Tsallis v Schofield
[2012] WASC 231
•2 JULY 2012
TSALLIS -v- SCHOFIELD [2012] WASC 231
| Link to Appeal : | [2013] WASCA 138 |
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2012] WASC 231 | |
| Case No: | CIV:1483/2007 | 3-4 APRIL 2012 | |
| Coram: | KENNETH MARTIN J | 2/07/12 | |
| 29 | Judgment Part: | 1 of 1 | |
| Result: | Privilege upheld Inspection refused | ||
| A | |||
| PDF Version |
| Parties: | VASILIS TSALLIS GEORGIA TSALLIS GREGORY RONALD RUSHTON HONEY RUSHTON ALLAN BARTHOLOMEW VERONIKA RIEGEL CLAIRE ASTRID GROCKE BRIAN HALL ERIKA HALL DESMOND PETER SEERY SARA LOUISE SEERY TERENCE RICHARD GROCKE EDEL GROCKE MARK BONSER SYLVIA GWEN KELLY IQBAL SAMNAKAY NEELAM ISMAIL SAMNAKAY PETER NOEL WINN PAMELA MAY WINN TODD MATHEW MOUNTFORD KATHLEEN DAWN EVANS RONALD McINERNEY VERNON SCHOFIELD CHRISTINE SCHOFIELD |
Catchwords: | Privilege Without prejudice Objection to inspection Voir dire Waiver Use of documents in prior proceedings |
Legislation: | Fair Trading Act 1987 (WA) |
Case References: | C v M [2011] WASC 175 Field v Commissioner for Railways (NSW) [1957] HCA 92; (1957) 99 CLR 285 JA McBeath Nominees Pty Ltd v Jenkins Development Corporation Pty Ltd [1992] 2 Qd R 121 Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 Mitchell v Schofield [2007] WASC 303 Ofulue v Bossert [2009] 1 AC 990 Pihiga Pty Ltd v Roche [2011] FCA 240; (2011) 278 ALR 209 Rush & Tompkins Ltd v Greater London Council [1989] 1 AC 1280 Unilever plc v Procter & Gamble Co [2000] 1 WLR 2436 Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- GEORGIA TSALLIS
First Plaintiffs
GREGORY RONALD RUSHTON
HONEY RUSHTON
Second Plaintiffs
ALLAN BARTHOLOMEW
VERONIKA RIEGEL
Third Plaintiffs
CLAIRE ASTRID GROCKE
Fourth Plaintiff
BRIAN HALL
ERIKA HALL
Fifth Plaintiffs
DESMOND PETER SEERY
SARA LOUISE SEERY
Sixth Plaintiffs
TERENCE RICHARD GROCKE
EDEL GROCKE
Seventh Plaintiffs
MARK BONSER
Eighth Plaintiff
SYLVIA GWEN KELLY
Ninth Plaintiff
IQBAL SAMNAKAY
NEELAM ISMAIL SAMNAKAY
Tenth Plaintiffs
PETER NOEL WINN
PAMELA MAY WINN
Eleventh Plaintiffs
TODD MATHEW MOUNTFORD
KATHLEEN DAWN EVANS
Twelfth Plaintiffs
RONALD McINERNEY
Thirteenth Plaintiff
AND
VERNON SCHOFIELD
CHRISTINE SCHOFIELD
Defendants
Catchwords:
Privilege - Without prejudice - Objection to inspection - Voir dire - Waiver - Use of documents in prior proceedings
Legislation:
Fair Trading Act 1987 (WA)
Result:
Privilege upheld
Inspection refused
Category: A
Representation:
Counsel:
First Plaintiffs : No appearance
Second Plaintiffs : No appearance
Third Plaintiffs : No appearance
Fourth Plaintiff : No appearance
Fifth Plaintiffs : No appearance
Sixth Plaintiffs : No appearance
Seventh Plaintiffs : No appearance
Eighth Plaintiff : No appearance
Ninth Plaintiff : No appearance
Tenth Plaintiffs : Dr P R MacMillan
Eleventh Plaintiffs : No appearance
Twelfth Plaintiffs : No appearance
Thirteenth Plaintiff : No appearance
Defendants : Mr M G Pendlebury
Solicitors:
First Plaintiffs : Stables Scott
Second Plaintiffs : Stables Scott
Third Plaintiffs : Stables Scott
Fourth Plaintiff : Stables Scott
Fifth Plaintiffs : Stables Scott
Sixth Plaintiffs : Stables Scott
Seventh Plaintiffs : Stables Scott
Eighth Plaintiff : Stables Scott
Ninth Plaintiff : Stables Scott
Tenth Plaintiffs : Stables Scott
Eleventh Plaintiffs : Stables Scott
Twelfth Plaintiffs : Stables Scott
Thirteenth Plaintiff : Stables Scott
Defendants : Culshaw Miller Lawyers
Case(s) referred to in judgment(s):
C v M [2011] WASC 175
Field v Commissioner for Railways (NSW) [1957] HCA 92; (1957) 99 CLR 285
JA McBeath Nominees Pty Ltd v Jenkins Development Corporation Pty Ltd [1992] 2 Qd R 121
Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1
Mitchell v Schofield [2007] WASC 303
Ofulue v Bossert [2009] 1 AC 990
Pihiga Pty Ltd v Roche [2011] FCA 240; (2011) 278 ALR 209
Rush & Tompkins Ltd v Greater London Council [1989] 1 AC 1280
Unilever plc v Procter & Gamble Co [2000] 1 WLR 2436
Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738
KENNETH MARTIN J:
Introduction
1 This is a voir dire to determine the status of three documents which the plaintiffs (particularly the tenth plaintiffs, Iqbal and Neelam Samnakay) wish to tender in evidence against the defendants. The defendants object to the admission of these documents into evidence, asserting that the communications were on a without prejudice basis.
2 None of the three documents (which for this voir dire became exhibits 3, 4 and 6) are labelled on their face as being a without prejudice communication. But such a marking is not necessary or even determinative of that status. Context alone may provide a sufficient basis to enable the conclusion to be drawn, as these defendants now contend.
3 There was minimal disputation between the parties as to the applicable law concerning without prejudice communications. Hence, I will briefly deal with the law at the outset.
The law
4 Recently in C v M [2011] WASC 175, after referring to the leading High Court authority, Field v Commissioner for Railways (NSW) [1957] HCA 92; (1957) 99 CLR 285, I observed [64]:
Without prejudice privilege is obviously enjoyed by parties in a settlement negotiation. As a privilege enjoyed mutually by the parties in a bilateral negotiation, that feature necessarily inhibits the amenability of the privilege to unilateral assertions of waiver by merely one of the parties to negotiations. A Calderbank communication (see Calderbank v Calderbank [1975] 3 All ER 333) however, is an example of without prejudice privilege in a communication being unilaterally expressly reserved for future possible waiver, as regards the limited issue of costs, at the completion of proceedings.
