Wood (As CO-EXECUTOR and Trustee of the Will of the Deceased) v Wood
[2014] WASC 386
•27 OCTOBER 2014
WOOD (AS CO-EXECUTOR AND TRUSTEE OF THE WILL OF THE DECEASED) -v- WOOD [2014] WASC 386
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [2014] WASC 386 | |
| 27/10/2014 | |||
| Case No: | CIV:1786/2014 | 17 JULY 2014 | |
| Coram: | KENNETH MARTIN J | 17/07/14 | |
| 14 | Judgment Part: | 1 of 1 | |
| Result: | Advice given | ||
| B | |||
| PDF Version |
| Parties: | FIONA MELANIE WOOD (AS CO-EXECUTOR AND TRUSTEE OF THE WILL OF THE DECEASED) MORGAN HOWARD SOLOMON (AS CO-EXECUTOR AND TRUSTEE OF THE WILL OF THE DECEASED) FIONA MELANIE WOOD KURT RUDOLF BAUR ROBERT CHARLES SCOTT CATHERINE ANNE HARRIES LISA HANNAN SHIRLEY FLETCHER JANICE DOREEN MORRIS STEPHEN ALAN TAYLOR SIMONE MARGARET BARR VARNER ONDIT PTY LTD THE FIONA WOOD FOUNDATION BENJAMIN SCOTT RUSSEL HANNAN ALICE YAOLI HARRIES GRACE CATHERINE HARRIES SARAH JAYNE FLETCHER SAMANTHA JENNIFER BALLANTYNE MICHELLE ANNE MATTHEWS SUZANNE GRACE MORGAN JOHANNA PICHLER KLEMENS PICHLER BETTY BALLANTYNE |
Catchwords: | Equity Executors and trustees Application for private advice Discretion of the Court to provide Whether to be provided by Judge managing related matters Whether Judge providing advice to preside at trial in related matters |
Legislation: | Supreme Court Act 1935 (WA), s 69 Trustees Act 1962 (WA), s 77, s 92, s 95 |
Case References: | Alsop Wilkinson (a firm) v Neary [1996] 1 WLR 1220 C v M [2011] WASC 175 Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66 |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
The Will and Estate of Jennifer Ballantyne (Dec)
- First Plaintiff
MORGAN HOWARD SOLOMON (AS CO-EXECUTOR AND TRUSTEE OF THE WILL OF THE DECEASED)
Second Plaintiff
AND
FIONA MELANIE WOOD
First Defendant
KURT RUDOLF BAUR
Second Defendant
ROBERT CHARLES SCOTT
Third Defendant
CATHERINE ANNE HARRIES
Fourth Defendant
LISA HANNAN
Fifth Defendant
SHIRLEY FLETCHER
Sixth Defendant
JANICE DOREEN MORRIS
Seventh Defendant
STEPHEN ALAN TAYLOR
Eighth Defendant
SIMONE MARGARET BARR VARNER
Ninth Defendant
ONDIT PTY LTD
Tenth Defendant
THE FIONA WOOD FOUNDATION
Eleventh Defendant
BENJAMIN SCOTT RUSSEL HANNAN
Twelfth Defendant
ALICE YAOLI HARRIES
Thirteenth Defendant
GRACE CATHERINE HARRIES
Fourteenth Defendant
SARAH JAYNE FLETCHER
Fifteenth Defendant
SAMANTHA JENNIFER BALLANTYNE
Sixteenth Defendant
MICHELLE ANNE MATTHEWS
Seventeenth Defendant
SUZANNE GRACE MORGAN
Eighteenth Defendant
JOHANNA PICHLER
Nineteenth Defendant
KLEMENS PICHLER
Twentieth Defendant
BETTY BALLANTYNE
Twenty-first Defendant
Catchwords:
Equity - Executors and trustees - Application for private advice - Discretion of the Court to provide - Whether to be provided by Judge managing related matters - Whether Judge providing advice to preside at trial in related matters
Legislation:
Supreme Court Act 1935 (WA), s 69
Trustees Act 1962 (WA), s 77, s 92, s 95
Result:
Advice given
Category: B
Representation:
Counsel:
First Plaintiff : Mr L A Tsaknis
Second Plaintiff : Mr L A Tsaknis
First Defendant : No appearance
Second Defendant : Mr M P Bruce
Third Defendant : Mr S Macdonald
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : No appearance
Thirteenth Defendant : No appearance
Fourteenth Defendant : No appearance
Fifteenth Defendant : No appearance
Sixteenth Defendant : No appearance
Seventeenth Defendant : Mr S Macdonald
Eighteenth Defendant : No appearance
Nineteenth Defendant : No appearance
Twentieth Defendant : No appearance
Twenty-first Defendant : No appearance
Solicitors:
First Plaintiff : Bowen Buchbinder Vilensky
Second Plaintiff : Bowen Buchbinder Vilensky
First Defendant : No appearance
Second Defendant : Bennett + Co
Third Defendant : Macdonald Rudder
Fourth Defendant : No appearance
Fifth Defendant : No appearance
Sixth Defendant : No appearance
Seventh Defendant : No appearance
Eighth Defendant : No appearance
Ninth Defendant : No appearance
Tenth Defendant : No appearance
