reasons which were unexplained, failed to do so. Subsequent to the service and filing of the College’s final submissions, the College filed another document which, in a table, listed the issue, the relevant paragraphs of the pleadings and the responding paragraphs in the final submissions. If this were intended to remedy the significant problem caused by the College’s failure to specifically address each issue, it failed. As I indicated to the defendant’s counsel on the final day of trial, a judge working in a busy trial division depends upon parties and their legal representatives to observe the court’s directions and the standard practices of the relevant division. When parties fail to file documents on time and fail to address issues in the manner required, it hinders the efficient administration of justice.
Did Mr and Mrs Lang desire a specific kind of education for their sons Yaakov and Binyomin? If so, what was it?
39The plaintiffs argued that Mr and Mrs Lang gave clear and uncontradicted evidence that they desired a specific education for Yaakov and Binyomin. They wanted a sound secular and Orthodox Jewish religious education in a single sex school suitable for boys of an Orthodox Jewish upbringing in a Litvish (non-Chabad, non-Adass) tradition. Mr and Mrs Lang wanted the combination of religious and secular studies to be available to their sons so that upon finishing their schooling, the boys had options to pursue further studies in both areas. The parents wanted the religious education to support, or be consistent with, their own religious values and practices. They did not want to expose their sons to either girls or aspects of contemporary culture or thought which might adversely affect their commitment to their Orthodox Jewish religious tradition.
40The College submitted that there was no evidence that Mr or Mrs Lang conveyed to the College their opinion about what constituted the “desired education”. The College noted that the boys had changed schools several times and that the schools themselves did not share identical philosophies. The College did not label itself as Litvish and said that Chabad and Hasidic families attended the school. Families who identified more as Litvish also attended other Jewish schools including Yeshivah College.
Analysis
41While before me, Mr and Mrs Lang were clear that they wanted the style of education which the College offered, they were not always consistent in their educational views. The pleaded case, which was advanced at trial, relied upon the hallmarks of the desired education referred to at paragraph 39 above.
42Yaakov and Binyomin commenced their schooling at Adass Israel, not the College. Mrs Lang said that they enrolled the boys there partly because of the convenience of having all their school aged children at one school and partly because they perceived the College to be a new school which was not fully established.[13] The Langs’ seven daughters attended Adass over a period of about 20 years and three of the girls were still at the school when Yaakov and Binyomin commenced there.
[13]The College was established in 1999.
43Mrs Lang commented that the environment at the boys’ Adass school was very different from that which prevailed at the girls’ school.
44Although the parents had some reservations about the religious teaching at Adass, which was different from how the parents educated their children, they were sufficiently happy to start the boys’ schooling there. However, by about mid-2009, the Langs were keen to move the boys. Mrs Lang seemed to be the more dominant parent in driving the decision to move. Her reasons for transferring Yaakov and Binyomin to the College at that time were mixed and did not appear to be wholly connected to the provision of the desired education.
45Mrs Lang gave the following reasons for removing the boys from Adass:
(a) there were cultural differences between the Adass community, which was broadly Hasidic, and the culture, and traditions practised by the Langs;
(b) Yaakov was concerned about going into Year 2 at Adass. The method of teaching at Adass was very different and did not align with the way that the Langs did things. It was pressing and important for Mrs Lang to transfer the boys out of that environment. As a result, the Langs paid $10,000 to enrol the boys and enable them to join the College in about the middle of 2009;
(c) Mr and Mrs Lang had serious concerns in mid-2009 about Adass. They decided that they needed to change the environment for the boys. Mrs Lang was not entirely clear about the nature of her concerns. She was uncomfortable with how the school treated children. The Langs did not believe in treating children harshly. I infer from her evidence that Mrs Lang considered that one or both of her sons were treated harshly at Adass; and
(d) the school had too little regard for the secular aspects of schoolwork and did not offer Year 12.
46I note also that after removing the boys from Adass, Mr and Mrs Lang also moved their three daughters from Adass to Yeshivah Beth Rivkah College. Mrs Lang said that they were not comfortable about moving the girls but felt that they had no choice. The Langs considered that the school was unhappy about the boys transferring to the College. Shortly after the boys left Adass for the College, Adass created challenges for the Langs and their daughters – challenges which they had not previously faced.[14] Mrs Lang said she and her husband felt that the school was treating one of their daughters unfairly. Mrs Lang wrote to the school about the situation. She said that Adass treated the letter as advice that the girls too were leaving the school and said that if they were to stay, they would have to re‑enrol. Mrs Lang said it was suggested to the family that a donation of $100,000 might help them stay at the school. In short, the parents felt they had no choice but to move the girls to Beth Rivkah as the only viable, but not preferred, alternative school.
[14] Mrs Lang did not identify the nature of the challenges.
47In summary, Mr and Mrs Lang had a preference for the education offered by the College: one in which Orthodox Jewish religious studies and secular studies were offered at a high level (including year 12 for secular studies) in a single sex school for boys of an Orthodox Jewish upbringing. The parents were keen on the Litvish tradition. However, the school did not describe itself as Litvish and the parents had sent their children to other schools which were not described as Litvish.
Was the defendant College the only school in Melbourne which provided the education desired by Mr and Mrs Lang?
48The plaintiffs contended that the College was the only school in Melbourne which provided the education which they sought for their boys.
49The College argued that there were other choices available to the Langs. These choices ranged from other Orthodox Jewish schools to government or independent schools and online alternatives.
50The evidence indicates that there were a number of potential Jewish schools in Melbourne. However, in my view the Langs had a narrow choice of schools available if they were to remain true to their particular family ethos and practice of Orthodox Jewish religion.
51First, Yeshivah College, which the boys attended between 2013 and 2017, is a Chabad school. This affects the religious education offered by the school. The Langs were not particularly happy about this, but at the time when they moved the boys to Yeshiva College in 2013, they felt that they had no real choice other than Yeshivah. Mr Casen, a Board member of the College, said that the religious studies at Yeshivah left a lot to be desired.
52By 2017, Binyomin was only permitted to attend religious studies at Yeshiva in the morning but was required to leave the school at 11.00am each day. According to Mrs Lang, she did not know why he was excluded from secular classes.
53In 2017, Yaakov was in Year 9. He failed to complete the school year and said that he did not feel the school wanted him back for Year 10. He did not feel welcome. He said that because his brother was uncomfortable at the school, he too felt uncomfortable. Yaakov spoke of an incident where he stood between Binyomin and a teacher trying to remove him from the school and told the teacher to “leave him alone and don’t touch him”.
54Second, Adass Israel School did not offer Year 12 secular studies so the boys could not have attained their VCE while attending that school. As noted, by the time they removed the boys from the school in 2009, Mr and Mrs Lang were generally unhappy with the environment at the school and the treatment of at least one of their children.
55Third, Leibler Yavneh College was a co-educational school which did not offer rigorous Orthodox Jewish religious education. Further, many children and families at the school were non-religious. The mixing of genders and the failure to observe Orthodox Jewish religious practice were major drawbacks for the Langs.
56Fourth, Mount Scopus College was similar to Leibler Yavneh. It was co-educational and did not provide a rigorous Orthodox Jewish religious instruction program. In addition, many within the school community were not observant Orthodox Jews.
57Finally, Divrei Emineh and Cheder Levi Yitzchok were two schools which were briefly mentioned during the trial. Neither was put to the Langs as a suitable alterative school. Mr Casen said that the secular education at Divrei Emineh was inferior. In 2018, Cheder Levi Yitzchok did not offer a secondary education. According to Mr Casen, the school has only recently offered Year 7 classes.
58Virtual learning was said not to be an option for the boys because it was too hard. There was no cohort of students with whom to interact. It also involved the use of the internet which could introduce to the Lang children material or concepts which would sit uncomfortably with the Orthodox Jewish religious upbringing which the parents were striving for.
59The Langs regarded TAFE, public schools and private schools, whether religious or otherwise, as unsatisfactory. They did not support the ideology and lifestyle which governed the Langs’ existence.
60Mr Lang made the point that the number of Orthodox Jews in Melbourne was small. As a result, there were limited options when choosing schools for one’s children. In places with larger Jewish populations like New York or Israel, the choice would be significantly greater. He said here in Melbourne, you had to take what you could get.