5 Fifty four years earlier, Dixon CJ, Webb, Kitto and Taylor JJ in Field had said (291 - 292):
As a matter of policy the law has long excluded from evidence admissions by words or conduct made by parties in the course of negotiations to settle litigation. The purpose is to enable parties engaged in an attempt to compromise litigation to communicate with one another freely and without the embarrassment which the liability of their communications to be put in evidence subsequently might impose upon them. The law relieves them of this embarrassment so that their negotiations to avoid litigation or to settle it may go on unhampered. This form of privilege, however, is directed against the admission in evidence of express or implied admissions. It covers admissions by words or conduct. For example, neither party can use the readiness of the other to negotiate as an implied admission. It is not concerned with objective facts which may be ascertained during the course of negotiations. These may be proved by direct evidence. But it is concerned with the use of the negotiations or what is said in the course of them as evidence by way of admission.
6 Relevantly to the present forensic exercise, the court had also said (292):
Needless to say, the privilege is a matter to be raised by objection to the admissibility of the evidence. For the purpose of deciding such an objection the judge may take evidence on the voir dire.
7 More recently, in Pihiga Pty Ltd v Roche [2011] FCA 240; (2011) 278 ALR 209, Lander J has remarked [81]:
Later authority shows that the rule protects not only admissions in the form of an offer to settle, but also communications between the parties generally in respect to issues in the dispute including assertions made of the strength and weaknesses of a party's case or an opponent's case.
- Unilever plc v Procter & Gamble Co [2000] 1 WLR 2436, 2449; Rush & Tompkins Ltd v Greater London Council [1989] 1 AC 1280 and Ofulue v Bossert [2009] 1 AC 990 were cited as authority for that proposition.
8 Clearly, the without prejudice privilege protection is never absolute. Robert Walker LJ in Unilever (2444 - 2445) identified eight categories of exceptions; subsequently approved by Lord Hope of Craighead, Lord Rodger of Earlsferry and Lord Neuberger of Abbotsbury in Ofulue.
9 Furthermore, a communication otherwise protected by without prejudice privilege may lose its protection and be opened through an act or acts of waiver: see Yokogawa Australia Pty Ltd v Alstom Power Ltd [2009] SASC 377; (2009) 262 ALR 738 [85] - [96] and [106] - [107] (Duggan J, with whom Sulan J agreed).
10 None of these legal propositions were at all in controversy between the parties as the respective voir dire arguments proceeded before me.
Procedural background
11 On 6 October 2011, orders were made by consent for a separate hearing of the tenth plaintiffs' action (that is, the Samnakays as tenth plaintiffs), effectively as a test case. Hearing of the balance of the remaining actions was stayed, pending the decision in the tenth plaintiffs' case or the determination of any appeal in the same.
12 In proceeding to deal with the separate hearing of the tenth plaintiffs' action, a controversy over the 'without prejudice' status of three documents is raised by the defendants and requires an early resolution. To this end it was directed that:
The determination of whether a without prejudice privilege exists and operates so as to render any evidence with respect to paragraphs 246 - 248 of the Amended Statement of Claim inadmissible be determined by a judge other than the trial judge and be determined prior to the hearing of the tenth plaintiffs' case.
13 To that end, I made directions on 13 December 2011 concerning filing of witness statements and the exchange of written submissions and lists of authorities for the voir dire concerning the disputed 'without prejudice' status of the three documents.
14 Reference in the direction for the voir dire to pars 246 - 248 of the plaintiffs' amended statement of claim dated 14 May 2009 requires some elaboration by reference to those pleas. I will set them out in due course. But first it is necessary to provide the wider context by reference to the state of the pleadings as a whole.
15 There are 13 separate plaintiffs in CIV 1483 of 2007, each pursuing their own discrete causes of action against the defendants. The plaintiffs' action was commenced on 11 May 2007.
16 In brief, the defendants, Mr and Mrs Schofield, are registered proprietors of Lot 9 Cheriton Road, Gingin. The land is also referred to as the 'Marchmont Estate'. As vendors, the Schofields had entered a number of contracts of sale, by written offer and acceptances, with the various plaintiffs for the sale of certain (proposed to be) subdivided portions of Lot 9, on terms. The sale contracts were entered across 2004 to 2006.
17 The defendant vendors had engaged Roy Weston Cabassi Realty as their local agent at Gingin to effect sales of the proposed subdivided lots. Invariably, the contracts of sale were made conditional upon the vendors obtaining certain approvals for subdivision from the Planning Commission of Western Australia. Clause 13.3 of the 2002 Joint Form of General Conditions was incorporated into each contract of sale (Joint Form of General Conditions). This provision required:
(a) Planning Commission endorsed approval on a subdivision plan within six months after approval for subdivision being granted by the Planning Commission (on 23 November 2003); and
(b) a subdivision plan being in order for dealing within three months after the date of endorsement of approval by the Planning Commission.
18 Clause 13.7 of the Joint Form of General Conditions required satisfaction of these conditions within specified time periods. Mr and Mrs Samnakay entered their contract of sale with the defendants on 16 February 2005 in respect of their planned purchase of proposed Lot 370 in the Marchmont Estate. Their purchase price was $50,000. Settlement was due on issue of a certificate of title.
19 There followed two written variations to the contract of sale - each extending the fixed period that had been allowed for the Planning Commission to endorse approval on the subdivision plan. The variations extended time to obtain the approval of the Planning Commission, first from six months out to eight months, and then, from eight months out to 14 months.
20 Notwithstanding those extensions of time for the Planning Commission approval to be obtained, it had not been obtained by the end of 14 months. The Schofields then purported to terminate performance of the contract of sale with the Samnakays during May 2006. On 17 May 2006, Mr Schofield signed a communication to a number of Marchmont Estate purchasers framed in a somewhat generic fashion. It read (see exhibit 2, Mr Schofield's witness statement, annexure VS6):
TO WHOM IT MAY CONCERN
I hereby advise that the Western Australian Planning Commission ('WAPC') has not endorsed its approval on the Sub Division plan for Marchmont Estate as required in clause 13.3(a)(1) of the joint Form of General Conditions for the Sale of Land (2002 Revision). The fundamental reason is that the Water Corporation will not agree to the plan as submitted, therefore the approvals required by the WAPC can not be satisfied.
