Supreme Court New South Wales Medium Neutral Citation: BJP1 v Salesian Society (VIC) Inc [2021] NSWSC 241 Hearing dates: 10 February 2021 Date of orders: 19 March 2021 Decision date: 19 March 2021 Jurisdiction: Common Law Before: Garling J Decision: See [96] Catchwords: CONTRACTS – whether there was an immediately binding agreement reached at mediation – intention of the parties - subsequent conduct of parties – relevance of history of previous dealings Legislation Cited: Civil Procedure Act 2005 Cases Cited: Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 Barrier Wharfs Ltd v W Scott Fell & Co Ltd [1908] HCA 88; (1908) 5 CLR 647 Baulkham Hills Private Hospital Pty Ltd v GR Securities (1986) 40 NSWLR 622 Brambles Holdings Ltd v Bathurst City Council [2001] NSWCA 61; (2001) 53 NSWLR 153 GC NSW Pty Ltd v Galati [2020] NSWCA 326 GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631 Howard Smith & Co Ltd v Varawa [1907] HCA 38;(1907) 5 CLR 68 Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353 Pavolic v Universal Music Australia Pty Limited [2015] NSWCA 313 Sinclair, Scott & Co v Naughton [1929] HCA 34; (1929) 43 CLR 310 Texts Cited: Not Applicable Category: Principal judgment Parties: BJP1 (P) Salesian Society (Vic) Inc (D) Representation: Counsel: D Lloyd SC / C O'Neill (P) S Lawrance / E Steer (D) Solicitors: Courtin Legal (P) Makinson d'Apice (D) File Number(s): 2019/253916 Publication restriction: Not Applicable Judgment 1. On 15 August 2019, the plaintiff, who has been given the pseudonym BJP1, commenced proceedings claiming damages from the Salesian Society (Vic) Inc ("the defendant"). The plaintiff claimed that he had been sexually abused by a Salesian priest, whilst a resident at Boys Town Engadine ("Boys Town") between 1978 and 1982. The Pleadings 1. The Statement of Claim pleaded that the defendant was liable because it owed a duty of care to the plaintiff which was a "non-delegable duty of care to exercise reasonable care for the safety of the plaintiff". The plaintiff pleaded that the defendant was in breach of that duty by failing to take a series of particular precautions including the institution of, and maintenance of, various systems of preventative education and mandatory reporting. 2. As well, the plaintiff pleaded that the defendant was vicariously liable for the conduct of the person identified as being the perpetrator of the sexual assaults on the plaintiff. Exemplary damages as well as compensatory damages were claimed. 3. In its Defence, the defendant put in issue the scope and content of the non‑delegable duty pleaded by the plaintiff, did not admit the abuse which was pleaded and denied that it was in breach of any duty. It denied that it was vicariously liable for the criminal conduct of the alleged perpetrator. 4. The defendant also pleaded as an entire answer to the plaintiff's Statement of Claim, that the plaintiff and the defendant had, in 1999, entered into a Deed of Release ("the 1999 Deed") "… the effect of which is to extinguish any further liability of the defendant and to bar any further claim or action brought by the plaintiff". 5. In a Reply filed on 21 April 2020, the plaintiff pleaded that the 1999 Deed "… was made non est factum and does not bind the plaintiff". He also sought an order that "… the deed be set aside for mistake". No point has arisen as to whether such a claim can be made in a Reply filed to a Defence, and in the absence of a cross-claim. Court Ordered Mediation 1. On 3 October 2019, the Court made an order that the parties participate in a mediation which was to conclude prior to 8 May 2020. The power of the Court to make such an order is found in s 26 of the Civil Procedure Act 2005 ("CP Act") 2. On 5 May 2020, a mediation took place as had been arranged between the parties, with Mr M Spartalis as the mediator. Issue for Determination 1. The issue in dispute before the Court, and with which this judgment deals, is whether the settlement, which was undoubtedly reached at the mediation, was intended to, and did, constitute an immediately binding agreement between the parties or whether the agreement reached at the mediation was intended only to become effective if and when a Deed of Release was executed by each of the parties and, in the case of the plaintiff, that executed copy returned to the defendant to enable it to take the necessary steps to pay the agreed monies. 2. There is little dispute about the facts of and surrounding the mediation and the conduct of the parties. 3. The defendant's solicitor, Mr Alex Kohn, was present at the mediation. He has sworn a number of affidavits in support of the defendant's contention that there was an immediately binding agreement. He was cross-examined for a short period. 4. The other participants in the mediation were not called as witnesses in the proceedings nor was any affidavit material filed recording their account of the mediation. The plaintiff did not give evidence. 5. Mr Kohn in evidence gave his recollection of what had occurred during the mediation. That recollection was not challenged. It is, in any event, consistent with contemporaneous notes made at the time by the mediator, Mr Spartalis, and the plaintiff's solicitor, Ms McCoy. Senior counsel for the plaintiff explicitly invited the Court to accept all of Mr Kohn's evidence. I accept Mr Kohn's account of all that occurred. 6. For the reasons which are set out below, I am satisfied that the agreement reached at the mediation was intended by the parties to be immediately binding, and the plaintiff should be held to that agreement. 7. It will be necessary for the parties to confer and agree upon the precise orders which the Court is to make. Relevant Facts 1. The proceedings were commenced by the filing of a Statement of Claim on 15 August 2019. 2. On 3 October 2019, the Court ordered mediation to occur. 3. On 17 April 2020, the solicitors for the plaintiff, together with the counsel who was briefed at that time, Mr John Sharpe, held a conference with the plaintiff in which there was a discussion about the 1999 Deed. In the course of that conference, Mr Sharpe advised the plaintiff that there was a risk that the Court would not set aside the 1999 Deed which had been signed at a time when the plaintiff was legally represented. The plaintiff was informed that if the defendant relied successfully on the 1999 Deed, he might be at risk of paying the defendant's legal costs of these proceedings. 