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  • Unreported Judgment

Hoch v Hoch

 

[2020] QSC 9

SUPREME COURT OF QUEENSLAND

CITATION:

Hoch v Hoch [2020] QSC 9

PARTIES:

ANDREW HOCH

(Applicant)

v

IAN HOCH

(Respondent)

FILE NO/S:

BS No 11084 of 2016

DIVISION:

Supreme Court

PROCEEDING:

Civil Trial

DELIVERED ON:

10 February 2020

DELIVERED AT:

Supreme Court in Brisbane

HEARING DATE:

2 September 2019

JUDGE:

Brown J

ORDER:

The parties are to provide a draft form of Order reflecting the reasons and file any submissions as to costs and any further orders sought by 4:00pm on 21 February 2019.

CATCHWORDS:

CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – INTERPRETATION OF MISCELLANEOUS CONTRACTS AND OTHER MATTERS – where the character of the condition was disputed – where the offer was conditional upon the making of orders in the terms of the offer, by consent of the parties, by the Supreme Court of Queensland – whether the offer is capable of acceptance

EQUITY – GENERAL PRINCIPLES – MISTAKE – EFFECT ON CONTRACT – MISTAKE AS TO NATURE OR CONTENTS OF DOCUMENT – OTHER CASES – where the parties were disputing the manner in which a lot of land would be partitioned – where the Respondent’s solicitor made a unilateral mistake in the Option contained in the offer – where the Applicant accepted the offer – where accepted serious and fundamental mistake – whether the Applicant ought to have reasonably known that there was a mistake in the offer presented by the Respondent

PROFESSIONS AND TRADES – LAWYERS – DUTIES AND LIABILITIES – SOLICITOR AND CLIENT – AUTHORITY – GENERALLY – WHERE COMPROMISE AGREEMENT – where the parties were disputing the manner in which a lot of land would be partitioned – where the solicitor for the Respondent had authority to make an offer to settle in terms which were Option B – where the solicitor for the Respondent had a mistaken belief as to the contents of the offer – where the Respondent’s solicitor made an offer in terms of Option A – where the Applicant accepted the Respondents offer – where the Respondent was unaware of the mistake in his solicitor’s offer – where the Respondent contends that to enforce the compromise would be unjust – whether the Courts discretion to set aside the compromise should be enlivened

PROCEDURE – CIVIL PROCEEDINGS IN STATE AND TERRITORY COURTS – JUDGMENTS AND ORDERS – AMENDING, VARYING AND SETTING ASIDE JUDGMENTS AND ORDERS – VARIATION AND SETTING ASIDE COMPROMISE AGREEMENT –  where the Applicant had materially altered their position in reliance on the agreement – where the Applicant had no knowledge of the fundamental mistake in the agreement – where the Respondent contends that to enforce the compromise would be unjust – whether the Courts discretion to set aside the compromise should be enlivened

Perri v Coolangatta Investments Pty Ltd (1982) 149 CLR 537; [1982] HCA 29, considered.

Sprott v Harper [2000] QCA 391, followed.

McTeir v Haupt [1992] 1 VR 653, considered.

Taylor v Johnson (1983) 151 CLR 422; [1983] HCA 5, considered.

Harvey v Phillips (1956) 95 CLR 235; [1956] HCA 27, considered.

Insbury Pty Ltd v Craig [1990] 1 Qd R 309, considered.

Broadbent v Medical Board of Queensland [2010] QCA 352, considered.

Neale v Gordon Lennox [1902] AC 465, considered.

COUNSEL:

G Forde and S Gibson for the Applicant

K Wilson QC and M Brookes for the Respondent

SOLICITORS:

Mullins Lawyers for the Applicant

Australian Property Lawyers for the Respondent

  1. [1]
    BROWN J: Andrew Hoch and Ian Hoch are brothers.  Their parents owned a property known as “Kerand” at Alpha.  Since 1997, the brothers have been owners of the property as tenants in common in equal shares.  From that time, Andrew Hoch (“Andrew”) conducted a grazing business on the western part of Kerand and Ian Hoch (“Ian”) conducted a grazing business on the eastern part.  The brothers conducted their businesses separately and independently.  Disputes arose between the brothers as to the appropriate land allocation between them. An attempted mediation in 2005 between them failed. Things again came to a head when the brothers fell into dispute, in relation to both land management practices and particularly as to the use of three paddocks: Big Holding paddock, Small Holding paddock and West Bottle Tree (“the disputed paddocks”) on the Kerand property.  The disputed paddocks are well suited to grazing and had been used by Andrew and Ian at different times.  Andrew had used the disputed paddocks for many years up until 2014 when Ian mustered Andrew’s cattle off  West Bottle Tree paddock and began using the paddock himself.
  2. [2]
    In October 2016, Andrew applied for an order for partition or sale of Kerand.  An order was made by this Court in December 2016 that the property be vested in trustees of the statutory trust for partition and that the parties pay the trustees’ costs equally.  The trustees subsequently proposed a Scheme of Partition to divide the property, under which the majority of the disputed paddocks were to go to Andrew, inter alia. Andrew generally supported a petition in those terms but Ian did not. Ian subsequently applied for a variation of the Scheme of Partition in December 2018. Ian’s expert had prepared a report discussing two options: Option A which largely mirrored the scheme of partition proposed by the trustees but provided Andrew with slightly more land and Option B which was a division based on the brothers’ receiving land of equal value.  Ian contended Option B was the correct division between the two brothers. The hearing of that application was set down for three days commencing Tuesday, 16 April 2019. 
  3. [3]
    On 10 April 2019, Andrew made an offer to his brother through his solicitors to resolve the matter based on Ian accepting the petition proposed by the Trustees.  Ian rejected that offer through his solicitors and made a written counter offer on 11 April 2019 based on Andrew accepting Option A outlined in his expert’s report.  Andrew accepted the counter offer on the same day, within an hour of receipt.  Approximately an hour and a half later,  Ian’s solicitors notified Andrew’s solicitors that the offer had contained an error, in referring to “Option A” rather than “Option B”.
  4. [4]
    Andrew accepts that Ian’s offer of 11 April contained a serious and fundamental mistake[1] but seeks to enforce the settlement whereas Ian contends it is unenforceable or should be set aside.
  5. [5]
    The parties have identified and I accept, that to resolve this matter three questions need to be determined by the Court, namely:
  1. (1)
    Whether the email from Ian’s solicitor dated 11 April 2019 which was “conditional upon the making of orders in the terms of this offer, by consent of the parties, by the Supreme Court of Queensland” contained an offer that is capable of acceptance;
  2. (2)
    If a contract was formed on acceptance of the 11 April offer by Andrew, whether it was vitiated by a mistake made by Ian that ought to have been apparent to Andrew and/or his lawyers. In considering this matter I also need to consider a subsidiary question raised by a contention made on behalf of Andrew, namely whether Ian acquiesced in or adopted the offer referring to Option A; and
  3. (3)
    As the 11 April 2019 offer was subject to the Court’s approval, whether the Court should enforce a compromise knowing that one party agreed to its terms by mistake.

Factual background

  1. [6]
    The following matters are uncontentious between the parties.[2] 
  2. [7]
    On 6 November 2018, the statutory trustees delivered their proposed Scheme of Partition, which was largely in accordance with Option 2 in a Valuation Report and Scheme of Partition Assessment prepared by Webster Cavanagh, dated 1 April 2018.  The two options in the Webster Cavanagh report were:
  1. (1)
    Option 1, which provided for a partition whereby the land was divided into two portions of approximately equal value.  Pursuant to this option, Andrew was to receive 2,887.40 hectares and Ian 4,704.50 hectares; and
  2. (2)
    Option 2, which divided the land into portions that were said to reflect improvements made by Andrew to the property, whereby Andrew was to receive 3,477.9 hectares and Ian 4,114 hectares.
  1. [8]
    Under the statutory trustees’ proposed scheme, the land Andrew was to receive included the disputed paddocks.
  2. [9]
    On 6 December 2018, Ian applied to the Supreme Court seeking a variation of the statutory trustees’ proposed scheme on the basis that, as nearly as practicable, Andrew and Ian should each be allocated a portion of the property of equal value. 
  3. [10]
    Ian swore an affidavit on 25 January 2019, maintaining that the property should be partitioned into two parcels of approximately equal value, relying on a report prepared by Christopher Dyer.  Christopher Dyer of Herron Todd White, who had previously prepared a report on behalf of Ian,[3] prepared a further report on 20 January 2019 (“the Dyer report”). The Dyer report assessed the overall value of the property as being $5,350,000.   It identified two options, Option A and Option B by reference to two plans of subdivision.  In terms of the two options, Christopher Dyer opined:
  1. (a)
    Option A which would provide Andrew with 3,507 hectares of land, with a value of approximately $3,230,000, and Ian with 4,085 hectares of land, with a value of approximately $2,120,000;
  2. (b)
    Option B which would provide Andrew with 3,006 hectares of land, with a value of approximately $2,750,000, and Ian with 4,586 hectares of land, with a value of approximately $2,600,000.
  1. [11]
    Provision was also made in the Dyer report for easements over the allocated property.
  2. [12]
    Option A of the Dyer report was very similar to Option 2 of the statutory trustees’ proposed scheme, although it provided Andrew with slightly more, some 29 hectares than Option 2.
  3. [13]
    On 26 February 2019 Ian’s variation application was listed for a three day hearing commencing on 16 April 2019.Trial directions were made at that time for steps to be taken prior to trial.
  4. [14]
    On 10 April 2019 Andrew made an offer to compromise the proceedings through his solicitors.  That offer provided:[4]

“Our client has serious concerns about your client’s ability to: (a) meet any adverse costs order, in the event that your client’s application to vary the scheme of partition fails; and/or (b) meet his obligation to pay 50% of the Trustees’ costs in any event. 

We say this because:

  1. (a)
    your client has no doubt incurred significant legal costs in bringing his application for the variation of the scheme of partition (as has our client); and
  1. (b)
    your client has failed to pay some $36,472.64 to the Trustees pursuant to their funding requests.  This has created uncertainty for our client in terms of achieving the partition outcome. 

We also note that the Resolution Bundle and Document Plan remains outstanding from your client. 

In the circumstances, our client makes the following offer, to save both parties from incurring further costs:

  1. Your client’s application dated 6 December 2018 be dismissed, with no order as to costs;
  1. The parties consent to the Trustees subdividing Kerand pursuant to the current scheme of partition;
  1. The parties continue to pay 50% of the Trustees’ costs until finalisation of the scheme of partition; and
  1. Your client, upon accepting this offer, acknowledges the Trustees’ scheme of partition applies immediately. 

The above offer is a genuine compromise and attempt to settle and is made in reliance on the principles in Calderbank v Calderbank.  It is open for acceptance in writing before 4.00pm on Friday, 12 April 2019.”

  1. [15]
    On 11 April 2019, Ian through his solicitors sent a letter to Andrew’s solicitors stating that:[5]

“With respect, your client is misinformed with respect to our client’s payment of additional fees and outlays to the trustees for partition.  As instructed, those funds have been paid by our client.

Our client rejects your client’s offer.

Our client makes the following offer to resolve the current proceedings without further expense and delay:-

  1. Your client consent to an order varying the Scheme of Partition to achieve a line of partition identified as option “A” in the valuation report of Christopher Dyer, Herron Todd White dated 20 January 2019 (“The varied Scheme of Partition”);
  1. The parties consent to the trustees subdividing Kerand pursuant to the varied Scheme of Partition and shall do all acts and things necessary in that regard;
  1. The parties to continue to each pay 50% of the trustees’ costs until finalisation of the varied Scheme of Partition;
  1. This offer is subject to and conditional upon the making of orders in the terms of this offer, by consent of the parties, by the Supreme Court of Queensland; and
  1. Upon making of orders in the above terms and the registration of all necessary plans of subdivision with the Department of Natural Resources, Mines and Energy Queensland to effect the varied Scheme of Partition, our client’s Application dated 6 December 2018 shall be discontinued with no order as to costs. 

The above offer is a genuine compromise and attempt to settle and is made in reliance on the principles in Calderbank v Calderbank.  It is open for acceptance in writing before 2:00pm on Monday 15 April 2019.

Our client will rely on this correspondence on the question of costs.”

  1. [16]
    As set out above, it is accepted that the letter mistakenly referred to Option A, whereas it was intended to refer to Option B. 
  2. [17]
    At 3:35pm on 11 April 2019, the solicitors for Andrew wrote to the solicitors for Ian accepting the offer contained in the letter of 11 April 2019. 
  3. [18]
    At 5:03pm Ian’s solicitors wrote to Andrew’s solicitors advising them that Ian did not intend to make the offer in terms of its earlier letter of 11 April 2019 and that where it referred to Option A, it should have referred to Option B and contended that there was no compromise.
  4. [19]
    At 5:23pm on 11 April 2019, Andrew’s solicitors maintained that there was a settlement of the proceedings.
  5. [20]
    There is no dispute between the parties that Option A of the Dyer report generally reflected Option 2 contained in the trustees’ proposed Scheme of Partition,[6] save that it provided that Andrew was to receive 3,507 hectares and Ian was to receive 4,085 hectares, which is approximated to be some 29 hectares more than Andrew would have received under Option 2 of the trustees’ proposed partition.

Was the offer capable of acceptance?

  1. [21]
    Paragraph 4 of Ian’s 11 April 2019 offer provided that:

“This offer is subject to and conditional upon the making of orders in the terms of this offer, by consent of the parties, by the Supreme Court of Queensland”

  1. [22]
    Ian’s counsel contends that Ian’s offer was, by reason of paragraph 4 of the offer, not capable of acceptance so as to form a contract between the parties.  He contends that the inclusion of paragraph 4 in the offer made the offer conditional on the occurrence of a non-promised event and was a contingent condition which had to be fulfilled prior to a contract being made between the parties in terms of the 11 April offer.   As the condition was not fulfilled prior to Ian withdrawing the offer there was no agreement to settle the matter. 
  2. [23]
    Andrew submits that there was a contract upon acceptance by him of the offer and paragraph 4 is properly characterised as a condition subsequent.
  3. [24]
    I do not accept the submission made on behalf of Ian. In my view, properly characterised, the condition is a condition subsequent, or a condition precedent to the performance of the contract, rather than a condition precedent to the formation of the contract. 
  4. [25]
    In Perri v Coolangatta Investments Pty Ltd,[7] Gibbs CJ considered that a clause in the special conditions of a contract, which provided that the contract was entered into subject to purchasers completing a sale of their property, was not a condition precedent to the formation of a binding contract.  His Honour stated that it was “clear that a binding contract came into existence immediately upon signature, and that the parties to it were from that moment subject to certain obligations”.[8]  The effect of the condition was that the party concerned was under no obligation to complete the sale unless the condition was fulfilled or waived.[9]  In the same decision, Mason J discussed the difference between a “condition which is precedent to the formation of a contract and a condition which is precedent to the obligation of a party to perform his part of the contract and is subsequent in the sense that it entitles a party to terminate the contract on non-fulfilment”.[10]  His Honour stated:[11]

“In the first category the transaction creates no rights enforceable by the parties unless and until the condition is fulfilled. In the second category there is a binding contract which creates rights capable of enforcement, though the obligation of a party, or perhaps of both parties, to perform depends on fulfilment of the condition and non-fulfilment entitles him to terminate.”