I further advise that the endorsement referred to above has not been obtained within the time specified in the Contract for Sale of Land (including any Variation thereof) between you as Buyers and V and C A Schofield as Sellers. Accordingly, the Contract is at an end. The Sellers' Agent will refund all deposited moneys to you without deduction. Upon further clarification from the WAPC we may re-offer the lots in Marchmont Estate for sale in due course.
Yours faithfully
V Schofield OBE
Managing Director
21 Mr Schofield's general communication was then despatched to individual Marchmont Estate purchasers on 25 May 2006 under cover of a communication from the Schofields' Gingin agent, Mr Tom Cabassi, the Principal/Licensee of Roy Weston Cabassi Realty.
22 Mr Cabassi wrote to Mr and Mrs Samnakay on 25 May 2006 enclosing Mr Schofield's generic communication (of 17 May 2006) under cover of the following advice:
Dear Iqbal and Neelam
RE: Marchmont Estate Lot 370
Please find enclosed a copy of the letter received from the owners of Marchmont Estate.
We apologise for the imposition and trauma this may cause you and we will use our utmost to seek an amicable outcome.
As soon as all the relevant information comes to hand I will be back in touch with you.
23 A number of Marchmont Estate purchasers were aggrieved after receipt of similar termination advice from Mr Cabassi as to the contracts of sale with the Schofields. Some purchasers sent direct communications to Mr Schofield, between 25 May and 6 June 2006, disputing that their contracts of sale were (lawfully) at an end. Some purchasers asked for a copy of Mr Schofield's written legal advice supporting the termination. Others said they did not accept the reason given for the cancellation of their contracts. A number of purchasers sought to be informed of their positions in more detail by Mr Schofield's legal representative. For example, Max and Deborah Yesberg advised Mr Schofield on 2 June 2006, 'We would like to be informed in more detail from your legal representative or we will be pursuing this matter further' (see annexure VS11 to exhibit 2).
24 The widespread disgruntlement of the various Marchmont Estate purchasers over the May 2006 termination advice received from Mr Schofield and Mr Cabassi eventually resulted in a purchasers' meeting that was convened at the Gingin Town Hall on Wednesday 7 June 2006. By this time several of the purchasers were communicating as between themselves by email. A Mr Terence Grocke then appeared to be playing a leading role in coordinating these email communications amongst disgruntled Marchmont Estate purchasers at this time. With his wife, Edel, they are the seventh plaintiffs in the action.
25 By the amended statement of claim, all plaintiffs seek their discrete relief. Each challenges the Schofields' purported termination of their contract of sale. Various contentions and causes of action are raised including (viewed by reference to the position of the tenth plaintiffs) that:
(a) the defendants had no right to terminate the contract of sale, on the basis cl 13.3 of the Joint Form of General Conditions had not been satisfied within the extended time specified (par 24C of the amended statement of claim);
(b) variations to the time allowed for satisfaction of the relevant conditions in the contract of sale on 12 July 2005 and 20 December 2005 (pars 19(c) and (d)) were void, alternatively of no effect (see par 24D);
(c) the defendants were in breach of contract, by failing to use their best endeavours to comply with condition 19 of the Planning Commission's approval as soon as practicable (pars 26 to 30 of the amended statement of claim);
(d) termination of the contracts by the defendants breached an implied term of each contract of sale, to the effect that in their treatment of the various plaintiffs, the defendants would exercise any right to terminate the contracts by acting reasonably, fairly and in good faith (pars 9C and 30 - 30E of the amended statement of claim);
(e) the purchasers were entitled to statutory relief for alleged misleading and deceptive conduct under the Fair Trading Act 1987 (WA), by reason of certain representations of the defendants made prior to the contract of sale being entered into in February 2005 (pars 230 - 236 of the amended statement of claim);
(f) alleged representations to the tenth plaintiffs when obtaining an extension of time pursuant to the two variations were misleading and deceptive contrary to s 10 of the Fair Trading Act (pars 237 - 242 of the amended statement of claim); and
(g) that the defendants' election to terminate the contracts of sale, rather than to again extend the time for obtaining the endorsement of the Planning Commission's required approval of the subdivision plan, in circumstances where the Schofields stood to receive a substantial windfall profit by reason of a rise over time in the value of Lot 370, and correspondingly because the Samnakays would suffer a substantial loss, was a situation in which enforcement of the legal rights of the Schofields to terminate the contract of sale have led to a harsh, excessive and unconscionable loss, by reason of which the Samnakays were entitled to relief against forfeiture (pars 249 - 251 of the amended statement of claim).
The 'without prejudice' issue: assessed by reference to the pleadings
26 In the context of asserted causes of action by the Samnakays, I can now move to examine pars 246, 247 and 248 of the amended statement of claim which have provided a foundation for the dispute. Those paragraphs aver:
246. The Schofields by notice dated 21 July 2006 offered to resell the block to the Samnakays for the sum of $99,000.
247. The Schofields in so offering to resell the block to the Samnakays informed them that the said sum of $99,000 represented a $41,000 discount on the market value of the block.
Particulars
- The Samnakays were so informed by undated table provided by the defendants to their representative, the first-named seventh plaintiff [namely Mr Terence Grocke] shortly before 21 July 2006.
248. The Samnakays following termination of the contract on [25 May 2006] had an election:
(a) to re-purchase the block at a purchase price substantially higher than the original purchase price; or
(b) to purchase an alternative block at a price substantially above the original purchase price of the block.
- The price at which the Samnakays could in mid-2006 have purchased a block equivalent to that purchased from the Schofields is a matter for expert evidence.
In relation to paragraphs 246 - 248 inclusive of the Statement of Claim the Schofields:
(a) say that the alleged notice and the information contained therein formed part of without prejudice communications between the Schofields and, inter alia, the Samnakays;
(b) say that at no stage has there been a waiver by the Schofields in respect of those communications;
(c) object to any attempt on the part of any of the plaintiffs to refer in these proceedings to any part of those communications;
(d) in the alternative do not admit the matters alleged.
28 I will now proceed to examine each of the three communications the subject of the challenged without prejudice privilege assertion.
Three documents at issue
29 The first document (exhibit 4) is an email and attachment, sent by Mr Tom Cabassi to the email address of Mr Grocke, on Thursday 8 June 2006 at 8.31 pm. The heading of the email is 'Conversation: new Price List'. The email says:
Terry
I have been inendated [sic] with calls to see if Schofield would come to the table and negotiate.
This is a verbal agreement that Schofield would let current contract holders take an option on their Lots subject to him receiving all clearances from Water Corp.
