FEDERAL COURT OF AUSTRALIA Pascoe v State of Victoria (Department of Health and Human Services) [2017] FCA 498 File numbers: VID 477 of 2015 VID 237 of 2016 VID 1173 of 2016 Judge: MURPHY J Date of judgment: 12 May 2017 Catchwords: HUMAN RIGHTS – disability discrimination – settlement of proceeding – Court approval of settlement Legislation: Disability Discrimination Act 1992 (Cth) Disability Act 2006 (Vic) Cases cited: Gillespie v Alperstein [1964] VR 749 Gray v State of Victoria (Department of Education and Early Childhood Development) [2017] FCA 353 Hickey v Public Advocate (Victoria) [2012] FCA 1203 Jones (by his next friend Jones) v Victoria (Department of Education and Early Childhood Development) (2014) 145 ALD 619; [2014] FCA 1404 Modra v State of Victoria (Department of Human Services Victoria) [2013] FCA 1041 Scandolera (by his next friend Robinson) & Another v Victoria (Department of Education and Early Childhood Development) (2015) 331 ALR 525; [2015] FCA 1451 Smith v Marriott Support Services [2013] FCA 312 Date of hearing: Heard on the papers Date of last submissions: 10 February 2017 Registry: Victoria Division: General Division National Practice Area: Administrative and Constitutional Law and Human Rights Category: Catchwords Number of paragraphs: 30 Solicitor for the Applicants: Arnold Thomas and Becker Counsel for the Respondents: Ms M Richards and Mr C Tran Solicitor for the Respondents: Victorian Government Solicitor's Office ORDERS VID 477 of 2015 BETWEEN: JAMES PASCOE Applicant AND: STATE OF VICTORIA (DEPARTMENT OF HEALTH AND HUMAN SERVICES) Respondent VID 237 of 2016 BETWEEN: JAMES PASCOE Applicant AND: STATE OF VICTORIA (DEPARTMENT OF HEALTH AND HUMAN SERVICES) Respondent VID 1173 of 2016 BETWEEN: JAMES PASCOE First Applicant BRONWYN PASCOE Second Applicant AND: STATE OF VICTORIA (DEPARTMENT OF HEALTH AND HUMAN SERVICES) First Respondent MAREE BELLEVILLE Second Respondent MICHAEL MEFFLIN Third Respondent JUDGE: MURPHY J DATE OF ORDER: 12 May 2017 THE COURT ORDERS THAT: 1. Subject to Order 2, pursuant to rule 9.70 of the Federal Court Rules 2011 (Cth) the settlement of these proceedings set out in the Deed of Release marked as Annexure "AG1" to the affidavit of Allanah Goodwin sworn 22 December 2016 and filed herein is approved. 2. If the Senior Master of the Supreme Court makes an order under r 79.10(2) of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) that the settlement monies that are payable to the Applicant pursuant to the Deed of Release be held in court for the benefit of the Applicant: (a) the Respondent shall pay those settlement monies to the Senior Master for the benefit of the Applicant; and (b) the Applicant has leave to file a notice of discontinuance of this proceeding with no order as to costs. 3. If the Senior Master of the Supreme Court does not make the order described in Order 2 by 9 June 2017, the matter be listed for directions on 15 June 2017. 4. The affidavit of Allanah Goodwin sworn 22 December 2016, together with Annexures "AG1" and "AG2", being the Opinion of Jonathan Brett Q.C. dated 21 December 2016, is to be placed in an envelope marked "Confidential - not to be opened without the permission of a Judge of this Court" and held on the Court file. 5. Publication of any of the terms of the Deed of Release marked as Annexure "AG1" to the affidavit of Allanah Goodwin sworn 22 December 2016 be prohibited pursuant to s 37AG(1)(a) of the Federal Court of Australia Act 1976 (Cth). Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT MURPHY J: 1 Before the Court is an application by Bronwyn Pascoe, the mother and litigation representative of the applicant, James Pascoe, seeking Court approval of the settlement of three proceedings brought against the State of Victoria, through the Victorian Department of Health and Human Services (the Department). Mr Pascoe suffers from various disabilities, and proceedings VID 477 of 2015, VID 237 of 2016 and VID 1173 of 2016 allege that between June 2013 and December 2015 the Department discriminated against him in breach of the Disability Discrimination Act 1992 (Cth) (the DDA), doing so in the provision of disability services including in case management, direct care services and the provision of accommodation in hospital and other disability care facilities. 2 On 30 March 2016 I ordered that two of the proceedings, namely VID 477 of 2015 and VID 237 of 2016, be joined and heard concurrently. 