  1. [26]
    Mason J further stated that the Court will generally tend to favour a construction by which the condition is construed as a condition precedent to performance rather than formation of the contract.[12]
  2. [27]
    In Sprott v Harper,[13] the Queensland Court of Appeal  observed, that an agreement between the parties which may require approval by the Court may still be binding. In this regard, the Court of Appeal referred to the decision of the Full Court of the Family Court in Bourke v Bourke (No 2),[14] which in turn approved the statement of Lord Denning in Smallman v Smallman[15] that:

“… If the parties have reached an agreement on all essential matters, then the clause 'subject to the approval of the court' does not mean there is no agreement at all. There is an agreement, but the operation of it is suspended until the court approves it … pending the application to the court, it remains a binding agreement which neither party can disavow.”

  1. [28]
    The submission on behalf of Ian particularly relied upon the decision of McTier v Haupt,[16] in which Brooking J held that the phrase “subject to” had long been used as a means of expressing a condition.  That much may be accepted.  However, that case held that the condition was a contingent condition which had to occur to enable completion,  and only in the event of it not being fulfilled were the purchasers were only entitled to avoid the contract. That finding acknowledges that there was a contract between the parties, albeit one which was subject to a condition subsequent.
  2. [29]
    In the present case, the offer was said in condition 4 to be “subject to and conditional upon” the making of orders in the terms of the offer by the Supreme Court of Queensland, by the consent of the parties. It is analogous to the offer that was the subject of the Court of Appeal observations in Sprott v Harper. The proper construction of that condition, given the language used and the context in which the offer was made, is that it is a condition precedent to the performance of the contract and not a condition precedent to the formation of a contract.  Under condition 1 of the terms of the offer, Andrew was required to consent to an order varying the Scheme of Partition in accordance with the offer. As such, consent to the relevant order for which the Court’s consent was to be obtained was provided for in the offer.  In addition, the offer to resolve the proceedings was expressed to be open “for acceptance” until the day before trial, having been made some five days before the trial was to commence.  All of the essential matters between the parties had been agreed.  The agreement was binding upon the parties but its operation was suspended until it was given approval by the Court.[17]
  3. [30]
    It follows that this contention made on behalf of Ian therefore fails and I find that a contract was formed upon Andrew’s acceptance of the 11 April 2019 offer.

Was the mistake one that would vitiate the contract?

  1. [31]
    The second question that must be determined by this Court is whether the contract was vitiated by mistake. Ian principally relies on the principle as pronounced by the High Court in Taylor v Johnson.[18]
  2. [32]
    In Taylor v Johnson,[19] Mason ACJ, Murphy and Dean JJ expressed the relevant principle as follows:

“… a party who has entered into a written contract under a serious mistake about its contents in relation to a fundamental term will be entitled in equity to an order rescinding the contract if the other party is aware that circumstances exist which indicate that the first party is entering the contract under some serious mistake or misapprehension about either the content or subject matter of that term and deliberately sets out to ensure that the first party does not become aware of the existence of his mistake or misapprehension.”

  1. [33]
    The majority further stated that:[20]

“In such a situation it is unfair that the mistaken party should be held to the written contract by the other party whose lack of precise knowledge of the first party's actual mistake proceeds from wilful ignorance because, knowing or having reason to know that there is some mistake or misapprehension, he engages deliberately in a course of conduct which is designed to inhibit discovery of it.”

  1. [34]
    In the present case, Ian submits that Andrew through his legal representatives and/or his son Mitchell had reason to know that Ian was entering into the contract under a serious mistake about the content of the offer in the circumstances in which the 11 April 2019 offer was made, not that he did know that there was a mistake and deliberately set out to ensure that Ian did not become aware of the existence of his mistake by accepting the offer in a short time after it was made. That is denied by Andrew. The resolution of the matter requires an examination of the circumstances surrounding the making of the 11 April 2019 offer and its acceptance.

Summary of evidence leading to 11 April offer

  1. [35]
    Mr Dempster was Ian’s solicitor who was acting on his behalf in the proceedings. He had instructed Mr Damien Atkinson QC to appear on Ian’s behalf at the trial.  Mr Marc Maskell assisted by Mr Riley McDermott acted on behalf of Andrew. They had instructed Mr David de Jersey to appear at the trial on Andrew’s behalf.
  2. [36]
    Mr Dempster was called on behalf of Ian.  His evidence was honest although at times defensive, consistent with his being obviously sensitive as a result of accepting that he was responsible for the mistake in the 11 April 2019 offer. His evidence at times was confused and I consider that his recollection was diminished by the fact he had not made contemporaneous file notes of conversations.  According to him he was solely responsible for the mistake that occurred and not Ian. His evidence was that Ian did not speak in terms of Option A or Option B when instructing him to make the 11 April 2019 offer but rather that Ian said that his proposal was 3006 with the easement benefiting his portion allowing him access to the wooden yards, cattle yards, waters and access points at the location depicted in the survey plan of Vince Byrne.[21]
  3. [37]
    According to Mr Dempster he had accidentally referred to Option A in the 11 April offer even though Ian had clearly instructed him in a telephone that the terms of the offer he was to make were that which reflected Option B. He had no real explanation as to how he came to refer to Option A rather than option B other than that he may confused himself because Option B included provision for an easement which was referred to as easement A. His evidence was that he did not check the Dyer report to see that the reference to Option A was the correct one prior to sending the 11 April offer and only realised a mistake had been made when he was contacted by Ian’s wife after he had sent them notice of Andrew’s acceptance of the 11 April offer.
  4. [38]
    Mr Dempster was challenged in cross-examination about the suggestion that he solely referred to Option A, not Ian, and that Ian had instructed him to make an offer in terms which would have accorded with the terms of Option B, never by reference to Option A.
  5. [39]
    Prior to the exchange of the offers of 10 and 11 April 2019, Mr Atkinson QC, who acted on behalf of Ian, had conversations and email exchanges with Mr de Jersey as to whether the matter could be settled. Mr Atkinson QC sent an email to Mr Dempster on 8 April 2019 summarising the effect of his discussions. In that email, Mr Atkinson QC commented that he and Mr de Jersey had discussed their shared concerns that the trial was going to take a long time, have an uncertain outcome and damage relationships irreparably.  According to Mr Dempster he considered that the reference to an uncertain outcome referred to the unpredictability of litigation, not uncertainty as to the strength of Ian’s case. He asked Mr Dempster to raise with Ian whether he was interested in compromising the matter, having commented that he assumed Ian would only be prepared to settle according to Dyer 2.0 whereby Andrew would get to 3,006 hectares.
  6. [40]
    Mr Dempster’s email records that he discussed Mr Atkinson’s email with Ian, who confirmed that he would only settle with Andrew on the basis of the partition whereby that Andrew  received 3,006 hectares.  Although he did not make a file note of the conversation, Mr Dempster’s evidence was that Ian’s position had been clear since the filing of the application on 6 December 2018, namely that the line of partition should be defined by reference to the survey plan of VSB Surveys done by Vince Byrne, which was annexed to the Dyer Report and was the partition the subject of Option B.   That position had been reiterated by Ian in his affidavit of 25 January 2019.  
  7. [41]
    Mr Dempster sent Mr Atkinson QC an email on 9 April 2019 stating that Ian and Paola confirmed that “Chris Dyer’s scenarios in his last report of 20/1/19 are the terms on which they remain willing to settle.” The email then addressed other matters relevant to the preparation for trial. Mr Atkinson QC subsequently sent Mr de Jersey[22] an email pointing out that he considered the wrong methodology had been used in the Webster Cavanagh report, his concerns about the matters proceeding, reiterating his client’s position and stating that:

“If the matter is to settle, I think that the only possibility is Option B in the attached report.  Your client receives 3000 hectares and has the more valuable piece of land, but the difference is relatively small.”