Regards
Tom
30 Although not apparent on the face of exhibit 4, it is accepted that there was an excel spreadsheet attachment accompanying Mr Cabassi's email to Mr Grocke. The spreadsheet showed the number of each proposed Marchmont Estate lot (between 300 and 375); an 'original price' in an adjacent column for each lot (referring, it would appear, to the respective contract sale prices for each lot); a 'new price' in a third column and finally, in the fourth column of the table, a 'market price' for each lot.
31 So, in the case of proposed Lot 370 the subject of contractual arrangements with the Samnakays, by reading across the page of the excel spreadsheet, the following information was presented:
Lot Original New Market
370 50,000 99,000 140,000
32 A reasonable interpretation of this spreadsheet information is that the market value of the Marchmont Estate Lot 370, which Mr and Mrs Samnakay had contracted to purchase from the Schofields in February 2005 for $50,000, was asserted to have risen by 8 June 2006 to $140,000, and further, that Mr Schofield was prepared to sell Lot 370 to the Samnakays for $99,000 by a fresh contract of sale in the wake of the termination of the original contractual arrangements in May 2006.
33 The second document at issue is exhibit 6. It is part of an email 'chain' that includes the abovementioned 8 June 2006 email as part of a forwarded email message.
34 The commencement of exhibit 6 is an email from Mr Grocke, sent to numerous identified recipients and with a copy sent to a solicitor (Mr Tim Coyle of Lavan Legal). This is under the heading 'FW: new Price List'. The exhibit 6 email by Mr Grocke was sent out on Friday 9 June 2006 at 9.12 am. It reads:
Marchmont Buyers,
ATTACHED is a revised price list from Tom Cabassi. See his comments below.
I have added a few calculation[s] to the price list - see the yellow shaded area. The new price list suggests increases from 25 to 52%. Average increase is 37.6%. Overall revenue from sales is up by $3 million.
NOTE: Tom phoned a few minutes ago to make sure everyone understands that it was he, Tom, who approached Schofield and asked for a revised price list. Tom says he did this because he was approached by 'several buyers following our meeting'.
Terry Grocke
35 A spreadsheet attachment to Mr Grocke's email replicates the tabular content of the earlier 8 June 2006 Excel spreadsheet's four columns. But this attachment contains an extra (fifth) column. The extra column contains Mr Grocke's calculations as to the percentage increase(s) in the sale price of each lot, which have been calculated by Mr Grocke by reference to the 'original' and 'new' prices stated in respect of each lot.
36 There is an evidentiary clash over the identity of the author of certain words at the conclusion of this particular spreadsheet. These words are found under the last horizontal row (dealing with Lot 375). They read:
Original price asked
New price for current contract holders
Market What RWCR estimate of today's market
37 During argument before me upon the voir dire, it was clarified that the email of Friday 9 June 2006, sent by Mr Grocke to various Marchmont purchasers, was not itself claimed by the defendants to be privileged. However, to the extent this email forwarded and effectively replicated the content of exhibit 4 (i.e. Mr Cabassi's email communication to Mr Grocke of 8 June 2006, as well as the content of the four columns of Mr Cabassi's Excel spreadsheet) those incorporated components of exhibit 4, as found within exhibit 6, were said to remain privileged.
38 The final document at issue upon the voir dire (exhibit 3) is another broadcast communication from Mr Schofield, this time of 21 July 2006. It reads in these terms:
TO WHOM IT MAY CONCERN
To purchasers [whose] contracts have expired
I refer to Roy Weston's revised computation on the price of plots for the above estate.
These computations were given to Mr T Grocke, the chairman of the group, on 8 June 2006.
The prices shown on that computation are substantially discounted from the present valuation.
This offer has been made only to purchasers [whose] contracts have expired.
We advise that this generously discounted offer will be withdrawn as of 1 August 2006,
Regards,
V Schofield OBE
Managing Director
- Again, this generically framed communication to purchasers was despatched by Mr Cabassi to individual Marchmont Estate purchasers.
39 As I earlier observed, none of these three documents is expressly labelled as being sent 'without prejudice'. Furthermore, none are communications made as between, or sent to, solicitors, save only that exhibit 6 may be seen on its face to have also been copied to Mr Coyle of Lavan Legal by Mr Grocke.
40 To assess whether one or more of these three communications attracted or retained without prejudice privilege status, it is necessary to assess their content in their overall context at the time. To those contextual facts I turn.
Facts surrounding the communications of 8 and 9 June and 21 July 2006
41 Mr Grocke's witness statement (exhibit 8) in the voir dire includes his own minutes of an evening meeting of the 'Marchmont Buyers Group' at the Gingin Town Hall on 7 June 2006. He records 53 people in attendance, representing '39 Marchmont Lots'.
42 That meeting had received presentations from two different law firms seeking to act for the purchasers. Mr Grocke's minutes under a heading 'Meeting discussions and appointment of a committee' record:
By a show of hands the Meeting agreed to appoint a legal advisor while simultaneously pursuing a possible negotiated settlement with the Developer.
…
Committee was instructed by a show of hands:
• Appoint LAVAN LEGAL to provide legal advice to Stage 1 of their proposal. The Stage 1 analysis and advice will be distributed to all participating parties. At this point a general meeting will be called to consider the next step.
• Instruct LAVAN LEGAL, as part of the Stage 1 process, to advise Committee on a possible approach to the Developer/Seller (Schofield) to investigate the Developer's attitude towards a negotiated settlement before serious legal proceedings are entered into.
43 In a further note accompanying his minutes, Mr Grocke records:
This morning [a reference I take to be to the following morning after the meeting, i.e. Thursday 8 June 2006] I phoned Tim Coyle, LAVAN LEGAL and instructed him as above.
44 The last page of the minutes seeks confirmation of instructions to Mr Grocke as the 'interim coordinator' of the Marchmont Buyers Group.
45 From Mr Grocke's minutes it is clear that after the presentations made to the meeting by the law firms, the meeting had resolved to appoint Lavan Legal to provide advice to the Marchmont purchasers. It is highly relevant to the without prejudice arguments before me to observe the record in Mr Grocke's minutes to the effect that Lavan Legal was to advise about a possible approach to the Schofields concerning their attitude towards a 'negotiated settlement'.
46 Mr Grocke's evidence under cross-examination confirmed that the topic of a possible negotiated settlement with Mr Schofield had indeed been discussed at the Gingin Town Hall meeting.
47 Mr Coyle of Lavan Legal on 8 June 2006 appears to have wasted no time establishing a direct line of contact with the defendants' appointed solicitor, who he obviously then knew to be a Mr Darren Miller of Marks & Sands Lawyers.
48 Mr Miller also provided a witness statement for the purpose of the voir dire. It became exhibit 1. Mr Miller was not cross-examined. His evidence then is not the subject of any challenge and may be accepted.