61On balance, it appears that the College was the school best placed to meet the expectations of Mr and Mrs Lang. Other possible schools were either not specifically established for Orthodox Jews, were co-educational or failed to meet the educational standards sought.
Did Adam Segal, when principal of the College, physically or verbally abuse the boys?
62The Langs argued that the court does not need to fully determine this issue. They said it was sufficient if the court found that they had an arguable basis to bring a claim, or to defend by way of set-off, any claim the school brought suing them for fees. They argued that, if the court were satisfied that they had reasonable grounds to believe that Mr Segal abused one or other of the boys, they would have a proper basis to raise the defence.
63The College submitted that the Langs did not run their case as an abuse claim. The College maintained that the basis upon which Mr and Mrs Lang would have a right to claim against it for the alleged abuse by Mr Segal was unclear, as was any resultant loss. It said that there was insufficient evidence before the court to substantiate the claim or the loss.
64The College also argued that, assuming the parents believed Binyomin had been abused, they did not provide any details or particulars of the abuse to the school before serving the writ and statement of claim. Further, it said that Mr and Mrs Lang paid the outstanding fees in February 2017 without qualification or any comment to the effect that the payment represented the surrender or abandonment by them of a potential claim against the College.
Analysis
65I do not need to determine whether Mr Segal physically and/or verbally abused the boys in 2012. I specifically decline to make such a finding.
66I accept that Binyomin gave unchallenged evidence about some of his dealings with Mr Segal. Binyomin spoke of unjustified allegations of him stealing a bouncy ball from another student and stealing jellybeans from a teacher’s jar. On each occasion, Binyomin said that, Mr Segal wrongly berated him, called him a thief, and said that in some places, people could have their hands cut off for such behaviour. Binyomin also spoke of other occasions upon which he was strongly criticised by Mr Segal and one day when Mr Segal picked him up and carried him from the classroom to his office.
67Whether or not these events occurred exactly as Binyomin says, and whether or not the conduct in question constitutes abuse, is not critical. I am satisfied on the basis of the evidence of the plaintiffs that Mr and Mrs Lang believed both that Binyomin was treated unfairly at the school by Mr Segal and that they might have some claim against the school and Mr Segal.[15]
[15] Plaintiffs’ submissions, [23] – [24].
Did Mr and Mrs Lang withdraw the boys from the College because of abuse by Mr Segal?
68Mr and Mrs Lang gave evidence that they withdrew the boys from the College because of Mr Segal’s conduct.
69The College did not, in my view, seriously challenge or contradict that evidence. The College did not call evidence from any teacher or other member of staff relevantly involved in the alleged abuse. Nor did the College suggest any other likely cause of the boys’ removal.
70I accept that Mr and Mrs Lang withdrew the boys from the College in early 2013 because of their concern about how Binyomin interacted with Mr Segal.
Was the education that the boys received away from the College between 2013 and 2016 deficient in any and if so what ways?
71The plaintiffs said this may not be an issue. However, they said it was relevant to the decision not to send the boys to Yeshivah College after the College declined to re-enrol them.
72The position of the College on this matter was unclear.
73In my view, this is not a significant issue. There was little if any explicit evidence about the quality of the education at Yeshivah College. The evidence was such that I could not answer the question posed. However, it was unarguable that Binyomin in particular had difficulties at Yeshivah as evidenced by the fact that, at least in 2017, he was permitted to undertake only religious studies at the school and was otherwise required to leave the school premises by about 11.00am each day.
Did the College represent to Mr and Mrs Lang in or about 2016 and 2017 that if they paid the sum of $50,010 in past tuition and other fees, the College’s position was the it would genuinely consider any subsequent application for re-enrolment of the boys?
74The Langs argued that the letters from the College dated 25 July 2016 and 2 February 2017 plainly made the representation alleged. They conceded that there was no oral communication to like effect.[16] But, after sending the two letters, the College never explicitly contradicted or sought to abandon or qualify the effect of the letters. Further, the conduct of the College was consistent with the substance of the letters.
[16] Plaintiffs’ closing submissions, [35].
75The College said that the representation relied upon the same facts as constituted the contract which the plaintiffs alleged, namely, the 25 July 2016 letter and the conversations referred to in paragraph 16 of the statement of claim.
76The College also maintained that it began the consideration process in February 2017 and went as far as it could in that process with the information available.
Analysis
77The letter from the College Board dated 25 July 2016 stated that it would not consider any application for re‑enrolment until the outstanding debt was fully paid in immediately available funds. Once that was done, the College would contact the parents about further consideration of, and the conditions applicable to, the re‑enrolment application.
78I have set out the precise terms of the 25 July 2016 letter at paragraph 22 above and the gist of the letter in paragraph 77. The plaintiffs’ characterisation of the representation is in different terms from this letter. The plaintiffs assume a commitment by the College to consider the applications for the two brothers. In my opinion, the letter commits the College, upon payment of the outstanding debt, to contact the parents about further consideration of, and the conditions applicable to, the re-enrolment applications. This indicates that the College may impose other terms or conditions about the basis upon which the re-enrolment applications may proceed. These terms or conditions might have been unacceptable to the parents or they might have been unable to satisfy them. To that extent, I do not accept that the College necessarily committed itself in that letter to considering the merits of the boys’ re-enrolment applications.
79The letter of 2 February 2017 reflects the College’s view that the July 2016 letter embodied a form of binding commitment on its part. This letter re-affirmed the commitment made in July 2016 provided the Langs complied with the terms of the letter. However, this February letter did not go beyond the terms of the earlier letter. The correspondence alone gave no unqualified commitment to consider the boys’ applications for re-enrolment.
80The Langs’ claim relied upon not only the two letters but also the conversations alleged in paragraph 16 of the statement of claim. These were said to have taken place between Mr and Mrs Lang and College staff in the latter part of 2016 and early 2017. Importantly for the plaintiffs, the conversations were pleaded as being to the effect that the College would consider the boys’ re-enrolment applications if the College received payment of $50,010 for past tuition fees.
81Mr Lang gave no evidence about these conversations.
82Mrs Lang said that, once she heard that Mr Segal had left the school, she made some enquiries to confirm this and to check on the extent to which the College had changed after his departure. She was not very happy with Yeshiva College at the time and saw Mr Segal’s departure as an opportunity to re-join the College.
83Mrs Lang said that she read the 25 July Letter as saying that if the Langs paid the $50,010 owed to the school, things would return to normal, the boys would be accepted and life would resume the way it used to be. She said that she had no reason to think that the boys might not have been accepted back into the College.
84As to the conversations, Mrs Lang gave no details. She said that she believed she spoke to Rabbi Friedman at some stage and to Mr Lebovits in 2017. The talks with Mr Lebovits were in the period January – April 2017 as she sought his help to get the enrolment application “over the line”.[17]
[17] See Transcript page 90.
85Mrs Lang said that, after they paid the outstanding school fees, she contacted board members and many other people about their situation. She said that she had a number of conversations, but nothing seemed to eventuate. She said that during the year 2017, she made mostly phone calls trying to contract Rabbi Goldblatt.
86Mrs Lang’s evidence was extremely vague as to who she spoke to, when, and the content of the conversation. There was no evidence of any specific conversation where a representative of the College told Mrs Lang that, provided the Langs paid the debt owing to the school, the College would consider the re-enrolment applications or the College would allow the boys to re-join the school. Given the state of the evidence, it was unsurprising that, in their final submissions, the plaintiffs conceded that there was no express oral communication to the effect of the representation. The letters and the conversations pleaded are major aspects of the Langs’ case and the evidence was too weak to establish the case alleged.
87Mrs Lang was not an impressive witness. She was prone both to not listen carefully to the question asked and to give long and irrelevant answers. Much of her recollection of important points was vague and generalised. While I consider Mrs Lang was not deliberately deceitful but believed what she said was true according to her perception and recollection of events, I would be reluctant to accept critical parts of her evidence without corroboration. Her presentation in court gave me no confidence that I could generally accept her as a reliable and credible witness.
