Weston v Bannister

[1998] HCATrans 47

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M82 of 1997

B e t w e e n -

MICHAEL WESTON

Applicant

and

JOHN BRUCE BANNISTER and JUSTIN JOHN HARTNETT

Respondents

Application for special leave to appeal

McHUGH J
GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 13 FEBRUARY 1998, AT 1.50 PM

Copyright in the High Court of Australia

MR M. WESTON:   The applicant appears in person, your Honours.

MS K.P. HANSCOMBE:   In this proceeding, I appear for the respondents.  (instructed by Price Higgins)

McHUGH J:   Yes, Mr Weston.

MR WESTON:   Is too much of a presumption to ask my next friend to be able to sit beside me at the Bar table or not?

McHUGH J:   No, he can.

MR WESTON:   Your Honours, the key issues in this matter are ‑ ‑ ‑

GUMMOW J:   You may wish to place your papers on the podium.  It may help a little.

MR WESTON:   The key issues in this appeal are that the Court of Appeal denied me natural justice to speak to the fraud that the respondents had participated in, that the decision of the trial judge was not open to him on the evidence.  During the proceedings before the trial judge, it became clearly obvious to him that there had been dishonesty and misrepresentation on the part of the ‑ ‑ ‑

McHUGH J:   Mr Weston, you say it was clearly obvious to him.  The trial judge took a quite different view.  He stated, in terms, that he preferred the evidence of the plaintiffs and Connor as honest and accurate witnesses and he preferred them to your evidence where there was a clash.

MR WESTON:   I hear what you say, your Honour.  As with all litigants in person, they make mistakes.  Probably one of the greatest mistakes I made in the hearing of the trial was to ever set foot in the witness box.  If I had not, the trial judge would not have been able to make that malicious allegation against me.

McHUGH J:   I know you are a litigant in person, but you may think that the judge’s findings are wrong and judges do make mistakes from time to time, but it does not advance your cause to describe it as a malicious finding.  Justice Southwell was sitting there to determine a dispute.  He no reason to be malicious towards you.  But carry on with your submissions.

MR WESTON:   I would simply take you to a couple of discrete pieces of the evidence.  I do not wish to relitigate it.  All I am saying is, as I understand it, I probably have not enunciated my grounds of appeal properly.  One of them is that the judge ignored the evidence and the weight of the evidence, which probably is better described as “that the findings of the judge were not open to him on the evidence”, and that is precisely what I want to take you to.  That evidence is found at ‑ ‑ ‑

McHUGH J:   You understand we do not sit here as a Court of Appeal.  This Court is the final court for the nation and the only cases we take on are cases that have something special about it.  There are hundreds of thousands of cases fought in Australia every year and every case - or just about in most of them - one side or the other will claim that a trial judge did not, or a magistrate, should not have accepted this evidence or that evidence.  That is not a ground for special leave to appeal.

Your problem, as it seems to me, is that the matters that you raise, apart from the question of the walnut trees being part of the security or not, all turn on questions of fact.

MR WESTON:   And they are findings of fact that were not open to the trial judge on the evidence.

McHUGH J:   You say that.  You were the one who was making the allegations of fraud and your allegations were rejected.  You had the onus of proof on these issues.  For example ‑ ‑ ‑

MR WESTON:   I say they were proved on the evidence that was presented by the respondents themselves.  They are simply that the purpose of the loan was to allow a solicitor negligence trial to go ahead.  There was a requisition that was required to be answered about litigation.  I made a personal phone call to the respondent when that situation was raised and he assured me that the litigation would not have to be terminated to secure the loan.  He gave me that assurance when he knew ‑ ‑ ‑

GUMMOW J:   This is Mr Bannister or Mr Hartnett?

MR WESTON:   This is Mr Hartnett.  We are not involved with Mr Bannister at all.  He gave me that assurance when he knew that the litigation was going to be terminated and that they had changed the purpose of the loan from protecting Norong Park to providing a vehicle where I would default on the loan and that I would lose it.  Now, I also say, and I was not given the opportunity to raise it in the Court of Appeal ‑ it was mentioned in my summary - that I believe that what had been done to me was deception in accordance with section 81 of the Crimes Act of Victoria and that is that ‑ ‑ ‑

McHUGH J:   For a start - correct me if I am wrong - but that was a point that was never raised before Justice Southwell, was it, for a start?