49 Mr Miller relates the first telephone call he received on 8 June 2006 from Mr Coyle (i.e. the day after the meeting Mr Coyle attended and presented to the Town Hall meeting of purchasers at Gingin). Mr Miller made a lengthy, contemporaneous longhand file note (annexure DJM3) of this conversation. The Miller note commences by recording that Mr Coyle told Mr Miller he expected to get instructions to act for about 50 to 60 of the owners (i.e. purchasers) in the Marchmont Estate. Mr Coyle had been instructed to raise some issues with Mr Miller. Issues discussed included concerns over whether the purchasers needed to lodge caveats to protect their interests, or whether some other method could be adopted to more consensually achieve protection for the purchaser group, akin to that provided from caveats. Mr Miller was to take instructions about this caveat concern.
50 A second issue, noted in Mr Miller's record, relates to what appears to be an assertion articulated by Mr Coyle on behalf of the Marchmont purchasers that these purchasers had a 'fair case' that the termination of their contracts of sale was 'invalid'. In short, Mr Miller's note suggests that there appears to have been some discussion in this 8 June telephone conversation between the solicitors over the merits of the purchasers' legal position as against the Schofields, by reason of alleged breaches of the contracts of sale with the purchasers brought about by the Schofields' purported termination of those contracts.
51 A third issue noted also goes to the merits of a contractual dispute. It relates to Mr Coyle asking Mr Miller whether it could be said the Schofields had used 'best endeavours' to obtain the necessary approvals before the effluxion of time that was applicable under the Joint Conditions (as varied).
52 A fourth issue discussed, as recorded by Mr Miller (again, very relevantly to disputed 'without prejudice' privilege arguments), under a heading 'Commercial Reality', was:
Clients keen to hang on to properties and not really want to get involved in litigation
May all be persuaded to pay a bit more per [client].
e.g. $500 - 1,000 ea.
Generate an extra $60,000.
53 The Miller file note of this first telephone conversation with Mr Coyle concludes:
Will call tomorrow re commercial option.
If go to trial may look at single [plaintiff]. Not sure if all [actions?] similar enough to go down that path.
54 It was not suggested the first Coyle/Miller open telephone conversation, which clearly canvassed a range of issues, was the subject of 'without prejudice' privilege. Its contextual significance lies in the fact that a possibility of resolving the dispute without litigation was actively raised; see Mr Miller's heading, 'Commercial Reality' and what followed. Moreover, a possible resolution was being raised by Mr Coyle in the context of the potential persuasion of some purchasers to pay more to the Schofields for their lots (specified then by Mr Coyle as in a range of $500 to $1,000 each).
55 The solicitors' open conversation discussing commercial realities and commercial options concluded on a basis that there was going to be further contact between them, initiated by Mr Coyle, the following day.
56 Hence it is undisputed that direct phone contact had been established between the solicitors acting for the parties from 8 June 2006. But there was, relevantly, also contact at 'agent to agent' level at the same time.
57 On 8 June 2006, about mid-morning, Mr Cabassi attended at Mr Grocke's house around Gingin. As related by Mr Grocke's evidence, what occurred (after Mr Grocke had spoken earlier that day to Mr Coyle at Lavan Legal confirming Mr Coyle was appointed and instructed) was in these terms (exhibit 8):
44. The same day, 8 June 2006, Tom [Cabassi] visited me at my house (about mid-morning).
45. I do not have an independent recollection of what was said to me by Tom but refreshing my memory from my diary, Tom said words [to the] effect to me that he had had a meeting with Vern Schofield because he (Tom) had been asked, by several Purchasers, if Schofield might negotiate, and Schofield wanted to negotiate higher prices because of increased costs.
58 Mr Cabassi and Mr Grocke had clearly spoken in the context of termination of the Marchmont purchasers' contracts by Mr Schofield, the purchasers' Town Hall meeting the previous evening and the purchasers' decision to appoint Mr Coyle as their legal representative to act and advise them. Mr Grocke told Mr Cabassi that lawyers had been appointed that day and had been instructed to act. Mr Grocke relates:
49. Tom said words to the effect to me that he had received inquiry from several Marchmont Purchasers as to making an approach to Schofield.
50. I said words to the effect to Tom that members of the Group had discussed the possibility of negotiating a reasonable and affordable price increase of perhaps 10 - 15%.
51. Late that same day (8 June 2006) or early the following morning (9 June 2006) I received an email from Tom Cabassi including an XL spread sheet showing new prices against all Lots in the Marchmont Estate.
59 From Mr Grocke's evidence, it is clear that sequentially, Mr Cabassi's email (exhibit 4) had followed their face to face meeting at Mr Grocke's house. Mr Cabassi's email was sent to Mr Grocke at 8.31 pm on Thursday 8 June 2006.
60 Mr Grocke's evidence on this point, which I accept, is that he did not actually access or read Mr Cabassi's email or the attached spreadsheet until the following morning, Friday 9 June 2006.
61 That is the context for Mr Grocke's receipt of exhibit 4 sent by Mr Cabassi. Essentially, that email and its spreadsheet attachment was sent to Mr Grocke as an interim agent on behalf of the Marchmont Purchasers Group that had met at the Gingin Town Hall on the evening of 7 June 2008 and had resolved to appoint Mr Coyle of Lavan Legal as their solicitor.
62 Mr Grocke then studied what he had received from Mr Cabassi on Friday 8 June 2006. He made his calculations of the percentage increases in sale prices from the information in the spreadsheet Mr Cabassi had sent. In doing that, Mr Grocke added the fifth column to the spreadsheet, showing his own calculated percentage increases in the prices of each lot. (Mr Grocke also accepts he had made some errors in his calculations, which were later corrected.)
63 That is the context for the exhibit 6 email, sent by Mr Grocke to numerous purchasers' email addresses, including to Mr Iqbal Samnakay, on Friday 9 June 2006 at 9.12 am. Relevantly to the 'without prejudice' privilege arguments, Mr Grocke's email was also sent to Mr Coyle of Lavan Legal, under the subject heading 'Fw: new Price List' with the attachment, 'Marchmont New Price List.xls' (which I interpret to mean the attached Excel spreadsheet).
64 The 'tail' of Mr Grocke's email extended to incorporate Mr Cabassi's original email to Mr Grocke of 8.31 pm the previous evening. However, the spreadsheet that Mr Grocke sent out, as his 9 June 2006 attachment, carried his extra fifth column, showing the percentage increases in the price of each lot as calculated by Mr Grocke.