88There was some dispute too about the introduction of the qualifying adverb “genuinely”. That word did not appear in the July letter. The College said that it constituted an unnecessary gloss on the text of the letter. The plaintiffs argued that the context meant that the College must undertake a process whereby it would assess the merits of the particular application and decide whether or not to grant it. By way of contrast, they submitted that, if the College simply applied a rule or policy which required the automatic rejection of an application, regardless of its merits, that would not constitute a genuine consideration of the application.
89The written evidence relied upon for the representation was these two letters. When the College wrote them, it had no formal enrolment policy. I consider that, at the time the letters were written, the College intended to consider the re-enrolment applications on their merits. It was only later in June 2017 that the College adopted a policy against lateral transfers in the high school.
90When considering an enrolment application, a school in the position of the College is entitled to have regard to all relevant circumstances. These could include such matters as the existence of an enrolment policy, the personal qualities or attributes of the prospective student and his family, and their compatibility with the existing members of the school community and reports from other schools attended by the student.
91While the word “genuinely” was absent from the letter, it probably adds nothing substantive to the representation. If a school actually examines and considers an enrolment application on the merits, it does so genuinely. If a school simply applies a policy which necessitates the refusal of an application irrespective of the merits, then it could be said to have considered the application only in a very limited sense.
92Having regard to all the evidence, I am not satisfied that the plaintiffs have established the representation alleged. In essence, the plaintiffs’ framing of the representation is not made out on the facts. Even assuming the plaintiffs’ framing of the misrepresentation is accurate, the College did begin considering the reenrolment applications for the boys. It asked the parents to authorise Yeshiva College to provide information to the College. There was no evidence that the parents agreed to and acted upon that request.
93Although I have found that the plaintiffs have not proved the representation, I shall nonetheless consider the related issues raised. For the purposes of issues (g) to (j), I shall refer to the representation as if it had been proved.
If such a representation was made, was it made in trade or commerce?
94The Langs contended that the College operated the school as a business by offering educational services in return for the payment of fees. The Langs were actual or potential consumers of the College’s services.
95The College did not seriously contest this point.
96In my view, if the College made the representation alleged, it was made in trade or commerce.
If such a representation was made, did Mr and Mrs Lang rely on it as alleged?
97It seems obvious that the Langs relied upon what the College advised in their letters of July 2016 and February 2017. The Langs paid the sum of $50,010 on about 8 February 2017 within the seven day period specified by the school. Based on the evidence of Mr and Mrs Lang, I accept that, but for the alleged representation made by the College, they would not have paid the outstanding debt at that time, or most likely, at all. The Langs had already failed and refused to pay the outstanding monies for a number of years and there was no suggestion that they were undergoing, or were likely to undergo, a change of mind. The College, for its part, did not suggest any other sensible or likely basis for why the Langs paid the money when they did.
98Notwithstanding the above, the College submitted that there was no evidence of reliance on the representation.[18]
[18] Defendant’s submissions, [109].
99I find that Mr and Mrs Lang relied upon the representation.
If such a representation was made, did it constitute misleading or deceptive conduct by the College?
100In their submissions, the plaintiffs made two arguments. The first was that the representation related to a future matter – what the College would do. By reason of section 4 of the ACL, unless the College had reasonable grounds for making a representation, it was deemed to be misleading and deceptive.
101The College pleaded no defence based on reasonable grounds. Thus, if the court found that the College made the representation in trade or commerce, then the Langs said that it should simply apply section 4 of the ACL and find the representation contravened the ACL as misleading or deceptive.
102The College argued that the alleged representation was not obviously referable to a future matter and that the statement of claim contained no reference to section 4 of the ACL. That being so, the defendant’s argument seemed to be that the court should ignore the statutory presumption created by section 4 of the ACL. The omission to plead this section was said to be a serious deficiency.
103The plaintiffs’ second point was that, in making a representation about what the College would do in the future, the College implicitly represented that it had in place a system, plan or policy to ensure that the representation was honoured and came to pass. Without such a system or plan, the representation would be mere rhetoric. The Langs submitted that the College had no such system or plan in place at the time it made the representation in February 2017. This followed from the fact that issues which were ultimately dealt with in the school enrolment policy adopted in June 2017 had been “bubbling for a period of time”[19] when the Board decided upon the new enrolment policy. If the College extracted payment of $50,010 from the Langs on the basis that it would then consider the boys’ re‑enrolment in the school, but then within about four months, forgot this and adopted a policy which rendered the school unable to fulfil the representation, then there was no working system or plan in effect to regulate such matters. Given that the truth or falsity of a representation is determined at the time it is made, the Langs contended that the representation was false in any event, independent of the existence of reasonable grounds. Because the evidence permitted the court to infer that there was no proper foundation in fact for the representation when it was made, then the representation, not having come to pass, was misleading or deceptive.
[19] Transcript, 397.
104The College denied that any representation was misleading or deceptive. In substance, the argument was that, at the time the alleged representation was made, there was no policy against lateral enrolment into the high school of the College. Thus, the representation was true and made in good faith at the time. The policy restricting lateral transfers into the College only came into being in June 2017, well after the initial July 2016 communication to Mr and Mrs Lang.
105The College further contended that from about February 2017 until December 2017, Mr and Mrs Lang did not contact school personnel or Board members to follow up the situation in relation to their sons. Rather, Mrs Lang pestered people like Mr Lebovits in order to secure the enrolment at the College of her grandchildren.
Analysis
106I consider that the representation was not misleading or deceptive in contravention of the ACL. I say this for several reasons.
107First, the representation was not misleading or deceptive because the College actually contacted the parents in February 2017 and began the process of considering the applications after Mr and Mrs Lang paid their debt to the College.
108Secondly, the representation was not misleading or deceptive because it was accurate and true at the time it was made. In July 2016 there was no policy whereby lateral transfers into the College high school were prohibited. Issues arose from time to time in relation to transfers and in June 2017, the board adopted a new policy.
109Mr Casen explained the rationale behind the new policy. There was some tension within the parental body whereby some parents wanted more focus on the Yeshiva, which taught Jewish religious studies, while others wanted more focus on the College, which taught secular studies. Because the philosophy of the school was to combine both religious and secular studies, Mr Casen said that the board wanted to ensure that if a student was enrolled in the Yeshiva, he was also enrolled in the College and vice versa.
110The Board was concerned that the process for ascertaining the suitability of candidates for the College was unsatisfactory because it was not sufficiently structured and was not applied consistently. It wanted to establish clear guidelines in ascertaining whether prospective students were Orthodox Jewish boys whose families’ religious affiliations, conduct, cultural norms and values were consistent with the mission statement and ethos of the College.
111The Board noted that some students and their families were initially considered suitable for the College but later changed their religious orientation. They were able to remain in the College because there was no review mechanism whereby their continued suitability at the College could be examined.
112The Board was of the opinion that, for several years before 2017, all except one of the lateral enrolments allowed in the high school were unsatisfactory. The newly admitted students had a corrosive effect on the student body.
113Sometimes, families failed to provide documentation or consents which were required to enable the College to assess an application for enrolment. Previously, such failures often involved no consequences for the enrolment process.
114Given the Board’s concerns, I can understand why it wanted to introduce a new enrolment policy where:
·students enrolled in the College were automatically part of the Yeshiva and the latter had no separate enrolment policy;
·the Menahel was responsible for assessing a student’s religious and cultural suitability for the College. Until the Menahel certified his approval to the principal and the Board, the enrolment could not proceed;
·students would be required to re-apply for admission to the College in grades 1 and 7 (this policy initiative would be postponed for at least three and a half years to facilitate publication to the parents); and
·where parents failed to produce within 14 days of request documents or consents in relation to an enrolment application, the application would automatically lapse.
115Mr Casen also gave evidence about why the responsibility to formalise the policy fell to him and why it was not until April 2018 that he finally completed this task. In short, between June and early September 2017, he was heavily engaged in acting for clients on two major transactions. Then Mr Casen’s older brother collapsed and was in the Alfred, Epworth and Caufield hospitals for months, initially undergoing treatment for significant kidney and heart problems, and then undertaking rehabilitation. As a result, and because Mr Casen was the person with prime responsibility for his brother’s care, he was occupied until after Passover in 2018 when he drafted the policy from the notes he took at the June 2017 board meeting.
116The plaintiffs suggested that the Board in fact did not create its enrolment policy until April 2018 and that it was the plaintiffs’ request for a copy of the College’s enrolment policy which brought it into existence.
