Talacko v Bennett & Ors; Talacko v Talacko & Ors

[2017] HCATrans 267

[2017] HCATrans 267

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M97 of 2017

B e t w e e n -

JUDITH GAIL TALACKO

Applicant

and

ALEXANDRA ANN BENNETT

First Respondent

MARTIN THORBURN JAN TALACKO

Second Respondent

ROWENA KIRSTEN EVE TALACKO

Third Respondent

ALEXANDRA ANN BENNETT AND DAVID ADAMS (AS EXECUTORS OF THE ESTATE OF MARGARET HELEN TALACKO)

Fourth Respondent

JAN TALACKO (AS EXECUTOR OF THE ESTATE OF HELENA MARIE TALACKO)

Fifth Respondent

ESTATE OF JAN EMIL TALACKO (DECEASED) (AN UNDISCHARGED BANKRUPT)

Sixth Respondent

DAVID TALACKO

Seventh Respondent

PAUL ANTHONY TALACKO

Eighth Respondent

PETER ANDREW NOEL TALACKO

Ninth Respondent

AMANDA MAREE FISCHER

Tenth Respondent

STATE TRUSTEES LTD (ACN 064 593 148)

Eleventh Respondent

Office of the Registry
  Melbourne  No M98 of 2017

B e t w e e n -

JUDITH GAIL TALACKO

Applicant

and

JAN TALACKO (AS EXECUTOR OF THE ESTATE OF HELENA MARIE TALACKO)

First Respondent

ALEXANDRA ANN BENNETT

Second Respondent

MARTIN THORBURN JAN TALACKO

Third Respondent

ROWENA KIRSTEN EVE TALACKO

Fourth Respondent

ALEXANDRA ANN BENNETT AND DAVID ADAMS (AS EXECUTORS OF THE ESTATE OF MARGARET HELEN TALACKO)

Fifth Respondent

ESTATE OF JAN EMIL TALACKO (DECEASED) (AN UNDISCHARGED BANKRUPT)

Sixth Respondent

DAVID TALACKO

Seventh Respondent

PAUL ANTHONY TALACKO

Eighth Respondent

PETER ANDREW NOEL TALACKO

Ninth Respondent

AMANDA MAREE FISCHER

Tenth Respondent

STATE TRUSTEES LTD (ACN 064 593 148)

Eleventh Respondent

Applications for special leave to appeal

GAGELER J
GORDON J
EDELMAN J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 15 DECEMBER 2017, AT 9.31 AM

Copyright in the High Court of Australia

____________________

MR B.W. WALKER, SC:   May it please the Court, I appear for the applicant with my learned friend, MR J.B. MASTERS, in both those cases.  (instructed by Strongman & Crouch)

MR P.H. SOLOMON, QC:   If your Honours please, I appear with my learned friend, MR O.M. CIOLEK, for the first to fourth respondents in M97/2017 and the second to fifth respondents in M98/2017.  (instructed by Brand Partners Commercial Lawyers)

GAGELER J:   Yes, Mr Walker.

MR WALKER:   There are, as your Honours will notice, some submitting appearances that complement the two cases.

GAGELER J:   Yes.

MR WALKER:   Your Honours, as things stand, the effect of the Court of Appeal’s disposition of the appeals to it is that there will be a remitted hearing for assessment of damages, including for loss of a chance.  That is, the reasons for the order which itself is in perfectly general terms for the assessment of damages are reasons which have to do with the not only completion of the cause of action but the fact that there has been the loss of a chance.

GAGELER J:   The points you wish to raise at this point are points that you could raise in a subsequent appeal from the ultimate order to be made?

MR WALKER:   I think my answer to that is no, your Honour.  I do not want to poison the ground ahead of me, but the situation is this.  The reasons for the order that damages be assessed which bind us as a matter of issue estoppel is that there has been a lost chance. 

In that assessment hearing we apprehend were bound by that, that is, we are precluded from saying the matter has yet to run, it has not run its course, to adapt this Court’s expression in Tabet v Gett to which we have drawn attention.  Thus, it would appear that we would not be able in an appeal in the same proceedings to challenge that proposition which has been heard and determined between us once that is in the Court of Appeal from which we seek special leave to appeal.