Eleventh Defendant : No appearance
Twelfth Defendant : No appearance
Thirteenth Defendant : No appearance
Fourteenth Defendant : No appearance
Fifteenth Defendant : No appearance
Sixteenth Defendant : No appearance
Seventeenth Defendant : Macdonald Rudder
Eighteenth Defendant : No appearance
Nineteenth Defendant : No appearance
Twentieth Defendant : No appearance
Twenty-first Defendant : No appearance
Case(s) referred to in judgment(s):
Alsop Wilkinson (a firm) v Neary [1996] 1 WLR 1220
C v M [2011] WASC 175
Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66
- KENNETH MARTIN J:
(This judgment was delivered extemporaneously on 17 July 2014 and has been edited from the transcript.)
1 Essentially, this is a directions hearing in two matters in my CMC list (CIV 1412 of 2014 and COR 108 of 2014), plus in matter CIV 1786 of 2014, which is the Executors' summons for directions pursuant to s 92 of the Trustees Act 1962 (WA), which I have not yet put in my CMC list, but I am about to.
2 Let me, before describing the underlying material, present something of a road map in terms of all the actions that are associated with these matters.
3 First of all, there are two matters pending before Pritchard J in her Honour's CMC list. CIV 1492 of 2014 is Mr Robert Charles Scott's action against the company Second Skin Pty Ltd, and the Executors. The Executors, I note, are there represented by different solicitors, Dwyer Durack.
4 Pritchard J also case manages a second action brought by the Executors against Mr Scott and others, CIV 1373 of 2014.
5 There is a pending summary judgment application by Mr Scott in CIV 1492 of 2014 which I am told her Honour is hearing at a special appointment on Monday, 8 September 2014.
6 There was also foreshadowed as regards those two actions concerning Mr Scott, although I cannot detect it having been commenced yet, a s 92 application for directions and advice by the same Executors - that is, Mr Morgan Howard Solomon and Professor Fiona Melanie Wood.
7 The solicitors acting for the Executors in the Scott actions, Dwyer Durack, have foreshadowed, in materials before me, by two pieces of correspondence, on 8 May and 24 June of this year, that s 92 trustees directions would be sought. As far as I can ascertain, they have not.
8 The third and fourth actions are in my CMC list. They are, first, an action brought by Mr Kurt Rudolf Baur, being CIV 1412 of 2014, which essentially seeks, in terms of permanent relief, the removal of the Executors and trustees, rescission of the grant of probate to them, injunctive relief, and orders that the shares left to Mr Baur under the will of the late Jennifer Ballantyne be vested in him permanently, in accord with the terms of that will.
9 Mr Scott is the fourth defendant in that action.
10 Allied to CIV 1412 of 2014 is COR 108 of 2014, also in my list. This is a Corporations Act 2001 (Cth) proceeding in respect of the company Ondit Pty Ltd (Ondit), in respect of which Mr Baur is the beneficiary under the will of all Ondit shares owned by Ms Ballantyne before her death.
11 In these actions I have issued some limited interlocutory relief to date. This was by way of orders effectively adding Mr Baur as an extra director to the Ondit board, which had comprised only the two Executors, also appointed to be Ondit's directors.
12 I had also granted some interlocutory relief in CIV 1412 of 2014 on an urgent basis, by reason of a need to inhibit a pending sale of an Edinburgh property owned by Ondit. That was in circumstances arguably prejudicial to the longer term interests of Ondit, and thereby Mr Baur's legacy in respect of his ultimately receiving all the Ondit shares. But if the Ondit assets are diminished the worth of the shares to be received is obviously affected.
13 Essentially, that matter came on urgently in May this year. I issued an interim injunction granted on 21 May 2014, followed by an interlocutory injunction on 27 May 2014.