3 On 5 October 2016, as Mr Pascoe's litigation representative, Mrs Pascoe commenced proceeding VID 1173 of 2016 against the Department and two named Departmental employees, claiming that they discriminated against Mr Pascoe under the DDA. Although the claim is not clearly pleaded, this proceeding also includes a discrimination claim under the DDA brought by Mrs Pascoe personally. 4 For the reasons I explain, I consider the settlement of the proceedings brought on Mr Pascoe's behalf should be approved. I have made orders accordingly. tHE PROCEEDINGS 5 Mr Pascoe was born on 26 November 1993 and is now aged 23. It is uncontroversial that he suffers from a number of serious disabilities within the DDA, including severe autism spectrum disorder, expressive and receptive language impairment, anxiety, attention deficit hyperactivity disorder, intellectual disability, and depression. He has very limited communication skills and he engages in a range of problematic behaviours that are a symptom and manifestation of his disabilities. 6 I draw the following summary of the facts from a detailed affidavit sworn by Mrs Pascoe on 10 October 2016 and filed in the proceedings. In broad summary she deposes that in the period prior to 2013 Mr Pascoe was in the care of his parents, with the support of some limited Department funding. He suffered difficulties with his schooling but it appears that he and his family managed. There was, however, a significant change in his circumstances from 2007. In May 2007 his paternal grandfather died, and in July 2007 his recently born sister Jacinta died, both of which affected him deeply. He completed his final year of education at one school in 2011 and commenced at a new school, but that transition was difficult for him. In November 2012 his maternal grandmother died which also affected him deeply. 7 By the end of 2012 Mr Pascoe's behaviour had deteriorated significantly and his family were having difficulty in coping. Mrs Pascoe describes an increasing need for her and her husband to seek assistance from the Department, which assistance she deposes became increasingly unsatisfactory and frustrating. 8 As Mr Pascoe's behaviour deteriorated it was sometimes necessary to call the police, which led to Mr Pascoe being hospitalised at the Austin Hospital where he was "chemically restrained", that is, tranquillised with medication and strapped to a hospital bed. Mrs Pascoe says that the treatment that Mr Pascoe received worsened his problematic behaviour and his state which placed enormous demands on her and her husband. She attributes many of the asserted shortcomings in the services and accommodation provided to a lack of adequate funding. 9 In September 2013 Mr Pascoe's behaviour became too difficult for his parents to manage on their own with the limited government support they received, and he was placed into full-time accommodation at a Department facility. It appears that until Mr Pascoe went home in December 2016, he remained in full-time care from then, save for two short periods. From 21 November 2014 to 15 December 2014, and for at least one other short period, Mr Pascoe was an inpatient at the Northern Hospital where, again, he was regularly chemically restrained. 10 Mrs Pascoe deposes to the significant deterioration in Mr Pascoe's behaviour over this period, which involved frequent self-harm and destruction of property, which evidenced his severe distress. Mrs Pascoe details conduct by employees of the Department which she asserts was confrontational, incompetent and damaging to Mr Pascoe. 11 One significant aspect of the proceeding relates to the Department's failure to undertake a Functional Behaviour Assessment of Mr Pascoe despite repeated requests to do so. A Functional Behaviour Assessment was completed in August 2015 and Mrs Pascoe contends that the eventual adoption of the strategies recommended in the Functional Behaviour Assessment and a subsequent Behavioural Plan led to a noticeable improvement in Mr Pascoe's state and a reduction in his problematic behaviour. 