4. On 29 April 2020, a further conference was held with the plaintiff, which included Ms McCoy (the solicitor with the day-to-day carriage of the matter on behalf of the plaintiff) and Mr Sharpe of counsel. During that conference the process for the mediation taking place the following week was discussed together with the range of possible values of the "relevant three heads of damage for your claim (general damages, medical expenses and economic loss)". 5. On 5 May 2020, Mr Spartalis, the mediator, convened the mediation by use of an AVL meeting platform. The plaintiff's counsel, Mr John Sharpe attended by telephone and the plaintiff's solicitor, Ms McCoy, attended by AVL. Mr Kohn and Father William Matthews, the Provincial of the Salesian Society, also attended by AVL. 6. The plaintiff indicated that he did not wish to participate by AVL in the mediation conference, but was available to, and did, provide instructions to his solicitor and counsel by telephone. The plaintiff was offered the opportunity, which he declined, to speak directly with the mediator from time-to-time in the course of the mediation. 7. It was accepted that the plaintiff's lawyers were fully instructed on his behalf, authorised to negotiate for him, and to enter into any agreement on his behalf. 8. The mediation was conducted by the mediator speaking separately on the one hand to the legal representatives of the plaintiff and in particular Mr Sharpe, and the other with Mr Kohn and his client, Father Matthews. There were no direct discussions either prior to the commencement of the mediation or during it between the legal representatives of the plaintiff and the defendant. 9. Negotiations commenced shortly after the mediation started. At about 8.43am, the plaintiff's lawyers put the first offer to the mediator. Thereafter, up until 10.28am, a further nine offers were exchanged in sequence, with the defendant responding to the plaintiff and then the plaintiff responding to the defendant. All of these negotiations took place with each party's lawyers indicating their client's respective position to the mediator, and the mediator conveying that position to the opposing party. The detail of these offers was recorded by the mediator by reference to the monetary amounts. It is unnecessary to set the contents of that record out here. 10. Within that sequence of 10 offers, the last two were significant. At 10.25am the plaintiff offered to settle for $400,000 inclusive of costs. That sum was two‑thirds of the plaintiff's opening offer. The defendant responded to that offer with a counter-offer of $190,000. That offer was 90% more than its opening offer. Both parties had moved significantly from their opening offers towards a compromise agreement. 11. According to Mr Kohn's affidavit, there was then a discussion between the mediator, Mr Kohn and his client, Father Matthews. It was to the following effect: Mr Spartalis: "Can you go to $250,000-$300,000?" Provincial: "No, I'm not prepared to go that high." Mediator: "Can you go to $225,000?" Provincial: "Yes, I can do that." 1. The mediator then spoke to the plaintiff's lawyers. According to a file note prepared by Ms McCoy, shortly prior to the exchange of the final two offers, there had been a discussion in some detail between the plaintiff, his counsel and his solicitor. At this stage, the defendant had offered $180,000 inclusive of costs. That discussion was along the following lines, as set out in Ms McCoy's file note: "JS and KM called [BJP1] to discuss the matter. JS explained that the offers that we had gone through. JS explained that [BJP1] could either accept the offer and it will be over, or we can go to court. JS explained that there is a real problem with the deed, and that there is a real chance that we can't fight the deed. JS explained that [BJP1] has time to think about it. And that there is no pressure to decide right now. [BJP1] said that he didn't understand the [1999] deed. JS said that the court might say that he did and then he will lose. [BJP1] said if he does take it to court is there a chance he could lose his house? JS said that not at that this stage, but there is always a chance they could go after him for the costs of he loses, but he would probably be the first person that this had happened to. JS said to think about it and we will get back to you. [BJP1] said OK." (sic) 1. Although the next offer of the defendant was recorded as being made at 10.28am, there is no note as to whether that was in fact communicated to the plaintiff, although I would infer that it was because a telephone call from the plaintiff to his solicitor was recorded at 10.42am in the following terms: "[BJP1] called me to say that he is considering accepting the offer. I called JS to let him know that [BJP1] is leaning towards accepting. JS advised me that we will try and get some more out of them, and not to call [BJP1] back yet." 1. Clearly, after that time there was a discussion between the mediator and the plaintiff's counsel. At 11.08am a further phone call with the plaintiff was recorded in these terms: "JS and KM called [BJP1] to say that we have finalised the offers, and that their final offer is $215,000 inclusive [of costs], which will get [BJP1] around $115,000 in his pocket. [BJP1] said that is good, he had discussed it with his wife and they had decided that they were never going to beat the deed so it is best to accept it. I told [BJP1] we would finalise it on our end and I would get back to him later today. He said no problem." 1. At about 11.10am, the mediator spoke to Mr Kohn and his client and said: "The plaintiff has agreed to accept $215,000 inclusive. The matter is settled. I will shortly send the parties an email confirming." 