117Although Mr Casen was on occasion needlessly obtuse in his answers and was unwilling to give direct answers regarding some obvious matters, his evidence on this part of the case was clear and persuasive and I saw no proper reason to reject it. Moreover, on this aspect of the case, Mr Lebovits supported Mr Casen. Mr Lebovits was an impressive witness who listened carefully to questions and gave precise answers. He was a thoroughly credible witness. Accordingly, I accept the defendant’s evidence that the Board created the enrolment policy in June 2017.
118The situation is similar to that in Lyndel Nominees Pty Ltd v Mobil Oil Australia Ltd.[20] In that case, at a convention held in 1991 for the benefit of Mobil’s service station franchisees, the Mobil retailing marketing manager made two alleged promises or representations. One was to the effect that if a franchise achieved 90 percent or more in the annual “Team-Pak” and “Circle of Excellence” judging in all of the six calendar years from 1991 it would receive, after the expiry of its current franchise agreement, an additional nine years’ service station tenure at no cost. Mobil allegedly repeated the representation in a video of the convention highlights and a monthly magazine later circulated among franchisees. In the latter half of 1995, Mobil advised franchisees that it would not grant renewals free of charge as allegedly represented at the 1991 convention.
[20] (1997) 37 IPR 599.
119Some franchisees sued Mobil relying upon the misleading and deceptive provisions of the Trade Practices Act 1974 (Cth).
120At first instance the trial judge held that, at the time the representation was made, the marketing manager had reasonable grounds for making the representation and made it bona fide. The court found that the representation was not honoured due to a subsequent change of policy rather than because it was not sincerely intended at the time, or because Mobil lacked reasonable grounds for making it.
121On appeal to the Full Federal Court,[21] the initial decision was overturned with respect to another aspect of the claim, but the court upheld the judge’s reasoning regarding the misrepresentation claim.
[21] Mobil Oil Australia Ltd v Lyndel Nominees Pty Ltd (1998) 153 ALR 198.
122Here, any representation was made initially in July 2016 when there was no policy against lateral transfers. So the College at that time intended to honour its letter and it did so. This was still the position in February 2017.
123Thirdly, whether or not the Langs should have explicitly relied upon section 4 of the ACL in their pleading, the College had a reasonable basis for making the representation. I infer this from correspondence between the parties in which the College noted that it had begun the process of examining the re‑enrolment application. The College’s action exceeded the conduct foreshadowed in the letter of 25 July 2016. The College was not merely contacting the parents about the further consideration of, and conditions applicable to, the application to re-enrol the boys, it had actually begun the process. The College’s actions suggest that it had good grounds for making the representation mentioned in the letter of 25 July 2016.
124Fourthly, to the extent that the plaintiffs rely upon the uncertainty and lack of clarity about the process between February and December 2017 as showing that the College failed to act as represented, I consider that the problem lay with the plaintiffs. I have referred earlier in the judgment to emails exchanged in February 2017 where Rabbi Friedman, the Deputy Menahel, told the Langs that the school had commenced the enrolment process. On 19 February 2017, Rabbi Friedman sent an email to the Langs saying:
“We are now in the process of collecting information about the boys.
If you could please write a letter to Yeshiva College to give permission to provide us with information, that would be much appreciated.
Thanks.”
125There is no document in the evidence responding to this request. Nor did the Langs give any oral evidence about their response to this request. So, not only was there no relevant responding document produced by the Langs in the evidence, but neither Mr nor Mrs Lang said that they had written to Yeshiva College granting permission for that school to release to Yesodei HaTorah College whatever information Rabbi Friedman, or some other representative of the College, sought.
126Given the circumstances, Mr and Mrs Lang would have known if such a letter of authority existed because they would have created it. Mr and Mrs Lang used email and computers in their written communications with the College. I would have expected them to produce a copy of any communication which they had with Yeshiva College on this issue. Where specific information or proof is particularly within the knowledge of one party and there is an unexplained failure to produce such information or proof at trial, that does not assist that party’s case – especially when it has the onus of proof more generally. That is the position here.
127The College argued that the Langs did not provide any referral from Yeshiva College or, at least, there was no evidence that they did. The latter was undoubtedly correct. There was no explanation of the failure by the Langs to produce evidence of any authorisation document for Yeshiva College. A possible reason (along with others) might be, for example, that they were reluctant for the defendant to learn that Binyomin was required to leave school each day at around 11.00am after conclusion of religious studies. Given the history of Binyomin’s behaviour at the College during his attendance there between 2009 to 2012, his parents might reasonably have thought that the College could find such information disquieting.
128In short, I consider that the College made the representation, began the re-enrolment process. It is most likely that the process stalled due to the inability to obtain information from Yeshiva College.
129Finally, if the College were either not honouring the representation at all or conducting the process too slowly I would have expected the Langs to complain to the College. Even though the initial contact with the College about the boys’ re-enrolment took place in mid-2016 and the College rejected the application in December 2017 (and confirmed the rejection in February 2018), there was no record of detailed complaints by the Langs in the period between about February and December 2017. If Mr and Mrs Lang genuinely wanted to move the boys from Yeshiva College to the College after mid-2016, I find it puzzling that there was no evidence of detailed and urgent follow-up. Moreover, it was inconsistent with other aspects of the Langs’ behaviour – for example, the Langs wanted the enrolment application to proceed “in a timely fashion” when giving the College the cheque for $61,300; they wanted an update from Rabbi Friedman only days after he told them in February 2017 that the enrolment process had begun; in and after March 2017, Mrs Lang texted and called Mr Lebovits chasing him up and complaining about the continued delay in dealing with the grandchildren’s application. Mr and Mrs Lang had a clear record of following people up regarding matters important to them.
130The evidence suggests two possible explanations for the conduct of Mr and Mrs Lang. As noted above, I consider it likely that Mr and Mrs Lang failed to authorise Yeshiva College to provide information about the boys to the defendant. In saying that, I accept that there is no record of the College acting in relation to the re-enrolment between about February 2017 and December 2017. Nor are there any additional requests from the College to the parents for an authorisation to Yeshiva College or correspondence between the defendant and Yeshiva College about the boys. However, the defendant has no onus of proof. It is the plaintiffs who allege the contravention of the ACL.
131The other point is Mrs Lang’s change of focus in 2017 from her sons to her daughter’s children. The contemporaneous documents indicate that, after about February or early March 2017, Mrs Lang did not pursue with any vigour or at all the re-enrolment of her sons. The plaintiffs did not challenge Mr Lebovits’ evidence that the communication he had with Mrs Lang after early 2017 related to the grandchildren and not her sons.
132In examination in chief, Mrs Lang said that after paying the $50,010 to the College in February 2017, she continued to contact board members of the school and many other people about the re-enrolment. However, she gave no details of specific individuals or the substance of any conversations she had. Nor did she produce any letters, emails or texts which supported this evidence. Curiously, it was not until re-examination that Mrs Lang referred to the pages of text messages she exchanged with Mr Lebovits. She did not explicitly address whether the texts were about her sons or her grandchildren. However, my view is that a fair reading of the texts shows that, at least from 9 March 2017 the texts clearly concern the grandchildren. Prior to that, they were largely ambiguous.
133The defendant put to Mrs Lang that the letter from the College to the parents dated 11 December 2017 was the first correspondence[22] between the parties in relation to Yaakov and Binyomin since February 2017. Mrs Lang said that she could not recall whether the letter was the first time the College had contacted her since February 2017 about the lateral enrolment policy. However, she said that it was sometime after they had expressed their interest in February 2017 that they heard from the College about the policy.
[22] The letter suggested that shortly before it was sent, Mrs Lang contacted the College by phone.
134Mrs Lang also faced a challenge to the effect that during 2017, she had not communicated with the College or taken other steps to advance the expression of interest in re-enrolling the boys. Mrs Lang did not identify any written correspondence with the College or provide any details of communications with representatives of the College between about February and December 2017 (save for the text messages and phone calls with Mr Lebovits referred to earlier).
135The plaintiffs also argued that the representation was misleading or deceptive because the College implicitly represented (falsely) that it had in place a system or plan which would ensure that the representation came to pass.