65 In a context of the assertion of the claim by the defendants to 'without prejudice' privilege over exhibit 6, it is important to repeat that the defendants' privilege objection is not against the entirety of Mr Grocke's email. The privilege objection is only asserted to the extent exhibit 6 contains and republishes the contents of Mr Cabassi's email and its spreadsheet attachment information, as was first sent to Mr Grocke of Thursday 8 June 2006 at 8.31 pm (namely, exhibit 4). On the face of it, Mr Grocke's communications to the Marchmont purchasers and to Mr Coyle look to be internal communications circulating as between those parties. Hence, they would present as largely irrelevant to litigation against the Schofields.
66 Effectively, then, my evaluation of the 'without prejudice' status or otherwise of exhibit 4 should flow through to its repetition as a component of exhibit 6. Otherwise the remaining content of exhibit 6 is not privileged, but in any event looks irrelevant to this litigation.
67 Mr Cabassi's email sent to Mr Grocke at 8.31 pm on 8 June 2006 (exhibit 4) needs to be evaluated in light of relevant discussions occurring across that Thursday. Discussions had taken place first by telephone as between the respective parties' solicitors, Mr Coyle and Mr Miller, then subsequently as between agents, Mr Grocke and Mr Cabassi, at Mr Grocke's house.
68 In the solicitor to solicitor conversation, as well as in the agent to agent conversation of 8 June 2006, the prospect of a negotiated resolution to what was clearly by then a multi-purchaser contractual dispute as between the purchasers and the Schofields - with lawyers now engaged on both sides - was expressly canvassed. A practical basis upon which such resolution might be achieved was also discussed. This possible remedial pathway was by reference to the Marchmont purchasers offering the Schofields slightly higher purchase prices to receive their lots, notwithstanding the Schofields' earlier purported termination.
69 As I observed, Mr Grocke's 9 June email to the Marchmont purchasers was sent to Mr Coyle of Lavan Legal at the same time. It obviously came to his attention that morning. He seems to have acted upon it by telephoning Mr Miller, following up their conversation of the previous day.
70 The second telephone conversation followed between the respective solicitors on 9 June 2006. Again it was an open conversation. Mr Miller has made a contemporaneous longhand file note of the conversation. It reads:
Agent distributing revised price list.
Reflects price at which purchasers can purchase.
At least confirm [undertaking?].
71 Mr Miller's unchallenged evidence explains his brief longhand notes of this second conversation:
16. On 9 June 2006 Coyle telephoned me and said that the vendors' agent (Cabassi) was distributing a price list for the lots in Marchmont Estate.
17. I advised Coyle that my instructions were that this was the price at which those purchasers who were interested in resolving their claim against the vendors could purchase the lots they had previously contracted to purchase (under the now terminated contracts).
18. Coyle requested that we at least confirm the undertaking (with respect to the caveats) …
19. On 9 June 2006 I wrote to Coyle with respect to the caveat issue.
72 The 9 June 2006 conversation between the solicitors provides more insights towards the spreadsheet price list as was circulated by Mr Cabassi to Mr Grocke the previous evening after their agents meeting.
73 The 8 June 2006 email from Mr Cabassi to Mr Grocke did not carry any endorsement as to it being a communication sent 'without prejudice'. But, as a matter of law, that label is not strictly necessary. A communication's protected status, if made in furtherance of a genuine attempt to resolve a dispute, is capable of being inferred and assessed from the overall surrounding circumstances of a communication.
74 Something of a side issue arose, concerning a three line endorsement seen at the bottom of the spreadsheet that was attached to exhibit 6, namely words underneath each other:
Original price asked
New price for current contract holders
Market What RWCR estimate of today's market
75 There was a dispute as between Mr Cabassi and Mr Grocke, over who was actually responsible for creating those three lines of text on the spreadsheet. The words do not appear anywhere on the copy of Mr Cabassi's four column spreadsheet that was attached to exhibit 4. They appear only on the copy of the spreadsheet attached to exhibit 6. In the end, relevantly, little turns on this point. If it were necessary to resolve, Mr Cabassi was not challenged about his asserted authorship of those words in cross-examination. Then, Mr Grocke seemed to me to be tentative when he initially stated he was author of the words. By the time I questioned him over this authorship issue, at the conclusion of his evidence, he seemed to have firmed up.
76 In the end, if it matters, I am of the view that this text is more likely to have been applied by Mr Grocke to the Excel spreadsheet (on the morning of 9 June 2006), rather than by Mr Cabassi. Logically, the words present as more consistent with the augmentation exercise to the four original columns of the Excel spreadsheet, carried out by Mr Grocke in company with his fifth column of calculations.
77 The phrase 'Market What RWCR estimate of today's market' also looks to me to be more consistent with Mr Grocke referring to RWCR (meaning Roy Weston Cabassi Realty), rather than Mr Cabassi using that acronym in reference to his real estate company.
Without prejudice privilege status: Evaluations
78 I am of the view exhibit 4, notwithstanding a somewhat overall clumsy construction, should be read as a settlement proposal sent by Mr Cabassi on behalf of the Schofields to Mr Grocke. I reach this assessment particularly in light of the overall context of the dispute and the passing communications at the time I have now related from solicitor to solicitor and from agent to agent which preceded it. It was sent by Mr Cabassi on behalf of the Schofields at that time, at the level of a settlement communication sent agent to agent.
79 Exhibit 4 is a communication to be viewed in the context of a settlement proposal as first foreshadowed between the solicitors, then confirmed to be such after its receipt the next day in the 9 June 2006 solicitor to solicitor telephone discussion.
80 Mr Cabassi's email reference to a 'verbal agreement' looks to be wholly nonsensical. So too is the reference to an 'option' on lots. The 'clearances' he refers to seem to be the outstanding approvals from the Water Corporation, the absence of which was relied upon by the Schofields as their reason for terminating the existing contracts.
81 But for all its clumsiness and illogicality, the Cabassi email, at the time it was sent and read in context, still presents as a settlement proposal emanating on behalf of the Schofields to the Marchmont purchasers' agent, Mr Grocke.
82 But the plaintiffs nevertheless say that even so, exhibit 4 does not reflect any genuine attempt at a negotiation concerning the dispute over validity of the Schofields' terminations of the purchasers' contracts of sale. More specifically for this voir dire, it is put that there was no genuine attempt to negotiate the dispute over the termination of Mr and Mrs Samnakay's contract of sale by notice under cover of Mr Cabassi's communication of 25 May 2006. The argument is that the Cabassi email was only a unilateral declaration of a position on behalf of the Schofields and involving only a prospect of new contracts. It is put that the Cabassi email was not a proposal to resolve any dispute over the termination of the existing contracts of sale.