1. At 11.16am, Mr Spartalis, the mediator, sent an email to the plaintiff's and the defendant's lawyers and also to the Provincial of the defendant. It said: "Dear All, This matter resolved at mediation today. Attached is a copy of the mediation agreement. The chronology of offers has been circulated throughout the day, please retain a copy for your records. I have destroyed the material provided. …" 1. The chronology of offers which was attached to that email noted that there was no opening session, and that a written apology would follow the mediation. It also recorded that the parties were bound by the Mediation Agreement. The sequence of offers was then set out. 2. The terms of the Mediation Agreement were not said to be relevant by either party for the purposes of the resolution of the current dispute and can be put to one side. 3. Very shortly after the mediation concluded, there was a short separate telephone discussion between Mr Kohn and Ms McCoy, in which the following exchange occurred: McCoy: "I don't have a current Medicare Notice of Charge. The one we had has now expired." Kohn: "I'll need to obtain a Centrelink clearance once I receive the signed deed back from you and this will take a bit of time due to COVID." 1. Sometime after that discussion, at about 1.50pm on 5 May 2020, Ms McCoy telephoned the plaintiff. She asked if he had an email address to which a written form of "Instructions to Settle" could be sent. Apparently, the plaintiff did not have an email address and asked for the document to be posted. Ms McCoy's file note recorded the following: "I said that I would send them express post and that he is to call me as soon as they arrive so that we can go through them. He said that's no problem and asked how long does the money take to arrive. I said generally around 10-12 weeks. [BJP1] was a bit shocked but I explained the government clearance processes and he understood. I let [BJP1] know I would track the documents and that he should call me as soon as they arrived. He said he would and thanked me for my help." 1. A document headed "Instructions to Settle" was sent to the plaintiff. On 11 May 2020, the plaintiff signed those Instructions, together with an authority to his solicitors to receive the settlement monies and returned both documents to Ms McCoy. 2. The signing of those documents occurred after a further telephone discussion between the plaintiff and his solicitor, which included the following: "I called [BJP1] as he had received the ITS. He advised he had a chance to read through it and understood it all. We discussed the Medicare and Centrelink points and [BJP1] said he understood and that was fine. I also noted that we would be posting the deed of release to him once we had received it and we would need to discuss it then as well. [BJP1] thanked me for my time, and I said it was no problem." 1. The Instructions to Settle, a four-page typed document, included the following statements: "3. The Salesian Society have offered to settle my claim for the sum of $215,000 inclusive of all payments made, payback (including Medicare Australia and Centrelink), any outstanding treatment accounts, professional costs and disbursements, and out of pocket expenses. 4. I acknowledge that my matter was settled inclusive of party/party costs paid by the defendant. Those party/party costs paid by the defendant are normally within the range of 60% - 70% of my total legal costs and disbursement and thus, the sum that I received was increased to cover those party/party costs and disbursements payable by law by the defendants. … 15. That I have been advised by my solicitors that should I accept the Offer of Settlement then it will put an end to all claims that I have arising out of the incidents which occurred between 1980 and 1982. … 19 That I have been advised that by accepting the offer of settlement I will put to an end any further claims that I have for compensation from the defendant or their insurer. …" (emphasis in original) 1. On the following day, 12 May 2020, the defendant's solicitor sent to the plaintiff's solicitor a proposed Deed of Release. The covering email read as follows: "We refer to the mediation of this matter on 5 May 2020 and now enclose proposed deed of settlement and release. If approved, could you please arrange for this to be signed by [BJP1] and return it to us together with the independent solicitor certificate. As you know, there are currently extensive delays obtaining Centrelink clearances which can nowadays take 4-5 weeks. Could you please explain this to [BJP1]. The deed provides for payment of the agreed sum within 28 days of the receipt of Centrelink clearance. In the meantime, we note that you are seeking an up-to-date Medicare notice of charge. If this is received before the agreed sum is due would you please let us know and we will be happy to remit that amount. In the absence of a current notice of charge, we will have to remit the 10% statutory payment. If you have any queries concerning the deed please let us know. Thank you for your assistance in resolving this matter." 1. It will be necessary to refer to some of the provisions of the Deed of Release in due course. 2. When the Deed was received by email, the solicitors for the plaintiff printed out a copy of it and posted it, together with a covering letter, to the plaintiff. That covering letter read, in part: "We refer to the mediation held in your matter on 5 May 2020 and to the settlement of your claim. We now enclose the Deed of Release. Before signing, please contact our office upon receipt of this letter to arrange a convenient time to discuss the enclosed documents by telephone with Ms Karli McCoy of our office as we are required to go through the documents with you. After speaking with Ms Karli McCoy from our office, we ask that you review, sign and return the enclosed documents to us as soon as possible." 1. On the day following the despatch of that letter to, and before it was received by him, the plaintiff telephoned Ms McCoy. She recorded the contents of the phone call in a file note which reads as follows: "[BJP1] called to let me know that he wanted to continue fighting the matter and does not want to proceed with the settlement. I let him know: there are costs implications difficult to do Porters would not be able to continue to act for him in the event that he did decide to reneg[e] on the settlement. [PB] let me know he would call me back. I said to take his time and think about it and to not feel any pressure. I also let him know we were happy to talk him through it further." 