Samuel Savage as Executor of the Estate of John Thomas Savage (Deceased) v Gibbins Investments Pty Ltd (No 2)

[2012] FCA 979

FEDERAL COURT OF AUSTRALIA

Samuel Savage as Executor of the Estate of John Thomas Savage (Deceased) v Gibbins Investments Pty Ltd (No 2) [2012] FCA 979

Citation:		Samuel Savage as Executor of the Estate of John Thomas Savage (Deceased) v Gibbins Investments Pty Ltd (No 2) [2012] FCA 979
Application for Leave to Appeal from:		Gibbins Investments Pty Ltd v Samuel Savage as Executor of the Estate of John Thomas Savage (Deceased) [2012] FCA 742
Parties:		SAMUEL SAVAGE AS EXECUTOR OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED), TERESA CLEGG AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED) and MARYELLEN QUIGLEY AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED) v GIBBINS INVESTMENTS PTY LTD (ACN 122 828 369)
File number:		VID 456 of 2012
Judge:		NORTH J
Date of judgment:		27 August 2012
Date of hearing:	27 August 2012
Place:	Melbourne
Division:	GENERAL DIVISION
Category:	No Catchwords
Number of paragraphs:	12
Counsel for the Applicants:	Mr N Lucarelli QC with Mr A Rodbard-Bean
Solicitor for the Applicants:	Thomsons Lawyers
Counsel for the Respondent:	Mr A J Kelly SC with Mr M P Costello
Solicitor for the Respondent:	Wisewould Mahony Lawyers

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 456 of 2012

BETWEEN:

SAMUEL SAVAGE AS EXECUTOR OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
First Applicant

TERESA CLEGG AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
Second Applicant

MARYELLEN QUIGLEY AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
Third Applicant

AND:

GIBBINS INVESTMENTS PTY LTD (ACN 122 828 369)
Respondent

JUDGE:	NORTH J
DATE OF ORDER:	27 AUGUST 2012
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.        The application for leave to appeal is refused;

2.        The parties to bear their own costs of the application.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
GENERAL DIVISION	VID 456 of 2012

BETWEEN:

SAMUEL SAVAGE AS EXECUTOR OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
First Applicant

TERESA CLEGG AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
Second Applicant

MARYELLEN QUIGLEY AS EXECUTRIX OF THE ESTATE OF JOHN THOMAS SAVAGE (DECEASED)
Third Applicant

AND:

GIBBINS INVESTMENTS PTY LTD (ACN 122 828 369)
Respondent

JUDGE:	NORTH J
DATE:	27 AUGUST 2012
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

1. Before the Court is a resumed application for leave to appeal from orders made by Marshall J in VID 259 of 2012 on 21 June 2012.  The application first came before the Court on 16 July 2012.  The circumstances in which the adjournment was required are set out in the reasons for judgment delivered on 16 July 2012 in this matter. 

2. Following the adjournment, the Savage parties approached Marshall J, and, as a result, on 30 July 2012 his Honour published some more elaborate reasons for the orders which he had made.

3. The evidence and arguments in the hearing before Marshall J were comprehensive.  The evidence was contained in several folders and comprised of a number of detailed affidavits.  The draft grounds of appeal seek to raise errors made by his Honour, both of fact and law. 

4. A number of examples were given of fact findings which are challenged by the parties to the proposed appeal. For instance, it is said that his Honour made an error of fact in holding that there was no attempt to negotiate a settlement of the dispute within the meaning of s 131(1) of the Evidence Act 1995 (Cth) (the Act) so as to enliven the claim to confidentiality. Further, his Honour is said to have erred in determining that the communications on 14 and 21 March 2012 by the solicitor for the Savage estate to the solicitor for Gibbins Investments Pty Ltd (Gibbins) were admissible because as they were communications which affected the right of Gibbins to enforce its pre-emptive rights to purchase shares in the relevant companies, they fell within s 131(2)(i) of the Act. It was submitted that this flowed from his Honour’s erroneous factual finding that the communications constituted a “threat” to sell the shares “irrespective of [Gibbins’] pre-emptive rights” in circumstances where the substance of the communications was expressed by the solicitor for the Savage estate to be “subject to the pre-emptive rights”.

5. Furthermore, some issues of interpretation of the section are sought to be raised on the appeal. 

6. In the reasons for judgment delivered in this matter on 16 July 2012, it was said, in relation to the first set of reasons at [9]:

   The difficulty which confronts this application for leave to appeal is that the reasons do not give the Full Court an appropriate basis upon which to make an assessment of whether his Honour fell into error. 

   The subsequent reasons do not advance that issue and the difficulty largely remains.  The later reasons do not refer to or analyse the substantial evidence in any way which would allow the Full Court to assess whether the findings were erroneous nor do they grapple with the legal issues raised. 

7. Whether leave to appeal is granted or not, the judgment of his Honour is open to an appeal. The only question to be answered at this stage is whether that appeal should occur now with leave, or whether it should await the final determination by Jessup J after the substantive trial has concluded. 

8. The draft grounds of appeal rely upon arguments which cannot easily be tested against the reasons which have presently been given. The result would be that the case would need to be argued before a Full Court from the beginning.  That is to say, counsel would need to take the Full Court through all of the evidence, undistilled by an original analysis.  This is both inconvenient for a Full Court but also potentially inefficient in the administration of justice. 

9. If there is an appeal from the judgment of Jessup J in the substantive proceeding and the operation of s 131 of the Act is then argued, that argument will be on the basis of a consideration of the evidence in dispute and hence, give the Full Court a clear picture of the circumstances and context in which the issues under s 131 of the Act arise.  It will be possible for the Full Court, if necessary, to rule upon the s 131 issues and, if it concludes that Marshall J erred and that the evidence or part of it should not have been permitted to be adduced, it will be in a position to give judgment on the basis that the evidence is excluded.

10. Alternatively, if the Full Court reaches the same conclusion as Marshall J, that the evidence in question was properly permitted to be adduced, then the appeal would be considered on the basis of the trial as it was actually heard. 

11. It is more efficient to refuse leave to appeal at this stage so that the evidence which, as a result of the judgment of Marshall J, can be adduced in the trial will be assessed by Jessup J.  This will ensure that the evidence is analysed and findings made.

12. Given that there is an opportunity for the matter to progress on a basis which might better inform the Full Court of the conclusions on the application of s 131 of the Act, it is preferable, in the interests of the administration of justice, for leave to appeal to be refused at this stage.

I certify that the preceding twelve (12) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice North.

Associate:

Dated:       6 September 2012