83 The argument echoes some observations of Kelly SPJ in JA McBeath Nominees Pty Ltd v Jenkins Development Corporation Pty Ltd [1992] 2 Qd R 121. That was a case concerning the refusal of a landlord's consent to the assignment of its tenant's lease. The landlord's denial of consent to assignment had been articulated on the basis the proposed assignee 'may not be able to operate the business, pay interest expenses and rental with an adequate margin of profit'. However, there was a subsequent conversation which took place between the parties' solicitors. The solicitors' conversation had been expressly stipulated to be held 'without prejudice'. In that conversation, the landlord's solicitor had offered to grant a new lease to the proposed assignee. However, the offer was on terms more favourable to the landlord than the existing lease arrangements.
84 In JA McBeath, one relevant question was whether the landlord had rejected the proposed assignee on the basis that the proposed assignee was not respectable or responsible, or whether in truth, the landlord's refusal was actually motivated by improving the landlord's own commercial interests.
85 The three members of the Queensland Full Court in JA McBeath, on my analysis, delivered different reasons. Macrossan CJ, dissenting in the result, conceded that evidence of the so-called 'without prejudice' conversation had been wrongly admitted by the trial judge. He assessed the conversation to be protected by the privilege. This was because it was an attempt to settle the dispute by a negotiation which had been explicitly characterised as 'without prejudice'.
86 Ryan J was also of the view that the discussion between solicitors would prima facie enjoy 'without prejudice' privilege protection. However, Ryan J found an exception negating the privilege, where a court could possibly be misled by an invocation of the privilege. That view led Ryan J to assert as correct the result reached by the trial judge's decision to admit evidence of the solicitor's without prejudice conversation. Ryan J said (134):
The proceedings were duly instituted by originating summons seeking a declaration that the lessor had unreasonably withheld its consent to the assignment. In my opinion there was a dispute between the lessor and the lessee as to whether the consent to the assignment had been unreasonably withheld and terms were offered for settlement of that dispute. Though there was at the time when the 'without prejudice' statement was made no pending litigation, it was made after the maker of the statement was informed that proceedings would be instituted. It is enough in my view to make the rule excluding 'without prejudice' communications from being admissible in evidence that litigation between the parties was anticipated at the time of the communication.
87 On the other hand, Kelly SPJ (who, with Ryan J, constituted the Full Court majority that dismissed the appeal) concluded that it was 'not accurate to describe the discussion as being entered into for the purpose of negotiating a settlement of a dispute between the lessee and the lessor' (128).
88 Effectively, Kelly SPJ appears to have assessed the passing dialogue between solicitors as not being part of any negotiation towards a settlement over the dispute existing as between the landlord and the lessee over the landlord's refusal of consent to the lessee's proposed assignee. Consent had already been refused by the landlord. What ensued was a discussion over something else as regards better commercial terms for the landlord.
89 On analysis, that view of Kelly SPJ presents as his alone, although he with Ryan J formed the majority that dismissed the appeal.
90 With respect, I would take a wider conceptual view of the scope of 'without prejudice' privilege than Kelly SPJ, and more akin to the approach that is discernible from the reasons of both Macrossan CJ and Ryan J.
91 The public policy rationale for 'without prejudice' privilege is directed towards encouraging parties to resolve their disputes through a protected negotiation. That being so, it is appropriate that no narrow view be taken as to the scope of permissible negotiations. The policy is not assisted by encouraging 'hairsplitting' debates over whether a dispute about which the parties have negotiated, crossed the line beyond a realm of privileged protection, or not. Often lateral solutions to disputes are required and discussed in order to reach a negotiated settlement of some dispute. Sometimes a panoply of different or wider external considerations must be put on the bargaining table, to achieve a negotiated resolution to what, on the face of it, may otherwise present as a narrower dispute. But, so long as parties are engaged in genuine negotiation, their passing communications should, subject to the (many) recognised exceptions as identified, be protected under this privilege.
92 Applying that rationale to the present circumstances leads me to conclude that the plaintiffs' argument on this point is too narrow. The plaintiffs say that the Schofields were not prepared to negotiate over rescinding their purported termination of the various contracts of sale in May 2006 (and only prepared to negotiate on a basis of increased prices). But I can detect no reason of policy or principle as to why a genuine negotiation to resolve the dispute could not proceed on the basis of such a protected dialogue. Here, negotiations were about whether the purchasers were amenable to resolving the termination dispute by entering a new contract at a higher sale price for the same lot. That was a legitimate path to explore for a potential resolution, in my view.
93 As already seen, by law it is not necessary for a communicated settlement proposal to be expressly labelled as made 'without prejudice'. Here, in my view, it is appropriate to reach that characterisation, bearing in mind the overall context of the three communications under scrutiny. I draw that conclusion particularly by reference to the preceding 8 June 2006 discussions as between the solicitors Mr Miller and Mr Coyle, and the mid-morning discussion at Mr Grocke's house between himself and Mr Cabassi. Discussions between agents and between solicitors on 8 June 2006 had openly canvassed a possible negotiated commercial settlement as being a preferable alternative to litigation. Even more important is the fact the solicitors and the agents both talked about a potential resolution of the dispute, by the pathway of the purchasers paying higher prices for their various lots beyond the sale prices they had originally contracted to pay the Schofields.
94 So, assessed in its overall context, Mr Cabassi's email of 8 June 2006 to Mr Grocke presents as being a 'without prejudice' settlement proposal made on behalf of the Schofields for the purchasers' consideration.
95 That leaves open two further arguments advanced on behalf of the plaintiffs.
96 First, applying the exception to the privilege invoked by Ryan J in JA McBeath, it was said the court would be misled if evidence could not be adduced at trial about these communications and particularly by Mr Schofield being cross-examined about them. This exception, it was said, was particularly relevant to arguments sought to be advanced by the plaintiffs concerning:
(a) whether reasonable endeavours had been made by the defendants to obtain the required approvals from the Water Corporation, so as to be in a position to obtain the Planning Commission's endorsed approval to the subdivision plan;
(b) availability of statutory relief based upon the harshness and unconscionability of the defendants' termination which, it was said, was motivated by increases in the value of the land since the contracts of sale were entered into; and
(c) relief against forfeiture.
97 The plaintiffs asserted that the court needed to have the privileged information before it so as not to be misled.
98 Viewed against the pleadings and potential trial issues, Mr Cabassi's 8 June 2006 communication and his Excel spreadsheet is hardly potential evidence of such importance that a court might be misled without it. On the contrary, increased prices that are the subject of the spreadsheet communication are equivocal, in terms of possibly carrying adverse implications (if any) against the defendants. Furthermore, allegations that Mr Schofield failed to use best endeavours, or acted harshly and unconscionably by denying the plaintiffs the benefit of settling under contracts of sale because of a rising market, are allegations all fully capable of being put to him in cross-examination without also needing to tender the four column Excel spreadsheet sent out on his behalf by Mr Cabassi on 8 June 2006. That adds very little to such foreshadowed challenges, in my view.