1. A further telephone call occurred between the plaintiff and his solicitor on 18 May 2020. Ms McCoy's file note records the telephone call in the following terms: "Telephone call to client re settlement I called [BJP1] to follow upon on our conversation last week where he indicated he didn't want to continue with the settlement. I informed him that we needed to know by Thursday afternoon because there is a court hearing on Friday morning. [BJP1] said he is waiting on a phone call from another law firm for a second opinion, and he will let me know after that. He also said he had received the Deed in the mail. I noted that I had posted that before we spoke last week. I thanked [BJP1] for his time and said I would wait to hear from him, and if I haven't heard back in the next couple of days I will call him." 1. On the following day, Ms McCoy telephoned the plaintiff. She made a note of that call in the following terms: "I called [BJP1] as we had received a request from Judy Courtin to return her call. I informed [BJP1]: we do not have authority to speak to her at this stage if he has retained her, she needs to send us a request for your file and we will send everything over we will inform the defendant that we aren't sure what is happening with the settlement but that we no longer act for you [BJP1] said he was sorry but just needed more out of the settlement. I said that was his choice, and we will facilitate the file being moved over when we received the official request. I wished [BJP1] good luck, and he said thank you." 1. On that day, and after that conversation, Ms McCoy telephoned Mr Kohn. She told him that her instructions had been terminated and that another firm would likely be taking over conduct of the matter. She told Mr Kohn that she thought that he would be contacted by the new solicitors prior to the directions hearing on 22 May 2020. 2. On 21 May 2020, Porters Lawyers sent a long letter to the plaintiff which summarised what they had done for him, what the issues were, of the various Court orders that had been made, what had occurred at the mediation and what had occurred afterwards. It is unnecessary to recount all that is contained in that letter. 3. However, it does include the following: "After a number of offers and counter-offers were made, together with the input of the Mediator, we were advised that the defendants had made a final offer of $215,000 inclusive of costs. … Mr Sharpe and Ms McCoy advised you that we considered that the settlement was a very good result, particularly considering the difficulties of defeating the previous Deed of Release that you entered into with legal advice in 1999, together with your limited economic loss. After considering our advice in relation to this final offer and your prospects of success if the matter continued to a full hearing, as well as the range of damages (considering that you had limited economic loss referrable to the assaults), you instructed us that you would accept the defendant's final offer in full and final settlement of your claim in the sum of $215,000 inclusive … We than acted on your oral instructions and advised the Mediator and the defendant that the matter was settled. On 6 May 2020 we posted you a copy of the Instructions to Settle, which you then discussed over the phone with Ms McCoy on 11 May 2020 and returned by express post to our office. … On 19 May 2020 we received a request to call Ms Judy Courtin on your behalf. Ms McCoy then telephoned you and informed you that we did not have authority to speak to Ms Courtin, and that we need to be advised in writing if Ms Courtin is now acting on your behalf. You then said to Ms McCoy: 'I'm sorry, but I just need more out of the settlement.' This puts us in a difficult position, as your instructions have now changed and you do not appear to accept our advice and the advice of counsel. We remind you that your verbally instructed us to accept the offer, and we advised the defendants and the Mediator that your matter was settled. You subsequently signed each page of the Instructions to Settle confirming your verbal instructions in writing. Accordingly, we acted on both your verbal and subsequent confirming written instructions. …" Deed of Settlement and Release 1. The proposed Deed of Settlement and Release ("the 2020 Deed") which was sent by the solicitor for the defendant to the plaintiff's solicitor on 12 May 2020, included the following features: 1. In addition to the plaintiff and defendant in the proceedings, two other parties were sought to be included. Those parties were described in this way: "Father William Matthews SDB (in his capacity as Provincial of the Salesian Society (VIC) Inc) of … Ascot Vale Victoria 3032. All prior religious, members, servants or agents of the Salesian Society (VIC) Inc who were involved in Boys Town Engadine … Ascot Vale Victoria." Together the defendant and these two additional described parties were called the Releasees. 1. Clause 2 of the 2020 Deed noted that the defendant would "without any admission of liability" agree to pay to the plaintiff the Agreed Sum within 28 days of the return of the executed copy of the Deed of Release, the receipt of an Authority to Receive, and receipt of the statutory notices from Centrelink and Medicare, whichever was the last to occur. 2. The release clause, clause 3, was in the following terms: "The Releasor, for himself, his executors, administrators, heirs and assigns forever hereby releases, remises, quits and discharges [the releasees] and any member, servant or agent of the Body Corporate, Fr Matthews or any one of the Catholic Church entities described in clause 4 hereof or any of them from all actions, suits, claims and demands of every description which he now has or which but for this Deed might have or has had, or which hereafter could be asserted, brought or made by him, or by anyone on his behalf …" 1. Clause 4 was in the following terms: "[The releasees] and any member, servant, religious or agent of Salesian Order, or any Catholic Church entity described in clause 5 hereof who may be liable to the Releasor arising out of the matters referred to in Recital A may plead this Deed in bar to any claim or proceedings by the Releasor or any person claiming on his behalf in respect of the Claims or any matter related or incidental thereto." 