  1. [42]
    Mr Dempster then rang Ian and Paola Hoch and read the email to them.
  2. [43]
    Notwithstanding Mr Atkinson’s email to Mr de Jersey of 9 April 2019 indicating Ian would only settle on the basis of Option B of the Dyer report as set out above Andrew’s offer of 10 April was put on the basis of the statutory trustee’s proposed scheme of partition.
  3. [44]
    Mr Dempster sent Andrew’s offer to settle of 10 April 2019 to Mr Atkinson QC. Mr Atkinson QC, who also gave evidence, had an exchange with Mr de Jersey where he informed him that he considered Andrew was being unrealistic. Mr Atkinson QC subsequently rang Mr Dempster  to discuss his conversation with Mr de Jersey, in which  Mr Atkinson QC had indicated to Mr de Jersey that the offer of 10 April was unrealistic but he thought Ian would settle on the basis he had set out in his 9 April 2019 email.  According to Mr Dempster’s affidavit, Mr Atkinson QC had told him that he had said to Mr de Jersey that “Ian’s instructions remained that he was willing to agree to a partition according to the Christopher Dyer’s final report providing for 3,006 ha to Andrew together with an easement providing for Ian’s access to cattle yards on or close to the line of partition”.[23]  Those were not, however, the words used in the file note he made of the conversation, which referred to Option B. 
  4. [45]
    Mr Dempster gave evidence that he had made a handwritten note of a conversation he had with Mr Atkinson QC on 11 April 2019 concerning communications between Mr Atkinson QC and Mr de Jersey, which Mr Dempster rewrote shortly after the conversation. Reading from that note, Mr Dempster accepted that Mr Atkinson QC had referred to “Option B”.[24]  Mr Dempster further gave evidence that paragraph 26 of his affidavit,[25] which stated that Mr Atkinson QC had referred in that conversation to a partition whereby Andrew would receive 3,006 hectares together with an easement, was an expansion upon the contents of the note. He did not accept that his affidavit did not accurately represent what he had discussed with Mr Atkinson QC, on the basis that the reference to “Option B” encapsulated both the 3,006 hectares and an easement which was “easement A” and his affidavit referred to what was encompassed in Option B.   He regarded the two references as one and the same.[26]  He rejected the proposition that Mr Atkinson QC had only referred to “Option B” and never stated that he had spoken to Mr de Jersey about 3,006 hectares and the easement.[27] However, his evidence as to what Mr Atkinson QC had stated he had said to Mr de Jersey was confused.  Mr Dempster accepted that his affidavit and his file note were inconsistent, to the extent that the file note did not refer to an easement and referred to option B, whereas his affidavit referred to 3,006 hectares, but did not accept that both matters were not raised by Mr Atkinson QC.
  5. [46]
    I find that in all likelihood, consistent with the offer of 9 April 2019, that Mr Atkinson QC in his discussion with Mr Dempster could have referred to both Option B and 3,006 hectares and that Mr Dempster expanded on that in his affidavit. Mr Atkinson QC was not asked about the conversation. Consistent with Mr Atkinson QC’s reference to Mr de Jersey saying  Andrew had strong views about the issue but that settlement was possible Mr Dempster’s note referred to Mr Atkinson QC saying that Mr de Jersey had said his client was a hothead. I accept Mr Dempster said he’d raise with Ian making a formal offer in terms of Option B but I think the additional detail as to the offer was in all likelihood a note to himself.
  6. [47]
    On 11 April 2019, Mr Dempster relayed his conversation with Mr Atkinson QC about the 10 April offer and his conversation with Mr de Jersey to Ian. According to Mr Dempster Ian stated he did not wish to make a counter offer.  Mr Dempster stated that he did not make a file note of this conversation with Ian, because his position remained the same as it had always been.
  7. [48]
    Mr Dempster had a further conversation with Ian later that same day, in respect of which he did make a file note.[28] It was this conversation that led to him forwarding the 11 April offer to Thynne and Macartney containing the mistaken reference to Option A. According to Mr Dempster, Ian stated that he had considered Mr Dempster’s earlier advice that he should make an offer in writing, which Ian had originally stated he thought was pointless. In his oral evidence, Mr Dempster stated that he wrote “advance – 3006 hectares” in his file note because that was what Ian had said when confirming the offer to be made.[29] His best recollection was that Ian had said that his proposal was 3,006 hectares to Andrew with an easement benefitting Ian’s portion, allowing him to access the wooden yards, the cattle yards, water and access points at the location depicted in the survey plan of Vince Byrne.[30] Mr Dempster testified that he had said “good” in response to Ian at that point, because he knew that was always going to be his position.[31] Mr Dempster said he erroneously wrote down Option A, which was not something communicated to him by Ian. He said he could only speculate as to why he wrote it down and said it may have been because there had been a reference to easement A.[32]
  8. [49]
    Mr Dempster’s affidavit evidence was that, during that conversation, he said to Ian words to the effect of “the 3,006 ha with easement as noted in Vince Bein’s [sic] survey plan…I believe that is option A”,[33] which he accepted in evidence to be correct. He stated in oral evidence that Ian had reiterated that all he wanted to achieve was a partition of the property in equal proportions or something approaching it.[34] According to Mr Dempster, Ian did not respond to Mr Dempster saying he believed the right proposal was Option B or correct him, but communicated again that the position he sought was the 3,006 hectares with an easement option.[35] He stated that Ian did not refer to Option A or Option B, but referred to the proposed offer as 3006 hectares with the easement, and that he did not have instructions to advance Option A. Ian told Mr Dempster that he did not require a copy of the letter of offer prior to it being provided to the other side, because he was busy and was happy for Mr Dempster to advance the offer.[36]  Mr Dempster did not send him the offer or read it to him over the phone prior to sending it. 
  9. [50]
    Mr Dempster then had a brief discussion with Mr Atkinson QC during which he informed him of Ian’s instructions to make an offer.[37] In his affidavit, Mr Atkinson QC states that during this discussion Mr Dempster referred to instructions from Ian to make an offer in terms of Option A.[38] Mr Dempster did not accept in cross-examination that he said that, stating that his recollection was that he referred only to the 3,006 hectare option.[39] Contrary to Mr Atkinson QC’s evidence, Mr Dempster did not recall Mr Atkinson QC stating, “[s]houldn’t it be in terms of Option B?”,[40] nor responding that those were his instructions and that was what he would be doing.  Neither Mr Dempster nor Mr Atkinson QC made a file note of this conversation.
  10. [51]
    Mr Dempster stated that he did not realise that there was an error in the offer until Paola Hoch telephoned him and pointed it out, which led him to write the email to Thynne and Macartney of 5:03pm. He rejected the proposition that the words “[w]e are instructed that there has been a misunderstanding” in that email[41] were written on the basis that when the offer was sent, it was Ian’s misunderstanding that the offer in Option A was 3,006 hectares, albeit he had been led into error by Mr Dempster.[42] He stated that while he did not state that the error was his, he had in the penultimate paragraph of that email referred to Ian having “clearly identified in his most recent Affidavit material his proposed line of partition by reference to the plan” and stating, “[i]t is for that reason that our client had Mr Dyer prepare his most recent Valuation Report incorporating that proposal”.[43]
  11. [52]
    Mr Atkinson QC gave evidence.  He was direct and candid in his evidence.  He confirmed that the matters he had raised in his email to Mr de Jersey on 9 April 2019[44] arose out of a chance meeting in the street with Mr de Jersey the day prior, subsequent to which he had sought and received instructions to make an offer. He confirmed that the points he had set out in the email as to the advantages of settling the matter were, in his mind, true.[45] He was also concerned that there was a possibility that a trial judge may determine it was not economic to split Kerand at all which would negatively affect both Andrew and Ian.
  12. [53]
    He stated that the  conversation he had with Mr Dempster on the morning of 11 April 2019, in which Mr Dempster mentioned making an offer to settle, occurred in the context of Mr Dempster calling about expert evidence.[46] He said that while his recollection was that Mr Dempster talked about Option A and Option B, they did not speak about which option was which, nor refer to a number of hectares.   Mr Atkinson QC understood the offer being made accorded with the brothers being allocated land of equal value which was the position his client had always maintained and he understood that was still the position.[47]  He said that at the time he was distracted by a large mediation which was about to commence in his chambers and he did not understand the offer was going to be other than the equality option.
  13. [54]
    According to Mr Atkinson QC, he considered that identifying the right option to reflect Ian’s position on equal partitioning was a “mechanical issue”, and while he thought it was Option B, it was a matter for Mr Dempster to work out which was the correct option.[48]  He stated that it was a general conversation and he was not advising on the offer.
  14. [55]
    Mr Atkinson QC stated that if he had thought that Ian was changing his position by the offer that was going to be made such that Andrew would get land worth more than Ian, he would have stopped preparing for his mediation and said it was all wrong.[49]  He commented that in his opinion the acceptance to the offer was made very rapidly, given the offer was open for some time.
  15. [56]
    Ian also gave evidence. He states he told Mr Dempster Andrew’s offer of 10 April 2019 was unacceptable and he had to reject it. Mr Dempster raised whether he would make a counter offer and explained the cost advantages and reference was made to Mr Dyer’s report.  In paragraph 9 of his affidavit sworn on 6 June 2019, he stated “I told Mr Dempster that if I had to live with one of those options, I could live with Option B”.  In oral evidence he stated however that when he spoke to Mr Dempster, he would not have used the words “Option B”.[50]  He stated that doing so would have been unnecessary because they had a good understanding of what was meant by A and B and he would not have needed to stipulate either one, because he definitely would not have referred to Option A in advancing an offer to Andrew. He agreed that he did know what Option A and Option B were, in terms of the Dyer report.[51] His evidence was that Mr Dempster had called him on 11 April 2019 to advise that he had received an offer from Andrew which was “hardly worth consideration”.[52] Consistent with Mr Dempster’s evidence he stated he did not provide instructions to make a counter offer during that conversation, but subsequently rang Mr Dempster back and agreed to make a counter offer to protect his position on costs.   That accords with the fact that the 11 April 2019 offer was not sent until that afternoon.
  16. [57]
    His recollection of the further conversation on 11 April 2019 was that they would restate their position as to what they would accept and not say much more.  He recalled Mr Dempster saying in that conversation that they would settle in accordance with one of the options in the Dyer report, but did not recall Mr Dempster saying it would be Option A.[53] He stated that there was no need for them to debate which option it would have been because it was a given.[54] He recalled saying to Mr Dempster that he would be willing to settle on terms of Andrew receiving 3,006 hectares with an easement for Ian’s access.[55] He accepted that Mr Dempster may have referred to believing the proposal would be Option A, but it was not a matter he could recall, and that there was in any event no need for discussion at the time because there was a clear understanding of the option that would be put to Andrew.[56]  He did recall saying,[57] “[l]ook, I would be willing to settle with Andrew on those terms: 3006 hectares and the easements”.  He again reiterated that he did not recall Mr Dempster saying, “I believe that’s option A”, but accepted he could have said it, stating, “[w]ell, I would suggest, with due respect, that’s why we’re here.  Because he more than likely did say option (a) and I might not have picked up on it”.[58] 
  17. [58]
    He rejected the proposition that, if Mr Dempster had mentioned Option A, he would have said to Mr Dempster, “okay, if you say so...[t]hen make that offer to the other side”.[59] His only recollection was of the use of the figure of 3,006 hectares in the context of the conversation as to the offer. 
  18. [59]
    Ian was cross-examined about a mediation with Andrew that had taken place in 2005, through which an agreement had been reached by reference to a subdivision line suggested in a valuation report by Mr Peter Whip. That agreement divided up the disputed “West Bottle Tree paddock”, with each brother receiving 375 hectares thereof. Otherwise, Ian was to have some 3,739 hectares and Andrew some 3,222 hectares. Andrew would therefore have received approximately 3,597 hectares. Ian was at the time agreeable to that proposal. Ian accepted that Andrew would have received less under the Option A proposal than he would have received under the 2005 mediation agreement.[60]  However, he stated that subsequent to that agreement being reached, Andrew indicated that he did not wish to proceed with the agreement.
  19. [60]
    I accept Ian’s evidence. He was a straightforward, impressive witness who did not seek to embellish his evidence to his own advantage but rather was prepared to make concessions even if they did not assist his own case.

Did Ian adopt the reference to Option A?

  1. [61]
    Notwithstanding that Andrew accepts that the reference to Option A was a serious and fundamental mistake, Counsel for Andrew contend that the error made in respect of Option A was adopted by Ian and therefore was an error made by him, not his solicitor in which case the Court has no power to set aside the agreement. Particular reliance is placed upon Little v Spreadbury.[61]
  2. [62]
    In support of that contention Andrew relies that the fact that, in 2005, Ian was prepared for Andrew to receive a greater share of land than was proposed in Option A of Dyer’s report, and Ian’s statement in his affidavit of 15 December 2016 that the 2005 agreement was a “fair outcome”,[62] support the view that Ian could live with Option A.  He also relies on the fact that Ian agreed he did on occasion speak in terms of Option A and Option B and Mr Dempster’s evidence supported the fact he used them interchangeable and when he spoke to Mr Atkinson QC he stated his client’s instructions were to make an offer in terms of Option A.

I find that the reference to Option A was one made by Mr Dempster, who mistakenly believed it was the option reflecting a division under which Andrew would receive 3,006 hectares and where there was provision for an easement to Ian.

  1. [63]
    I do not find that Ian adopted or acquiesced in the  error by agreeing with or failing to correct Option A.
  2. [64]
    I find that Ian had stated his position as to the offer to be made by reference to Andrew receiving 3,006 hectares and he did not at any time connect that with Option A. While Ian was clearly aware of Option A and Option B in the Dyer report, I accept that he did not generally speak in those terms and spoke in terms of allocation of hectares consistent with the position he had adopted from the time he opposed Andrew’s application for petition in 2016. I find that he did not register that Mr Dempster may have referred to Option A, as he had clearly stated that he was prepared to make an offer on the basis of Andrew receiving 3,006 hectares with an easement in his own favour, and he did not engage any further in that regard. I find that it was likely that Mr Dempster’s comment that he believed it was Option A was made in the manner of thinking aloud, rather than seeking instructions from Ian in those terms, and that Ian would have perceived it as such. 
  3. [65]
    While Ian could not recall Mr Dempster referring to Option A, he conceded that he may well have done so and it was likely he had, given the present proceedings. While he accepted he may have missed Mr Dempster referring to Option A, he emphatically did not however accept that he had told Mr Dempster to make an offer in terms of Option A. I accept that to be the case.  I also accept his evidence that the discussion proceeded on the basis that it was the 3,006 hectares option that was to be the basis of any offer. That is supported by the reference to “Chris Dyer’s last report advance – 3,006HA” in Mr Dempster’s file note of his conversation with Ian, which I accept, as well as with the position he and Paola had previously adopted when the prospect of compromise was first raised by Mr Atkinson QC.
  4. [66]
    While I consider Mr Dempster’s evidence was sometimes confused and inconsistent, I accept Mr Dempster’s evidence that he did not consider he had instructions from Ian to make an offer in terms of Option A and that Ian had not agreed to an offer being made in terms of Option A during his discussions with him, following which he sent the letter of 11 April 2019.  The fact that Ian spoke in terms of the number of hectares to be allocated under any offer made to Andrew is consistent with Ian’s evidence and the fact that had been Ian’s position since 2016, prior to the 2019 Dyer report.
  5. [67]
    Contrary to the contention made on behalf of Andrew, I do not find that the fact that Ian did not ask to see the draft letter or have it read to him prior to it being sent constitutes some degree of acquiescence to the mistake made. Having discussed the matter with Mr Dempster and having given him instructions to make an offer, it did not fall upon Ian as the client to check that his solicitor followed his instructions. I do not consider Mr Dempster’s statement in the email of 5:03pm that he had been instructed that there had been a “misunderstanding” in relation to the letter of offer was written on the basis that it was a misunderstanding shared by both Mr Dempster and the Hochs.
  6. [68]
    I accept that at the time Mr Dempster was busy with trial preparation and no doubt other matters and perpetuated the mistake in his conversation with Mr Atkinson QC and the letter of offer, as he failed to check  the Dyer report to confirm Option A was the correct option that was to be the subject of the offer.. 
  7. [69]
    I find that Mr Atkinson QC’s recollection is more reliable than Mr Dempster’s insofar as he recalls Mr Dempster referring to Option A.   It is consistent with the error Mr Dempster made when speaking to the Hochs, by attributing the 3,006 hectare division to “Option A” rather than to “Option B”.  I accept that Mr Dempster simply does not recall those references in his discussion with Mr Atkinson QC.  That accords with the fact that the primary discussion was about experts at a time when Mr Atkinson QC was preparing for a mediation.  Further, Mr Dempster was not seeking advice from Mr Atkinson QC as to the terms of the offer, but simply updating him. The inconsistent recollections are also consistent with the lack of contemporaneous file notes.
  8. [70]
    I find however that it is likely that Mr Dempster did refer to 3,006 hectares in that conversation with Mr Atkinson QC, given that Mr Atkinson QC stated that he did not consider, which I accept, that as a result of their conversation that Ian’s position had changed from what it had always been. I accept his evidence that if he had understood otherwise he would have immediately acted and delayed his mediation to speak to Ian.  While Mr Dempster stated Ian’s instructions were to make an offer in terms of Option A and that’s what he was going to do, as I have found above, I do not find that in fact Ian instructed Mr Dempster to make an offer in terms of Option A or acquiesced in him doing so.
  9. [71]
    As to the 2005 settlement I consider that if it has any relevance it is only in determining whether the reference to Option A was something Andrew and his legal team ought to have known was a mistake. It is accepted by Andrew that the mistake was a serious and fundamental one. In any case, what occurred in 2005 is of little significance given that the agreement of 2005 did not result in a partition, as it was rejected by Andrew and Ian’s proposals from December 2016 onwards.  It did not suggest that Ian would still be prepared to agree to the 2005 resolution or a similar proposal, such as Option A. The evidence of Mr Dempster, Mr Atkinson QC and Ian was consistent with the fact that Ian was only prepared to accept a partition that accorded with Option B in April 2019.
  10. [72]
    In Little v Spreadbury, instructions were given to make an offer in accordance with a memorandum, but the litigant did not understand the terms of the offer and did not mean to adopt them, even though she seemed to assent. When the written terms were sent to her, she repudiated the offer on the basis they were not the terms which she had authorised her solicitor to accept.  Unlike the case of Little v Spreadbury,[63] I have found that the offer Mr Dempster was authorised to make was the partition by which Andrew would receive 3,006 hectares and certain easements would be granted, which generally accorded with Option B in the Dyer Report not Option A.
  11. [73]
    The present case can also be distinguished from Little v Spreadbury  insofar as the litigant in that case had stated what were acceptable settlement terms, which were then rejected by the other side. The terms of settlement were subsequently modified by her solicitor to accommodate suggestions of the other side and read to her. According to the judgment, “[s]he seemed to consent to it”.[64] It was in those circumstances that the Court found the litigant was bound in respect of a settlement agreement; her conduct had led her solicitor to believe he had authority to make a compromise in the said terms and the solicitor, believing he had authority to make the offer, proceeded to do so. Ian did not by his conduct lead Mr Dempster to believe that he was authorised to make an offer in terms of Option A, nor did Mr Dempster believe he have the authority to make an offer in those terms.
  12. [74]
    Ian had authorised Mr Dempster to make an offer, but not one in terms of Option A but by reference to Andrew receiving 3,006 hectares 
  13. [75]
    I do not find that Ian told Mr Dempster to offer Option A or that, after Mr Dempster connected Option A with the option that resulted in Andrew receiving 3,006 hectares, Ian mistakenly adopted the suggestion that the 3,006 hectare offer should be drafted by reference to Option A. I also do not find that Ian failed to correct Mr Dempster’s misapprehension because I accept that Mr Dempster had only said that he believed that it was Option A, which suggested that he would check that was in fact the case. That is a different situation than if Mr Dempster had positively asserted it was the correct Option.
  14. [76]
    Ian did not lead Mr Dempster to believe that he had agreed that an offer could be made in terms of Option A for the reasons set out above, nor did he authorise Mr Dempster to make an offer in terms of Option A. I do not find that Mr Dempster believed he had instructions to make an offer in terms of Option A. I find he knew that his instructions were to make an offer whereby the partition would result in Andrew having 3,006 hectares. It was Mr Dempster’s mistake alone  thinking that such an offer accorded with Option A,not Ian’s. In that regard it is telling that the Hochs alerted Mr Dempster to the fact that the 11 April 2019 offer had been made in mistaken terms.    