GORDON J:   It does not answer the question though, does it?  There is a split trial between liability and quantum.

MR WALKER:   There was.

GORDON J:   It goes back for the assessment of damages on the quantum hearing and in the ordinary course both the question of principle and assessment, if there is any appeal from the assessment, would come up in the ordinary course.

MR WALKER:   Yes, but that is why I have started with this point, your Honour.  As we apprehend matters, in the assessment we are bound to it being an assessment of the damages to compensate for a loss that includes – I do not think it is wholly constituted – but it includes what has been held to have been the loss of a chance.  Now, we apprehend that as a matter of rule and principle we are bound by that conclusion to the extent that we cannot in the damages case say the chance is not lost.

GORDON J:   That is probably right, that does not preclude you coming up again if necessary and challenging both the underlying principle and the assessment.

MR WALKER:   Your Honour, I suppose it depends on how far up ‑ ‑ ‑

GAGELER J:   The point that you have now reached, Mr Walker, the point of asking this Court to look at it, the points you now wish to raise before this Court are points I think – I could be persuaded otherwise perhaps – that could be raised by you at the subsequent and final stage of having a final order in the ‑ ‑ ‑

MR WALKER:   Trial division, your Honour.

GAGELER J:   Well, yes, even in the trial division you would not even need necessarily to come up through the Court of Appeal.

MR WALKER:   One does have to test it at the trial division.

GAGELER J:   Yes, of course.

MR WALKER:   As I say, I do not want poison the territory ahead of me; if we can do that then this is an application that is premature.  But it is, in our submission, both a matter of rule and principle that we cannot canvass the grounds upon which an order has been made for the trial division to complete the proceeding by proceeding to the damages phase.

EDELMAN J:   We do not even know at this stage whether that would even be an issue.  If, for example, the question of expenses were resolved adversely to you in terms of quantification on a basis that you accept to be legitimate, then all of these issues would fall away as questions of principle.  They would just be questions of quantification.

MR WALKER:   With great respect, that is true, but not dispositive of the present question of special leave.  It is true in this sense.  If the damages phase – the trial division says there are – and I will just pick a figure out of the air – several hundred thousand dollars of loss, they would have nothing to do with a chance, they are expenditure and they are the damages, then nothing in our special leave application as it presents itself today will be apposite; nothing at all.  In that sense, with respect, your Honour is correct.

However, it is only if that was the only head of loss for which there was an award that that would be so.  If there were an attempt, as we apprehend the trial division is bound to undertake, of assigning a money value for the prospects of Czech litigation yet to run its course then, in our submission, procedurally we apprehend we will not be able to tell the trial division but it has yet to run its course, there is no place for the common law to assess its chances.

GORDON J:   That is in a sense a quantification assessment as well.

MR WALKER:   It is, of course, your Honour, but ‑ ‑ ‑

GORDON J:   So in a sense it begs the question – you may make submissions, will you not, I assume, about the assessment of that by reference to quantification issues.

MR WALKER:   Yes, there is a difference - your Honours appreciate the question of principle we wish to raise ‑ ‑ ‑

GORDON J:   We do.

MR WALKER:   I had not quite finished the sentence.  Your Honours appreciate that the question of principle we want to raise does not involve telling a damages court you cannot or you should not assess a money value for the prospects of this litigation because it is yet to run its course.  The matter of principle we want to raise says no court should be seized of the question what it is worth, because it is still there and we will know what it is worth after it is finished.

We are deprived of that argument and will be forever deprived of that argument, that is, unless we get special leave, either today or eventually, because the Court of Appeal has currently concluded that it is no answer to a claim that a chance has been lost that the case is still able to be run.  It is enough to fit the common law description of a lost – some of the cases say destroyed chance, but there has been something that is variously called an impediment or an obstacle created by the wrongdoing.

Now, in our submission, that is a matter of principle which we are not able properly to engage with on the quantum hearing which means that in an appeal from the quantum hearing we will not be able to engage with it and we cannot in what I will call a second appeal to the Court of Appeal say that the first Court of Appeal was wrong, because we are still in the same proceedings and we are bound by their finding that there was a lost chance either upon the donation agreement or by the time of judgment at first instance.

