Naczek & Dowler (No. 2)

[2008] FamCA 90

FAMILY COURT OF AUSTRALIA

NACZEK & DOWLER (NO. 2) [2008] FamCA 90

FAMILY LAW – PRACTICE AND PROCEDURE – Ruling on objections to evidence

Evidence Act 1995 (Cth)
Family Law Act 1975 (Cth)

Andi-Co Australia Pty Ltd v Meyers [2004] FCA 1358 (12 October 2004)
Gpi Leisure Corporation Ltd (In Liq) v Yuill and 85 Ors [1997] NSWSC 258 (14 July 1997)
Rodgers v Rodgers (1964) 114 CLR 608

APPLICANT: MR NACZEK

RESPONDENT: MS DOWLER

FILE NUMBER: MLF 1222 of 2006

DATE DELIVERED: 19 February 2008

PLACE DELIVERED: MELBOURNE

PLACE HEARD: RULING

RULING OF: THE HONOURABLE JUSTICE CRONIN

IT IS NOTED that publication of this ruling under the pseudonym Naczek & Dowler is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF1222 of 2006

MR NACZEK

Applicant

And

MS DOWLER

Respondent

INDEPENDENT CHILDREN’S LAWYER

RULING – OBJECTIONS TO EVIDENCE

1. This is a discrete ruling in respect of two objections to evidence. I determined a large number of objections on Monday 18 February and heard submissions from Mr Strum and Mr Wood about these two matters.

2. The two matters relate first to evidence of settlement discussions between the parties and secondly a significant portion of evidence by the wife about her discussions with a Department of Human Services worker and her lawyers’ observations of complaints about the wife that formed the basis of a notification to that department in 2007.

3. In his affidavit filed 3 December 2007, the husband said [1] that on Sunday (sic) 7 July 2007, he spoke to the wife by telephone intending to speak to the children he said:

   She then began complaining about having no money and asked me to wire $50,000 to her bank account the following day.

   [1] Para 38

4. The husband then referred to his subsequent telephone call in which he spoke to the children. N asked if he was going to “help them with money”. He said that he again spoke to the wife who asked about the $50,000.

5. On the following day, Sunday 8 July 2007, the husband spoke to the wife who asked for a loan of some money saying “we’re in trouble”. The affidavit of the husband says little if anything about his response.

6. The money situation was again the subject of discussion between the husband and N on Sunday 8 July with the child seeking an answer from the husband about whether he was going to “give us money” and “give mummy money”. As with his description of the previous day’s events, little was said about his statements and involvement in the discussion.

7. In her affidavit filed 1 February 2008, the wife responded[2] acknowledging the conversation of 7 July 2007 confirming that she did ask the husband for a loan. She explained why and said that the husband asked her to send her “request” through the lawyers and that he would “review it”. She then[3] referred to the fact that the husband sent her an email “offering to settle our UK appeal” and she then annexed the email message[4].

   [2] Para 4 (jj) and 4(kk)

   [3] Para 4 (ll)

   [4] Annexure KID-2

8. Counsel for the husband objected to the wife’s evidence insofar as the wife may seek to refer to terms of the husband’s offer of settlement of the UK appeal on the grounds of privilege. In respect of the specific annexure, counsel objected on the same ground.

9. One dilemma that has arisen is that after discussion with the parties at the mention of the matter on 13 February 2008, all agreed that it might be prudent for me to listen to all of the taped telephone conversations to reduce the evidence to be led in the hearing. No mention was then made of any problem areas in those tapes and it was agreed that there was something like 14 hours of material.

10. Pursuant to my order, the tapes were delivered along with each party’s transcript of what was on the tapes.

11. In the covering letter from the practitioners for the husband, a reference was made to the husband not waiving privilege although no details were set out about what material was involved.

12. I had indicated to the parties that I would only refer to the transcripts and use them as an aide memoire if I could not decipher the spoken words.

13. For practical reasons, I had also not read the affidavit material of the husband and wife at that stage.

14. It will come as no surprise to the parties therefore that I heard the precise conversations between them as well as between the husband and the children about the money, issue. It is fair to say that the conversation was in much more detail than that to which either of the parties has referred in their respective affidavits.

15. I am now asked to rule on the admissibility of the evidence in the affidavit whilst at the same time, putting out of my mind what I heard.

16. How the evidence of the conversation is to be put and of what relevance it may be, I am yet to hear. However, having become aware of the issue, I can indicate that I will not take into account the precise details of the supposed offer. The parties will need to remember however that regardless of the details of the “offer” which are in my view inadmissible, I have heard much more of the conversation than that to which they have referred.

17. Counsel for the husband said that I should not admit any of the evidence of the wife on this issue because it amounted to negotiations which were caught by s 131 of the Evidence Act 1995 (Cth).

18. Counsel for the wife said that the husband wanted part of the details in but not others and that that was inappropriate having regard to the fact that he raised the subject.

19. Section 131(1) of the Evidence Act reads:

    Evidence is not to be adduced of:

    (a)a communication that is made between persons in dispute, or between one or more persons in dispute and a third party, in connection with an attempt to negotiate a settlement of the dispute; or

    (b)a document (whether delivered or not) that has been prepared in connection with an attempt to negotiate a settlement of a dispute.