The present case falls within the category of case identified by Lord Coleridge in Little v Spreadbury in which a client would not be bound by a compromise effected by their solicitor, namely “a case where the solicitor has effected a compromise through his own admitted inadvertence or mistake to which the client has not in fact consented”.[65] The mistake was not a mistake of Ian’s nor did Ian adopt the mistake made by Mr Dempster and give instructions to settle on that erroneous basis. The Court therefore has the power to set aside the agreement. 

Ought Andrew’s son and his legal representatives to have known that the reference to Option A was a mistake?

  1. [77]
    It is uncontentious that the offer of 11 April 2019 mistakenly referred to Option A instead of Option B and this was a serious or fundamental mistake in the terms of the 11 April offer.  However, the real point of dispute is whether the agreement is vitiated by the mistake on the basis that it ought to have been apparent to Andrew and or his lawyers and that they deliberately set out to ensure that Ian did not become aware of his mistake.  If the offeree did not know and could not reasonably have known of the mistake at the time of acceptance, the offeror cannot withdraw the offer on grounds of mistake.[66]
  2. [78]
    Andrew did not know of Ian’s offer and its acceptance until after the event. His son Mitchell gave instructions to Mr Riley McDermott and Mr Marc Maskell of Thynne and Macartney on his behalf.
  3. [79]
    Counsel for Ian contended that Andrew’s  representatives were aware of the circumstances which indicated that Ian’s solicitors had made a mistake in terms of their offer, and deliberately set out to ensure the mistake was not discovered by quickly accepting the offer. At the hearing, on behalf of Ian, Mr Wilson QC clarified that the contention was that there were circumstances by which Andrew’s  representatives ought to have known that the offer provided was mistaken and they adopted a course of action which did not clarify whether there was in fact a mistake and which took advantage of the offer. The onus is on Ian to establish that Andrew’s representatives could reasonably have known of the mistake at the time of acceptance.
  4. [80]
    The circumstances particularly relied upon by Ian to show that Andrew’s representatives could reasonably have known of the mistake at the time are that:
  1. (a)
    The offer made by Ian was more generous to Andrew than the offer made by Andrew which had been rejected in the same correspondence;
  2. (b)
    The offer represented capitulation in the proceedings of which there was no prior inkling and, indeed, the evidence was to the contrary;
  3. (c)
    In an email of 9 April 2019, counsel for Ian had written to counsel for Andrew indicating that Ian would only settle on the terms outlined in Option B of the Dyer report;
  4. (d)
    At no stage in the proceeding had Ian indicated he was prepared to settle on terms that were not in accordance with Option B;
  5. (e)
    The junior practitioner acting for Andrew queried whether a mistake had been made, and counsel acting for Andrew considered the possibility of such a mistake having been made; and
  6. (f)
    The solicitors for Andrew considered that he might take some convincing because he would be suspicious about whether there was some hidden detriment to him, because the terms of the offer were so unexpected. 
  1. [81]
    The submissions made on behalf of Andrew contend that the circumstances surrounding the offer did not indicate that it had been made on a mistaken basis.  In particular, they point to the following circumstances:
  1. (a)
    Ian and Andrew had attended a mediation in 2005 to resolve their issues which resulted in an agreement being reached to the effect that the property was to be divided in accordance with a plan provided by Peter Whip of PRW Agribusiness dated 15 June 2015. That agreement would have provided Andrew with more than 3,500 hectares of property, which was more than he would have received under Option A of the Dyer report;[67]
  2. (b)
    In an affidavit filed 16 December 2016, Ian stated that he considered the mediation achieved a fair outcome, but Andrew had refused to comply with the terms of the agreement then reached;
  3. (c)
    Ian, by his counsel, had initiated the prospect of settlement a week before the trial. This was the third occasion on which the possibility of settlement had been raised with counsel for Andrew, giving the impression that Ian was keen to settle;
  4. (d)
    Settlement negotiations are often conducted in circumstances where parties play their cards close to their chests;
  5. (e)
    Senior counsel for Ian had expressed concerns to Andrew’s counsel, including that he did not consider that there was much value in pursuing the matter for either brother, that there was a risk the Court may come to the view that a split of the property would not result in the property being economically viable, and that the brothers would be left with large legal debts and an irreparable relationship;[68] 
  6. (f)
    Ian had previously asked for the hearing to be adjourned, which had been refused by Andrew;
  7. (g)
    Ian was arguably in breach of the court orders relating to trial preparation made on 26 February 2019;
  8. (h)
    Ian had failed to pay his share of the trustees’ costs;
  9. (i)
    Ian was about to incur substantial costs associated with the trial;
  10. (j)
    If Ian’s variation application were dismissed, he would likely be ordered to pay costs and there was some likelihood they would be ordered on the indemnity basis, in light of Andrew’s earlier offer;
  11. (k)
    The offer made by Ian was clear in its terms, referring to “Option A”;
  12. (l)
    The differences between Andrew’s offer and Ian’s offer were:
  1. (i)
    Andrew’s offer required Ian to immediately hand over the disputed paddocks.  In Ian’s offer, Ian would be able to continue to use the disputed paddocks that were to eventually go to Andrew up until the partition was finalised;
  2. (ii)
    Ian was offering to settle according to his expert’s report;
  3. (iii)
    If Ian’s offer were accepted, it would cause further delays to the finalisation of the partition as the trustees would need to make amendments to the documentation. This would enable Ian to continue to use the disputed paddocks for a longer period than if he had merely agreed to Andrew’s offer or even if he had offered to accept the trustees’ scheme of partition;
  1. (m)
    The difference between Ian’s offer and the agreement reached at the mediation in 2005 was that Ian would receive more land pursuant to Option A than he would have under the mediation agreement;
  2. (n)
    The offer had been prepared by Mr Dempster, an experienced solicitor who was referring to a report he and his client had obtained, and it was reasonable to assume that he would know the difference between Option A and Option B;
  3. (o)
    Mr Dempster had, through his previous correspondence and conduct, portrayed himself as a careful and thorough solicitor, and given the differences between Option A and Option B, it was unlikely he would make such a fundamental error;
  4. (p)
    Andrew had already rejected the prospect of a settlement being effected in accordance with Option B and that had been discussed with counsel for Ian on the day before Ian made his offer;
  5. (q)
    The counter offer states it is a genuine compromise and attempt to settle;
  6. (r)
    Having made a previous offer to settle in accordance with Option B, which had been rejected, it would have made no sense for Ian to make an offer in terms of Option B, and it would have been inconsistent with the above statement;
  7. (s)
    A party’s attitude towards settlement in the days leading up to trial often changes from their earlier posturing;
  8. (t)
    When Mr Atkinson QC was told by Mr Dempster on 11 April 2019 that a counter offer was to made in terms of Option A, Mr Atkinson QC had queried whether it should be Option B, to which Mr Dempster had stated, “Well those are my instructions from Ian Hoch and that is what I will be doing”;[69]
  9. (u)
    If Mr Atkinson QC was prepared to accept that Ian was willing to make an offer in terms of Option A, it follows that it was reasonable for Andrew, Mitchell and Andrew’s lawyers to do the same;
  10. (v)
    The offer appeared to be Ian making his best offer in order to settle the matter;
  11. (w)
    The offer made sense in the context of the case and an impending trial, and was more beneficial to Ian than the offer he had rejected two days earlier and the line of partition he had agreed to in the mediation agreement in 2005;
  12. (x)
    The offer required compromise on both sides.  Andrew, in accepting the offer, lost the ongoing use of the disputed paddocks for an extended period of time until the partition was effected and abandoned any claim for costs; and
  13. (y)
    The offer left the door open to the possibility of the brothers repairing their relationship.
  1. [82]
    A number of witnesses were called on behalf of Andrew.
  2. [83]
    Mitchell Hoch, who is the son of Andrew and was authorised to make decisions on Andrew’s behalf in respect of the current proceedings, gave evidence. According to Mitchell’s affidavit, his father had told him that as Mitchell would ultimately receive whatever is left as a result of the partition, Andrew wanted Mitchell to be the person who made the decision in respect of the partition proceedings.[70]  Mitchell deposed to the fact that he has never been convinced that Ian truly believed that he was entitled to be given land of the same value as Andrew.[71]  He considered that the stance taken by Ian was a negotiation tactic Ian was using in an attempt to “get a better slice of the property” as, through his own deliberate choices, he had not maximised the production potential of East Kerand.[72]  Mitchell believed that Andrew had made improvements to the land, and should receive an allotment of higher value to reflect those improvements.[73] While that clearly reflects Mitchell’s opinion it is of little significance given while it may be his personal view, Ian clearly did not accept that view and differed from Andrew as to what he considered were the appropriate land management methods and whether the methods adopted by Andrew in fact improved the land.  His opinion also has to be approached with some circumspection given he stood to benefit if his father was allocated a share of Kerand taking account of what he contended were improvements he had made to Kerand.
  3. [84]
    Mitchell Hoch participated in the meeting between his father, Bronwyn Hoch and their solicitor Mr Maskell, in which they discussed making an offer to Ian to settle out of court.  According to Mitchell, Andrew was prepared to settle if Ian withdrew the application to vary the Scheme of Partition and let the trustees get on with it.  Mitchell Hoch, however, said that he wanted additional terms included to require Ian to immediately destock the contested paddocks and remove his machinery, if he was to accept their offer.[74] After the statutory trustees’ notified the parties of their proposed scheme of partition, Andrew requested the exclusive use of the disputed paddocks from that point in time. Ian refused. The statutory trustees’ determined not to take any action to exclude Ian from the disputed paddocks until the matter was resolved by the Courts.
  4. [85]
    Mitchell stated in his affidavit that on 11 April 2019 at approximately 3:05pm, he received an email from Mr Riley McDermott, a graduate lawyer at Thynne and Macartney, which was marked “urgent”.  Mr McDermott identified in the email that the offer was based on Option A from the Dyer Report, under which Andrew would receive 3,507 hectares, which was very similar to that of the trustees’ Final Partition, with only some 27 hectares’ difference.[75] That is, Andrew would receive approximately an additional 27 hectares. Mr McDermott indicated that he would liaise with Mr de Jersey, their barrister, and suggested that they accept as soon as possible. 
  5. [86]
    Mitchell Hoch stated that shortly after receiving the email, he received a phone call from Mr McDermott, who asked him to review the offer and the Dyer Report. Mr McDermott again stated that he thought they should accept the offer, as it seemed Option A was very similar to that of the trustees’ Scheme of Partition, which was the subject of Andrew’s offer of 10 April 2019.[76] Mitchell Hoch stated he indicated to Mr McDermott that he was concerned Ian would not destock the contested paddocks upon the acceptance of the offer, as the offer contained no such term.  According to Mitchell, it occurred to him when considering the offer that both parties were well aware of the details pertaining to the mediation partition, the trustees’ Scheme of Partition and the Dyer Report.[77] 
  6. [87]
    Mitchell was not able to get into contact with Andrew and Bronwyn Hoch immediately following the conversation with Mr McDermott.  He considered, however, that Andrew would have no concerns in instructing him to accept the offer as the concern about immediate destocking had been held by Mitchell, not by Andrew.[78] 
  7. [88]
    Mitchell stated that at 3:18pm, he spoke to Mr Maskell by telephone and mentioned to Mr Maskell that, if they were to accept the offer, Ian should be instructed by the trustees to remove his cattle and machinery.[79] Mitchell recalled raising with Mr Maskell why Ian would not simply refer to the trustees' Scheme of Partition rather than the Dyer Report, to which Mr Maskell indicated that it was common for parties to rely on their own trusted experts and that there was a slight variation in terms of his offer and it could be more suitable for Ian. [80]
  8. [89]
    According to Mitchell Hoch, it occurred to him that the terms of the offer allowed Ian to continue to stock and use the contested paddocks and infrastructure until the trustees could register each lot and finalise the partition, and presumably that would be a favourable option for Ian.[81]  He also thought Ian may have been seeking to save face after he had initially rejected the trustees’ Scheme of Partition.[82] 
  9. [90]
    Mitchell stated in his affidavit that he then received another call from Mr Maskell at [3.33] stating he needed instructions to accept Ian’s 11 April 2019 offer, at which point Mitchell advised that he was in a position to formally instruct them to accept the offer.[83]  He raised the question of destocking the disputed paddocks with Mr Maskell, who advised it was an issue for the trustees to resolve.  Mitchell stated he was not told until the next day that Ian’s solicitor had notified Andrew’s solicitors that there was a mistake in terms of the settlement.[84]  He outlined the basis for his view that neither he nor Andrew ought to have known that the offer contained a mistake at paragraph 50 of his affidavit. Those matters generally reflected the circumstances relied upon by Andrew which I have outlined above.
  10. [91]
    According to Mitchell in cross-examination, those factors were written with the assistance of his solicitors.  It became plain in cross-examination that a number of the matters referred to were not matters which Mitchell was aware of at the time. For example, the circumstances included his suspicion that Ian did not want to go to trial, as he knew Ian had asked for the trial to be adjourned.  However, in cross-examination, he did not know the circumstances in which Ian had sought an adjournment and agreed it was one of the matters that the solicitors had assisted him to put into the affidavit.[85] 
  11. [92]
    In cross-examination, Mitchell Hoch stated that he understood that the offer that Ian was making, as a counter offer to his father’s offer of 10 April 2019 and after having rejected the trustees’ proposed Scheme of Partition, was one which gave his father more land, namely 29 hectares.[86]  When asked whether he found that surprising, Mitchell stated, “[a]t that point in time, not overly.  Although it was a little bit surprising – sorry – I rephrase that.  At the time I wasn’t surprised by it”.[87]
  12. [93]
    Mitchell agreed in cross-examination that he was aware that Ian’s consistent position throughout the litigation was that the land should be partitioned so that each brother received an allotment of approximately equal value.[88]  According to Mitchell, neither Mr McDermott nor Mr Maskell told him that they had considered whether the offer was a mistake or contained a mistake, nor that they had consulted with Mr de Jersey, although he knew an attempt was being made to do so.[89]
  13. [94]
    Mitchell Hoch gave evidence that he considered that the offer made by Ian would allow Ian to save face, after having rejected the trustees’ Scheme of Partition, in that it varied the terms of the offer made by Andrew which allowed the trustees’ Scheme to be carried into effect immediately.[90]  Mitchell Hoch agreed that in a period of 25 minutes he had three or four phone calls from solicitors chasing him for instructions.[91]  He was aware that the offer was open for two business days.[92]
  14. [95]
    In relation to sub-paragraph 50(g) of his affidavit, which stated that Ian had failed to pay his share of the trustees’ costs, Mitchell stated that he understood that the trustees had asked Ian on numerous occasions to pay costs and they were outstanding, but he agreed that in the letter of 11 April 2019 from Ian’s solicitor, they had been informed that Ian had paid his share of the costs.[93]  He agreed that he knew that Ian had retained experts for the trial and that he had no reason to believe Ian was not ready to go to trial.[94] 
  15. [96]
    Mitchell’s evidence was that he made the decision to accept the offer before he could speak to his father because Andrew was always happy with the trustees’ Scheme of Partition and there was only a very meagre difference between the two.[95]
  16. [97]
    Mitchell Hoch was a cautious and guarded witness insofar as he appeared to be concerned not to make any concession that could be damaging to his father’s position.  I also consider that his view of the offer made by Ian was influenced by his belief that his father was in the right, in terms of the dispute between the brothers.  That is not to suggest his evidence was not honestly given, rather that his perception of matters was influenced by his wish to ensure that he and his father’s positions were maintained, rather than being based on objective facts. As such, he was prepared to adopt matters suggested by his solicitors which he thought favoured his case even if not personally aware of them at the time the offer was accepted. He also sought to avoid making concessions that may have favoured Ian’s case, such as withdrawing his answer that he found Ian’s offer “a little surprising”.
  17. [98]
    Mr David de Jersey swore an affidavit on 17 July 2019. He stated that he had previously engaged in discussions with Mr Atkinson QC about the possibility of settlement. He stated that he was conscious that in his discussions with Mr Atkinson QC 10 April 2019 was the third occasion on which Mr Atkinson QC had raised the issue of settlement with him.[96] He stated that at that time, he was also conscious that Ian had not complied with a court-ordered deadline for the parties to agree on an index to a resolution bundle and document plan and that Andrew had sworn in an affidavit that Ian had not paid all of the trustees’ costs.[97]  On 11 April 2019, he reviewed an email from Mr McDermott attaching the offer prepared by Mr Dempster. He compared the trustees’ Scheme of Partition with Option A and noted that, in identifying Option A as the line of partition, Ian was giving up the position he had taken in the application, but with no order as to costs.   He considered that the offer should be attractive to Andrew.[98]
  18. [99]
    Mr de Jersey did consider whether the letter from Mr Dempster contained a mistake but reached the view that it did not, based on a number of considerations set out in paragraph 26 of his affidavit.  He informed Mr McDermott that the offer surprised him and that it was in Andrew’s interests to accept it.[99]  He told Mr McDermott that he had wondered whether the offer contained a mistake but decided it did not, providing him with the reasons set out in paragraph 29 of his affidavit.  When notified of the advice that the offer had been made based on a misunderstanding, Mr de Jersey advised Mr Maskell and Mr McDermott that they should write back as soon as possible stating that the offer was accepted and the proceeding was settled.[100]  He stated that if they had made a mistake, that was unfortunate, but it was a matter for Ian and his solicitors to sort out between themselves. 
  19. [100]