136I reject the plaintiffs’ argument on this point. A prediction that does not eventuate can be misleading in limited circumstances. This includes where the representation is made without reasonable grounds and where the representation contains an implied representation of present fact which is incorrect or has no basis. Here, the plaintiffs wrongly assumed that the representation was to the effect that the College would consider the boys’ re-enrolment application on the merits. Further, the representation did not include any relevant implied representation. Alternatively, if the alleged representation did imply an existing plan or system to ensure the College honoured the representation, it did so to the extent that the College contacted the parents and commenced the assessment process.
If there was misleading or deceptive conduct by the College, have each of the plaintiffs suffered any, and if so, what loss and damage as a result of that breach?
137If I am wrong and there was a representation giving rise to misleading or deceptive conduct by the College, then I need to examine briefly the questions of loss and damage.
138In this context, it effectively involves comparing how much worse off the plaintiffs are for having relied upon the representation. The aim of damages under the ACL is to put the plaintiffs in the position they would be in if there had been no misleading or deceptive conduct.
139On this hypothesis, the plaintiffs argued that, but for the alleged representation by the College, Mr and Mrs Lang would not have paid the sum of $50,010 for outstanding school fees and expenses.
140The plaintiffs also argued that without the misrepresentation, they would not have wasted their time, effort and focus between July 2016 and early 2018 (when they abandoned the prospect of re-enrolling the boys in the College) on pursuing the possibility of enrolment and, instead, would have used the time to plan for a more orderly transition from Yeshiva College to some other form of education.[23]
[23] Plaintiffs’ reply submissions, [10].
141The plaintiffs argued that without the representation, the boys would have suffered an impaired secondary education at Yeshiva College or would not have completed secondary education at any school. However, the boys’ prospects would have been better than they turned out to be because they would not have wasted 18 months trying to gain admittance to the College. This meant that the boys could have sooner pursued other options which might have produced a better educational outcome.
142I accept that if I awarded damages for contravention of the ACL, I would give Mr and Mrs Lang $50,010 for money which they would otherwise have not paid the College. But for the misrepresentation, the parents would not have spent time and energy in seeking to have the re-enrolment application accepted. However, there was no evidence led regarding the time spent on this activity and the associated cost or value of that time. Accordingly, there is no other damage for which the parents might be compensated.
143I consider that Yaakov and Binyomin cannot claim damages against the College under the ACL. The College made no representation to them. The boys did not rely upon any representation from the College. They simply followed the instructions of their parents as to where they would attend school.
144Even if Yaakov and Binyomin were able to claim damages under this head, the identification and quantification of loss was so vague as to render the exercise one in judicial guess work. Because loss or damage is part of the cause of action for damages under the ACL, the boys must prove some specific loss.
145My view of the evidence is that it is most likely that the boys would be in a similar position to their current position – it just would have happened quicker. From one perspective, it was unfortunate for the boys that their parents would not countenance them attending a non-Jewish school, a co-educational school or a school like Mount Scopus where the parents regarded many attendees as only culturally, but not religiously, Jewish. Mr and Mrs Lang could be flexible. They allowed the boys to commence their schooling at the Addas School even though it was Chabad and Hasidic. Mr Lang was pragmatic in attending a synagogue close to home even though it had shortcomings and was not consistent with his religious views. But when faced with the refusal of the College in early 2018 to re-enrol the boys, Mr and Mrs Lang decided that no school was preferable to one which offended their religious or educational sensibilities. Although the parents sought to ameliorate the situation by sending Yaakov to school for a time in Canada and/or engaging tutors for the boys and pursuing virtual learning, neither boy liked nor seemed able to cope with solitary learning. So, due to the conduct and attitudes of the parents and the boys, the formal education of Yaakov and Binyomin has ceased for the present.
Did the Segal abuse (if it occurred) give rise to any claim which the Langs may have had against the College, the giving up of which was capable of amounting to valuable consideration in contract?
146The Langs argued that this was a legal question. They referred to an argument foreshadowed by the College to the effect that because past consideration is no consideration, the payment of the outstanding debt could not constitute consideration in law. This was said to rely upon the line of authority based in Stilk v Myrick.[24] They argued that because the outstanding debt of $50,010 was disputed, the principle did not apply – by paying the fees, the Langs were prevented from running an arguable defence to any claim for payment. Thus, it was said, making payment and foregoing the defence was good consideration.
[24](1809) 170 ER 1168.
147The College submitted that there was no legal basis to say that the boys had given up any claim in relation to alleged abuse as a result of the parents paying the outstanding debt. There was no limitation period in Victoria regarding claims for abuse which claimants suffered as a child. Moreover, even if such claims had been made and settled in the past, there was now scope to reopen such claims.
148The College criticised the plaintiffs’ argument that they could have brought an action against the College for the Segal abuse and that their decision not to sue constituted valuable consideration. It argued that this construction, which was based on forbearance, was not supported by the evidence and was legally unsound. If there were a claim open to the boys against the school for the alleged abuse by Mr Segal (which it did not concede), then it could be brought at any time. The parents could not surrender such a claim on the boys’ behalf and the usual six-year limitation period for personal injury did not apply.
Analysis
149A promise not to sue is valuable consideration if there is either liability or a bona fide belief of liability.[25] The benefit to the other party is the abandonment of the claim. So long as the claim is honestly made and there is a genuine dispute, it does not matter that one party benefits more from the compromise than the other. Thus, as a matter of general principle, if there were an agreement whereby the Langs agreed not to sue the College or Mr Segal for alleged abuse, that forbearance to sue could constitute good consideration. However, this statement of general principle is subject to certain qualifications.
[25]See for example Wigan v Edwards (1973) 1 ALR 497.
150First, while the parties disagree about whether there is a contract between them, they seem to have reached a consensus about what might have constituted the offer and its acceptance. In their statement of claim, the plaintiffs pleaded the terms of the 25 July 2016 letter from the College and later conversations based upon it and said that upon payment of the $50,010 by Mr and Mrs Lang, there came into existence an enforceable agreement.[26] This was consistent with the plaintiffs’ final submissions where they said[27] that the payment of the $50,010 in accordance with the terms of the letter dated 2 February 2017 was the Langs’ acceptance of the College’s offer.
[26]Statement of claim, [15] – [18].
[27]Plaintiffs’ final submissions, [37].
151The College’s final submissions appear to adopt the plaintiffs’ framing of the issue whereby the payment of the outstanding fees constituted the acceptance of the offer. However, the College maintained that the plaintiffs’ evidence failed to make out the agreement because there must be an objectively ascertainable intention by both parties to enter into, and be bound by, an agreement.[28]
[28]Defendant’s final submissions, [8].
152For present purposes, it is enough to say that the plaintiffs have framed the case as one where they accepted the College’s offer by the payment of the outstanding debt. The decision not to sue the school or Mr Segal for abuse or to deploy this claim as a defence or set-off to any action by the College for debt was not said to be part of the consideration.
153Secondly, although the plaintiffs’ statement of claim included reference to Mr and Mrs Lang determining not to claim or retain by informal set-off any sum by way of compensation for the abuse by Mr Segal,[29] the evidence at trial did not establish that Mr and Mrs Lang communicated this determination to the College. So, even assuming the court accepted that Mr and Mrs Lang made such a determination, the school was not informed and was therefore unaware that the surrender of the alleged claim might form part of the consideration given by the plaintiffs. While a promise not to sue can be valuable consideration if there is either liability or a bona fide belief of liability, for the plaintiffs to rely on this promise as valid consideration, it must have been part of the agreed price for the defendant’s promise to consider the re-enrolment of the boys. Here, not only was the agreed price for the College’s promise said by the plaintiffs to be the payment of the $50,010, the foregone claim was not raised with the College as being part of the consideration.
[29]Statement of claim, [17(b)].
154Thirdly, the Limitation of Actions Act 1958 (Vic) has been amended so that since 1 July 2015, there is no limitation period restricting claims for personal injury caused by physical or sexual abuse (and any resultant psychological abuse) perpetrated against a claimant when that person was a minor.[30] That being so, the boys can sue for any alleged physical or sexual abuse committed against them by Mr Segal.
[30] Limitation of Actions Act1958 (Vic), s 27O, 27P and 27QA.