99 Overall, I am of a view the exception to without prejudice privilege protection, grounded on the court being possibly misled without the material, cannot appropriately be invoked by the plaintiffs in the present case.
100 The plaintiffs' last basis for the argued exception to privilege rests upon claims of waiver. This raises the past use of exhibit 6 in previous proceedings which had been brought against the Schofields by two other purchasers and determined at an earlier trial before Simmonds J in this court.
101 Waiver arguments here proceeded on the basis that, because the materials had been put into evidence in that earlier trial without objection by the Schofields, there followed a waiver of any 'without prejudice' protection as against all persons, including the plaintiffs in these proceedings (and more specifically the tenth plaintiffs, Mr and Mrs Samnakay).
102 In evaluating this last argument I proceeded by:
(a) receiving a copy of the Papers for the Judge (without objection) in Mitchell v Schofield [2007] WASC 303;
(b) considering the reasons of Simmonds J in that case, and particularly his Honour's observations at [65] - [67] and [73] - [76], noting in particular that his Honour's reasons at [74] cite Mr Schofield's 'To whom it may concern' communication of 21 July 2006 (exhibit 3 in this voir dire). I also particularly considered [178] - [182] of his Honour's reasons. There it is noted that it was the Schofields at that trial who had submitted that exhibit 3 could be viewed as a purported termination of the contracts of the two purchasers in those proceedings.
103 The waiver analysis required presents as somewhat akin to the evaluation of a waiver argument in a context of an assertion of legal professional privilege. To that end, I have assessed whether the Schofields may now be assessed as adopting an inconsistent position, which would manifest unfairness, given that they used these materials in Mitchell yet, in the present action, have sought to have the same materials excluded on the basis of 'without prejudice' privilege.
104 In Mitchell par 27(c) and (d) of the defence and counterclaim had contended that the 21 July 2006 communication (exhibit 3) could be relied upon as against the Mitchells. But this was, relevantly, used as an attempt to negate the Mitchells' contention that they had not been informed of the vendors' termination of their contract of sale. That was an unsuccessful argument by the Schofields in that trial.
105 For present purposes, I must evaluate whether a use of materials to that end of showing receipt of a communication in the 2007 proceedings can show some inconsistency in the defendants' position as between the two actions, particularly in circumstances where exhibit 3 is found published verbatim at [74] in the unsuppressed reasons of Simmonds J in Mitchell.
106 My conclusion is that there is no inconsistency or unfairness by the Schofields now asserting 'without prejudice' privilege in the present litigation in respect of the materials in this action, particularly exhibit 3, where the privilege is otherwise applicable. That use of 'without prejudice' materials, particularly exhibit 3, in the Mitchell action unfolded in the unique circumstances of that other action, where there was an assertion made that the defendants had not communicated the termination to the purchasers. That same issue does not arise in any way in the present proceedings. Completely different legal issues are being resolved in the present litigation. Each of the individual purchasers received the defendants' 21 July 2006 communication, under cover of a letter sent by the Schofields' agent Mr Cabassi. That being so, there is no inconsistency or unfairness. The communication was used (unsuccessfully) against the Mitchells to meet the discrete communication receipt issue arising in that litigation. It may be accepted there was in that case a waiver by the Schofields of 'without prejudice' privilege, as against the Mitchells. But I do not construe that event as amounting to a waiver for all purposes and which therefore creates circumstances of inconsistency or unfairness applicable to the present action, particularly as against the position of the tenth plaintiffs.
107 I reach these views by reference to the exposition, as regards waiver, of the inconsistency and fairness criteria explained in Mann v Carnell [1999] HCA 66; (1999) 201 CLR 1 and a subsequent application of the waiver principles in Yokogawa Australia Pty Ltd v Alstom Power Ltd, particularly at [85] - [96] and [106] - [109] (Duggan J).
The particular position of the Samnakays
108 Mr Samnakay's witness statement was received without objection. It became exhibit 7. Mr Samnakay was not cross-examined. What is of key significance is that he does not appear to have been a direct recipient of either exhibit 4 or exhibit 6. He appears to have been an intended email recipient of exhibit 6 (as shown in the email's addressee list). But it is not said that he received it.
109 Nor does Mr Samnakay mention his receipt of exhibit 3, Mr Schofield's communication of 21 July 2006, which Mr Cabassi sent out to each individual lot owner.
110 Nevertheless, I observe from the pleadings that Mr Samnakay seeks to rely on Mr Schofield's 21 July 2006 communication. On that basis it is appropriate to deal with the issue, although it is curious that the plaintiffs chosen, for what is in effect a test case, do not say they received any of the three 'without prejudice' communications at issue.
111 It is apparent Mr Samnakay had been in touch with Mr Cabassi from at least 7 June 2006. He had declined to receive a return of his deposit from the Schofields. Mr Samnakay was made aware of the Gingin Town Hall meeting of the Marchmont purchasers scheduled for the evening of 7 June. But he was not able to attend. Mr Samnakay was, as I have mentioned, one of the intended recipients of the email sent out on 9 June 2006 by Mr Grocke.
112 Later, Mr Samnakay received a distinct communication sent by Gale and Brian Cargill to Mr and Mrs Grocke on 10 June 2006, regarding the new prices, which contained an amended version of the spreadsheet attached to exhibit 4. This amended spreadsheet shows, in its fifth column, corrected calculations that remedy Mr Grocke's erroneous calculations of percentage increases in lot price that he included in the spreadsheet he sent to purchasers on 9 June 2006.
113 On that basis, I will proceed to assess the ramifications of at least the four privileged columns of information in that component spreadsheet as received by Mr Samnakay, bearing in mind his pleading.
114 For the reasons given, my conclusion is that exhibits 3, 4 and 6 (to the extent exhibit 6 incorporates the contents of exhibit 4) remain the subject of the Schofields' 'without prejudice' privilege. Privilege may be asserted by the Schofields against any proposed admission into evidence of these three documents as explained in these proceedings. The balance of exhibit 6 is not asserted to be privileged, but the relevance of its non-privileged components is most doubtful, as purely internal communication between the purchasers and their representatives. Needless to say, however, any final decision about relevance rests with the trial judge.
115 Presently, the Schofields have not, as I conclude, waived their privilege in those documents.
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