14 There is a further action commenced in this court by Mr Baur under the Family Provision Act 1972 (WA), but which is not before me, CIV 1525 of 2013. I mention it for the record.
15 Most materially for today, there is now this fresh action commenced by the Executors, CIV 1786 of 2014. They seek directions pursuant to s 92 of the Trustees Act - in respect of issues which have arisen in and around Mr Baur's actions - but, most particularly, on the question of whether the Executors should be given directions from the Court in relation to continuing their defence of and resistance to the action brought against them by Mr Baur, seeking their removal.
16 Currently those s 92 directions as sought by the Executors do not extend to seeking any directions or advice in terms of what I refer to colloquially as Mr Scott's actions, currently managed by Pritchard J, namely CIV 1492 and CIV 1373 of 2014. One of the issues before me now is how might any directions for the Executors under s 92 in that quarter concerning Mr Scott be advanced, if at all?
17 So then it can be seen from that that there are at least six pieces of litigation pending in this court which are broadly related to the will and estate of the late Jennifer Ballantyne - of which Mr Morgan Solomon and Professor Fiona Wood are the appointed executors and trustees.
18 The most recent action, CIV 1786 of 2014, has reached me courtesy of a referral of the Principal Registrar. CIV 1786 of 2014 is the s 92 Trustees Act application for directions. I will now add that action to my CMC list, for reasons which follow.
19 The evidentiary materials now before me began arriving for the directions hearings in this court on Thursday 3 and Friday 4 July 2014. Unfortunately, a directions hearing on Friday, 4 July could not extend any further that day and into a short lunch time interval which I had tried to organise. That was for reasons it is not necessary to go into. A consequence of that failure was that I extended an opportunity for further written submissions to be received from all parties - in order to address the issue of how CIV 1786 of 2014 should advance and if so, before whom.
20 One significant issue now is whether the Executors' application for directions under s 92 of the Trustees Act should be heard by me, or not. The question raised is whether my prior involvement in terms of case management and the interim or interlocutory orders that I have made to date in Mr Baur's two CMC list actions, CIV 1412 of 2014 and COR 108 of 2014, precludes me from being the judge hearing the directions application of the Executors under s 92 of the Trustees Act. The Executors' counsel contends I cannot hear the s 92 application and referred me to observations in some earlier English cases about the undesirability of the judge determining the substantive litigation also being the judge who gives the private advice and directions to trustees - where directions are sought under s 92 of the Trustees Act (or under the New South Wales or UK equivalent provisions).
21 Before addressing that issue I will just list the rather expansive evidentiary and other materials I now hold, some presenting as lodged in CIV 1412 of 2014, others in CIV 1786 of 2014, but all basically driving at the same issues. I have the Executors' minute of 8 July 2014, the Executors' primary submissions also of 8 July, then, subsequently, further submissions of the Executors responding to the submissions of the third defendant, that is, Mr Scott, of 14 July 2014.
22 In terms of the materials from the Executors, I think almost all of them describe themselves as either a draft minute, primary submissions and responsive submissions of the so described first and second defendants. That is an error in description. The Executors are the first and second plaintiffs, and the first and second defendants are Fiona Wood, in her capacity as beneficiary, and Mr Baur as the second defendant. The Executors' materials make no sense, unless the headings are corrected to read First and Second Plaintiffs in CIV 1786 of 2014. I render that correction to clarify what could otherwise mislead others - on the basis of a deluge of materials that I have been sent from at least six different actions.
23 On behalf of the fifth and sixth defendants in CIV 1412 of 2014 I received, through my Associate, an email of Ms Sally Bruce of Jackson McDonald of 11 July 2014, in which she makes a brief observation about the fifth and sixth defendants not wishing to file submissions. But she goes on to say that her clients 'simply wish to state that they concur with the Executors' view that the s 92 application should be heard by a different Judge'. That, of course, is the position articulated in the submissions of the Executors under their primary submissions of 8 July 2014 and responsive submissions of 14 July 2014.
24 I also hold the submissions and minute for Mr Scott, of 4 July 2014, supported by an affidavit of Jeremy London also of that date. Then, I have supplemental submissions by the fourth defendant in CIV 1412 of 2014 of 10 July 2014, followed by a short email to my Associate of 11 July 2014, all on behalf of Mr Scott.
25 On behalf of Mr Baur, I hold, through his solicitors, a minute of directions proposed for the s 92 action of 10 July 2014, a fourth affidavit, in fact, in CIV 1412 of 2014, of Jenna Purdey sworn 10 July 2014, and then the written submissions on behalf of Mr Baur of 10 July 2014.