12 In summary the proceedings allege that the Department discriminated against Mr Pascoe in breach of the DDA by failing to: (a) properly plan and implement changes in Mr Pascoe's accommodation which caused him considerable distress and anxiety; (b) provide stable and trained staff in various places at which Mr Pascoe was accommodated, which caused him distress, anxiety and a deterioration in his life skills; (c) undertake a Functional Behaviour Assessment within a reasonable time; (d) provide Mr Pascoe with counselling and psychological support to help him deal with traumatic events, such as his restraint whilst in hospital; (e) provide Mr Pascoe with suitable supported accommodation; (f) include Mr Pascoe in decision-making processes about the services and accommodation provided; (g) develop and implement a Behaviour/Treatment Plan; and (h) develop a Functional Communication Plan. 13 The allegations include allegations of failures to make "reasonable adjustments" within the meaning of s 5(2) of the DDA, and breaches of the Disability Standards under the Disability Act 2006 (Vic). In broad terms the case is based on the argument that Mr Pascoe has serious disabilities which require careful, extensive and expert management if he is to achieve a reasonable quality of life, and that the Department has discriminated against him by failing to make reasonable adjustments for his disabilities and failing to provide appropriate services and accommodation. Mr Pascoe alleges that these failures caused him distress, anxiety, pain, suffering and a significant reduction in his quality of life. 14 The Department denies that it discriminated against Mr Pascoe. It contends that in all the circumstances it provided reasonable and appropriate services and accommodation, and it made reasonable adjustments for him. Materials in support of the application 15 The parties attended a Court-ordered mediation before a registrar of the Court on 2 December 2016 at which they agreed to a confidential settlement. The settlement is recorded in a Deed of Release dated 2 December 2016 (the Settlement Deed) made between Mr Pascoe (through Mrs Pascoe as his litigation representative) and Mrs Pascoe in her personal capacity on the one hand, and the State of Victoria through the Department and the relevant two Departmental officers on the other hand. 16 Rule 9.70 of the Federal Court Rules 2011 (Cth) requires that a litigation representative must make an interlocutory application to the Court for approval of any settlement reached on behalf of a person under a legal incapacity, and that the settlement does not become binding unless approved. Rule 9.71 requires that an interlocutory application for settlement approval must be accompanied by an affidavit stating the material facts on which the application relies, the agreement that is sought to be approved, and an opinion of an independent lawyer that the agreement is in the best interests of the person under a legal incapacity. 17 In support of the application for settlement approval Allanah Goodwin, a partner with the legal firm Arnold Thomas & Becker, filed an affidavit sworn on 22 December 2016 which includes the following annexures: (a) the Settlement Deed; and (b) a confidential opinion of Mr Jonathon Brett QC dated 21 December 2016 (Senior Counsel's opinion). Consideration Whether the settlement is in Mr Pascoe's best interests 18 The Settlement Deed includes terms requiring confidentiality, but it is necessary to record that the settlement includes a modest monetary amount for Mrs Pascoe for her personal claim. The amount payable to Mrs Pascoe can only be payable for her personal claim in proceeding VID 1173 of 2016 and that aspect of the settlement does not require Court approval. 19 Because of the confidentiality of the settlement I cannot set out my views as to whether approval is appropriate by express reference to its elements. It must suffice to note that I have considered the allegations made in the proceedings, the defence filed, the terms of the Settlement Deed and Senior Counsel's opinion. Senior Counsel's opinion deals with the significant aspects of the proceedings, expresses a view on Mr Pascoe's prospects of success and on the appropriateness of the settlement, and concludes that settlement is in Mr Pascoe's best interests. Having regard to these matters, I consider the settlement is in Mr Pascoe's best interests. 20 I give Senior Counsel's opinion significant weight in my decision to approve the settlement but it remains the Court's responsibility to determine whether the settlement is beneficial to Mr Pascoe: Modra v State of Victoria (Department of Human Services Victoria) [2013] FCA 1041 (Modra) at [12] (Tracey J), Scandolera (by his next friend Robinson) & Another v Victoria (Department of Education and Early Childhood Development) (2015) 331 ALR 525; [2015] FCA 1451 (Scandolera) at [27] (Mortimer J). In making this assessment, the Court is concerned only with the benefit of the settlement to Mr Pascoe: Gillespie v Alperstein [1964] VR 749 (Gillard J); Smith v Marriott Support Services [2013] FCA 312 at [12] (Tracey J); Modra at [12]. 