Did College staff convey to Mr and Mrs Lang in 2016 and/or early 2017 that if, but only if, the sum of $50,010 in respect of past tuition and other fees was paid, then the College would consider an application for re-enrolment of the boys?
155I am not satisfied that College staff conveyed to Mr and Mrs Lang in 2016 and/or early 2017 that if they paid the sum of $50,010 for past tuition and other fees, the College would consider an application for re-enrolment of the boys. My reasons are essentially the same as those for finding that the plaintiffs did not prove the representation alleged in issue (f). In my opinion, Mrs Lang contacted the College in mid-2016 about the boys re-enrolling at the College. The College considered her enquiry about the re-enrolment to a very limited degree by writing the 2016 July letter. In that letter the College stated that, if the Langs paid the money owed to it, the College would contact them about further consideration of, and the conditions applicable to, the re-enrolment application for the boys. Thus, there was no unqualified commitment from the College to consider the re-enrolment applications on their merits or to permit the boys to re-join the school. The College simply committed to contacting the parents about the question of going forward with the applications, including the potential imposition of conditions which may or may not have been acceptable to the Langs.
Was there an enforceable agreement made in early 2017 requiring the College to genuinely consider any application which Mr and Mrs Lang may thereafter make to re-enrol the boys at the College?
156The plaintiffs contended there was an enforceable agreement because the Langs paid the sum of $50,010 and thereby accepted the offer made by the College. The plaintiffs argued that the payment constituted valid consideration and that the College’s offer in its letter of 25 July 2016, as affirmed in its letter of 2 February 2017, became a contractual promise.
157The College denied there was an enforceable agreement. The defence appeared to rely upon a variety of grounds:
· there was no objectively ascertainable intention to enter into a binding agreement;
· the payment of the $50,010 did not constitute proper consideration because, on the plaintiffs’ evidence, the money was a gift and/or the money simply satisfied an existing debt obligation; and
· Mrs Lang’s conduct and subjective views were inconsistent with a contract.
158I have found that the College staff did not convey to the Langs an unconditional commitment to consider re-enrolment applications for the boys once the outstanding debt was paid. To that extent there could be no enforceable agreement of the kind alleged. This issue deals with other reasons why there might not be an enforceable agreement.
No objectively ascertainable intention
159In deciding whether or not parties have entered into a contract, one must attend to the objective aspects of the context and not the subjective intentions of the parties. The test to apply is that of the reasonable objective observer and what such a person would make of the situation. Courts cannot take account of the subjective desires, hopes, motivations and beliefs of a party – especially where they are not communicated to the other party.
160In the present case, I consider the reasonable observer would have concluded that the parties’ intention, as objectively assessed through their words and conduct towards one another, was to enter a contract.
161The context is one in which the College offered to Orthodox Jews a quality education in both Jewish religious studies and secular subjects such that students could attend the College and complete Year 12 with a view to potentially attending university. The school charged substantial fees. Even in 2012,[31] the total fees for the two Lang boys were around $7,000 per term – that is, approximately $28,000 per annum or $14,000 each for the school year. The fees for 2017 and following years were unknown but I doubt the fees would have reduced during that time.
[31]Court book, 165.
162For many parents, their children’s education is an important issue. Often a child’s vocational hopes depend upon attending a particular course of study and/or training and certain educational standards have to be satisfied in order to gain entry into such courses. Thus, the choice of a school can be important in relation to the quality of the education offered. Also, some parents are keen that their children’s school supports and reinforces the values and standards which the parents try to inculcate in their children.
200In circumstances where:
·the Queensland Court of Appeal has found that the practical benefit exception does not operate in a debt situation where the creditor has performed its obligation;
·the statement of principle regarding Williams v Roffey Bros. by Glidewell LJ and the amended formulation of principles by Santow J expressly limit the application of Williams to cases involving the performance of work or the supply of goods or services;
·the contract between Mr and Mrs Lang and the College involved the payment of a debt and was not still executory on both sides;
·the English Court of Appeal in Re Selectmove[53] declined to apply Williams to a scenario involving the payment of debt;
·the comments made by Judd J were obiter and he did not criticise the decision of the Queensland Court of Appeal in Amos;
·Zammit AsJ did not grapple with authorities like Amos and Re Selectmove and explain why they were wrongly decided and not to be followed; and
·the Victorian Court of Appeal recognised that the issue was both significant and complex and it did not endorse the decision of Zammit AsJ.
[53] [1995] 1 WLR 474.
I consider this court is best advised (until there is binding authority to the contrary) to apply accepted common law authorities which say the practical benefit principle does not apply in the debtor/creditor context particularly where the contract is not executory on both sides.
201Accordingly, Mr and Mrs Lang, by paying the $50,010 owed to the College, did no more than discharge their outstanding obligation to the school. That being so, the plaintiffs did not give valid consideration for any agreement with the College.
If there was such an agreement are the boys able to sue on it, or only the parents? If the latter, what are the consequences for the claims in this proceeding?
202I have found that there is no legally enforceable agreement between the plaintiffs and the College. However, I shall briefly consider the issue.
203The plaintiffs argued that the boys could sue on any agreement with the College made by the parents. Otherwise they would be left without a remedy and contracting parties like the College could breach their contracts with impunity. The plaintiffs contended that cases like Trident General Insurance Co. Limited v McNiece Bros Proprietary Limited[54] and Gate Gourmet Australia Pty Ltd v Gate Gourmet Holding AG[55] showed that privity of contract is not necessarily a barrier to enforcement by a non-contracting plaintiff in circumstance where a contract is made by a party for the benefit of the non-contracting party. In particular, they referred to a later case where the trial judge would have held that, where a parent company contracted for the benefit of its non-contracting subsidiary, the subsidiary could still sue on the contract. The plaintiffs contended that the same principle applied here where the parents made a contract to benefit the children.
[54] (1988) 165 CLR 107.
[55] [2004] NSWSC 149.
204The plaintiffs also contended that on the basis of Jackson v Horizon Holiday Ltd[56] the court could find that all the plaintiffs were entitled to damages. In that case, Mr Jackson contracted with the defendant travel company for a two-week luxury holiday in Sri Lanka. Mr Jackson had some specific requirements or conditions regarding the holiday which he informed the defendant were essential. The plaintiff, his wife and small children did not receive the holiday they were promised. Mr Jackson sued and recovered damages at trial in an amount which reflected the loss suffered by all family members not just himself. The Court of Appeal dismissed the appeal by the travel company which argued that the damages were excessive. The Langs contended that the present case involved the same principle.
[56] [1975] 1 WLR 1468.
205In general terms, the College’s position was that Mr and Mrs Lang could not claim for losses suffered by their sons. The sons could not claim damages against the College because they were not parties to the contract with the College.
Analysis
206The doctrine of privity is a settled and fundamental doctrine in Australian contract law. As a result, a person who is not a party to a contract cannot sue upon the contract to enforce its obligations.
207At first blush, the High Court decision in Trident General Insurance Co. Limited v McNiece Bros Proprietary Limited[57] suggests that policies of liability insurance are an exception to the doctrine of privity. However, the position is more complicated than it appears.
[57] (1988) 165 CLR 107.
208In Trident, an insurer under a public liability insurance policy agreed to indemnify a company against any sums it might be required to pay in relation to personal injuries suffered by workers on building sites. The definition of the “insured” under the policy included the company’s contractors. A person was injured due to the negligence of a contractor. The contractor at the time Trident issued the policy was not a contractor to the insured. The worker recovered damages from the contractor and the contractor in turn sued the insurer seeking indemnity. The contractor succeeded against the insurer at first instance and the New South Wales Court of Appeal dismissed the appeal. Essentially, the Court of Appeal held that a beneficiary under an insurance policy could sue upon it even though it was not a party to the contract of insurance and gave no consideration.
209By majority, the High Court dismissed the appeal. The judgments of the High Court were conflicting. Mason CJ, Wilson and Toohey JJ thought that the privity of contract doctrine did not apply to a policy of insurance and considered that McNiece Bros were entitled to succeed against the insurer. Brennan, Dawson, Deane and Gaudron JJ opposed any change to the privity doctrine or the creation of an insurance exception to that doctrine. Deane J found that the contractor was not entitled to enforce the insurance contract but should have the opportunity to show that the policy created a trust in favour of the insurer’s promise to the contracting party to indemnify the contractor as part of the insured. Gaudron J upheld the Court of Appeal decision on the basis that a promisor who has accepted agreed consideration for a promise to benefit a third party would be unjustly enriched at the expense of the third party to the extent that the promise is unfulfilled and the non-fulfilment did not attract proportional legal consequences.
