Abdo v Said and Mantello [2022] VSC 372 (29 June 2022)

Last Updated: 29 June 2022

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

PROPERTY LIST

S ECI 2020 03858

BETWEEN:

MOHAMED ABDO	Plaintiff
v
FRANK SAID and RITA SAID	Defendants
and
MARIO MANTELLO	Third Party

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JUDGE:	Garde J
WHERE HELD:	Melbourne
DATE OF HEARING:	28 June 2022
DATE OF JUDGMENT:	29 June 2022
CASE MAY BE CITED AS:	Abdo v Said and Mantello
MEDIUM NEUTRAL CITATION:	[2022] VSC 372

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PRACTICE AND PROCEDURE – Person under disability – Approval of proposed compromise – Principles to be applied – Supreme Court (General Civil Procedure) Rules 2015 (Vic) ord 15, r 8 – Mayer v Mayer [2015] VSC 2 – Clement v Basset [1987] NTSC 16; (1987) 46 NTR 36.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr A Panna QC with Ms M Bennett	Basilone Legal
For the Defendants	Mr P Corbett QC with Mr H Forrester	Coulter Roache Lawyers
For the Third Party	Mr T Mitchell	McKay Law

HIS HONOUR:

Introduction

1 This is an application to the Court to approve a compromise proposed by the parties to this proceeding. Approval of the compromise is required as the second defendant is a person under disability and is sought by her and by Lisa Said, her litigation guardian, under r 15.08 of the Supreme Court (General Civil Procedure) Rules 2015 (Vic) (‘Rules’). The application is made on day six of the trial of the proceeding.

Background

2 The background facts to the proceeding as set out by the parties in a joint statement of issues and agreed facts dated 20 June 2022 are as follows:

1. Since about 9 September 1981, the Defendants have been the registered proprietors of the land situated at 1210 Doherty’s Road, Tarneit, Victoria and more particularly described in Certificate of Title Volume 8954 Folio 163 being Lot 23 on Plan of Subdivision 092856 (“the land”).
2. The Third Party (“Mantello”) is, and was at all material times a barrister and solicitor carrying on a legal practice at Werribee under the name Mantello Lawyers.
3. On about 9 June 2017, Mantello was retained by the Defendants to prepare a vendors’ statement and contract of sale and advise and act for the defendants in relation to the sale of the land.
4. On about 13 June 2017, the Defendants entered into an Exclusive Sale Authority ... for 30 days appointing Sold Real Estate as their agent in relation to the land.

5. The Exclusive Sale Authority included the following terms:

(a) Vendor’s price $7,000,000 payable in 24 months
(b) A fixed commission (including GST) of $200,000.

6. The Exclusive Sale Authority was signed by Walied Haouli (“Haouli”) on behalf of Sold Real Estate.
7. On about 2 August 2017, the Plaintiff executed a written contract of sale of real estate for the land ...
8. On about 2 August 2017, the Defendants executed the Contract of Sale.
9. On about 11 August 2017, the Plaintiff and Haouli attended the land and spoke with the First Defendant.
10. On about 26 August 2017, the Plaintiff, Haouli and Khaled Abdo ... attended the land and spoke with the First Defendant.
11. On about 25 September 2017, consultants engaged by the Plaintiff attended the land and were denied access by the First Defendant.
12. On or about 11 October 2017, at around 9:30am, the Plaintiff and the solicitor for the Plaintiff, Robert Tebbs ... attended the office of Mantello Lawyers to discuss the contract of sale.
13. On 11 October 2017, Tebbs and Mantello exchanged emails concerning their clients’ respective positions.
14. On around 20 October 2017, Tebbs lodged a caveat over the land on behalf of the Plaintiff, claiming an interest as purchaser under a contract dated 2 August 2017.
15. On 21 October 2019, Tebbs sent a letter to Mantello outlining his client’s position and making an offer to settle the dispute with the Defendants paying the Plaintiff $50,000.
16. On 15 July 2020, the caveat lodged by Tebbs lapsed in accordance with s. 89A of the Transfer of Land Act 1958.
17. The Plaintiff claims that he has suffered loss and damage by reason of the Defendants’ breach of the contract of sale.

3 The defendants have also made a third party claim against Mantello who was their solicitor in the matter.

Principles to be applied

4 In considering the principles to be applied, I am assisted by the judgment of Croft J in Mayer v Mayer.^[1] As his Honour says, it is clear that a proceeding of this nature involving, as it does, a person under disability, cannot be the subject of a valid compromise without the approval of the Court.^[2]
5 Croft J summarises the principles and practice to be applied in an application for approval of a compromise, setting out the following passage from the reasons of Kearney J in Clement v Basset:

The next friend of the plaintiff deposes that, having taken legal advice, she considers that “it is a satisfactory compromise and in the best interests of [the infant plaintiff]” ... I am satisfied that the next friend has fully considered the proposed compromise and is satisfied that it is for the benefit of the infant plaintiff.
The plaintiff’s solicitor deposes that he considers the proposed compromise to be satisfactory and in the best interests of the plaintiff. He annexes to his affidavit an “advice on quantum” which he prepared, presumably for the next friend, for the purpose of advising on the suitability of the proposed compromise. It analyses the plaintiff’s case and led the solicitor to conclude that the proposed compromise should be accepted as representing “an adequate and proper figure upon which to compromise this claim” ...
Practice Direction No 2 of 1985 states that the opinion of the plaintiff’s solicitor favouring a compromise “... should be supported by sufficient facts and other information as to the circumstances giving rise to the plaintiff’s claim, as well as by ... an opinion of counsel, if one is available, as will enable the court to reach a proper conclusion on the application ...”. In this case no opinion of counsel is annexed. In all other respects the requirements of the Practice Direction have been met.
...
The court’s function on this application is to determine whether or not the proposed compromise will in fact be beneficial to the infant plaintiff. In making that determination the court necessarily relies heavily on the infant’s advisers.
...
[T]he test of benefit is whether the compromise is proper, and reasonably in the interests of the plaintiff. I consider that the plaintiff’s solicitor has addressed the question which requires to be addressed.^[3]

6 In Civil Procedure Victoria,^[4] the following passage appears and describes the requirements of r 15.08 of the Rules:

Before the court approves the compromise of a claim to which a person under disability is party it must be satisfied that the compromise will benefit that person ... The major consideration is the degree to which the person under disability is at risk that if the proceeding went to trial the result would be less favourable than what is offered in settlement. The court will hesitate to withhold its approval where that risk is not insignificant.^[5]

7 The same section in Civil Procedure Victoria also discusses the weight to be given to the opinion of legal advisers as follows:

Significant weight will be attached to the opinions of the person’s legal advisers, and, in some cases, the person’s litigation guardian ...^[6]

Supporting affidavit

8 The application is supported by an affidavit of the defendants’ solicitor filed 28 June 2022. Paragraph 6 of the affidavit states:

I verily believe, based on my discussions with senior and junior counsel for the defendants, that the Terms of Settlement and the Confidential Terms of Settlement constitute a fair and reasonable settlement of the proceeding and Third Party proceeding which are in the best interests of the second defendant given the issues in dispute, and the costs of the further trial of these proceedings, and that they benefit the second defendant. I am informed and verily believe that the litigation guardian, Lisa Said is also of the belief that the Terms of Settlement and the Confidential Terms of Settlement are entered into in the best interests of and for the benefit of the second defendant.

Assessment

9 I have had the advantage of perusing the court book and of hearing much of the evidence. The compromise ends a long-standing dispute between the plaintiff and the defendants, and the defendants and the third party.
10 In my opinion, the proposed compromise is in the interests of the second defendant, and will benefit her. Although she is a defendant in litigation, the compromise does not involve the payment by her of any amount to any other party or any other adverse order. She and her husband, the first defendant, will have to bear their own costs of the proceeding. The trial has continued for four days of hearing with the fifth day used for completion of documentation relating to the compromise, the execution of documents and the preparation of this application.
11 In the event that the trial were to continue until completion, it is likely that another six to eight sitting days would be required. The defendants have retained senior and junior counsel to represent them, and sought indemnity from their former solicitor. The plaintiff has also instructed two counsel.
12 In my view, the compromise is in the best interests of the second defendant and protects her interests. The termination of the proceeding in the manner proposed is beneficial to her interests having regard to the risks of litigation, which are not insignificant, and the desirability of preserving the funds of the defendants so that they might be used for their benefit rather than expended in litigation costs. If the proposed compromise is not approved and the trial proceeds, there is a considerable risk that the second defendant would be significantly worse off following the determination of this proceeding.

Conclusion

13 For these reasons, orders will be made for the approval of the proposed compromise.

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^[1] [2015] VSC 2.

^[2] Ibid [4].

^[3] Clement v Basset [1987] NTSC 16; (1987) 46 NTR 36, 37-8, quoted in Mayer v Mayer [2015] VSC 2, [5].

^[4] Williams, Civil Procedure Victoria (LexisNexis Butterworths, loose-leaf), [I 15.08.05].

^[5] Referring to Hargrave v Hargrave [1850] EngR 258; (1850) 50 ER 1117; Re Wells; Boyer v Maclean [1903] UKLawRpCh 49; [1903] 1 Ch 848 at 853; Moore v McKelvey (1906) 23 WN (NSW) 100; Katundi v Hay [1940] St R Qd 39; Gillespie v Alperstein [1964] VicRp 97; [1964] VR 749; Stephens-Sidebottom v Victoria (Department of Education and Early Childhood Development) [2011] FCA 893; Smith v Marriott Support Services [2013] FCA 312; Mayer v Mayer [2015] VSC 2 at [4]- [6]; Maez bht Maez v Corbett [2015] NSWSC 102; Herbert bht Meehan v Tamworth City Council [2015] NSWSC 103; Butler v Djerriwarrh Employment v Education Services Inc [2015] FCA 296; Koenders v Victoria (Department of Education and Training), above; Tsirigotis v The Ivanhoe Girls Grammar School [2017] FCA 1064 and cases cited therein.

^[6] Referring to Re Barbour’s Settlement [1974] 1 All ER 1188 per Megarry J at 1191; Clement v Basset [1987] NTSC 16; (1987) 46 NTR 36 at 37-38 per Kearney J; Wade v Victoria (No 2) [2012] FCA 1080 at [6] per Bromberg J.