1. The term "Catholic Church entity" was defined in clause 5 of the Deed and included, but was not limited to, any person or body which, although an independent entity, came under the umbrella of the Catholic Church. It is unnecessary to set out the entire detail of the clause, but it is appropriate to note that it is a clause of significant width. 2. The 2020 Deed included a confidentiality clause in the following terms: "The [parties] agree to keep the agreed sum and the settlement discussions confidential, PROVIDED that this clause shall not in any way prevent or hinder the [parties] from reporting to or co-operating with the police or any relevant authorities as required by law or from co-operating with the Releasees' advisers and insurers (if any), AND PROVIDED FURTHER that this clause shall not in any way prevent the Releasor from discussing the circumstances out of which the Claims arose." 1. A further clause was included to which attention was drawn in submissions in the following terms: "The releasor acknowledges that by accepting the Agreed sum and executing this Deed he is not entitled to make any further approach to [the releasees] and any other member or agent of the Salesian Order, or any Catholic Church entity described in clause 5 hereof, for financial assistance, including assistance with respect to any specialist medical advice, counselling, therapy or for damages or otherwise." 1. Clause 13 was in the following form: "This Deed sets forth the entire agreement between the parties hereto and supersedes any or all prior agreements or understandings between the parties hereto pertaining to the Claims and the proceedings." 1. Clause 19 was in the following terms: "The Releasor agrees to file a Notice of Discontinuance in the Supreme Court proceedings numbered … within 14 days of receipt of the Agreed Sum." 1. The only signatories to the 2020 Deed were the plaintiff, the defendant and Father Matthews in his capacity as Provincial of the Salesian Order. Other Deeds of Release 1. Mr Kohn's unchallenged evidence was that in the 10 years or so preceding this particular mediation he had participated in "… well over 200 settlement conferences and mediations with Porters Lawyers, the former solicitors for the plaintiff". He then said this: "In my prior dealings with Porters Lawyers, I have settled each matter on the basis of a Deed of Settlement and Release in a form which is prepared by my office and contains terms which are very similar, if not identical, in each matter, subject to occasional various to accommodate particular matters." 1. Mr Kohn went on to describe his invariable practice with respect to mediated, or negotiated, settlements. He said: "My practice is to provide Porters Lawyers with a deed in these usual terms following the completion of financial negotiations as to the agreed sum. I cannot recall any instance in the matters I have settled with Porters Lawyers over this time where that has been a problem. The practice that has taken place over all these years is that once the financial negotiations have concluded and we have reached an agreed sum, I would forward to Porters Lawyers the deed of settlement and release containing the usual terms, they return it to me after execution and I arrange for Centrelink clearances and payment of amounts owing to Medicare, before remitting the net settlement sum to that firm." 1. Mr Kohn pointed out that on occasions where negotiations have taken place face to face, it is his practice to hand the deed to Porters Lawyers on the day, once the settlement sum had been agreed upon. In other instances, such as where negotiations have occurred over the telephone, via AVL or in some other way, his practice is to forward the Deed to Porters Lawyers by email. 2. Mr Kohn then said in his affidavit: "Due to the fact that we have had so many settlement meetings over the years, I do not state at the beginning of every settlement conference or mediation that any offers communicated by me on behalf of my clients are subject to the usual terms, namely, the terms set out in the deed of settlement and release. For my part, that is implied by virtue of the way we have conducted these types of settlement meetings over the years." 1. Mr Kohn noted that at no time, either prior to or during the mediation, did either the mediator (speaking on behalf of the plaintiff and plaintiff's solicitors) or the plaintiff's solicitors themselves, give him any indication that any clarification was needed as to terms upon which offers were being put, nor that they wanted to see the Deed before completing the financial discussions, or that there was anything about the usual course of conduct of past negotiations which would not apply in this particular case. 2. There is in evidence a folder of some past Deeds of Release. Of those deeds, Mr Kohn said this: "In the case of each deed … (a) The deed concerned a dispute in which the Releasor alleged that he or she had been sexually abused and made a claim against an emanation of the Catholic Church. (b) Porters Lawyers acted for the Releasor named in the Deed. (c) I or a lawyer in my firm for whom I am the supervising partner acted for the Releasees named in the Deed; (d) The deed was executed following a settlement conference in which I or a lawyer who I supervised participated and in which the Releasor was represented by a solicitor from Porters Lawyers." 1. An examination of the deeds, the earliest of which is dated in April 2013 and the latest of which is dated in June 2020, supports the evidence of Mr Kohn that the deeds are identical in respect of the operative provisions, the way in which the releases, confidentiality terms, and parties protected by the releases are expressed, and that there is no difference of any significance between them. 2. Senior counsel for the plaintiff in his final submission, did not suggest that there was any difference in substance between what the Deed provided to the plaintiff in this case and the provisions of any of the other deeds. Defendant's Submissions 1. The defendant submitted that the Court would be satisfied that, immediately prior to the conclusion of the mediation on 5 May 2020, the parties made an immediately binding agreement, the terms of which included: 1. that the defendant agreed to pay the plaintiff the sum of $215,000.00 (inclusive of legal costs); and 2. the plaintiff agreed to settle his claim against the defendant. 