210Thus, while the insurer’s appeal was dismissed, a majority of the court upheld the privity of contract doctrine.
211In the circumstances, I consider that I am bound to accept that the usual law of privity applies in the present case. For that reason, I find that Yaakov and Binyomin cannot sue on the contract alleged because they were not parties to the contract.
212I also make two further observations.
213The first is that, both when the agreement was made and breached and when the proceeding was issued in 2020, Yaakov and Binyomin were minors.[58] Accordingly, they could not sue in their own right but would have required litigation guardians. The statement of claim contained no plea about litigation guardians and the matter was not argued at trial. That being so, the parents cannot make any claim under the contract on behalf of the boys.
[58] I note that Yaakov turned 18 in March 2020.
214The second comment relates to the use of trust law to circumvent the operation of the privity doctrine. It is well accepted that a promisee can properly hold a promisor’s promise to benefit a third party in trust for that third party. This is consistent with longstanding authority that a person can create a trust over property. This includes a chose in action constituted by the benefit conferred under a contract. As put by the learned author of Heydon on Contract:
“the language of a contract in which one party promises a second party to confer a benefit on a third person can also lead to the conclusion that the first party created the second party a trustee of that promise or that the second party made a declaration of trust over that promise: in either event the second party holds the promise in trust for the third person as beneficiary”[59]
[59] Justice J D Heydon, Heydon on Contract, (Thompson Reuters, 2019), [12.380].
215In the present case, the plaintiffs made no allegations of trust in the statement of claim and the matter was not argued at trial. Thus, the plaintiffs cannot now seek to argue this point.
216The standing of Jackson v Horizon Holiday Ltd is unclear. In the Court of Appeal Denning MR applied a statement of Lush LJ in Lloyd’s v Harper[60] where he said that where a contract is made with A for the benefit of B, A can sue on the contract for the benefit of B and recover all that B could have recovered if the contract had been made with B himself. The House of Lords later examined the case in Linden Gardens Trust Ltd v Lenesta Sludge Disposals Ltd.[61] There, Lord Browne-Wilkinson, with whom Lords Keith, Bridge and Ackner agreed, said it was a case in which damages were quantifiable by reference to the difference in value between that which was contracted for and that which was supplied in fact. This view was similar to that expressed by James LJ in the Court of Appeal. His Lordship indicated that, in his view, the father had contracted for a certain standard of family holiday and had not received it. However, James LJ did not examine whether the plaintiff husband should obtain all the damages awarded.
[60] (1880) 16 Ch D 290.
[61] [1994] 1 AC 85.
217Jackson was also considered by the House of Lords in Woodar Investment Development Ltd v Wimpey Construction UK Ltd.[62] There Lords Wilberforce, Russell and Keith rejected the reasoning of Denning MR while accepting that the decision itself was correct. Lord Wilberforce said that the decision could be supported either as a broad decision on the measure of damages, or possibly as an example of a type of contract calling for special treatment. Examples of such contracts included contracting for family holidays, ordering meals in a restaurant for a party and hiring a taxi for a group of people.[63] Lord Keith said the decision could be seen as rightly decided upon a reasonable view of the quantum of damages due to the plaintiff as the contracting party. The decision did not necessarily create a law about the ability of a third party to recover damages under a contract to which they were not party.
[62] [1980] 1 WLR 277.
[63] Ibid, 283.
218In Trident, Mason CJ and Wilson J said that the standing of Jackson’s case was uncertain and the basis upon which it was supportable was unclear even after the House of Lords decision in Woodar.[64]
[64] (1988) 165 CLR 107, 119.
219Given that Trident appears to be the most recent High Court case expressly dealing with Jackson, I consider that the parents can sue for any loss which they suffered but the boys cannot sue the College on the contract alleged because they were not parties to it. Consequently, if there were an enforceable contract, the parents can recover damages only in respect for any loss which they suffered. The boys cannot recover pursuant to the contract for any loss which they suffered.
Did the College breach the alleged agreement by enforcing its policy not to accept ‘lateral enrolment’ of students during Years 7 to 12?
220The plaintiffs contended that it was beyond argument that the school breached the alleged agreement. It was no defence to say that the College failed to honour the agreement because it adopted a policy which prevented it from doing so.
221The plaintiffs argued that the College sought to advance an unpleaded defence to the effect that the initial re-enrolment applications made in 2016 had lapsed (whereupon the commitment in the College’s letters of 25 July 2016 and 2 February 2017 was spent) and then a second application was rejected in December 2017.
222The College argued that, because the plaintiffs could not prove that they provided the authority to Yeshiva College when required in February 2017, the plaintiffs could not complain about the College’s failure to proceed promptly with the application in 2017. Also, it said that it was unreasonable for the plaintiffs to expect the College to keep in mind later in that year the change brought about by the enrolment policy.
223The question of whether the re-enrolment application made in July 2016 or early 2017 was abandoned and a second application initiated by a phone inquiry in December 2017 was not clearly pleaded and, therefore, not explored to any significant degree at the trial. I have commented previously about my surprise that the Langs did not vigorously pursue the boys’ re-enrolment during 2017. If Mr and Mrs Lang were truly keen to sort out the boys’ schooling for the following year, I would have expected them to pursue the College with determination in 2017 to obtain an answer. This is especially so when the boys were apparently having difficulties at Yeshiva College: Binyomin was forced to leave school early each day; Yaakov was uncomfortable at school. One imagines that Mr and Mrs Lang would have been anxious to have a better option ready for the next school year.
224It appears that it was only when Mrs Lang contacted the school in December 2017 that the Menahel, Rabbi Goldblatt, told her about the policy against lateral transfers at the high school.
225I note that there are aspects of the plaintiffs’ case regarding the number of re-enrolment applications which are curious. In the statement of claim, the plaintiffs referred to the 25 July 2016 letter and said that there were conversations in late 2016/early 2017 in which College staff said that the College’s position on any re-enrolment of the boys was as set out in that letter and the College would consider a re-enrolment only if the outstanding fees were paid.[65] The plaintiffs then pleaded that, in reliance on the July 2016 letter and the said conversations, they paid $50,010 and determined not to claim for the alleged abuse by Mr Segal.[66] Upon the payment of the money, an enforceable agreement came into existence whereby the College had to genuinely consider any application for the boys’ re-enrolment.[67] In February 2018 the parents asked the College to consider the re-enrolment of the boys.[68]
[65] Statement of claim, [16] - [17].
[66] Ibid, [17].
[67] Ibid, [18].
[68] Ibid, [20].
226Thus, the plaintiffs pleaded the case in such a way that there was no re-enrolment application until February 2018 (or possibly as shown by the evidence, December 2017). This approach is inconsistent with the evidence at trial which showed that the College began considering the re-enrolment application in February 2017 after the money was paid.
227Assuming there was an enforceable agreement for the College to consider the re-enrolment applications, the College probably breached that agreement by using the policy to justify the refusal to re-enrol the boys in the school. The introduction and reliance on the policy meant that the College was unable or unwilling to perform its part of the agreement. The College was also inflexible in refusing to use the “exceptional circumstances” proviso in the policy to consider the applications. Mr Casen said that the proviso was limited to a situation where a student moved to Melbourne from overseas.
228If there were an agreement to the effect alleged in issue (l),[69] then I would find that the College breached the agreement by adopting a policy which precluded it from considering the boys’ applications on the merits.
[69] I have found there is not.
If there was a breach by the College of an enforceable agreement, have each of the plaintiffs suffered any and if so what loss and damage as a result of that breach?
229The plaintiffs claimed that, if there were a breach of the alleged agreement, then:
(a)Mr and Mrs Lang should:
(i) recover the $50,010 paid to the College;
(ii) be compensated for the loss of education for the boys which they had hoped to provide. The parents were deprived of the satisfaction of knowing they had given the boys the education they wanted to. It was suggested that $100,000 - $200,000 for each parent might be appropriate compensation; and
(b)the boys should be compensated for the loss of education and the consequential improvement it would have made to their prospects in life. They argued that each boy was intelligent and articulate, and each was likely to have completed year 12 at the school. It was said that they have suffered and will suffer financial, cultural and social consequences from the College’s breach. The plaintiffs suggested a figure of $750,000 - $1 million damages for each boy.