MR WESTON:   It was not.  But I will, if you go back to the pleadings, and I was told I would not necessarily have to refer to the pleadings in the application for special leave, that that sort of material would be put in the appeal books for the appeal proper.  But it was put in argument before Mr Justice Southwell that the money was being advanced for a criminal purpose.  That was in the pleadings.

McHUGH J:   I know, and the judge, in effect, thought that your submission on that was absurd.

MR WESTON:   I have sat here for a little while this morning, your Honour, and heard riotous laughter in this Court when your brother Judge mentioned situations of a cover up.  What I am saying to you is that there have been questions of fact found to the effect that the - I would not use the word “absurd”, I would use the horrendous crime, the heinous crime that has been played on me, the tricks that they have played on me, have been effectively covered up by findings of fact which were not open to the trial judge.  On top of that, they have done it - the original findings were criminal offences.  If they were criminal offences, they were prohibited by law and the novelty point that I say attracts the application for special leave is that if an action is prohibited by the statutes of the State of Victoria, a person cannot come along to a court and say - use an illegal, an unlawful, an evil action to maintain a cause of action for possession of somebody else’s land.

McHUGH J:   Why not, if it is completely unrelated?  You borrowed money ‑ ‑ ‑

MR WESTON:   I did not borrow the money.  I have never given a free and willing consent to borrow the money.  I told - if you look ‑ ‑ ‑

McHUGH J:   I know, for example, in paragraph 2.27 of your written submissions you say that the second respondent attended the settlement and knowing that the applicant did not wish to proceed with the loan, paid over cheques to facilitate the fraud and deception which Connor had arranged to terminate ‑ ‑ ‑

MR WESTON:   Exactly, your Honour, and I take you to page 44 of the application book.

McHUGH J:   I was putting that to you.  Now, how do you explain the fact that you attended that settlement with a bank cheque for $8,000 if you did not want the loan?

MR WESTON:   Because I was duped and conned.  As I said to you earlier, the original purpose of this loan was to preserve Norong Park, to pay the sheriff’s warrant, so that we could run the solicitor negligence claim in August.  I take you to page 44, please.

GUMMOW J:   Just take it a little quietly.

MR WESTON:   It might be all right for you, your Honour, but I have got everything to lose and nothing ‑ ‑ ‑

GUMMOW J:   I understand that.

MR WESTON:   One of the key questions in here is that can a member of the public have the confidence to go to a solicitor and get advice and not be just ripped off.  Now, your Honours, I take you to page 44.  That discussion ‑ I rang Mr Hartnett because I was concerned about the whole situation.  On 30 June, it was the first time I heard about this settlement.  It was just sprung on me out of the blue.

McHUGH J:   But this was Connor.

MR WESTON:   Yes.

McHUGH J:   Connor, it has nothing to do with ‑ ‑ ‑

MR WESTON:   And because I had no further faith in Connor, I had lost confidence in him, I rang Mr Hartnett direct and I put the question to him, “If we go ahead with this loan, do we have to terminate all the litigation?”  I take you to the first line:

Do we insist on all litigation ceasing?

His answer to me is “No.”  As I read the problem question which is question 12 was that there was a requisition there, it is on page 50 at line 20:

If so, full particulars must be supplied prior to settlement, and discontinuance of such proceedings must be procured at the expense of the Mortgagor before settlement.

Now, what was the point of us raising $400,000 to be able to go ahead with the solicitor negligence claim when a condition of getting that $400,000 was that the solicitor’s negligence claim had to be settled?  Now, it was put to me that I was able to go on with the loan because it protected the farm until we were able to conduct the litigation.  During that discussion, you will also go down to the next paragraph in it, that the bank was not stopping in, they wanted out.  We were assured of money.  We could not get to the settlement.  If you go down to the next paragraph:

Considering not proceeding until after case heard against sol -

Now, that page there represents five to 10 minutes of a conversation I had with Mr Hartnett.  It does not record everything that was said.  One of the things that was said is that the settlement that Mr Connor was proposing was absolute suicide.

McHUGH J:   You say that, but there are no findings of fact.  We are not here as some sort of an ombudsman.  All you have, at the moment, done is point to material which you say is the basis of some findings of fact that should have been made.  Where that leads to is another question altogether.

MR WESTON:   What I am saying is the correct finding that the trial judge should have made was that the mortgage was obtained by dishonesty and fraud.

McHUGH J:   How can you say that?  You were the one that was seeking a loan?

MR WESTON:   Yes.