1. In support of its submission that the agreement was intended to be immediately binding, the defendant pointed to the following objective circumstances as being relevant: 1. the fact that the agreement was reached in the course of a court ordered mediation; 2. the language used by the parties, coupled with the context in which it was used was only consistent with the conclusion that the agreement which was reached was intended to be immediately binding; 3. the mediator and the lawyers participating in the mediation who were conducting the settlement negotiations, were each experienced litigators whom the Court should infer knew the difference between words and phrases such as "settled" or "settled in principle". The defendant submitted that the language and dealings between all parties both during the mediation and as reflected in later correspondence, did not indicate that the parties intended the agreement to be conditional on any future event, or only an in-principle agreement; and 4. the defendant argued that there were sufficient express terms of sufficient certainty to constitute a binding contract. 1. The defendant also argued that there were terms which the Court ought imply into the agreement by reference to past dealings between the lawyers and their common understanding of the terms upon which the agreement was being negotiated and finalised. Plaintiff's Submissions 1. The plaintiff opposed the relief sought in the defendant's Notice of Motion. The plaintiff submitted that in the present case there was no immediately binding agreement reached between the parties at the mediation because: 1. there were a multitude of terms in the 2020 Deed which are either essential or critical, and which were not discussed at the mediation; and 2. the conduct of the parties after the conclusion of the mediation was inconsistent with an intention to enter into a binding contract on that day. 1. In dealing with the proposition that there were a multitude of terms which were not discussed at the mediation, the plaintiff pointed to the following: 1. the inclusion as parties obtaining the benefit of releases and other relief in the 2020 Deed, additional individuals (including Father Matthews) and any prior religious or other members or servants or agents of the Salesian Society who were involved in Boys Town; 2. as well, the extension within the 2020 Deed of the release to Catholic Church entities; 3. the fact that the agreement recorded in the 2020 Deed was stated to be without admission of liability; 4. the whole structure and language of the 2020 Deed, particularly with respect to the reliance by the parties on representations, suggests that the parties did not intend to enter a binding agreement until the 2020 Deed was signed; 5. there was no agreement at mediation about time for payment; 6. the confidentiality promise in the 2020 Deed was not the subject of discussion at any time before the agreement was made; 7. the 2020 Deed included a broader than standard release, a broader class of persons obtaining the benefit of the release, the promise of an indemnity by the plaintiff to a range of classes of individuals in the event of a past or future payment of victim's compensation; and 8. the inclusion of clause which required an indemnity from the plaintiff directed to his abuser. 1. In addition, the plaintiff contended for other reasons that the Court should not accept the defendant's submissions. This included a submission from the plaintiff that it was unlikely that parties to litigation of the kind engaged in here, would bind themselves to a settlement without having reached explicit agreement on the matters which were included in the 2020 deed. Principles of Law 1. Before considering the arguments of the parties, it is convenient to identify the relevant legal principles. The Existence of a Binding Contract 1. The first issue is whether a binding contract came into existence. In Masters v Cameron [1954] HCA 72; (1954) 91 CLR 353 (at 360) the High Court of Australia held that in circumstances where the parties conduct contractual negotiations and agree that the subject matter of their negotiations is to be dealt with by a subsequent formal contract, those circumstances would fall into one of three categories: "1) [a case in which] the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect; 2) … a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document; and 3) [a case] in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract." 1. The High Court held that the first two categories were binding contracts, but the third category was not. 2. A fourth category, derived from the High Court's decision in Sinclair, Scott & Co v Naughton [1929] HCA 34; (1929) 43 CLR 310, was recognised by McClelland J in Baulkham Hills Private Hospital Pty Ltd v GR Securities (1986) 40 NSWLR 622 (at 628E): "… in which the parties were content to be bound immediately and exclusively by the terms which they had agreed upon whilst expecting to make a further contract in substitution for the first contract, containing, by consent, additional terms." Intention of Parties 1. Notwithstanding the category in which the agreement falls, it is necessary to identify the objective intention of the parties. In GR Securities Pty Ltd v Baulkham Hills Private Hospital Pty Ltd (1986) 40 NSWLR 631, McHugh JA (with whom Kirby P and Glass JA agreed) said (at [634]) that: "The decisive issue is always the intention of the parties which must be objectively ascertained from the terms of the document when read in the light of the surrounding circumstances. If the terms of a document indicate that the parties intended to be bound immediately, effect must be given to that intention irrespective of the subject matter, magnitude or complexity of the transaction." 1. In Pavlovic v Universal Music Australia Pty Limited [2015] NSWCA 313 Beazley P (with whom Bathurst CJ and Meagher JA agreed) observed (at [64]) that: "Where parties have reached agreement as to all the terms of a contract, but also agreed that a further, formal agreement is to be executed the question for determination is whether the parties intend to be immediately bound. That is to be determined objectively from the 'outward manifestations' of the parties' intentions: Electricity Generation Corporation v Woodside Energy Ltd [2014] HCA 7; 251 CLR 640 at [35]." 