26 All of that written material I have now considered.
27 In terms of issues today, I start by dealing with the question of whether there should be a reference to private mediation, which is one of the orders sought in the minute of the Executors as draft order number 1. Such an order is inappropriate. This is apparent if one has recourse to the content of pt VI of the Supreme Court Act 1935 (WA), dealing with mediations in this court. Section 71 and s 72 address the issues of privilege and confidentiality. My reasons for decision C v M [2011] WASC 175, delivered 22 July 2011, set out the background to pt VI as regards mediations and, in particular, important terminology used, namely, 'mediation under direction', in s 69 of the Supreme Court Act.
Of significance is the definition in s 69 of 'mediator', which extends to include:
(a) A registrar appointed by the Chief Justice to be a mediation registrar under the rules of court;
(b) a person approved by the Chief Justice to be a mediator under the rules of the court; or
(c) a person agreed by the parties. (my emphasis)
29 Accordingly, a proposal on behalf of the Executors, in terms of draft order 1 in the minute of proposed directions, to the effect that the matter be referred to a private mediator, is currently misconceived. That could only be done with consent of all parties. There is no such consent. On that basis, there is no power for the Court to order it.
30 There has also, to date, already been, largely at my behest, an urgent mediation held in the Baur actions, conducted before Registrar Whitby on 20 June 2014. That mediation has not resolved the underlying Baur litigation. But there is always capacity for the parties to ask to return to the Registrar and have that mediation resumed. That is a matter for the parties. I do not propose to order it now.
31 Perhaps the direction now sought was pursued on the basis of an observation I made, I think, at the directions hearing of 3 July 2014, in terms of the parties needing to break some limited, but presently deadlocked, issues which appear to have emerged after the first mediation session before Registrar Whitby concluded.
32 My suggestion to the parties was not for a private mediation. What I had mentioned was that if the parties were interested, there could be agreed, effectively, a quick expert determination upon limited issues - agreed to be binding on all sides and conducted by an experienced Queen's Counsel or Senior Counsel.
33 The process I suggested was not an instance of mediation at all. Rather, it would be a case of a confidential submission of limited issues in dispute, to the expert determinator, with the parties agreeing to be bound in terms of whatever the ultimate expert determination was - by way of a final outcome on all deadlock points. That was my suggestion. It would be for the parties to follow through on that course by their concurrence, if that were to happen. Again that course is not within the power of the Court to order absent consent on all sides - currently lacking.
34 Moving then, substantively, to issues the subject of s 92 Trustees Act directions now sought, the first in principle question, is whether I should, effectively, do nothing more for the moment in the two CMC list actions commenced by Mr Baur. Such inertia would be so as to allow the application now made by the Executors to be heard by a third judge of this court in civil.
35 Essentially, it was suggested by the Executors, supported by the fifth and sixth defendants, that my earlier case management involvement in the Baur matters to date renders it inopportune for me to be the judge to hear the Executors' s 92 Trustees Act application for directions.
36 In relation to this point, there is, first, a question of principle in terms of a suggestion, perhaps, of apprehended bias - based upon my involvement to date in Mr Baur's two CMC matters.
37 There was a passing assertion in a piece of recent solicitor correspondence now before me to the effect that not only had I actually formed first views, but that I had actually said I accepted I had formed such views about the substantive merits of the two Baur actions. That is, of course, fundamentally wrong, as a scrutiny of the relevant transcript shows.
38 Correspondence exchanged between the parties discussed within the written submissions, particularly a transcript of some hypothetical questions I put to Mr Bruce when he was acting as counsel for Mr Baur, on Friday, 4 July 2014, show that there is no substance in the suggestion that I have formed, let alone expressed, any views of a final or even provisional nature - in terms of any of Mr Baur's substantive litigation that is currently case managed before me. That aberrant proposition must be put aside as misconceived.
39 There are, of course, the well known observations in the English case authorities that a judge who hears an application by trustees for directions and advice should not actually be the judge who hears the final action, if the action proceeds: see Alsop Wilkinson (a firm) v Neary [1996] 1 WLR 1220. So much is self-evident. It may be that in hearing a directions application, confidential material, or even privileged material might be disclosed. A review of the High Court's decision in Macedonian Orthodox Community Church St Petka Inc v His Eminence Petar the Diocesan Bishop of the Macedonian Orthodox Diocese of Australia and New Zealand [2008] HCA 42; (2008) 237 CLR 66 (Macedonian Church) provides insights to the character of what was in that case an application under s 63 of the Trustee Act 1925 (NSW), broadly equivalent to s 92 (and s 95) of the Trustees Act 1925 (WA).