230The plaintiffs were not helpful in directing the court to authorities or principles which provided guidance in determining an appropriate quantum of damages in a case like this. The College seemed not to dispute that, if there were a breach of contract, Mr and Mrs Lang could recover the $50,010 which they paid. However, the College contested any other damages.
231As to the boys, the College denied that they had any contract claim. It recognised that they could sue for alleged abuse in separate proceedings.
Analysis
232Had the College breached an enforceable contract, I find that the parents would have been entitled to $50,010.
233I do not know how to readily assess damages for the disappointment Mr and Mrs Lang suffered in not enabling their sons to complete their schooling in the usual way. While completing year 12 and undertaking tertiary studies are often useful steps in helping a child choose a career path, their completion is no guarantee of material success. Nor does the failure to finish school or attend university or some other training course necessarily lead to penury and unhappiness. However, in general terms, I accept that not finishing school is likely to be a disadvantage. Yaakov hoped to be a lawyer which required university study. Binyomin was interested in being a pilot. The educational pre-requisites for that option were not clear.
234The plaintiffs’ case seems to assume that:
(a) the current position will not change and the two boys will not have any further formal education: Yaakov, now 19, has mostly completed year 9, studied for nearly a year in Canada and began some year 11/12 subjects through virtual learning before stopping to become a truck driver; Binyomin has finished year 7 and undertook flight training for some time at Moorabbin Airport. Now 17, he is unemployed;
(b) had the re-enrolment application proceeded at the College, the boys would inevitably have returned to school there; and
(c) the College is wholly responsible for the boys’ present predicament.
235I consider that none of these assumptions is justified.
236First, while I have no doubt it would be very difficult for the boys to complete school in the future, it cannot be ruled out. If they are keen to have a career in an area which requires the completion of year 12 studies, then they could become sufficiently motivated to do whatever is required to attain that objective.
237Secondly, there can be no guarantees that the College would have accepted the boys for re-enrolment. Plainly Binyomin was a troublesome student when he attended the College between 2009 and 2012. He must also have been the subject of some controversy at Yeshiva College, if he were required to leave school every day before lunch. Also, because he was excluded, at least in part, from secular classes at the school, his competence in secular studies may well have been below standard. Yaakov did not finish the school year at Yeshiva College in 2017, missing around a month of school. Further, the difficult and drawn out dealings between representatives of the College and Mrs Lang about the enrolment of the three grandchildren suggest that the College might not have been enthusiastic to renew its association with the family.
238Thirdly, during 2017, the boys were enrolled at Yeshiva College. To the extent that they were unhappy at that school, it had nothing to do with the College. Insofar as Mr and Mrs Lang would not entertain the option of other schools for the boys to attend, that was a factor independent of the College. I commented earlier that the parents decided it was preferable that the boys attend no school rather than attend a school which did not satisfy their religious or educational criteria. This is a significant matter, particularly when one son wants to be a lawyer and the other has only completed year 7 or thereabouts.
239The plaintiffs contended that apart from the likely financial consequences for the boys, they would also suffer social and cultural consequences due to not completing school. The plaintiffs argued that the financial consequences for the boys over a lifetime were likely to be substantial. The plaintiffs’ expert, Mr Corey Plover, an actuary, prepared a report of actuarial estimates of an individuals’ earning capacity differential based upon the individuals’ level of education – a person who completed year 10 compared to a person who completed year 12 or a university degree. Mr Plover relied upon data produced by the Australia Bureau of Statistics, government departments or authorities and KPMG.
240The plaintiffs submitted that the Plover report suggested that the difference in lifetime earnings between:
·an individual completing year 10 and an individual completing VCE was about $500,000; and
·an individual completing year 10 and someone completing a bachelor’s degree was about $1.5 million.
The report was general in nature and took no account to the particular skill levels, abilities, or personal characteristics of the boys.
241I found Mr Plover’s report was not helpful in trying to assess damages arising from an alleged failure by the College to consider re-enrolment applications for the boys. The actuarial evidence might have been more relevant if the plaintiffs’ claim alleged a failure to enrol the boys. The damages claimed seem to me to be referable to the latter type of claim rather than the former. In my opinion, the plaintiffs have not proved to the requisite standard all the damages sought for an alleged failure to consider the applications. These significant damages are, quite possibly, too remote in any event.
242As to the parents I would award them the money they paid to the College $50,010 and for their disappointment, I would award $5,000. This amount is small because, in my opinion, even if the College had assessed the applications on the merits, I have grave doubts that the College would have accepted the boys. The conduct of the school in refusing to make an exception for Yaakov and Binyomin after the College adopted its enrolment policy and the extensive delay regarding the grandchildren’s enrolment indicates to me an attitude inimical to the hopes of the Langs.
243In relation to the boys, I find that they were not parties to the contract and therefore cannot sue the College. Any loss they suffered is extremely difficult to assess in monetary terms. As noted, it is not reasonable to assume they will have no further education or that the school is wholly responsible for their current situation.
Have each of the plaintiffs failed to mitigate their loss?
244The College contended that the plaintiffs failed to mitigate any loss suffered. The College said that the plaintiffs sought to blame it for the lack of educational options available to the boys. It argued that the plaintiffs failed to give evidence about why options were not available to them. This omission was notable especially in circumstances where:
·the Langs had a chequered history at different schools their children attended;
·little effort was made to give the boys religious or secular education in a school supplemented by external instruction at home; and
·Mrs Lang agreed that there were other, albeit challenging, ways of achieving an appropriate secular education.
245The plaintiffs relied upon their assessment of the various Jewish schools in Melbourne, and why, for different reasons, none was as suitable as the College.
Analysis
246An injured party cannot claim damages in contract for loss which would have been prevented by reasonable mitigation steps. The party which acted in breach of contract has the onus of proving the failure to mitigate. An injured party is required to take only such measures as are reasonable. It does not have to take measures which are costly or extravagant or are likely to harm its position or reputation. A plaintiff is not required to take steps beyond the ordinary course of business. The standard expected of a plaintiff is not particularly high – the defendant is the wrongdoer.
247Here the College alleged that the parents could have enrolled the boys in another school providing a secular education to VCE level while arranging private tuition in Orthodox religious studies. It also said that the boys had not attended school for a secular education since 2018.
248In my opinion, to the extent that they had a valid claim against the College, the plaintiffs failed to mitigate their loss. Put simply, it is not reasonable to act as Mr and Mrs Lang did: removing their sons from Yeshiva College without having another school or schooling option ready to employ for the following school year; not requiring the boys to proceed with private tuition or home schooling or virtual schooling whether or not they enjoyed it. It is unreasonable for the plaintiffs to blame the College exclusively for the dilemma which they faced in February 2018. The parents had not obviously prosecuted the re-enrolment application with any vigour during 2017 and appeared to assume that the College would simply re-admit the boys to the school. They had no alternative plan or fallback position ready if their preferred option were unsuccessful. After it became clear that the boys could not return to the College, Mr and Mrs Lang would not consider other schools for the boys, whether Jewish or otherwise. It is possibly problematic whether the parents were entitled to compromise the boys’ secular education by not ensuring that, one way or another, they completed their schooling, at least to year 10 level. However, assuming that the parents’ choice was legally available, it does not mean that they should be able to hold the College exclusively responsible for the position the boys now find themselves in. I would reduce the parents’ disappointment damages by 50%.
Conclusion
249For the reasons set out, I find that the plaintiffs’ claim should be dismissed
250I direct the parties to confer about the form of final order and costs in an effort to agree upon orders giving effect to this judgment. If they cannot agree, then by 4:00pm on 4 June 2021, each party is to file with my chambers and serve a written submission setting out the orders sought and the reasons therefor. The submissions are not to exceed five A4 pages, a minimum 12 point typeface, and 40mm margins on either side of the page. By 4:00pm on 7 June 2021, each party may file a reply submission limited to no more than three A4 pages.
0
21
0