1. In Air Great Lakes Pty Ltd v K S Easter (Holdings) Pty Ltd (1985) 2 NSWLR 309 Mahoney JA set out (at 326G) three questions which are helpful to consider: "Did the parties arrive at a consensus?; (if they did) was it such a consensus as was capable of forming a binding contract?; and (if it was) did the parties intend that the consensus at which they arrived should constitute a binding contract?" Subsequent Conduct 1. It is clear that subsequent conduct of the parties can be considered when determining the existence of a binding contract: Brambles Holdings Ltd v Bathurst City Council [2001] NSWCA 61; (2001) 53 NSWLR 153 at [25] per Heydon JA: see also Howard Smith & Co Ltd v Varawa [1907] HCA 38;(1907) 5 CLR 68 at 77; Barrier Wharfs Ltd v W Scott Fell & Co Ltd [1908] HCA 88; (1908) 5 CLR 647 at 668, 669, 672; GC NSW Pty Ltd v Galati [2020] NSWCA 326 at [92]. Discernment 1. Before the mediation started, and having regard to the extensive prior dealings between the solicitors for both the plaintiff and the defendant, I am satisfied that both sets of solicitors entered upon and negotiated during the mediation with the clear mutual understanding that any settlement agreed upon would be given effect to by the plaintiff entering into a deed in and to the effect of the many deeds which had been prepared by the solicitors for the defendant in other matters, and sent to the solicitors for the plaintiff in other matters. 2. As well, it was a common understanding between the solicitors that the proceedings in Court would be resolved by the filing of a Notice of Discontinuance once the settlement monies had been paid. The timing of the payment of those monies was dependent upon the obtaining of certificates from the Commonwealth Government with respect to the payback, if any, owed by the plaintiff to Medicare or the Department of Social Security, or both. This was a well-known and commonly understood mechanism by which any settlement agreed upon would be given effect to. 3. That the solicitors engaged in the mediation whilst sharing this common understanding is obvious from their past dealings and that there was no specific discussion of the details of that mechanism being used at the start of, or else during, the mediation. Nor was there any demur observable from the correspondence after the mediation concluded. In particular, I note that there was no objection, protest or query raised by the solicitor for the plaintiff at any time after the mediation concluded, which suggested that the proffering of a Deed of Release, the entry into that Deed, the filing of a Notice of Discontinuance after payment of the money, and a delay to enable the obtaining of the Government clearance certificates, was either unexpected or else outside the terms of the "settlement" reached at the mediation. This seems to me to clearly demonstrate that the solicitors for the plaintiff at all times knew exactly what was intended to occur. 4. Accordingly, at the mediation the parties were engaged in a discussion about the only contentious issue between them, namely, in what sum would the matter resolve. Of course, it may have been that the parties could not reach an agreement on that sum but the mediation was intended to enable the parties to explore a resolution of the whole proceedings, the essential term of which was the relevant sum of money. 5. The mediation was arranged pursuant to Court orders and was an invariable part of the Court's management approach to the disposition of claims of the kind which the plaintiff made. The parties approached the mediation with the intention of resolving the proceedings. A representative of the defendant, who was authorised to negotiate on its behalf, was present during the mediation. The plaintiff was available to give instructions to his lawyers by telephone. This is an important factor in considering whether the parties intended to reach a final and binding agreement at the mediation. 6. These settlement negotiations did not take place without a context. They did not take place by chance or in an informal setting. On the contrary, the parties agreed upon the identity of the mediator, a mediation agreement was agreed upon providing for the parties to participate in the mediation. The mediation was formally convened – albeit by an AVL platform – and negotiations took place. The fact that negotiations occurred through the medium of the mediator, with each party speaking to the mediator and then the mediator conveying the offers from one party to the other, rather than the parties conveying them directly, serves only to emphasise the formal nature of what was occurring with recognition on all sides that the intention was to reach a final agreement if that were possible. 7. The language used between the parties, and to which I have earlier referred, was not language consistent with some form of provisional agreement or some form of conditional agreement. The language during the mediation was clear. The defendant made a final offer. It was open to be accepted by the plaintiff or not. The plaintiff accepted that final offer. The mediator, consistently with what he had been told by each party during the course of the mediation, said that the matter was settled. He terminated the mediation. No expression was used by either party, such as "settled in principle" or "settled subject to the execution of a final deed" or "settled, subject to confirmation from the plaintiff once the proposed deed is received" or any words to that effect, which indicated that the settlement was in any way conditional or provisional. 8. It is also important for the purpose of determining objectively what had occurred at the mediation, and what was intended to occur, to examine the correspondence and notes made by the solicitors for the plaintiff. Immediately after the mediation concluded, Ms McCoy noted: "This matter settled at mediation for $215,000 inclusive of costs." 1. The plaintiff told his solicitor, having been informed of the final offer from the defendant and what sum he would get clear after deductions, that the offer was a good one, he had considered it and discussed it with his wife and it was best to accept it. That acceptance instruction was not conditional. 