    In cross-examination, Mr de Jersey agreed that between December 2016 and April 2019,  the two brothers had taken quite polarised positions.[101]  He further agreed that neither of them had shown any intention of moving from their respective positions.[102] Mr de Jersey agreed that Option A in the Dyer Report was very close to the trustees’ proposed Scheme of Partition.[103] He also agreed that as at 8 April, and even continuing into 9 and 10 April, nothing had occurred or been communicated to him to suggest that Ian was not steadfast in his position as far as the litigation was concerned.[104] 
  20. [101]
    Mr de Jersey stated that while he did consider contacting Mr Atkinson QC or having his solicitor contact Mr Dempster to ascertain whether there was a mistake in the offer that had been sent on 11 April 2019, he elected not to take that course, having gone through the thought process set out in his affidavit and being satisfied no mistake had occurred.[105]  He stated that he did not suggest that Mr McDermott contact or have the partner at his firm contact Mr Dempster, because he had formed the view that it was not a mistake.[106] 
  21. [102]
    Mr de Jersey did not consider that Mr Dempster would make a mistake so stark as to refer to Option A, rather than Option B, because of his view that Mr Dempster was a careful solicitor.[107] He accepted that his view was based on his observations in this case and that he had not ever been briefed by Mr Dempster, nor dealt with him in any case other than the present.[108] As such, only limited weight can be attached to that opinion, albeit genuinely held. Mr de Jersey agreed that while certain directions of the Resolution Registrar had not been complied with, a draft list of issues had been settled between himself and Mr Atkinson QC[109] and the only direction in respect of which compliance was outstanding was the provision of a bundle of documents and index thereto.[110] He agreed that as at 11 April, there was nothing to suggest that Ian was not ready to proceed to trial.[111]  He was also aware that Ian disputed that he had not paid the trustees’ costs given the statement to that effect in Ian’s 11 April 2019 offer.
  22. [103]
    Mr de Jersey stated the matters supporting his view that Ian had capitulated by the terms of the offer and that “the wheels might have finally come off” Ian’s case were Ian’s non-compliance with case management directions, the failure to pay the trustees’ costs and his previous experiences as counsel where, despite expectations, people sometimes capitulate on the brink of trial. He stated that was his view despite the fact that he had assumed as at 8 April 2019 that Ian would not compromise.[112] 
  23. [104]
    Mr de Jersey was a careful and considered witness and I accept his evidence.
  24. [105]
    Mr McDermott, who was a law graduate working for Thynne and Macartney in 2019, also gave evidence. He had undertaken work for Andrew under Mr Maskell’s supervision.  He agreed that the positions of the Hoch brothers had remained polarised from December 2016 until at least 11 April 2019.[113]  He further agreed that each party had steadfastly stuck to the same position over a period of more than two years.[114]  He outlined in [38] of his affidavit the reasons for his rejection of the suggestion that he ought to have known that there was a mistake in the offer, although when he first opened the offer, it crossed his mind that Ian had made an error.[115] 
  25. [106]
    In cross-examination, Mr McDermott agreed that he was aware that in the 11 April 2019 offer, Ian’s side contended that Ian did not owe any money to the trustees.[116]  He also agreed that Thynne and Macartney had not written a letter under rule 444 of the Uniform Civil Procedure Rules 1999 (Qld) in regards to the outstanding bundle of documents, as it had done in relation to other orders made by the Resolution Registrar which had not been complied with.[117]  He stated that the offer contained in the letter sent by Ian’s solicitor on 11 April was materially different from the trustees’ Scheme of Partition with respect to the immediate use of the disputed paddocks.[118]  He accepted that Option A in the Dyer report was virtually identical to the trustees’ proposal, save that it gave Andrew an additional 29 hectares of land.[119] 
  26. [107]
    Mr McDermott said that the 11 April offer did strike him as strange at the time and that although he did not think there had been a mistake, he had “wondered if there was a mistake”.[120] He stated that he asked Mr Maskell, “Do you think they might have made a mistake?”[121] He and Mr Maskell discussed whether there had been a mistake for a couple of minutes and Mr Maskell expressed the view that he did not think another lawyer could make a mistake such as referring to the wrong option.[122]  Mr McDermott stated that they did not consider that contact should be made with Mr Dempster to clarify whether or not there had been a mistake because he and Mr Maskell did not consider there was a mistake after discussing it.[123]
  27. [108]
    Mr McDermott did not accept that the offer of 11 April 2019 was a complete capitulation by Ian, because it may have enabled him to continue to use the disputed paddocks and because Andrew’s side considered that they were likely to get a costs order in their favour.[124]  He agreed that, from the perspective of the other side, Ian had made an offer which on its face was a complete capitulation.[125]  He stated he thought Ian was making his best offer to settle the matter because he was accepting the trustees’ Scheme of Partition and giving Andrew 29 hectares more.[126] 
  28. [109]
    Mr McDermott set out the matters said to have informed his conclusion that there was not a mistake at paragraph 38 of his affidavit. One of the matters which Mr McDermott pointed to was that he thought it was a good offer, because Ian might have been struggling to prepare for trial and the “wheels might have fallen off” Ian’s case or his evidence.[127] In that regard, Mr McDermott referred to Ian requesting an adjournment of the hearing of the variation application on 19 March 2019 and the failure of his side to deliver the resolution bundle or trial plan as required by the Resolution Registrar.  Although not identified in his affidavit, he stated that his view about Ian’s case or evidence was also based upon a conversation with Mr de Jersey.[128] He did accept, however, that Ian had:
  1. (a)
    Prepared expert evidence that he was going to rely on at trial;[129]
  1. (b)
    Retained Queen’s Counsel to represent him;[130]
  2. (c)
    Issued a subpoena to the accountant for Andrew;[131] and
  3. (d)
    Sent an email at 3:32pm issuing a notice requiring each of the witnesses called on behalf of Andrew for cross examination.[132]
  1. [110]
    Mr McDermott still, however, stated notwithstanding those matters he believed there were a number of matters indicating that Ian was not ready for trial.  Mr McDermott agreed that Ian made the request for adjournment after it was suggested that Mr Cavanagh was not going to be available to give evidence at the time of the trial, who he accepted was an important witness.[133]  He accepted that an email was then circulated on 20 March 2019 which confirmed that Mr Cavanagh was going to be available for the trial,[134] and that the prospect of the trial being adjourned was no longer an issue from 20 March 2019.[135]  He still considered it was relevant on 11 April 2019 because there had been discussion at the time that Ian had not gone to the effort of seeing that Mr Cavanagh was available for the trial. He further stated that he did not believe that Andrew’s accountant had been provided with funds at the time that he was provided with a subpoena for the purposes of attending trial.[136]
  2. [111]
    While Mr McDermott’s views were not expressed from the voice of experience he was for such a young practitioner an impressive thoughtful witness.
  3. [112]
    Mr Marc Maskell is a partner at Thynne and Macartney who was supervising and conducting the litigation on behalf of Andrew. This included acting on Andrew’s behalf in respect of the appointment of statutory trustees in December 2016, with assistance from Mr McDermott in recent times.[137] Mr Maskell provided a lengthy affidavit setting out his thought processed in relation to this matter at particular points leading up to the acceptance of the offer. He agreed that, following the order of Justice Mullins on 16 December 2016, the position of Andrew was that the partition should provide him with a parcel of land of greater value, to reflect improvements he had made to the land at West Kerand, while Ian’s position was that the two brothers should be allocated parcels of approximately equal value.[138] He stated that, in addition to the partition dispute, there was some dispute about access to yards and tanks and the necessary infrastructure to maintain the ongoing cattle operation.[139]  There were also considerations around the minimum requirements imposed by local authorities to allow a partition of that nature.[140]  He agreed that Ian had not deviated from his position in correspondence between the two firms after the end of 2016.[141] 
  4. [113]
    Mr Maskell contended that the offer of 10 April 2019 was made by Andrew to try to settle the matter and not just for the purpose of costs protection, given that they were robust in their view about Andrew’s prospects of upholding the partition that had been proposed by the statutory trustees at trial. They had hoped that Ian would see the sense in what was proposed.[142]  At the time the offer was sent, Mr Maskell had seen the email from Mr Atkinson QC to Mr de Jersey, which stated that Mr Atkinson QC could only see the matter resolving in accordance with “Option B” in the Dyer Report, although he had no particular recollection of the email.[143] 
  5. [114]
    Mr Maskell considered that Ian’s non-compliance with trial directions for the delivery of a trial plan and/or trial bundle, and the fact that Andrew’s accountant had contacted him to say he had been served with a subpoena with no conduct or witness expense money, were signs that “there was a fair bit of catch up happening on Ian’s side” and they were not overly prepared to proceed with the trial.[144]  He said that he had discussed the possibility there had been a mistake with Mr McDermott in the context of “pressure testing the offer”.[145]  He stated the offer was a little bit unusual in that it referred to Christopher Dyer’s report, not Tim Cavanagh’s report.  The offer therefore required, he stated, a side by side comparison between the relevant map in the Tim Cavanagh report and the relevant map in the Dyer report.[146]
  6. [115]
    Mr Maskell stated that there was nothing in the 11 April 2019 offer that made him think that there had actually been a mistake in the content of the communications from Ian’s solicitors.[147]  His recollection was that he found the offer to be straightforward.  His affidavit set out his approach in assessing the offer which accorded with his usual practice, which implicitly included assessing whether there was any mistake.  He concluded that was not the case. 
  7. [116]
    Mr Maskell considered that it made sense for Ian to make an offer in terms of the Dyer report, rather than simply withdrawing his variation application. Adopting the latter course could result in the trustees immediately enforcing the trustees’ Scheme of Partition and directing Ian to immediately remove his cattle from the disputed paddocks, while the Dyer report would require further consideration and amendment to the trustees’ subdivision application, with the trustees likely to maintain the status quo and allow Ian to keep possession in the interim.[148] He did not see anything incomplete in the terms of the offer. He noted it deviated from the offer Andrew had provided to Ian’s solicitors by not giving Andrew immediate possession of land.[149]   He considered that the offer would not be entirely satisfactory to Andrew and Mitchell Hoch, but thought it should be recommended as a sensible middle ground to save further legal costs and avoid the additional animosity with Ian that might result from the trial.[150]   In his assessment, the offer provided Andrew with critical infrastructure for his ongoing cattle operation. Mr Maskell stated he asked Mr McDermott to prepare a draft letter accepting Ian’s offer in anticipation of the instructions he thought he would obtain, and to then to prepare a letter for all witnesses telling them to “down tools”.[151]  All of this took place before he received the notice from Ian’s solicitors that the offer contained a mistake.[152]
  8. [117]
    Mr Maskell produced telephone attendance notes in respect of several relevant conversations. At 3:18pm, he discussed the offer with Mitchell Hoch, who expressed his desire for Ian to vacate the bottle tree paddocks immediately. Mr Maskell responded that that would be a matter for the trustees to consider after acceptance.  Mr Maskell advised that acceptance would avoid the trial and costs, noting that witnesses were booking flights and accommodation.  He told Mitchell to contact Andrew and advise Andrew that he could avoid a trial and the witness box.  At 3:33pm, he made a further call to Mitchell Hoch, in which he stated that he needed instructions with respect to the offer.  Mitchell Hoch stated they were worried that Ian would not remove his gear and cattle.  Mr Maskell pointed out that the Court would not decide that issue as part of the variation application, and Mitchell Hoch then indicated that he should go ahead and accept Ian’s offer.  At 3:36pm, a letter was sent to Ian’s solicitor advising him that the offer was accepted and at 3:37pm, an email was sent to Mr de Jersey confirming that settlement had occurred.[153] 
  9. [118]
    Mr Maskell also did not think the offer was unusual, given his experience of litigation. He had seen clients with strong prospects crumble at the steps of the Court at the prospect of additional stress or costs and business interruption, even after years of robust litigation.[154] He noted that while the partition was not perfect from Andrew’s point of view, and Andrew had felt somewhat aggrieved by the trustees’ proposed Scheme of Partition because it gave Ian a greater amount of land, the proceedings dragging out further would be to the benefit of Ian because it would give him the use of the disputed lands, and the trustees had taken some two years to deliver the partition at considerable expense.[155] Given that Ian carried the burden of persuading the Court to interfere with the trustees’ partition, he felt that Andrew had better prospects.[156] He considered that Andrew was confident that they would be successful and Mitchell was even more so.[157] He thought that the offer indicated that Ian had come to his senses.[158]  He also placed some reliance on the fact that Ian had previously requested a delay of the trial and not complied with some court directions.[159] Mr Maskell rightly identified that Mr de Jersey’s comment that the “wheels might be falling off for Ian”, relayed to him by Mr McDermott, was not a matter in which he would put much stock.[160]
  10. [119]
    Mr Maskell stated that if he had been aware of any mistake that would have come close to activating rule 30 of the Australian Solicitors Conduct Rules 2012, he would have sought advice from a Queensland Law Society ethics advisor, but there was no such mistake as far as he knew or could have been aware.
  11. [120]
    Mr Maskell did not know, or at least did not recollect, that the offer made under Option A of the Dyer Report provided 29 hectares more to Andrew than the trustees’ Scheme of Partition.[161]   He also had thought the letter of offer from Ian’s solicitor was two to three lines, but accepted once he saw the letter of 11 April that it was more detailed than that.  Mr Maskell stated that at the time the offer was made, he had assumed that Option A in the Dyer Report was the same as under the trustees’ Scheme of Partition.[162] He considered that the reference to Option A of the Dyer Report was included to avoid accepting the trustees’ Scheme of Partition and delay the partition being put into place, as the trustees had made it clear to Andrew’s solicitors that they would not exercise their discretion to ask Ian to remove cattle from the disputed paddocks unless he clearly accepted their partition.[163]  He agreed that both offers from Andrew and Ian agreed to bear their own costs.  Therefore, the only point of difference between the two offers was how long Ian could spend on the disputed paddocks.[164]  His view was that the offer was not surprising because he considered that Ian was desperate to stay on the disputed lands for as long as he could.[165]  He did not regard the offer as a capitulation, but rather a realisation of the week coming. He assumed that Ian would have been in Brisbane and received sobering advice from his counsel. 
  12. [121]
    He did not recall Mr McDermott telling him that he had discussed the possibility that the offer had contained a mistake with Mr de Jersey.  He did recollect Mr McDermott reporting to him the comment by Mr de Jersey that the wheels had fallen off Ian’s case.[166] He thought that comment accorded with the fact that Andrew was seeking to uphold a determination reached by the statutory trustees, which he considered the court would be more reluctant to set aside, and that the costs of the three day trial would exceed the value of land that was actually in dispute.[167]  He had nothing to say about the email sent by Ian’s solicitors at 2:41pm on 11 April 2019, after Ian’s offer had been sent and very shortly before it was accepted by Andrew, which put the other side on notice that their witnesses would be required for cross-examination.[168] 
  13. [122]
    Mr Maskell agreed that the factors which he had taken into account in considering Ian’s affidavit were set out in paragraph 40 of his affidavit.  A significant factor in Mr Maskell’s assessment of Ian’s offer was the fact that he considered Andrew was in the stronger position by accepting the proposed partition of the trustees, whereas Ian was seeking to dispute that partition and bore the onus.
  14. [123]
    While Mr Maskell considered what the “wheels might be falling off for Ian” as suggested by Mr de Jersey, he agreed that Ian’s non-compliance with the court directions was not a big deal and that they could deal with it.[169]  He agreed that his reference to Ian trying to delay the trial referred to the possibility that Mr Cavanagh may not be available to give evidence. Mr Maskell accepted that issue was raised on 19 March 2019 and Mr Cavanagh did end up being available, although he did not recollect that the issue had been resolved by 20 March 2019 as a result of enquiries made by Ian’s solicitors.[170]  He considered that an exchange of emails[171] about Mr Cavanagh’s appearance supported his view that Ian was trying to delay the trial.  He considered that if they had not pushed back in that exchange and insisted that further enquiry be made of Holding Redlich, Ian’s solicitors would have made no effort to prevent the delay of the trial.[172]
  15. [124]
    While it may have been true that Ian’s solicitors needed prompting from Thynne and Macartney to take the issue further, the correspondence indicates the issue was quickly resolved, largely at the instigation of Ian’s solicitors.  Little significance could be attributed to the reference in correspondence to vacating the trial, given that the matter was resolved within 24 hours and any delay was based upon the unavailability of a witness who was not being called by Ian’s solicitors.
  16. [125]
    Mr Maskell accepted that it would have been appropriate and good practice, if it had been apparent that there was a mistake in the letter from Ian’s solicitors, to ring Mr Dempster to clarify the matter, but he did not consider there was such an issue.[173] 
  17. [126]
    Both Mr McDermott and Mr Maskell were candid in the evidence given.  Understandably, Mr McDermott and Mr Maskell’s perspectives were in some respects influenced  by the fact that they had been acting for Andrew and felt he had strong prospects. That is, what they considered were significant or insignificant matters in assessing the offer was naturally affected by their close involvement in the case. Mr Maskell was also influenced by the way he clearly conducts his own practice. In particular, in the cut and thrust of litigation, the fact that money had not been provided for a subpoena served to a witness on 9 April 2019, the index to the trial bundle being overdue by only one to two days and the proposed adjournment of the trial in March 2019, which was resolved within 24 hours, were matters to which he and Mr McDermott attached some significance in terms of whether Ian was ready to proceed to trial.  Given that the affidavit evidence, expert reports and lists of issues had been exchanged, they were objectively circumstances to which little importance could be attached in considering the offer, even though subjectively they considered them to be of some importance.