McHUGH J:   And the broker went to the respondents.  The respondents ‑ ‑ ‑

MR WESTON:   I will stop you there, your Honour.  I was seeking a loan up until 30/6/1994 and, as you will see from the line at paragraph 15, things changed drastically on the morning of 30 June when Mr Connor told me about the settlement he proposed because that settlement took our total debt load to $630,000, including debt of my father, including alleged costs from Mr Connor, and it was not serviceable.  I had a decision that I had to make on the 30th.  I looked at it.  Now, are we better off to take this settlement, because it is suicide, we are going to lose the farm anyway, taking that.  The option was that we delay a settlement of the thing until after the solicitor negligence thing and we could have got a stay or the sheriff would not have sold the farm before the solicitor negligence case was heard because we had a trial date set for it on 29 August.  I said - the decision what I wanted to do and the decision I made was that we would wait.  If we win the solicitor negligence thing it brings our total debt load back to about $300,000 which was quite manageable.  The proposition that Mr Connor was putting, and the respondent Hartnett deceived me into going along with, was absolute suicide.

McHUGH J:   But you keep making these allegations.  The trial judge saw the witnesses.  We do not have the witnesses before us.  We have no function of - the trial judge preferred their evidence to yours and from what I gather from the papers, in separate proceedings in the Supreme Court you lost your case against Connor, your solicitor.

MR WESTON:   I am told the appeal has been dismissed.  I do not know why and I have every intention of appealing ‑ ‑ ‑

McHUGH J:   It really has nothing to do with this case, but I just mention that by the way, but you make ‑ ‑ ‑

MR WESTON:   You mention that to try and divert me from the facts of ‑ ‑ ‑

McHUGH J:   No, please do not make that sort of - you will withdraw that statement.

MR WESTON:   All right, I will, your Honour, but please, I say the evidence of fraud was tendered to the trial judge by the witness Hartnett himself.  My mistake in that was that I set foot in the witness box and opened myself up to the findings of fact that he has made.  If I had not set foot in the witness box he would not have been able to say that I was whatever type of witness he ‑ ‑ ‑

McHUGH J:   If you had not set foot in the witness box, your case would not have got off the ground, so you made no mistake going into the witness box.  It was necessary.

MR WESTON:   I went into the witness box and attempted to tell the truth.  I would, please, like to take you to the manner in which the trial judge conducted, and also the manner in which the Court of Appeal conducted the appeal.  That is that they know that this mortgage is void, they know that because - and Master Wheeler identified this in the original strike-out thing.  He said that if this money was advanced in the furtherance of a criminal act then I would not have to repay the money.  One of the reasons that the decisions have been made is that it is abhorrent to the legal profession that that sort of situation could happen.  That is one of the reasons why special leave should be granted in this case.

I was trying to take you to a portion of the transcript which demonstrates ‑ and if I could take you to page 38, your Honours.  The particular lines I want to take you to are down at line 24 and it is his Honour speaking:

So can I bring you up again to the point where finally Hartnett agreed to lend 400,000?

I was trying to give evidence and trying to give evidence to this material.  A lot of the evidence that I would rely on never got into evidence because the judge was deliberately misleading me.  He had come to a conclusion that Mr Hartnett had done something very evil.  It was something that should or should not ever be allowed to see the light of day in a finding in my favour.  Both his Honour and the Court of Appeal conducted themselves in a manner which covered up the things that Mr Hartnett had done ‑ ‑ ‑

McHUGH J:   You keep making these allegations and you have no evidence at all, bar assertions that you make from the Bar table, about these matters, in the face of findings of fact against you in which your evidence was rejected by the trial judge.

MR WESTON:   I am taking you to page 53, which was material that was put in evidence by Mr Hartnett himself.  I take you to line 21 and it is in answer to that question 12 that I took you to before.  Mr Connor has said, “No”, there is no litigation on foot.  The ticks along the side are Mr Hartnett’s.  He has ticked it, yes, that is right; the answer to that question is right, there is no litigation on foot.  Yet the previous day he had given me an assurance that the litigation would be allowed to stay on foot.  I would seek leave to hand up to you Mr Hartnett’s letter of 4 July ‑ ‑ ‑

McHUGH J:   Was it in evidence at the trial?

MR WESTON:   Yes, it was, your Honour.

McHUGH J:   Very well.  Have you seen this, Dr Hanscombe?

MS HANSCOMBE:   I have, your Honour.  It was part of an exhibit.