GAGELER J:   That really comes to the question I wanted to ask you about timing.  If this Court were to examine the existence or non‑existence of the loss, at what point would we be looking for the lost chance; at what point in time?

MR WALKER:   There are three that are thrown up in principle.  Only two seem to have got a whole lot of attention.  One is the date of the donation agreement itself.  We do not suggest that is anywhere near a complete answer.  No doubt it is relevant to inquire what was the effect upon it being entered into.  But as a matter of common law reasoning, that does not exhaust the inquiry, “have you suffered loss?”.  The other is judgment.  With respect, that makes it sound as if it was an equity matter.  It is not, it is a common law matter.  The third obvious one is the time of commencement of the proceedings, that is, commencement of the common law proceedings.

GAGELER J:   You accept that judgment is one of the possibilities?

MR WALKER:   The record shows that that seems to have been embraced, if not by everybody, at least I think by us, and certainly by the court.

GAGELER J:   Does that not really point up the problem that we have not got to judgment yet?

MR WALKER:   And that is one of the reasons ‑ ‑ ‑

GORDON J:   That is the hesitation.

MR WALKER:   And that is one of the reasons I was about to say, but in principle all causes of action at common law and subject to special amendment liberality rules, all common law causes of action have to be accrued at the commencement of the proceedings.  You do not have a cause of action unless you have suffered a loss.

Now, if we are right that there was no loss suffered because upon the donation agreement being made and discovered proceedings became available, and indeed have been instituted and are still on foot and have been persisted in to set them aside – set it aside, then the question should be asked at the date that you sued for conspiracy, civil conspiracy, was there a loss constituted by a supposed lost chance with respect to enjoying the fruits of a judgment for which the donation agreement stands as some kind of obstacle?

GAGELER J:   Correct me if I am wrong, but the difference in date between the date of commencement of the proceedings and the date of judgment in the proceedings would only be a material difference if a limitation period intervenes, would it not?

MR WALKER:   If something had intervened between ‑ your Honour is quite right, that is next point I want to come to.  In this case the difference is immaterial because nobody says anything has occurred between commencement of the common law proceedings and its judgment.  I do mean the first day of judgment, not so much the Court of Appeal.  Nothing has occurred between those two dates or indeed any later date and indeed up until today which has altered the position as to what might be called the destruction or loss constituted by the pendency of the proceedings to set aside the donation agreement.

So, your Honour has asked me questions of principle.  They are intensely practical in terms of the prematurity question ‑ we accept that entirely ‑ but my answer is the question of loss of a chance is fully ripe now because there needed to be a lost chance for there to be a cause of action to entitle proceedings to be commenced.  Now, I have alerted your Honours to the fact that I do not think it has been put quite that way below, but it does seem to be true as a matter of principle.  But it makes no difference be it judgment or not, because nothing has intervened in any event.

Now, it is true, as Justice Gageler has pointed out to me, well, in one sense judgment is yet to happen because everything is interlocutory until a judgment money sum is ordered.  I am bound to concede that if, for example, by an ingenious argument as to the incapacity to award substantive damages for litigation that is yet to run its course, that is not canvassing the Court of Appeal but somehow doing it by quantification argument, then in that event, which is quite difficult to contemplate, there will not be a lot of beef, as it were, in the point of principle.

But we submit that the whole of the quantum argument is now required by the Court of Appeal’s conclusions in support of its order to be conducted on a premise which is fundamentally wrong and which places the law in this country in a direct collision so far as fundamental aspects of tort reasoning is concerned with the position in the United Kingdom.

EDELMAN J:   Although the position in the United Kingdom in cases like Gregg v Scott, you see three different approaches that are taken in the majority, whereas if we were to give special leave in this case we would be trying to resolve those questions of principle without the underlying findings of fact, at least in relation to quantification.