Consideration

  1. [127]
    In reality, the position as to the significance of factors surrounding the making of the 11 April 2019 offer is not as clear cut as either party would submit.  There were some circumstances which could have suggested that the offer was made on a mistaken basis and which indeed caused Mr de Jersey and Mr McDermott to consider whether that was the case.  Similarly, there were circumstances which existed at the time that could explain the terms of the offer and that it was the offer intended to be made, rather than being the result of a mistake.  A number of the circumstances relied upon by Ian are circumstances which indicated that there was reason for Ian to attempt to settle the matter, rather than necessarily supporting the fact that the offer was not made on a mistaken basis.
  2. [128]
    Other considerations relevant at the time do weigh against it being apparent to Mitchell Hoch and Andrew’s legal representatives that a mistake had been made.  As pointed out by Mr de Jersey, Mr McDermott and Mr Maskell, it is not uncommon for parties to rethink the wisdom of proceeding to trial when on the brink of a trial. The parties will often, at that stage, have had the benefit of focussed legal advice with legal representatives having the benefit of the evidence exposed for the pending trial.  By that stage the parties have come to appreciate the costs and interruption in their lives which will occur during a trial.    Armed with knowing what to expect from the trial process and under the pressure of a pending trial it is not unusual for parties to make offers to resolve it.  They were clearly relevant considerations in assessing the circumstances surrounding the offer.  However, they must be weighed against the fact that Ian had not suggested at any point prior to the offer being made that his position could change, and the case was generally ready to proceed to trial.  The offer indicated a change in Ian’s position that caused Mr McDermott and Mr De Jersey to at least consider whether the offer had been made in error.
  3. [129]
    Further, at least from Mitchell Hoch’s perspectives, Ian not immediately vacating the disputed paddocks upon resolution of the matter was a matter of significance, of which his solicitors were aware. That is supported by the request that was made to the statutory trustees to have Ian vacate the disputed paddocks upon provision of the partition they considered appropriate, well prior to the events giving rise to the present dispute. The fact that Andrew’s position was adopting the partition proposed by the trustees could reasonably have given them some additional confidence in the strength of their case. However, whether or not that confidence was well-founded would depend on what the Court considered was the proper approach in determining how the property should be divided and whether that had been adopted by statutory trustees or the expert upon which they relied. Some of the circumstances relied upon by Andrew’s representatives had little weight by the time the 11 April 2019 offer was being considered.
  4. [130]
    While the failure by Ian to pay the trustees’ costs may have suggested difficulties in financing the litigation, that was a matter of little significance given that at the time the offer was made, Ian had responded to the allegation that he had failed to pay his share of the trustees’ costs. His letter of offer stated that those costs had been paid and no evidence to the contrary was presented in this proceeding.  Further, the fact that there was a breach of the court orders relating to trial preparation insofar as the trial bundle had not been prepared was not of great significance, given the matters that had been completed.
  5. [131]
    I do not accept that Ian having previously asked for the hearing to be adjourned was a matter of great significance, given that request was made in the context of Mr Cavanagh potentially not being available for the hearing. If anything it is more consistent with Mr Dempster not being as organised as he perhaps should have been.  The matter had in any event been resolved by 20 March 2019. I consider that Mitchell Hoch and Andrew’s legal teams accorded that fact unjustified significance in the context of the offer being made.
  6. [132]
    In my view the fact that Ian’s offer which had rejected Andrew’s offer to compromise based on the statutory trustee’s proposed partition in fact increased the amount Andrew would receive, albeit by only 29 hectares, did raise and objectively would raise the prospect of a mistake having been made. It was made by Ian in stark contrast to the position he had adopted throughout the litigation, a matter that was accepted by all of Andrew’s representatives. However its significance must be weighed against a number of other factors.
  7. [133]
    The offer was in clear and unequivocal terms and did provide some advantage to Ian by protecting him to some extent from costs orders. While it gave Andrew an extra 29 hectares compared with what he would have received under the trustees’ proposed Scheme of Partition, Ian would have been able to continue to use the disputed paddocks until the partition was finalised, as opposed to the offer made by Andrew. Given the history of the matter that was clearly a matter of importance to both brothers in respect of their grazing business.
  8. [134]
    That, of course, would come at a cost since under Ian’s offer, the parties were to continue  to pay 50 percent of the trustees’ costs until finalisation of the varied Scheme of Partition.  Making an offer in terms of Option A of the Dyer report not only gave Andrew more land than he would have received under the trustees’ Scheme of Partition, but would also result in incurring additional costs for variation of the Scheme of Partition with no potential benefit to Ian, other than additional time in which to use the disputed paddocks.  That could have been addressed by including a term that the status quo was to be maintained until the partition was effected.  Given the costs were to be shared between Andrew and Ian and the work needed to be carried out to adjust the statutory trustees’ proposed scheme of partition was relatively minor, I do regard the fact that Ian would likely have maintained the use of the disputed paddocks given the statutory trustees’ previous attitude to be a significant circumstance that weighed against Ian’s offer being a mistake.
  9. [135]
    Notwithstanding the agreement that had been reached between Ian and Andrew in 2005, which Ian had stated he thought provided a fair outcome, Ian had from the time of the application for partition consistently taken the position that the property should be divided on the basis of each brother receiving portions of equal value.  As I have stated above, the parties had moved well beyond the 2005 mediation. The fact that Ian was prepared to agree to a partition which gave Andrew more land than under Option A in 2005 is not a circumstance which I consider could or should have objectively carried any weight in the assessment of the offer made.  The reference to the mediation agreement in Ian’s affidavit of December 2016 was made in the context of him responding to a suggestion that he was not prepared to voluntarily partition Kerand on fair terms.  It is a matter which was objectively of little relevance but which was given exaggerated significance by some witnesses called on behalf of Andrew and in submissions.
  10. [136]
    A matter which I do consider objectively of some significance is the context in which the offer was made. Settlement negotiations opening up between counsel is not an unusual occurrence in litigation, and in particular, in the present case Mr Atkinson QC had identified the reasons he thought a settlement was a better outcome for the brothers.  However, Mr Atkinson QC made clear in his email to Mr de Jersey on 9 April 2019 that he considered that Ian would only settle on the terms outlined in Option B of the Dyer Report, as well as highlighting matters which he considered supported his client’s position.  The fact that Mr Atkinson QC had raised the prospect of settlement and had pursued it with Mr de Jersey objectively could raise an expectation in Andrew’s team that Ian was willing to compromise and that Ian may have held some reservations as to the potential outcome of the proceedings, rather than that the offer was made in error.
  11. [137]
    The incongruity of the offer with Ian’s previous position is evident from the fact that Mr de Jersey considered the possibility of whether a mistake had been made and the junior practitioner acting on behalf of Andrew queried whether a mistake had been made. However, objectively it could also properly be seen as a party who previously was perceived to have an intransigent position being faced with the prospect of a trial and the risks that are commensurate with it making a decision to avoid the risk of possibly being unsuccessful and being liable for costs. 
  12. [138]
    It is submitted on behalf of Andrew that the fact that Mr Atkinson QC did not cavil further with Mr Dempster stating he would be making an offer in terms of Option A supports the contention that it was reasonable for Andrew, Mitchell and Andrew’s lawyers to do the same.  I do not accept that submission as it does not accurately reflect the evidence.  Rather, on the basis of Mr Atkinson QC’s evidence, which I accept, he was involved in a substantial mediation on that day and had assumed that Mr Dempster was correctly nominating Option A as being the option which related to a partition in equal proportions and regarded the mechanics of determining the right option as a matter for his solicitor.  Mr Atkinson QC stated that the whole case had been run on that basis and, had the offer been one which deviated from that position and effectively adopted the trustees’ Scheme of Partition, he would have stopped or delayed the mediation and spoken to his client about it. I accept that evidence. 
  13. [139]
    The present is not a case where it is suggested that Andrew, Mitchell or Andrew’s legal representatives knew that Ian had entered into the agreement under a serious mistake as to the content of a fundamental term.  Rather, it is suggested that the circumstances were such that they ought reasonably to have known it.  The question therefore is whether Mitchell and Andrew’s legal representatives were aware that circumstances existed which indicated that Ian was entering the contract under some serious mistake or apprehension about the content of the offer in its reference to Option A.[174] The question is a finely balanced one. It must be borne in mind that the onus is upon Ian to persuade the Court that, on the balance of probabilities, the circumstances surrounding the offer were such that it reasonably ought to have been known by Andrew through Mitchell or his legal team that the offer contained a serious mistake.
  14. [140]
    The fact that Ian made an offer that was contrary to the position he had previously adopted in litigation would not of itself be sufficient to suggest that Mitchell or Andrew’s lawyers were aware that indicated Ian was entering the contract under a serious mistake or apprehension.  However, the fact that Ian made an offer which was, in effect, a “capitulation” and which gave Andrew 29 more hectares of land than had been assigned to Andrew in his own offer, which Ian was rejecting, are circumstances which could objectively have suggested that Ian was entering the contract under a serious mistake or apprehension, unless they could be explained by other circumstances. 
  15. [141]
    The circumstances which run counter to that are that the offer was made by Ian’s solicitors in clear terms and said to be a genuine offer to compromise, which would be relied upon as a Calderbank offer, and was made in circumstances where the pressure of the pending trial was increasing.  There had been some build up to the offer being made through the discussions between Mr De Jersey and Mr Atkinson QC, where the possibility of a bad outcome with the Court not agreeing to a division of the property at all had been raised. Further Ian did obtain some benefit from the offer insofar as it likely gave him extra time to use and clear the disputed paddocks without the risk of being liable for Andrew’s costs. Given the dispute involved two brothers the fact that reference to the Dyer report may have been regarded as face saving by Ian was not unreasonable.
  16. [142]
    Further, I accept that  the question of whether a mistake had occurred was carefully considered by  Andrew’s counsel, as well as being a  matter that was discussed between the junior practitioner and partner acting on Andrew’s behalf. The urgency with which Andrew’s representatives acted to get instructions to accept the offer, even though the offer was open for longer, is also explicable by the pending trial. It was also reasonable for Andrew’s legal representatives to assume that Mr Dempster who had been acting in the matter for considerable time would have been familiar with the different options and careful to identify the correct one. While I have not accepted all  of the circumstances  identified by the Andrew’s legal representatives were a matter of any significance, I consider that the pressure of the litigation in light of the pending trial and the motivation to strike while the iron was hot before Ian could change his mind and stop further costs being incurred where a benefit could be identified to Ian in the term of the offer weighed heavily against those circumstances which indicated that the offer was made under a serious mistake or misapprehension. So too does the fact that the question of whether a mistake had occurred was considered carefully, albeit in pressured circumstances, by Andrew’s counsel and the junior practitioner and discussed between the junior practitioner and the partner acting on behalf of Andrew.  While it is a matter that is finely balanced, I am unpersuaded that a reasonable person in the position of Andrew’s lawyers or Mitchell ought to have known of the mistake at the time of acceptance.  It is therefore unnecessary to consider the question of whether Andrew’s representatives deliberately set out to ensure Ian did not become aware of the mistake.