MR WESTON:   I will take you over to the page 2 of the letter of 4 July.  It refers to what I took you to before.  The only question in relation to those answers to those requisitions is 11(c) where you see the line and the question mark out the side.

McHUGH J:   I do not see it.  I see, on page 2?

MR WESTON:   Yes, on page 2:

Could you please check your client’s answer to requisition 11c which states that the present use of the property -

That was the only query he had.  Yet he accepts question 12 when the previous day ‑ ‑ ‑

McHUGH J:   But what has this got to do with the case?  What legal issue does it go to?

MR WESTON:   That the evidence of fraud of a dishonest act was there.

McHUGH J:   What dishonest act?

MR WESTON:   That he told me that the litigation did not have to be terminated when he knew it was going to be terminated.

McHUGH J:   Where do you get that, for a start, and in any event, what has it got to do with the case, the legal issues?

MR WESTON:   The legal issue is that the only way that you can defeat a mortgage and the registration of a mortgage pursuant to section 42 of the Transfer of Land Act is by actual fraud.  As the Privy Council has set out in the Assets Case - I will take you to that particular paragraph ‑ ‑ ‑

McHUGH J:   I am afraid your time is up, Mr Weston.

MR WESTON:   That because he did not make any inquiries, the authority in the Privy Council was that it was fraud.  Mr Connor has said “No” to an answer that I spent 5 minutes with the day before.  Thank you, your Honour.

McHUGH J:   Thank you, Mr Weston.  The Court does not wish to hear you, Ms Hanscombe.

The applicant seeks special leave to appeal against an order of the Court of Appeal of the Supreme Court of Victoria which allowed his appeal in proceedings concerned with the possession of land and the repayment of a mortgage loan but only to the extent necessary to give effect to costs orders concerning interlocutory matters.  The applicant alleges that the respondents were parties to fraud and/or criminal conduct and in breach of a fiduciary duty owed to him and that it was the intention of the parties that walnut trees growing on the mortgaged land were not part of the security.  The latter point has no substance.  The other points are precluded by the trial judge’s findings of fact, the judge preferring the evidence of the

respondents and their witnesses to that of the applicant.  An appeal would have no prospect of success.  Special leave is refused.

MS HANSCOMBE:   Your Honours, might I make an application for costs and, as set out in our outline of argument, we would seek that those costs be on the basis of solicitor and own client as agreed in the mortgage.  The mortgage is in evidence by way of an affidavit sworn by my instructing solicitor which I believe to be on the file and of which I have copies.  Could I hand those copies up, your Honour?

McHUGH J:   Yes.  Has a copy been given to Mr Weston?

MS HANSCOMBE:   Yes, a copy was given to Mr Weston during the application for a stay before your brother Justice Hayne which was made late last year.  But there is another copy.  I wonder if, while the Court officer is on his feet, I might also hand up a case on the point.

GUMMOW J:   What is the clause?

MS HANSCOMBE:   The case is Gomba Holdings.

GUMMOW J:   No, the clause.

MS HANSCOMBE:   Clause 11(c).  The case to which I would like to take the Court is Gomba Holdings (UK) Limited & Others v Minories Finance Ltd & Others( No 2) (1993) Ch 171. I would like, if I may, to take the Court to page 192 and following. Most of this case concerns other issues to do with costs. The discussion as to whether a Court ought to give effect to the contractual intention of the parties as to costs begins at page 192 ‑ ‑ ‑

McHUGH J:   Yes, but that is dealing with a situation in England.  What the parties contract to do cannot control the way we order costs in this Court, Dr Hanscombe.

MS HANSCOMBE:   No, your Honour.  I do not submit that it ought to control it; I simply submit to this Court that it might be a matter this Court ought to take into account in the exercise of its discretion. 

McHUGH J:   You have your contractual rights against the applicant.  Thank you.

MS HANSCOMBE;   If your Honours please.

McHUGH J:   What do you say about the question of costs generally, Mr Weston?  The Court does not intend to order costs on a solicitor and

client basis against you, so you need not worry about that.  But you have lost the application.  So what do you say about the question of costs?

MR WESTON:   I say there was never a contractual arrangement between us or a contractual arrangement between us that could be ‑ ‑ ‑

McHUGH J:   You do not have to worry about that.

MR WESTON:   I say that there should be no order for costs at all.

McHUGH J:   Thank you, Mr Weston.  I am afraid that the order dismissing the application will have to be with costs.  Thank you.

AT 2.16 PM THE MATTER WAS CONCLUDED