20. The logic behind the provision is clear. It is designed to encourage settlement and there is no judicial discretion to overcome the privilege unless the situation falls within one of the exceptions set out in s 131(2).

21. For the purposes of this ruling, the only exceptions that could apply are:

    (a)the persons in dispute consent to the evidence being adduced in the proceedings concerned…; or

    (b)The substance of the evidence has been disclosed with the express or implied consent of all the persons in dispute; or

    (c)The substance of the evidence has been partly disclosed with the express or implied consent of the persons in dispute, and full disclosure of the evidence is reasonably necessary to enable a proper understanding of the other evidence that has already been adduced; or

    (d)……………………….. :

    (e)…………………………

    (f)…………………………

    (g)Evidence that has been adduced in the proceeding, or an inference from evidence that has been adduced in the proceeding, is likely to mislead the court unless evidence of the communication or document is adduced to contradict or to qualify that evidence; or

    (h)…………………………;

    (i)…………………………;

    (j)…………………………;

    (k)…………………………

22. At this preliminary stage of the proceedings, the parties have both skirted around the precise details of what was said and why that was so. The only document that goes beyond that is the annexure to the wife’s affidavit being the husband’s email.

23. Standing alone, the document is inadmissible because of s 131(1). It was an attempt by the husband to negotiate a settlement even if the subject was prompted by something suggested by the wife. The wife’s position as outlined in her affidavit had nothing to do with a settlement. She asked for a loan.

24. In Andi-Co Australia Pty Ltd v Meyers[5] Heerey J dealt with a case in which an employer presented an employee with a settlement agreement at the time that the employee’s position was terminated. The employer argued that the document was inadmissible because of s 131(1). The employee argued the privilege had been waived because the document was handed over at the time of the dispute beginning. Heerey J ruled the document inadmissible saying:

    In my opinion the terms of section 131(1)(b) make it clear that one should direct attention to the preparation of the document. I do not think it matters that from one point of view the dispute may be said to have commenced instantaneously with the handing over of the letter (of termination) and the settlement agreement. The conclusion is compelling that…..the settlement agreement was prepared in connection with an attempt to negotiate a settlement of dispute, albeit a dispute which was not in existence at the time the settlement agreement was prepared, but which was obviously contemplated as being virtually inevitable.

    [5] [2004] FCA 1358 (12 October 2004)

25. There can be little doubt why the husband prepared the document notwithstanding the wife may not have been the slightest bit interested in negotiating a settlement of the UK appeal issue.

26. In Gpi Leisure Corporation Ltd (In Liq) v Yuill and 85 Ors[6] Young J looked at what “in connection with an attempt to negotiate a settlement of the dispute” meant in s 131. His Honour examined a number of aspects of a “without prejudice” letter and pointed out that the use of those words was not conclusive. What was important was that the letter had to suggest a method of compromising the underlying dispute. In this case, the husband has apparently been quite precise about his “offer” notwithstanding the wife’s interest in a “loan”.

    [6] [1997] NSWSC 258 (14 July 1997)

27. As the High Court said in Rodgers v Rodgers[7], the absence of the words “without prejudice” was irrelevant in negotiations. The Court said:

    (I)t is sufficient that the wife’s first petition was then pending, that claims had been made upon the husband, and that the negotiations took bona fide with a view to a compromise.

    [7] (1964) 114 CLR 608

28. Absent any argument that may arise in cross-examination about whether the evidence set out in the annexure fits within an exception in s 131(2), I rule the annexure inadmissible and cannot be relied upon. I do not rule any of the other paragraphs referred to inadmissible at this stage having regard to the fact that they otherwise do not appear to disclose an attempt at negotiations as referred to in s 131(1)(a).

29. The second issue relates to a significant portion of the wife’s evidence about what her lawyers ascertained about an allegation that the children were at risk that was made to the Department of Human Services.

30. The husband objects to the wife’s evidence on the basis that in its entirety, it is hearsay, comment and is argumentative.

31. The starting point is s 56 of the Evidence Act, that is, that evidence that is relevant is admissible.

32. Section 59 provides that evidence of a previous representation is not admissible to prove the existence of a fact that the person intended to assert by the representation. There are specific exceptions to the hearsay provisions. Here if I accepted that the allegations were made as described, they could affect the husband’s case particularly if they were without foundation.

33. I am not entirely sure of the relevance of the intervention in the children’s lives by the Department and as such, I have asked each party to indicate what they wish to do with it. It may be that it is a subject about which there is to be cross-examination going to matters in s 60Cc of the Family Law Act 1975 (Cth).

34. On the basis that the wife was reporting albeit through her lawyers a record prepared on the basis of information directly by a person who supposedly had knowledge of the matters asserted, the evidence is not hearsay if taken from a business record. If the accuracy of the record is in dispute or that the reporter to the recorder of facts did not have the knowledge reputed to have been recorded, then I would rule the evidence inadmissible but allow the wife to call the recorder of the facts as to what he was told.

35. At this preliminary stage therefore, I propose to permit the evidence to remain as admissible.

I certify that the preceding Thirty Five (35) paragraphs are a true copy of the Ruling of the Honourable Justice Cronin

Associate:

Date:  19 February 2008