Should the court refuse to enforce the compromise?

  1. [143]
    Paragraph 4 of the offer of 11 April 2019 included a provision that the offer was “subject to and conditional upon the making of orders in the terms of this offer, by consent of the parties, by the Supreme Court of Queensland”.[175]  The proceedings were not to be discontinued until all required plans for the partition were registered. 
  2. [144]
    Counsel for Ian submits that the Court, if satisfied that a party has acted upon a mistake in making a compromise, ought not to exercise its discretion to enforce that compromise.  I have found above that Ian did not adopt or acquiesce in the 11 April 2019 offer being made in error, therefore rejecting Andrew’s contention that the Court was excluded from having any power to set the agreement aside.
  3. [145]
    The respondent places particular  reliance on Harvey v Phillips,[176]  in which the High Court found that the discretion to set aside a compromise was not enlivened because it was not a case of misapprehension or mistake made by counsel in consenting to an order or settlement. Rather, the plaintiff had indicated to her counsel and solicitors that she would accept the offer, albeit under pressure from her advisers, including her counsel. Ian’s counsel places particular reliance upon the following dicta of the plurality:[177]

“It is not a case where a compromise has been agreed upon by counsel acting only in pursuance of his apparent or implied authority from his client but, owing to a mistake or misapprehension, in opposition to his client's instructions or in excess of some limitation that has been expressly placed on his authority. In such a case, at all events until the judgment or order embodying the compromise has been perfected, an authority exists in the court to refuse to give effect to or act upon the compromise and perhaps to set it aside…”

  1. [146]
    The plurality continued that in such a case:[178]

“…if in fact counsel has had his authority withdrawn or restricted the Courts will not feel bound to enforce a compromise made by him contrary to the restriction, even though the lack of actual authority is not known to the other party.”

  1. [147]
    Harvey v Phillips has been followed in this Court.  In Insbury Pty Ltd v Craig,[179] Byrne J noted that a solicitor’s consent to a compromise was both inconsistent with his limited authority and the result of his misunderstanding of the ambit of a clause of a proposed guarantee.  His Honour found the solicitor for the other side contributed to that misunderstanding.  Citing Harvey v Phillips,[180] he stated:[181]

“In such circumstances, where no judgment or order embodying the compromise has been perfected, ‘an authority exists in the court to refuse to give effect to or act upon the compromise and perhaps to set it aside … The power of the courts is to be exercised as a matter of discretion when in the circumstances of the case to allow the compromise to stand would involve injustice …’”

  1. [148]
    In that regard, his Honour noted there are cases where the Court has refused its assistance to enforce a compromise where, unbeknownst to the other side, one party’s legal advice is mistaken as to its effect.[182]  His Honour declined to enforce the compromise. 
  2. [149]
    It is a power however which the Court should only exercise in limited circumstances.
  3. [150]
    In the more recent case of Broadbent v Medical Board of Queensland,[183] Fraser JA considered the principles in Harvey v Phillips in the context of a compromise of an appeal. An offer to settle an appeal had been made on the applicant’s instructions, but the applicant subsequently communicated to his solicitor that he was withdrawing the instructions on Friday, 8 October 2010.  His solicitor responded and indicated he was unavailable that day and all weekend.  The respondent’s solicitors emailed the applicant’s counsel at 9:03am on Monday, 11 October 2010 and accepted the applicant’s offer.  The applicant sent a letter that afternoon to the respondent’s solicitors denying that there was a compromise and advising that he had withdrawn his instructions for the offer to compromise on the Friday.  Fraser JA noted that on the evidence it was reasonable for the applicant to assume that his solicitor would do what was necessary to act upon his instructions that he did not wish to compromise his proposed appeal.  His Honour stated that it was clear that the compromise was made in defiance of the applicant’s instructions.[184]
  4. [151]
    His Honour noted there was limited guidance as to when the Court should exercise the power, and in that regard referred to statements in Halsbury’s Laws of England[185] derived from Neale v Gordon Lennox,[186] namely that:[187]

“When, in the particular circumstances of the case, grave injustice would be done by allowing the compromise to stand, the compromise may be set aside, even though the limitation of counsel’s authority was unknown to the other side.”

  1. [152]
    Fraser JA stated that the discretion to set aside a compromise should be exercised with caution and only where it is clearly demanded by the interests of justice.  In particular, he noted that “a party to litigation should be able to rely upon the apparent authority of the opposite party’s lawyers to compromise the litigation, within the well-known limits of apparent authority”.[188]  His Honour particularly alluded to the fact that if the courts were too ready to set aside compromises, the important aim of promoting settlement of litigation would be hindered, and resources wasted, on investigating disputes which probably ought to be confined between lawyers and clients who, unlike the opposite party, should readily be able to prove whether or not a particular compromise reflected the client’s instructions.[189]  Thus, while a compromise of litigation which is contrary to the client’s instructions might be regarded as always involving an injustice, that fact is not necessarily sufficient for the court to exercise its discretion to set aside the compromise.[190] 
  2. [153]
    In Broadbent, the Court did consider that it was appropriate not to enforce the compromise, given the potentially serious consequential damage to the applicant’s reputation, which could not effectively be remedied by leaving him free to pursue any damages claim he might have against his solicitors for failing to give effect to his instructions.  Fraser JA found it was also “very relevant that the applicant repudiated the compromise within hours of it being concluded and virtually immediately upon becoming aware that it bound him”.[191]  The respondent did not argue that it had changed its position in reliance upon the compromise or that it would suffer any injustice other than the loss of the compromise, if the Court resolved not to enforce it.[192] Both parties were ready to argue the application for leave on the day it was set down for hearing.  His Honour found:[193]

“Taken together, these considerations demonstrate that the applicant will be the victim of a serious injustice if he is denied the opportunity of having his application for leave to appeal considered by this Court.”

  1. [154]
    Fraser JA did not think it was appropriate, in reaching that conclusion, to take into account his view that there was no merit in the application for leave to appeal.[194]  His Honour noted that if the Court did so, the applicant would be afforded the inconsistent benefits of the compromise and the hearing of the application.[195] 
  2. [155]
    Andrew contends that the Court should not exercise its discretion as Ian has not established that a “great injustice” will be done by allowing the compromise to stand because, in summary:[196]
  1. (a)
    He failed to correct Mr Dempster’s misapprehension;
  1. (b)
    He did not peruse the offer before it was sent;
  2. (c)
    The compromise that had been reached was consistent with an agreement made between the parties in 2005;
  3. (d)
    Any loss that Ian may have suffered is a loss that he can pursue against Mr Dempster for the error that was made. 
  1. [156]
    As I have discussed above I do not consider that Ian was responsible for the mistake in the 11 April 2019 offer in terms of the matters raised in subparagraphs (a) and (b) nor do I regard the matter in (c) of any relevance.
  2. [157]
    I have  found above that I do not consider that Ian was responsible for the error by  failing to correct Mr Dempster’s misapprehension.  I accept Ian’s evidence that he did not appreciate that Mr Dempster had identified Option A.  Further, according to Mr Dempster’s evidence, which I have accepted he had said, “I believe it is Option A”, rather than positively asserting that that was definitely the case.  As I have found above, Ian had given his instructions as to the basis upon which an offer was to be made to Mr Dempster by reference to the amount of hectares.  Further, I do not accept that any significance should be attached to Ian’s omission to peruse the offer and ensure it was correct prior to it being sent, that being Mr Dempster’s responsibility once Ian had given clear instructions, which I have found he did.
  3. [158]
    As to the 2005 compromise, the fact that Ian had considered it to be a fair agreement when it was reached in 2005 is not a matter of any significance to Andrew’s position, given that Andrew rejected that resolution and the evidence has supported the fact that there have been significant changes in the brothers’ positions since that time. Accordingly, it is irrelevant to his position now.  I have referred above to the context in which Ian has given evidence about that agreement.  It is plain that much has occurred since that time and it cannot be regarded as a statement of his position since December 2016. 
  4. [159]
    It is, however, true that Ian may be able to pursue any loss he has suffered against Mr Dempster as a result of the error made.  That is of less significance given the context of the present dispute. This was not a commercial arrangement. The present dispute arises out of the brothers inheriting an interest in the property owned by their parents and holding that interest as tenants in common, with each depending for their livelihood on the property, but having very different ideas about how that is best achieved and who is entitled to the use of the disputed paddocks.
  5. [160]
    In contrast, Andrew contends that he would suffer an injustice because:
  1. (a)
    He was an innocent party;
  1. (b)
    He altered his position by abandoning his preparation for trial and releasing his witnesses from any need to appear;
  2. (c)
    He was relieved the matter had settled, given it was a long-term dispute;
  3. (d)
    If the compromise were set aside, Andrew would suffer emotional turmoil and have to continue to endure the stress of litigation, as well as suffer further delays in relation to the use of the disputed paddocks.
  1. [161]
    It was not challenged and I  accept that the evidence on behalf of Andrew is that between 3:35pm and 5:03pm solicitors at Thynne and McCartney were instructed to and did cease preparation for trial and contacted the applicant’s witnesses. However, the lost preparation time was less than two hours, given the time frame between when Andrew was notified that a mistake had been made in the offer and the acceptance of the offer.  Ian’s counsel contend that the arrangements could have been made to reinstate the witnesses and to proceed with the trial and that the adjournment of the trial was due to Andrew’s choice to seek to enforce the compromise.  Given the shortness of the time frame I accept that to be the case.
  2. [162]
    I accept that Andrew will suffer some injustice if the compromise is set aside but find it is limited.  Andrew’s solicitors were notified within an hour and a half of the acceptance of the offer that the mistake had been made and the 11 April 2019 offer was accepted within an hour of it being made.  The offer was subject to further steps having to be satisfied before it could be put into effect.  To the extent Andrew felt relief about the settlement, it was short lived and was in part extended due to not being informed that Ian’s solicitors had notified that a mistake had been made in the 11 April 2019 offer and that he considered there was no compromise by his own solicitors the following day Andrew also would no doubt have been made aware that should the Court not hold up the settlement agreement, the matter would proceed to trial, as it was previously going to do.  In that regard, I note that the dispute was on the brink of the matter going to trial and all steps other than the index to the trial bundle had been completed.
  3. [163]
    In the present case, I am satisfied that the discretion of the Court is enlivened and that it should be exercised to set aside the compromise made on 11 April 2019. It is not a decision which I have lightly made given I must be satisfied that there would be a grave injustice if the compromise was not set aside in circumstances where there are strong policy grounds for upholding settlements.
  4. [164]
    However, in the present case I do consider enforcing the settlement would cause a grave injustice due to the fact that Ian had maintained a consistent position since December 2016, had engaged an expert in support of that position and the steps for trial had been all but completed.  I have found he was not responsible for the mistake.  Enforcing the compromise would mean that Ian would lose rights to part of the land which he considers should rightfully be allocated to him, although he may have a right to pursue a cause of action against his solicitors for loss of opportunity arising out of the mistake. The present dispute however is not merely a commercial one. It is a dispute as to the source of each of the brothers’ livelihood, namely Kerand, which each received as a result of an inheritance from their parents and held as tenants in common. It is evident from the long history of the dispute between the brothers that the disputed paddocks are of great significance to both of their grazing businesses which is unlikely to be recompensed simply by a monetary award. Furthermore, the mistake was brought to the attention of the solicitors for Andrew within a very short time of the mistake being realised, namely one hour and 40 minutes, albeit that Andrew has sought to maintain the compromise. Further, while I have not concluded that the circumstances in which the offer was made were such that Andrew and his legal team ought to have known that the offer contained a serious mistake, the circumstances were sufficient to at least raise a question of whether a mistake had been made.
  5. [165]
    While Andrew has lost the benefit of trial dates, albeit from seeking to enforce the compromise, given the stage at which the litigation had reached the matter should be able to be set down relatively quickly[197] given the index to the trial bundle is the only matter which is outstanding. Andrew has also had witnesses stood down, and would suffer the disappointment of a case which has been ongoing since at least December 2016 not being resolved. However, it is evident that the broader dispute between the brothers has been ongoing for a considerably longer period than the present proceedings.  While I accept that emotional strain will be caused by the litigation continuing, the prospect that it had resolved was in reality short-lived, as notice of the error was given very quickly.  The suggestion that Andrew will suffer further delays with respect to his use of the disputed paddocks before this dispute comes to an end presumes an outcome to the litigation.
  6. [166]
    Andrew should not, however, suffer the financial costs arising from the trial being adjourned. Any order to set aside the compromise should be conditional on the making of an order that the costs thrown away by the adjournment of the trial are to be paid on an indemnity basis.[198] I would consider that, given the findings above, the appropriate order may provide for those costs are to be paid by Ian’s solicitors. However, I will hear further submissions from the parties as to the proper form of the order
  7. [167]
    In the circumstances, I am satisfied that Ian has established that a grave injustice would be suffered if the compromise were enforced by this Court and that the compromise should be set aside.