2. The terms of the Instructions to Settle document, which are in part infelicitous, when read as a whole, are only consistent with the plaintiff instructing his solicitors that he was prepared to accept the offer on a final and unconditional basis. The significance of those written instructions is not that they indicated that the solicitors were not authorised to resolve the matter, but rather that the plaintiff was, subsequent to the provision of oral instructions, confirming his understanding of all of the terms of the settlement which he had instructed his lawyers to accept. There is nothing about the Instructions to Settle which, on my reading of them, suggests in any way that there was not intended to be a binding settlement at the mediation. 3. It is also of significance that when the Deed of Settlement and Release was sent by the solicitor for the defendant to the solicitor for the plaintiff, it was forwarded without comment to the plaintiff. There was no complaint made by the plaintiff's solicitor to the defendant's solicitor that the terms of the 2020 Deed were in any way unexpected or did not accord with the common understanding to which I have earlier referred. As well, it is clear from the correspondence from the plaintiff's solicitor to him that they did not regard the 2020 Deed as being at all remarkable or binding the plaintiff to any contractual obligation which fell outside what was to be expected. 4. Finally, it is clear that the plaintiff's decision to not proceed with any further steps in the settlement was reached by him, and conveyed by him to his then solicitors, at a time prior to his receipt of the 2020 Deed. In other words, the plaintiff's change of mind had nothing to do with the fact of, or terms of, the 2020 Deed. 5. After the instructions by the plaintiff to his then solicitors were terminated, (because he did not wish to adhere to the settlement agreement reached in the mediation) the solicitors for the plaintiff wrote to the plaintiff setting out various matters. The terms upon which the settlement was referred to in that correspondence is also of relevance. In particular, the plaintiff's solicitor recorded this: "… You instructed us that you would accept the defendant's final offer in full and final settlement of your claim … We then acted on your oral instructions and advised the mediator and the defendant that the matter was settled." 1. When all of these matters are considered together, I conclude that the agreement reached between the solicitors for the parties at the mediation, which was conducted on 5 May 2020 was, and was intended to be, a final and immediately binding agreement to resolve the proceedings. 2. The terms included the payment of the sum of $215,000 less any amounts which the law obliged the defendant to deduct prior to payment to the plaintiff, and that the proceedings would be formally resolved in the Court by the lodging of a Notice of Discontinuance once the plaintiff had entered into a deed in the usual form with respect to the release and indemnity of an ordinary and typical kind. 3. The plaintiff's submissions in the proceedings, which placed a great deal of emphasis on the range of conditions and obligations contained in the proffered 2020 Deed as demonstrating that the settlement which was reached at the mediation was not intended to be immediately binding, are unpersuasive. 4. First, the terms of the proffered 2020 Deed were not different from the terms of deeds which had been regularly proffered throughout previous matters and which, as I have earlier found, were the subject of a common understanding between the parties that if an agreement could be reached on the monetary sum, the settlement would be undertaken on those terms. 5. Secondly, had these terms been as contentious as is now submitted, and had they proffered a settlement on terms so different from that reached by the parties, then one would have expected such a change to have been noted immediately after the settlement in correspondence between the solicitors for the parties. It was not. 6. Thirdly, settlement was in fact reached between the solicitors for the parties. There is no doubt that the plaintiff's solicitors were properly and adequately instructed and authorised to enter into a full and final settlement of the proceedings. That is what they did and what they confirmed to the mediator and the defendant. 7. Objectively speaking, the provisions of the 2020 Deed, the execution of the Notice of Discontinuance and its filing after payment of the money, were simply ordinary, typical and usual procedural steps which the parties envisaged would be taken to give effect to the agreement which they had reached. 8. As earlier indicated, had there been any concern about the terms of the proposed 2020 Deed, then the plaintiff's solicitors would have expressed that concern not by entering into a "full and final settlement" of the proceedings, but rather by using language reflecting the conditional acceptance of the offer. 9. For these additional reasons taken with the earlier considerations to which I have referred, I am persuaded by the defendant that the agreement reached at the mediation was intended to be a final and binding agreement. 10. It will be necessary for the parties to determine what orders ought be made which have the effect of disposing of the proceedings in light of the agreed settlement and the terms of this judgment. 11. I stand the proceedings over to enable that process to occur. Orders 1. I make the following orders: 1. Stand the proceedings over for directions to Friday 16 April 2021 at 9.30am. 2. Direct that on or before 26 March 2021, the solicitors for the defendant are to provide to the solicitors for the plaintiff a set of Short Minutes of Order which they contend appropriately reflect the terms of this judgment and the finalisation of the proceedings. 3. Direct the solicitors for the plaintiff to provide to the solicitors for the defendant a set of Short Minutes of Order to enable finalisation of these proceedings on or before 4pm 9 April 2021. 4. Direct that at the time the Short Minutes of Order are provided by each party, a copy is to be provided to my Associate. 5. Liberty to apply. ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 19 March 2021