40 An application under s 92 of the Trustees Act for directions by a trustee, is not an adversarial proceeding. It is a private advice proceeding and, on that basis, is of a very special character. It proceeds effectively by a court lending its assistance to a trustee. The court's advice is provided in summary fashion and, effectively, given at the discretion of the court hearing the application.
41 The unique features of such a private advice application by trustees are explained within the eight general factors the plurality reasons discuss in the Macedonian Church action. They assist me to my conclusion today that my participation in the giving of directions in respect of the s 92 application by the Executors raises no issue of conceptual difficulty, from an apprehended bias perspective.
42 There are additional pragmatic considerations buttressing that conclusion, allied to considerations of principle. First of all, there is the question of the Court's very limited available judicial resources in civil at present. Two CMC list judges, myself and Pritchard J, are already engaged in aspects of litigation related to the late Ms Ballantyne's estate. A prospect of trying to obtain the urgent participation from a third judge of this court in civil to hear a s 92 application has led me to conduct some informal enquiries with the acting listing officer of the Court - exploring judicial availability. In short, the prospects look very bleak.
43 What I am told in response to enquiry is that if it was sought to obtain another judge in the General Division to hear the directions application, there would be nobody available (in terms of non-CMC list judges) until May 2015. In terms of other CMC list judges, it would be a matter of individual application to a particular CMC list judge - to see whether a new matter could be squeezed into already overburdened lists, as a matter of urgency. It is currently the Court's two-week winter recess from sitting. But my regular discussions with fellow CMC list judges suggest that they are all equally as busy, if not more busy, than me. In fact, Pritchard J was only able to list Mr Scott's summary judgment application in her CMC list for 8 September 2014, as indicated.
44 In a pragmatic sense, capacity to find a third judge to hear a s 92 Trustees Act application by the Executors reasonably quickly, is a resourcing problem of some magnitude - if it is not to be me who actually hears the s 92 Trustees Act application. So the present lack of available judicial resources in civil to hear the s 92 application (reasonable urgency being the assessment that I make in terms of the need for the application to be heard prior to 8 September 2014) also leads me to a view that because I do currently have some availability in the week of 1 September 2014 (as I indicated to the parties previously) I should be the judge to actually hear the Executors' application for directions under s 92.
45 Allied to that, I add the observation that if I do, then demonstrably, were the Baur actions to still continue on thereafter towards trials, obviously I could not be the trial judge. That, I think, would cater for any conceptual difficulties in terms of s 92 of the Trustees Act, removing any prospect of the directions judge being the ultimate trial judge.
46 That deals with issues in terms of principle, resourcing and urgency and leads me to my view that I should hear the s 92 Trustees Act application for directions.
47 In terms of 'nitty-gritty' detail towards that objective, there is still the question of the present lack of any Executors' application for private advice regarding the Scott litigation for directions under s 92 - notwithstanding application to that end has been foreshadowed by Dwyer Durack acting for the Executors under correspondence of 8 May 2014 and 24 June 2014.
48 The draft minute of proposed directions that has been circulated by Mr Baur's solicitors (which helpfully marks up the Executors' minute) basically foreshadows a direction whereby the Executors would file and serve any amended originating summons containing all the directions sought pursuant to s 92 of the Trustees Act and in the inherent jurisdiction of the Court - plus any affidavits in relation to that application on which they propose to rely - by 25 July 2014.
49 I assess that to mean that there should be an amendment to the present originating summons as filed in CIV 1786 of 2014, to embrace extra directions being sought across all actions, including in the Scott litigation by the Executors. That is appropriate. There should not need to be another separate action commenced for directions by the same Executors as trustees, in relation to the Scott actions.
50 I am prepared to hear the parties in terms of any pragmatic problems, in terms of proceeding down that path.
51 The remainder of the directions can now be resolved. Broadly speaking, the timetable proposed under Mr Baur's solicitors' minute is appropriate, augmented by the programming in of written submissions and a proposal to deal with any confidential material that is to be provided to me for that application by the plaintiffs - such as privileged legal opinions or the like.
52 In those circumstances, I propose to order that I will hear the s 92 application. But the current originating summons needs to be amended to embrace any directions sought in respect of the Scott actions.
53 The parties have indicated that this could be all heard in a day. I will hear from the parties in terms of precisely when this should happen.
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