Conclusion

  1. [168]
    On the basis of the above reasons, I find that:
  1. (1)
    The 11 April 2019 offer was capable of being accepted. The condition in paragraph 4 is properly characterised as a condition precedent to performance, not to the formation of the agreement itself;
  2. (2)
    The solicitors acting on behalf of Andrew did not know that the reference to Option A was a mistake, nor that in the circumstances ought they have reasonably known that there was a mistake in the 11 April 2019 offer;
  3. (3)
    Ian was not responsible for the mistaken reference to Option A in the 11 April 2019 offer, nor did he adopt it. The Court has power to set the compromise aside;
  4. (4)
    The court should exercise its discretion to refuse to give effect to the compromise as its enforcement would involve grave injustice. The order to set aside the compromise, however, should be conditional on the costs of Andrew thrown away by the adjournment of the trial being met by Ian Hoch or his solicitor.
  1. [169]
    I will hear the parties further on the appropriate form of order and as to submissions for the costs of this application.

Orders to be made

  1. [170]
    The parties are to provide a draft form of Order reflecting the above reasons and file any submissions as to costs and any further orders sought by 4:00pm on 21 February 2019.

Footnotes

[1]Although he contends he was not aware nor should have been aware of that mistake at the time he accepted the offer.

[2]Paragraphs 1-21 and 27-29 of Ian’s amended points of claim were admitted by Andrew in his amended points of claim.

[3]In response to Andrew’s original application for a scheme of partition in 2016, in December 2016  Ian had identified his preferred line of partition as being a line of partition identified by Christopher Dyer whereby Ian would be allocated 4631 hectares and Andrew 2961 hectares, said to be portions of equal value.

[4]Affidavit of RL McDermott, affirmed 11 July 2019, Exh RLM-6.

[5]Affidavit of RL McDermott, affirmed 11 July 2019, Exh RLM-8.

[6]In accordance with a valuation report from Webster Cavanagh.  Option 2 of the report provided that the partition would provide East Kerand (Ian) with 4114.00 hectares and West Kerand (Andrew) with 3477.90 hectares.

[7](1982) 149 CLR 537.

[8]At 541.

[9]At 543.

[10]At 551.

[11]At 551.

[12]At 552.

[13][2000] QCA 391.

[14](1994) 121 FLR 124.

[15][1972] Fam 25 at [31G]-[32C].

[16][1992] 1 VR 653.

[17]Affoo v Public Trustee of Queensland [2012] 1 Qd R 408 at [8]-[9]. 

[18](1983) 151 CLR 422

[19](1983) 151 CLR 422 at 432.

[20]At 432-433.

[21]T1-21/14-19.

[22]A copy of which he sent to Mr Dempster who said he checked it accorded with Ian’s position.

[23]Affidavit of I G Dempster, sworn 5 June 2019, [26].

[24]T1-17/27-30.

[25]Sworn 5 June 2019.

[26]T1-16/33-40.

[27]T1-18/25-30.

[28]Affidavit of I G Dempster, sworn 5 June 2019, [28]-[30]; Exh IGD-1, p 7.

[29]T1/20-39-41.

[30]T1-21/14-17.

[31]T1-21/19-20.

[32]T1-21/30-34.

[33]Affidavit of I G Dempster, sworn 5 June 2019, [29].

[34]T1-22/6-8.

[35]T1-22/29-31.

[36]T1-23/31-35.

[37]T1-24/35-41.

[38]Affidavit of DLK Atkinson QC, sworn 5 June 2019, [21]. Although Mr Atkinson QC refers to one conversation on 11 April 2019 where he told Mr Dempster of his discussion with Mr de Jersey and Mr Dempster telling him in the same conversation about him having instructions to make an offer I think it is more likely there were two separate conversations. One where Mr Atkinson QC telephoned him to relay the content of his discussion with Mr de Jersey and one where Mr Dempster phoned Mr Atkinson QC about expert evidence and relayed his conversation with Ian about making an offer.

[39]T1-25/24-26.

[40]Affidavit of DLK Atkinson QC, sworn 5 June 2019, [21].

[41]Affidavit of I G Dempster, sworn 5 June 2019, [28]-[30]; Exh IGD-1, p 7.

[42]T1-27/40-43.

[43]Affidavit of I G Dempster, sworn 5 June 2019, [28]-[30]; Exh IGD-1, p 7.

[44]Affidavit of DLK Atkinson QC, sworn 5 June 2019, Exh DLKA1, p 4.

[45]T1-31/19-20.

[46]T1-33/34-44.

[47]T1-33/39-44.

[48]T1-35/1-5.

[49]T1-35/15-24.

[50]T1-39/30-42; T1-40/6-18.

[51]T1-39/29-31.

[52]T1-40/39-40.

[53]T1-41/34-35.

[54]T1-41/36-39.

[55]T1-42/8-10.

[56]T1-41/44-47; T1-42/11-21.

[57]T1-42/7-10.

[58]T1-42/19-21.

[59]T1-42/23-24.

[60] T1-48/19-29; T1-49/1-9.

[61][1910] 2 KB 658.

[62]Affidavit of IR Hoch, sworn 15 December 2016, at [27] and [35].

[63][1910] 2 KB 658.

[64]At 665.

[65]At 665.

[66]OT Africa Line Ltd v Vickers plc [1996] 1 Lloyd’s Rep 700 at 703

[67]T1-48/9-29.

[68]See affidavit of DLK Atkinson QC, sworn 5 June 2019, Exh DLKA1, p 4.

[69]Affidavit of DLK Atkinson QC, sworn 5 June 2019, [21].

[70]Affidavit of M G Hoch, sworn 23 July 2019, [4].

[71]Affidavit of M G Hoch, sworn 23 July 2019, [20].

[72]Affidavit of M G Hoch, sworn 23 July 2019, [20].

[73]Affidavit of M G Hoch, sworn 23 July 2019, [19]-[20].

[74]Affidavit of M G Hoch, sworn 23 July 2019, [28].

[75]Affidavit of M G Hoch, sworn 23 July 2019, [31]-[32].  In fact, the difference appears to be 29 hectares.

[76]Affidavit of M G Hoch, sworn 23 July 2019, [33].

[77]Affidavit of M G Hoch, sworn 23 July 2019, [36].

[78]Affidavit of M G Hoch, sworn 23 July 2019, [37].

[79]Affidavit of M G Hoch, sworn 23 July 2019, [40].

[80]Affidavit of M G Hoch, sworn 23 July 2019, [41].

[81]Affidavit of M G Hoch, sworn 23 July 2019, [42].

[82]Affidavit of M G Hoch, sworn 23 July 2019, [42].

[83]Affidavit of M G Hoch, sworn 23 July 2019, [43].

[84]Affidavit of M G Hoch, sworn 23 July 2019, [46].

[85]T1-61/24-32.

[86]T1-55/15-19.

[87]T1-55/21-23.

[88]T1-55/27-30.

[89]T1-56/6-15.

[90]T1-57/44-56; T1-58/1-3.

[91]T1-58/13-16.

[92]T1-58/18-20.

[93]T1-61/44-56 - T1-62/1-2.

[94]T1-62/12-13.

[95]T1-62/21-29.

[96]Affidavit of D de Jersey, sworn 17 July 2019, [22](c).

[97]Affidavit of D de Jersey, sworn 17 July 2019, [22](a)-(b).

[98]Affidavit of D de Jersey, sworn 17 July 2019, [25].

[99]Affidavit of D de Jersey, sworn 17 July 2019, [28].

[100]Affidavit of D de Jersey, sworn 17 July 2019, Exh DDJ-8, p 105.

[101]T1-64/9-10.

[102]T1-64/12-13.

[103]T1-65/1-3.

[104]T1-65/5-10.

[105]T1-65/23-29.

[106]T1-65/38.

[107]Affidavit of D de Jersey, sworn 17 July 2019, [26](b)-(c).

[108]T1-66/1-7.

[109]T1-66/13-14.

[110]T1-66/16-20.

[111]T1-66/23-25.

[112]T1-67/7-8; Affidavit of D de Jersey, sworn 17 July 2019, [11].

[113]T1-68/23-25.

[114]T1-68/27-28.

[115]Affidavit of RL McDermott, affirmed 11 July 2019, [20(g)].

[116]T1-68/41-42.

[117]T1-70/16-21.

[118]T1-70/39-42.

[119]T1-71/1-8.

[120]T1-71/13-14.

[121]T1-71/21-22.

[122]T1-71/26-29.

[123]T1-72/5-6.

[124]T1-73/1-6. 

[125]T1-73/12-13.

[126]T1-73/11-20.

[127]Affidavit of R L McDermott, affirmed 11 July 2019, [38](j).

[128]T1-73/31-32.

[129]T1-73/34-35.

[130]T1-73/37.

[131]T1-73/39.

[132]T1-73/41-42.

[133]T1-74/6-14.

[134]T1-74/24-41.

[135]T1-75/3-4.

[136]T1-76/35-36.

[137]T1-78/1-3.

[138]T1-79/1-5.

[139]T1-79/7-10.

[140]T1-79/6-16.

[141]T1-79/26-28.

[142]T1-80/7-17.

[143]T1-80/1-24.

[144]T1-81/1-9.

[145]T1-82/7-8.

[146]T1-82/10-17.

[147]T1-82/25-31.

[148]Affidavit of MAP Maskell, affirmed 12 July 2019, [24](c)(ii).

[149]Affidavit of MAP Maskell, affirmed 12 July 2019, [24](d).

[150]Affidavit of MAP Maskell, affirmed 12 July 2019, [24](f)(i).

[151]Affidavit of MAP Maskell, affirmed 12 July 2019, [24](f)(iii).

[152]Affidavit of MAP Maskell, affirmed 12 July 2019, [25].

[153]Affidavit of MAP Maskell, affirmed 12 July 2019, [26].

[154]Affidavit of MAP Maskell, affirmed 12 July 2019, [39].

[155]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](a)(i)-(iii).

[156]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](b).

[157]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](c).

[158]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](d).

[159]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](e)-(f).

[160]Affidavit of MAP Maskell, affirmed 12 July 2019, [40](g).

[161]T1-83/1-5.

[162]T1-83/13-19.

[163]T1-83/38-42.

[164]T1-84/4-5.

[165]T1-84/6-10.

[166]T1-84/25-30.

[167]T1-84/32-43.

[168]T1-84/32-43.

[169]T1-85/27-29; Affidavit of MAP Maskell, affirmed 12 July 2019, [40](f).

[170]T1-86/11-19; Affidavit of MAP Maskell, affirmed 12 July 2019, [40](e).

[171]Exhibit 2.

[172]T1-87/43-46 - T1-88/1-2.

[173]T1-88/21-24.

[174]Taylor v Johnson (1983) 151 CLR 422 at 432.

[175]Affidavit of RL McDermott, affirmed 11 July 2019, Exh RLM-8, p 130.

[176](1956) 95 CLR 235 at 242-243.

[177]At 243, per Dixon CJ and McTiernan, Williams, Webb and Fullagar JJ.

[178]At 243, referring to Neale v Gordon Lennox (1902) AC 465 and Shepherd v Robinson (1919) 1 KB 474.

[179] [1990] 1 Qd R 309 at 313.

[180](1956) 95 CLR 235 at 243.

[181]Insbury Pty Ltd v Craig [1990] 1 Qd R 309 at 313.

[182]Insbury Pty Ltd v Craig [1990] 1 Qd R 309 at 314.

[183][2010] QCA 352.

[184]Broadbent v Medical Board of Queensland [2010] QCA 352, [33].

[185]Lord Simonds (Ed), Halsbury’s Laws of England, vol. 3, (3rd ed.,1953) at p 51; Viscount Hailsham (Ed), Halsbury’s Laws of England, vol. 2 (2nd ed., 1931) at pp 526, 527.

[186][1902] AC 465.

[187]Broadbent v Medical Board of Queensland [2010] QCA 352, [34].

[188]Broadbent v Medical Board of Queensland [2010] QCA 352, [36].

[189]Broadbent v Medical Board of Queensland [2010] QCA 352, [36].

[190]Broadbent v Medical Board of Queensland [2010] QCA 352, [37].

[191]Broadbent v Medical Board of Queensland [2010] QCA 352, [38].

[192]Broadbent v Medical Board of Queensland [2010] QCA 352, [38].

[193]Broadbent v Medical Board of Queensland [2010] QCA 352, [38].

[194]Broadbent v Medical Board of Queensland [2010] QCA 352, [39].

[195]Broadbent v Medical Board of Queensland [2010] QCA 352, [39].

[196]Applicant’s Outline of Submissions, [57] and [58].

[197]Subject to parties’ availability.

[198]See Neale v Gordon Lennox [1902] AC 465.

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Editorial Notes

  • Published Case Name:

    Hoch v Hoch

  • Shortened Case Name:

    Hoch v Hoch

  • MNC:

    [2020] QSC 9

  • Court:

    QSC

  • Judge(s):

    Brown J

  • Date:

    10 Feb 2020

Litigation History

No Litigation History

Appeal Status

No Status