21 There are, of course, advantages to settlement. As I said in Gray v State of Victoria (Department of Education and Early Childhood Development) [2017] FCA 353 at [12]: Settlement avoids the risk of a less advantageous outcome, of incurring significant legal costs, of being required to meet an adverse costs order, and it avoids the stress of a trial. 22 Before approving settlement of a proceeding brought on behalf of an applicant with a legal incapacity it is necessary to consider the prospects of success of the proceeding if it proceeds to trial, and the likely range of recovery if the case is successful. It is also appropriate to consider the emotional and psychological strain that a trial would place on the applicant and his or her family: Scandolera at [29] and [32]. I now set out my views on those matters. 23 First, I consider the settlement to be in Mr Pascoe's best interests in light of his prospects of success if the proceedings were to go to trial. It is not certain that Mr Pascoe would be successful in the proceedings. A detailed defence filed by the Department indicates that there is a real factual dispute between the parties. The Department submits that the claims face significant hurdles and refers to Hickey v Public Advocate (Victoria) [2012] FCA at [16] 1203 (Gray J) and Jones (by his next friend Jones) v Victoria (Department of Education and Early Childhood Development) (2014) 145 ALD 619; [2014] FCA 1404 at [16]-[18] (North J). 24 If the proceedings were unsuccessful at trial Mr Pascoe would not receive the settlement amount. Further, if the proceedings were unsuccessful at trial, it is likely that a significant adverse costs order would be made against Mrs Pascoe as his litigation representative. That would have a significant impact on his parents' ability to care for him, which would affect him as well. 25 Second, the settlement amount is substantial. The settlement is in Mr Pascoe's best interests in light of the likely range of recovery if the case was successful (at least on those parts of his claims on which he appears to have a reasonable prospect of success). 26 Damages in proceedings such as these are compensatory. Any damages would relate to the periods of anxiety, distress, pain and suffering caused by the unlawful conduct found together with any resultant ongoing increase in his problematic behaviour or ongoing deterioration in his life skills. The quantum of damages in a case such as this is difficult to assess and is likely to depend on contested medical evidence about the effect of the unlawful conduct. Assessing the likely range of recovery will be difficult because the materials indicate that Mr Pascoe's condition was deteriorating and his problematic behaviour increasing before his parents were forced to relinquish his care to the Department in 2013. There are likely to be difficulties in establishing the extent of the deterioration in Mr Pascoe's condition through the alleged discriminatory conduct, and the extent of any ongoing effect. 27 Third, the other terms of the settlement are broadly reasonable. 28 Fourth, the scope of the allegations, the different people involved in the various allegations, and the lengthy time-frame over which the Department's discriminatory behaviour is alleged to have occurred, indicates that a significant number of lay and expert witnesses would have been required to give evidence and that the trial would have been lengthy, complex and costly. Mr Pascoe's parents have already suffered enormous psychological distress as a result of the matters the subject of this proceeding, and a trial would have placed significant further emotional, psychological and financial pressure on them. Although that may not directly be taken into account, the distress they suffer as a result is likely to also have adverse consequences for Mr Pascoe. It is in Mr Pascoe's best interests that they, and he, avoid the pressures of a trial. 29 Fifth, it is worth noting that Mr Pascoe moved home on 23 December 2016 and out of the Department's accommodation. The necessary services are now provided to him through the National Disability Insurance Scheme. The settlement of the proceedings gives the parties certainty to go their separate ways. 30 I have made orders approving the settlement. I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Murphy. Associate: Dated: 12 May 2017