MR WALKER:   Two answers to that.  The first I hope your Honours will not regard as facetious; it is not intended thus.  It would be a good thing for this Court to be engaged in resolving the doubts which we do accept are apparent when one seeks to distil the position in Gregg v Scott.  Now, with respect, there is something to be distilled – there are common threads that provide a ratio.  It is not a judgment without reasons; far from it.  That is the first thing.

The second thing is everything has been found which is necessary for what I will call the Gregg v Scott proposition.  It is clear to demonstration ‑ and detail is not necessary and detail would be irrelevant ‑ that the proceedings in the Czech Republic to set aside the donation agreement are on foot and are persisted with and are not regarded as hopeless, let alone having been rendered hopeless by the conspiracy which has been found.  Indeed, it makes no sense to say they have been rendered hopeless by that.  Rather, they are rendered necessary by that.  That is the whole theory of the claim against us.  When I say “claim”, I accept that we have suffered judgment on what I will call the liability position, subject to completing the cause of action by the suffering of loss.

GAGELER J:   So you are speaking in the present tense, “are”, but for the purposes of this hearing are we talking about the position in 2009, 2015, 2017?

MR WALKER:   It will not make any difference whether it is any of those three.  That is, the position is the same for each of those.  I have already said what I need to ‑ ‑ ‑

GORDON J:   Because the facts have not changed, is that why?

MR WALKER:   That is right.  I do not for a moment gainsay the matters of principle which are explicit in your Honours’ questions and what I have tried to say about that.  It so happens that that is not a reason to say this case is not right because there are still facts to be found, because those facts are now historical and they are not in doubt and they are very plain.

EDELMAN J:   What do you say to the respondents’ proposition that all of this if it came to this Court would be moot because, for example, the costs of investigating the claim could be a standalone loss?

MR WALKER:   With respect, that is a good answer so far as it goes.  It is not an answer to our special leave point.  It is an answer to number 3, our proposed ground 3.  But it is not an answer to the other because we are bound now to a quantum hearing which goes far beyond those costs.  Your Honour is, with great respect, correct to draw to attention an argument, as it were, levelled against us for special leave which your Honours will not be surprised to know we point to as showing in principle the nature of the fallacy committed by the Court of Appeal.

There is the world of difference between the expenditure, the out of pockets – and we do not say that they will necessarily recover them – but we understand that is a case which has nothing to do with loss of a chance.  It may raise questions concerning the policy of the law which is not for today and does await a quantum hearing as to the extent of recovery for expenses with respect to the prospect of litigation.

GORDON J:   Does that not show up the fact that in a sense your application brings about fragmentation?

MR WALKER:   Your Honour, I cannot possibly deny that we are here for a fragment but we suffered, if I can put it that way – and I do not mean to complain – we are the objects of an order for a split trial, and so it is in the nature of such proceedings that they do raise what are sometimes called fragmentation matters.  It is not as fraught in civil law as in crime, particularly when it can be seen that the point is one that has to be grappled with in any event and if decided one way would bring certain forms of controversy to an end once and for all, and this is a point that does have to be determined one way or the other, we submit.

The question is whether we will lose our chance of saying there was no lost chance if we do not seek to challenge that in this Court now and, if that were not the case, then there is a deal to be said for what I have called the prematurity of our application but, with respect, we are bound to make it at a point when there is final relief in the Court of Appeal directing the manner in which the assessment is to take place.  We will not be able to

challenge that in the Court of Appeal upon a return.  We can challenge the counting, but we cannot challenge the fact that the count was had.

GAGELER J:   You can come back and talk to us when it is all over.

MR WALKER:   Thank you, your Honour.  May it please the Court.

GAGELER J:   Mr Solomon, we do not need to hear from you.

In our opinion this case does not, at this stage, present as a suitable vehicle for the consideration by this Court of principles governing the identification of loss in the tort of unlawful means conspiracy.  Nor do we consider it to be in the interests of justice that the proceeding in the Supreme Court be further fragmented.  Special leave to appeal is refused with costs.

MR WALKER:   May it please the Court.

GAGELER J:   Did you wish to say something?

MR SOLOMON:   Only to ask for costs, but your Honour pre‑empted me.

GAGELER J:   Yes, thank you.

AT 9.52 AM THE MATTERS WERE CONCLUDED